Ladies and gentlemen, good day and welcome to Poly Medicure Q2 FY25 Earnings Conference Call, hosted by ICICI Securities. As a reminder, all participant lines will be in the listen-only mode, and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal an operator by pressing star then zero on your touchtone phone. Please note that this conference is being recorded. I now hand the conference over to Ms. Nisha Shetty from ICICI Securities Limited. Thank you, and over to you, ma'am. Thank you, Palak. Good afternoon, everyone. On behalf of ICICI Securities, I would like to welcome you all on Q2 FY25 Earnings Conference Call of Poly Medicure Limited. Today on this call, we have with us the senior management team of the company, represented by Mr. Himanshu Baid, Managing Director, Mr. Naresh Vijayvergiya, CFO, and Mr. Avinash Chandra, Company Secretary. I would like to thank the management team of Poly Medicure for giving us this opportunity to host this call. With this, I will hand over the call to the management. Over to you, sir. Thank you, Nisha. Thank you for hosting this call. A very good afternoon to everybody who's connected on the call. My pleasure to talk about the company's progress in the previous quarter and also discuss about the H1 results for the current financial year. As you have seen, the company's revenue has grown in line with the guidance we had given in the beginning of the year. The guidance was between 22% and 24% for the whole year. So the H1 revenue, if you look at the standalone comparison, has grown by around 23%, so it's pretty much in line with what we had mentioned earlier. Also, all the new plants which were commissioned last year have started functioning well. The additional capacity which was generated by these new plants, we're able to, you know, sell most of these products to customers in India and outside India. The margin also, we have seen a slight improvement in the margin. This was also as per the guidance given in the beginning of the year, of 100 to 150 basis points margin improvement during the year. During the quarter under review, the Q2, we have seen EBITDA margin, operating EBITDA margins almost touching 28% versus last year's Q2 margin of 25.82%. So we have seen an improvement, a significant improvement in the margin also. In comparison to previous quarter of Q1 of this current financial year, we have also seen a margin improvement from 27.5% to 28.06%. On the PAT side also, there is a significant improvement. For the second quarter, 2023, 2024, and this quarter, 2024, 2025, we have seen PAT increase from 59.21 crores to around 87.22 crores. So there's a significant increase in the PAT also comparatively, as compared to the previous quarter. Overall, if you look at H1 to H1 comparison, the revenue has increased from 625 crores to seven -- and these are all standalone revenues, to 770 crores. EBITDA has increased, you know, you know, operational EBITDA has increased from INR 167 crores to INR 214 crores. EBITDA, including other income, has increased from INR 193 crores to INR 258 crores, and PAT has increased from 119 to 159 crores. So in every parameter, you know, we have improved from the previous quarter and previous year, and this is mainly because of the new expansion we have done, launching of new products over the last, you know, 12 to 24 months. So all that has actually helped us to improve our revenue as well as the sales in the current financial year. Though there were a lot of headwinds during the current financial year because of the current, you know, geopolitical situation in Europe and in Middle East, we had, you know, incidents of high freight costs during this quarter. Also, we have seen shortage of containers, you know, in key geographical areas. That also, you know, was one of the factors which we're constantly monitoring. And also there was some fluctuation in the raw material prices because lot of our raw material price is crude oil, so a little bit fluctuation was there. But in spite of all these challenges, we were still able to do better compared to the previous year and even do a little bit better margin comparatively. If you look at the current product sales mix in the current quarter, again, I think exports are close to 70% and domestic business is close to around 30%. So we are maintaining the same range, and I think for the whole year, we'll also maintain a similar range for exports and domestic business. The good news about the domestic business is, if you look at the quarter under review, the second quarter, the domestic business has grown by around 22%. If you recall, in the previous quarter, we had only increase of 6%, but as I had mentioned in the last call, that we are focusing now more deeply on the domestic business. Because of the efforts we have done, domestic business has grown actually in Q2 to Q2 comparison, around 22%. This is a big jump for us in terms of, you know, the efforts we have put in the domestic business, and this trend should continue in the coming quarters also. So for the full year, you know, we maintain our guidance of a 20% plus growth for the domestic business. Export business definitely has grown by around 26% if you compare H1 to H1 numbers, and that continues to do well for the company. In exports also, we have seen that Europe has done very well. We are logging a growth of around 35% in the export business, growth in export business in Europe. A lot of the key markets are doing well for us, including the U.K., France, Italy, Germany, Spain, and Nordic countries. They are doing well for us right now. We are adding new products. We are adding new clients also in these markets. All that is helping us to grow our business there. When we look at the U.S. business, I think this year we expect to clock anything between $2-$3 million revenue. This is the first full year where we have FDA approvals, and the business has started rolling out in the U.S. We started getting repeat orders from our customers, so it's very heartening that the business is ticking well, and we will still maintain our guidance of $15-20 million over three to four years, as we have been saying earlier. We are building up the business. We are absolutely as per the plan, which we have actually made for the company, and everything is going as per schedule. We don't see any changes in that schedule or plan of implementing revenue in the U.S. market. When we look at the renal business, it has done well. We have seen a growth of around 40-45% in first six months, and we've maintained our guidance of 50% growth for the next six months also. So overall, from a 90 crore number, we should be able to do between 140 to 150 crore of renal business in the current financial year. And we are very bullish about the business prospects, because with the new, you know, prime minister scheme, or PMJY, where the reimbursement rates have increased for renal treatments from around 1,200 to 1,800, I think more and more patients are now able to take renal treatment, and it's actually become profitable for providers, which were actually earlier bleeding. So with this change, which and that, the big change which has come in, in the payment by the government and, you know, a lot of state government, if you've seen recent Haryana elections, government is around also free dialysis for patients. A lot of state governments are now moving to actively promote dialysis in the healthcare budgets. And also, we are seeing the use of single-use dialysis is also changing. Because earlier, when we started the business few years ago, there was a high reuse of the products. Almost close to 90% market was reused and 10% was single use. But now we have seen in last, after COVID, the trend is changing. Almost 30%-35% market has moved to single use, and 60%-65%, or maybe 65%-70% is close to around multiple use. But in next two, three years, as the trends are showing, I think the market will become 50% single use and 50% multi-use. That will also further increase the demand for dialysis products, because once they are more single-use products, then the consumption will further increase. We are making adequate investments in the dialysis business, you know, in terms of, you know, our footprint in manufacturing, machine servicing, you know, engineering, service spares. Everything we are building up right now as an infrastructure, which will help us to grow at a much faster pace in next four, five years. After, you know, this, you know, initial struggles we had with the business, now the business is pretty much on track and on a high growth path. I think we don't see any reason that, you know, we will not gain more than 30%-40% market share in next four to five years in this business. There is no competitor in India making these products. So we are the only company which is manufacturing such products, and we have full technology backup, and we are also developing some new products in this area, which will also further benefit the patients, and, you know, also help in reducing pain, which dialysis patients have to undergo, you know, for a longer treatment. So there are some new technology we are developing, and that also products will be launched sometime early next year. On the QIP front, the company in the previous quarter has raised additional funds, around INR 1,000 crores. Totally, 53 lakhs and 19,000 130 equity shares were issued at a price of INR 1,880. After the QIP, the institutional shareholding has increased from pre-QIP level of 19.26% to around 23.58% post-QIP. And the split is pretty much even. Almost half, institutional holders are from India, DIIs, and half are FIIs. As of September 2024, the institutional shareholding post-QIP now has increased to around 24.21%. And major new investors, which were part of the QIP, were Lighthouse Fund, SBI Mutual Fund, Aberdeen, Nomura, White Oak, ICICI Life, Quant, Morgan Stanley. So a lot of new investors have actually joined, and a lot of insurance companies, Kotak Life, Max Life, Tata AI, have also, you know, been allotted shares under the new QIP. The QIP proceeds will be used over next two years, and it's mainly for new CapEx, for new plants. So the company is setting up three new facilities, additional facilities, one in Haryana, Rajasthan, Uttarakhand. And all these facilities will come live in sometime middle to end of 2026. And we are focusing on three core business areas. One would be, of course, renal dialysis business, second would be cardiology, and third one would be critical care. So under all these three therapeutic areas we will be expanding capacity and capability to you know to cater to domestic as well as international demand. Out of the QIP proceeds, INR 500 crores is for new CapEx, INR 250 crores will be for general corporate purposes, to fund the working capital requirements in next few years, and acquisitions, we have earmarked INR 50 crores for that. Also, company has around INR 250 crores of cash, you know, surplus, which would be also deployed, you know, in these three areas. Also, you know, in the current six months, company has done a CapEx of already INR 150 crores. For the whole year, we had planned around INR 250 crores CapEx. As it looks like, we were able to speed this up, and all this CapEx has been done from internal resources. No QIP money has been used so far for this. All this CapEx has come from internal accruals, and for the balance six months, we also will spend another INR 100-INR 125 crores more for the current plants, where we will be adding more machines and more capacity in the current plants. So with this new CapEx, and I think with this, you know, new, you know, all the three big plants which we are going to set up in next two years, we will have sufficient capability and capacity to look at new opportunities in the medical device industry. Already, we see some, you know, tailwinds coming to India, because of now, you know, some changes in the U.S. tariffs against Chinese products. And I think in next one or two years, we also see good opportunities in the CDMO sector, where, you know, contract design manufacturing will be a good opportunity to work with large companies. So I think the infrastructure we are creating will be also, you know, help us to create for such kind of opportunities, which should be coming to us in next one to two years. So all these new tariffs are going to come in next, I think, starting from October, they will be implemented in a phased manner in one year. So I think we are also seeing some traction from U.S., where companies are interested to develop some additional products with us. So hopefully, next one to two years, we will see also some new products being developed, you know, to cater to U.S. markets. Also, you know, with the global geopolitical situation changing, we also will see some more, you know, traction coming from Europe, you know, where more companies in Europe would be interested to look at India as a manufacturing option. So, this is some update on the international business. On the other hand, we have seen, you know, that next six months again, we will stick to our guidance, what we have given. So we should be able to hit that growth rate of 22%-24%, which we have already, you know, given as a guidance. I think we are pretty much on track for that. We have, you know, in terms of sales people, we have in first six months, we have added 60-plus new sales associates in the company, which is absolutely in line with our plan to add 100-plus people in the current financial year. Out of this, you know, 60 people, 40 people have been hired in new verticals, critical care and cardiology. These verticals have just started, so we are on the verge of, you know, launching a lot of new products in these in these new two verticals. Some products have been launched already, some are in the pipeline. A lot of work is being done right now. We are also, you know, going to, you know, work very closely with certain clinical research organizations to help us to conduct evaluation of our, you know, high-end Class III devices. That is another area we'll focus on in the next six months to one year, so that we will have enough data to fast-track our, you know, regulatory approvals in, in, developed markets. So we are already working on that. On the PLI scheme, of course, the first PLI for these products, as we were one year late, so we were not able to, you know, get the traction because one year we missed the cycle, and because of that, we are not able to get any incentives of that. But on the PLI 2, the company will receive around INR 1.4 crores of incentive quarterly, which has not been... which has recently, you know, come in October to us. So that is for the previous year, which has been coming to us in this current quarter. And so we are hopeful that on the PLI 2, we'll continue to you know get some incentives from the government. PLI 1, we may not get any incentive, though we have requested the government to extend the scheme by another one to two years because of COVID. During COVID time, it was very hard to set up plants and scale up capacities. So we are not sure about it, but anyway, for us, it's more important to build traction in the business, and renal business continues to do well. So probably with or without PLI, it doesn't matter for us right now, and we are very hopeful that that 50% growth in next few years will continue to come for renal business, and this is mainly for domestic market. And maybe by FY26, we'll also start exploring the global export market for renal products. So that will further help us to strengthen our position in this category. These are some of the updates from my side, and I'll be happy to answer more questions. You know, whoever is on the call, please feel free to ask questions about the company, and Nisha, over to you again. Thank you very much. We will now begin the question and answer session. Anyone who wishes to ask a question may press star and one on their touchtone telephone. If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use handsets while asking a question... Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question is from the line of Karan Khanna from Ambit Capital. Please go ahead, sir. Yeah, thanks for the opportunity, and, congratulations, Mr. Baid, on another strong quarter. Himanshu, my first- Yeah. Yeah, yeah. My first question is on the exports business, in particular Europe, which continues to grow at about 25% plus for the company. Yeah. What's driving that, and how do you see exports growth over the next few years? And then what's the kind of visibility that you have from your distributors and customers in that market? And similarly, on the US business, are there any updates on further FDA approvals? And, how was the feedback for the shipment that you completed via GPOs, and how do you see the distribution evolving here? So I'll start with Karan with Europe. So Europe, I think we have great traction in Europe market. And I think we have long-term visibility because most of the businesses we contract in Europe, they are long-term, basically spread over three to five years. And a lot of these businesses are new businesses, which we have got into in last few years. So we have great visibility in Europe. So Europe will continue to outperform the growth, you know, general growth of the company. So we expect Europe to grow in the range of 30% to, you know, 35% in the next coming couple of years also. On the US business side, I think we have already, as I had mentioned on the call, we have already, you know, got our second, third orders from the US. So I think the feedback is great, and I think we are moving ahead with that. You know, all the products we have launched in the US market, we have given a guidance for $2 million-$3 million for the first year, you know, where, you know, we will, we'll be selling at least four to five products in the US. And we are still waiting for FDA approvals to come, and hopefully early next year, we should have, you know, we should get few more approvals. That's what we're expecting in, you know, first quarter of the next calendar year. Once we have the approvals, we'll start building businesses for those products also. Sure. My second question is on your expansion plans to set up four new plants. Yeah. What are the timelines for commissioning these and likely CapEx for the same? And what kind of peak revenue potential do you anticipate once these plants are online? So we have, you know, you know, put an outlay of INR 500 crores for these three new facilities, which is part of the QIP fundraise. And these facilities should be live by from mid to end of 2026. And land has been acquired for all the three facilities, Haridwar, Jaipur and Faridabad. So these are in the existing areas we currently operate, so these are, you know, adjacent facilities. Some are nearby, some are adjacent. So this helps us to, you know, leverage our current infrastructure and, you know, expand quickly, you know, with new products. Sure. And lastly, on your new divisions, such as cardiology and critical care, what kind of further investments do you anticipate? And, similarly, on scale, what kind of scale do you anticipate for both these divisions over the next three to five years? I think the cardiology is a big business going forward, you know, intervention cardiology, though there are too many players in the market, but what we have seen is mostly import driven, especially on the consumable side. We're not talking about stents here, but mainly on the consumable side. And I think that is the area we are targeting right now. And PolyMed, because of its manufacturing expertise, so we are able to, you know, bring some new products in the market, which are locally manufactured, Made in India products, and that will actually drive that market. So I think in next three to five years, I think maybe in, let's say, by 2030, we should be able to look at 300-400 crore revenue also from cardiology business. Great. Thank you very much, and happy to talk to the entire team. Thank you. Thank you so much, Karan. Appreciate it. Thank you, sir. The next question is from the line of Girish Jain from KJMC Finserv Group. Please go ahead, sir. Hello, and, congratulations on a very good set of numbers, Himanshu Ji. Thank you, Girish. Thank you. My question was relating to the CapEx, which we had done earlier. I think four plants were to be operational. Yes. Is it correct to assume that all the four plants are now operational, and can you give a guidance of what kind of capacity utilization we are running at, the new ones? All the new four plants are operational, and most of the plants probably should be working at around 50% capacity. We are still doing a lot of CapEx in this plant. As you see, the first INR 150 crores, which we have spent in the first six months, all that CapEx has catered to existing plants only, the new plants and the existing plants. A lot of automation is being added, you know, and some of you have already visited plants, have seen that how much, you know, amount we spend on automation. Automation becomes very critical to our business because quality is the most important part, you know, in our products, and we can only achieve through automation, and that is already happening. I think, when we look at the revenue side, I think, as you are already aware, that, you know, if we spend INR 1 on CapEx, we see a revenue around 1.2-1.3, and that's been actually, you know, the guidance, you know, for by us, and also that's more or less the industry standard also. Okay, so, with the new CapEx now, which is being planned with the QIP money, which we have raised- Yeah. Then you mentioned that it might be operational by end of financial year 2026. Yes. What will be the increase in the capacity, like, in terms of percentages? See, basically what we are doing is we are going to expand capacity in three core business areas. One is renal dialysis, where we will double our capacity from our current level where we operate. And what we have in pipeline right now, a lot of capacity also comes during this year. So from where we end this year, we'll almost double our capacity in the next two years, because as we are growing at 50% in this business. And similarly, we will be also expanding some new products in cardiology. So there also will, because the market, we have just started selling some products. The division has just been launched, and if you see renal is a five-year-old division and, you know, almost, you know, we'll be ending around 50 crores. So now we see a big ramp up happening. So initial part is, you know, the regulatory part is slightly slower, but as we move on, we will see the ramp up happening faster. So a lot of new products will be added in the cardiology and critical care, and critical care is more driven towards oncology segment, the cancer care. So we have a lot of products which we are making in Italy today, a lot of these products will be shifted to India and also scaled up in future. So we are already, you know, looking at, you know, expanding that area of business where still India is around 80%, 90% import dependent. Okay, and last question. Going forward, let's say in the next three to four years, do you see any change in the product mix between infusions, cardio, renal and critical care? See, I think we have not extrapolated that data, Giriji, but I think see, infusion still will remain our core business, because that is the where we have a global excellence on that product category. So that will continue to be our core business. But as new businesses pick up, for example, renal, by, let's say, in next five years, will constitute around, roughly, let's say, around 10-15% of the business. Today, it may be only 5-6%. Okay. So similarly, cardiology, which is probably only maybe. I mean, you know, there are no numbers for cardiology right now, but maybe in next five years we will see it to growing to around 5%-7%. So all this will keep on evolving, basically. Okay, thank you so much, and all the best. Thank you, Girish, and Happy Diwali to you, sir. To all of you as well. Thank you. Thank you, sir. The next question is from the line of Zain Hussain from Dolat Capital. Please go ahead. Hello. Am I audible? Yes, yes, please. Thank you, sir, for the opportunity, and congratulations on the great set of numbers. I have three questions. Regarding domestic business guidance, you have given for only 20% and, but we are in H1, we are already running at 11% in average. So do you think to change the India guidance, domestic guidance, or do you wish to maintain it? No, no, we have... I've already said in the initial part of the call, that we will do around 20%, and that, because currently we have done a H1 to H1 growth of 13%. In the first quarter, it was only 6%. So in fact, we are now growing faster now already. And as you know, the private market is growing faster for us, and government business is kind of where we are, you know, exiting part of that government business. So that's the reason first quarter numbers were a little screwed. But overall, if you see a private market trajectory, we are growing 75-25% in that category. Okay. But for the whole year, definitely we are maintaining a guidance of 20% plus. Okay, sir. And, sir, renal care, sales in Q2 as against H1 was? Say again. If you had shared a number, renal care. No, so we have not shared any numbers. What we have shared is that we have seen a growth of around 40%-45% in renal care business in the first six months. Okay, sir. We are told that five hundred dialysis machine to be installed by the end of this year, so that is maintained by the- Yeah. Guidance, sir? Total installed base will go over 500 machines by the end of this year. In particular this year, we should be able to sell between 350-400 machines in this particular year, 350 machines. The earlier base of 150 plus 350 this year, we will be able to cross our installed base of 500 machines. Okay, sir. And the infusion category contribution in domestic as well as in export? Absolutely. So it is close to around 65%. Okay, and domestic? Same, same, same concentration. Okay. And so, export has also grown very well. So what are the factor driving this export business? Could you repeat that question, sir, again? The export business, growth, factor, it is driven by? It's driven by infusion business, because that is where we have global excellence on that product category. And we have a lot of products which are innovative, we have patented products, and that is driving that growth in that segment. Okay, sir. And, sir, guidance for, with the margin, do you maintain a margin guidance? Yeah. So if you see in the beginning of the year, we had given a guidance of around 100 to 150 basis points. Yeah ... in the margin, and I think you already have seen the results, and I think- Yeah ... that has been reflected in the results also now. Okay, sir and sir, last question, working capital days is? That is around close to hundred days right now. Okay, sir. Thank you. Thank you. Thanks a lot. Thank you, sir. Before we take the next question, we would like to remind participants that you may press star and one to ask a question. The next question is from the line of Yash from Sterling Assets. Please go ahead, sir. Hi, thank you for the opportunity. So I just wanted to understand that since you've kept INR 250 crores out of your QIP money for acquisitions, you know, what are the new products or new sort of areas that you can pivot to with this amount of money? ... See, basically, INR 250 crore is just, you know, an amount from the QIP part, but company also has internal cash and internal cash generation, and we are not limiting ourselves to INR 250 crores. So we are looking at opportunity adjacent to current product areas. For example, in anything cardiology or anything in oncology space or anything in critical care. So any new product areas, you know, there are thousands of products in this space. We do only few, maybe 20, 30 products. So what are other areas? So we are looking at adjacent areas in these therapeutic areas, and whatever, and we are looking at technology basically. Because currently, what we need is a technology and a regulatory clearance so that we can fast-track those, you know, projects. Otherwise, once we do it on organic basis, that is going to take a long time, because typically timeframe is three to five years. So that is one of the reasons that, you know, we are looking at some acquisition opportunity, and as and when we have something, we'll definitely, you know, announce that. Right. Correct. And so I just want to understand that apart from Europe, you know, what could be potentially more, you know, fast-growing sort of regions for you? Would it be like Middle East or Southeast Asia, or have you sort of explored some of the countries there, where, you know, you can potentially have the same kind of growth that you're seeing in Europe? No, I think if you look at the global landscape, around 35% global market is U.S. in terms of value, and then followed by around 25% in Europe. So and then I think India is only 2-3% today. But again, being our presence in India, and we have been present for a long time now, we have a bigger market share in India compared to, you know, other global markets. So I think for us, these three geographies will continue to be the key market for us as we go along, you know, next three to five years. Got it. Got it. Thank you. Thank you, sir. Participants who wish to ask questions may press star and one at this time. The next question is from the line of Zain Hussain from Dolat Capital. Please go ahead, sir. Thank you for the follow-up question, sir. Sir, guidance for gross margin, if you can give? See, gross margin, we normally give guidance with the margin. I don't have those numbers. Mm. But typically, we operate between 60% to 65% gross margin. Okay, sir. And, the CapEx guidance of 100-120 crores in next six months will be from internal approval or- Internal -QIP? These are mainly CapEx happening in the existing plants. Some of course will also CapEx will be directed towards the new facilities as we start building them up, but the majority will come from internal pools and some of the QIP money will be also partially on the 500 crore pool. Got you. The major QIP utilization will start sometime early next year. Okay. Thank you. Thank you, sir. The next question is from the line of Vihang Subramaniam from Java Capital. Please go ahead, sir. Yeah, hi, congratulations on a good quarter, and thank you for taking my question. Welcome. Just one question from my side. In some of your remarks, initially you mentioned that you're seeing a lot of traction from U.S. customers due to- Yeah. potential tariffs, right? Yeah. So could you talk about what are the tariffs currently on our products, as well as similar Chinese products in U.S. and Europe? And, if we see an increase in tariffs after the U.S. election, do you expect to get more competitive versus China? So, it's a great question, Vihang. So let's first talk about the tariff, what are the current tariffs? The current tariffs are zero from India right now. So when we export to Europe, there's zero tariff, and Europe, you know, is not going to change any tariff. And Europe, you know, is our major market. More than one-third revenue comes from Europe, over one-third. One-third is Indian, one-third is rest of the world. So US is also not very significant. You know the numbers already. And Mm. Currently the U.S. tariff is zero. But even if U.S. keeps, puts a reciprocal tariff, which we are hearing from, you know, Mr. Trump's speeches, I don't know who's gonna come, but, let's assume that he's gonna come. So, you know, India has a tariff of around 10% on medical devices. So the reciprocal tariff can be only 10%, in my view, number one. Number two, current tariffs on Chinese products range from 25%-50%. So there will still be a big gap. And I think the most important thing is the global supply chain, you know, with this current uncertainty and what is our environment, I think is going to shift a little bit to India, and I think med tech space on also. I think that change should come in next, you know, let's say two years to five years. So, but... We are building, and most of the tariffs become effective now till January 2026. So in this period, I think if we can, you know, catch hold of some good companies and product, I think that is the target we are trying to set up for ourselves. Understood. And, just in regards to the acquisition that, the potential acquisition that you may look at- Yeah. Are there any particular, you know, products or any particular kind of therapies that you are No, because we are very clear. or at this point it's more open? No, no, we are very clear that we want to stay adjacent to what we are doing. So we'll only do something which we are currently operating in, whether it's cardiology or critical care or oncology or in renal space. Anything around adjacent to these therapies, we are going to do. So we're not going to go out of our therapeutic, you know, competence. ... And, just last one on the margin side. I think it seems like we have been, trending a bit ahead of our guidance. So would you look to revise this at some point? Because, it seems like our export revenue savings is driving margins higher, right? So any thoughts on that? No, I think, Vihang, more important is, you know, it is good that we are trending higher, but I think we would like to stay in the range. And I think, whether on the top of the range or on the bottom of the range, but at least we want to be in the range. And I think, see, we don't know what's gonna happen, you know, in next six months in the global, you know, geopolitical situation. So it's good to be prudent and stay prudent. So if we have done well, I think, we should compliment ourselves, but, we don't know about the future. But I think if we can, the company has the capacity to absorb any future shock, even though this first six months very difficult in terms of global supply chain, because freight rates started increasing, the shipment transit times kept on increasing. So in spite of all these challenges, we are able to, you know, still make some small improvements in our margins. So I think, let's continue with that. I think maybe another quarter we'll see what is gonna happen. Understood, sir. Yeah, that makes a lot of sense. Yeah, that's it from my side. Good luck, and wish you and the team a very happy Diwali! Thank you, Vihang. Same to you, everybody in Baba family. Thank you, sir. Before we take the next question, we would like to remind participants that you may press Star and One to ask a question. The next question is from the line of Naman Bagrecha from IIFL Securities. Please go ahead, sir. Hello. Can you hear me? Yes, Naman, I can hear you. Please go ahead. Thanks, thanks for the opportunity. Sir, just some clarifications on the India business part. Yeah. You highlighted that the first half of this year, we've grown at around 13%. Right? Yeah. So that means that to achieve, let's say, a 20% kind of growth on a full year basis, we will be growing at around 30%, at least for the next two quarters Y-o-Y. Or, let's say, for first half, growing at around 30%... Second half, growing at around 30%. Yeah. Is my understanding correct? I mean, You are absolutely correct, and I think these are the numbers we have with us. So, you know, we are pretty certain because, you know, we have the build-up, the capacities have gone up, and, you know, the, let's say in quarter two, we were able to see a 22% growth, you know, compared to quarter one, which was only 6%, basically. So we are seeing these changes already, you know, in the customer profile, in the demand side. And renal business is already growing, you know, at 50%, you know, which will be almost 150 crores, and this will become almost close to around 25%-28% of our total business, so, in India, at least. You know, we are pretty confident in getting those numbers. Okay. Okay, okay. And as you said, on the renal business, so renal business, I mean, if I back calculate, we actually have grown at around 50-51% just in second quarter, and the CAGR would be closer to around 60+%, if you look at INR 145 crore of business. Yeah, so the reason we are able to do it, because we have added a lot of new capacity in renal business. Mm-hmm. Most of this capacity is coming live between October and November. Okay, so basically this- So it... One time. Yeah, so currently we are short of products right now. We can't supply enough. Okay. And lastly, on the export business, if we exclude the subsidiaries, I mean, we have seen a fantastic growth of, let's say, around, what? 28%-30%. Is my understanding correct? That's correct. Around 27-28%. You're right, actually. 27%-28%. Yeah. So for the full year, would you want to revise the guidance, or this would not be achievable? I mean, let's say you guided for around, let's say, 25%, right, for the full year? We have guided for the full year total overall growth of around, you know, 22%-24%. Mm. And with India doing around close to 20%, you know, with a weighted average of 30% on India business. Mm-hmm. Export business around 70%, weighted average of around 25%-27%. Mm. So I think, we typically have to also look into facts, like what is going to happen in next six months. So it is good to give a, you know, muted guidance, and if you do better, it is always good. Mm. So, you know, we will not like to revise margin, let's say, you know, guidance at the end of second quarter. I think after end of third quarter, we'll be more prudent to revise guidance. Mm-hmm. Okay, okay. And one more, if I may. The earlier participant also highlighted that because of higher export business, we are seeing 50 basis points quarter on quarter improvement in margins. Yeah. So given that, our export business will be, let's say, growing faster than the domestic business- Yeah ... do we expect the margins to be slightly better? I mean, probably achieving, let's say, 28% on OPU exits? See, well, the target was to improve by 150 basis points, and it also depends on the product mix, you know, every quarter. But I think we are pretty much on line. But, you know, again, it's a lot of very uncertain situations, you know, in the geopolitical world. We don't know where oil is gonna hit, is it gonna impact raw material prices- Mm ... or, you know, what, what is going to happen to supply chain, the current situation? Mm. So it's good that we have done better in one quarter, so even if we do bad in other quarter, we'll be able to, you know, normalize it. But that is not the case right now. But the important thing is that, you know, continuous improvement is required, and we are doing it actually, in terms of margins. And as the product mix keeps on changing, you know. Mm-hmm. As we go more and deeper in, let's say, critical care, more deeper in cardiology, definitely we'll be able to have better margins in these products also in India also going forward, as time progresses. Because currently we are also in a lot of the initial investment phase in these businesses. So like, for example, we hired 40 new people, so 10% of the workforce is completely new for new businesses, which are not contributing at the same run rate as the original businesses where, you know, other 370-80 people are working. Mm, mm, mm, mm. So gradually, you know, we'll see a ramp-up. So definitely, once the businesses, you know, get more and more, let's say, you know, deeper, we will definitely see margin improvement. Renal business is still not a great margin contributor, but as we increase the volume substantially, and definitely the margin will keep on changing because the contribution margin will keep on increasing. Got it. Yeah. And I think the idea in this business, I think it's all about technology and, you know, volume and, you know, what you can do in terms of, you know, how you position yourself in the market. If you position at a lower spectrum, then you get lower pricing. But if you start competing with large multinationals, then definitely- Mm. You can, you know, improve your price points, and that is what we are trying to achieve right now. We are trying to replace the multinationals on the market in India, not replacing Indian companies in the market. Got it. And just on the sales and marketing addition, the associates, just wanted to understand how does, let's say, their productivity play out? I mean, today, let's say we are at four, we were at around... I mean, if I look at, you know, Hundred crores. sales per month for a rep, close to around INR 850,000. One crore rupees a year, basically. Typically, one crore rupees. One crore rupees a year. Yeah, right. So, the addition that you have done, so generally, how much time do they take to achieve, let's say, these kind of productivity? It's a very hard question to answer because it, you know, it depends from business to business, depends on the approval process on each hospital. Mm. And some businesses may take longer, some may take faster. You know, so again, you know, it's something we have to continuously juggle with in terms of balancing the people versus the revenue. But when we have new businesses to set up, let's say two new businesses, then, you know, sometimes you have to compromise on that area and say, "Okay, I need people first," so that, you know, they can go to hospitals and push the products. So I think in that case, we are very careful in, you know, hitting the headcount versus... But again, when we say end of this year, we'll have 500 people, but we'll also see revenue almost touching INR 500 crores in domestic business. So this is where somewhere we are in that zone. Mm. So we always keep that one crore number in mind. Okay. O-okay. So new versus old keeps on getting blended, basically. Okay, so on a blended basis, we will say that one crore is, would be the- Yeah. From that basis, what we are targeting always. Mm, yes. It's on a blended basis. Okay. Because always you have new people coming in, going out, you know, that is always the case. So sorry, I didn't understand. So on a blended basis, you will target one crore or to achieve one- On a blended basis- On a blended- With the new and old together, yeah. Okay, okay, okay. And what were... I mean, you highlighted that, total hundred associates to be added in FY twenty-five. Any other plans, let's say, for FY twenty-six or on a steady state, you would like to add, fifty, hundred people? We need to add that many people because the business is growing- Mm. We need to reach out to more hospitals. Today, we reach out to eight, nine thousand hospitals. We need to reach out to almost twenty thousand hospitals in the country, so, you know, in next three to five years. So we'll have to almost double the headcount in, let's say, next three to four years. Okay. Even if we continue with the 20% growth rate, the business is anyways, you know, double in next, you know, four years. Mm. Yes, yes. We'll have to continue to increase the headcount to reach more and more customers, and customer means hospitals there too. Yes. And just on the last point, what would be, let's say, the blended capacity utilizations? You said 50%, or... I mean, sorry. For new plants and for the existing plants, is already around 75%-80%. What would be the blended number, sir? Blended will be close to around 60-65%. Okay. Thanks a lot. I will join back. Thank you, sir. Participants who wish to ask a question may press Star and one at this time. Ladies and gentlemen, to ask a question, please press Star and one now. As there are no further questions from the participants, I would now like to hand the conference over to management for closing comments. Thank you, everyone, for great questions and, you know, I really appreciate the kind of deep study you have done, you know, for the business and for the company. Please continue to ask these probing questions. This will help us to do better every year, every quarter. We hope we also assure you that whatever guidances we give you in the beginning of the year, we will try to hit those revenue numbers and profit numbers, you know, to ensure that, you know, the company is on track with the right performance parameters. Thank you again very much, all the participants, ICICI team for hosting this call. Thank you again. Thank you, sir. On behalf of ICICI Securities, that concludes this conference. Thank you for joining us, and now you may disconnect your lines.