Welcome to Advanced Enzyme Technologies Limited Q and HI FY 2026 earnings call. Please stay connected; your conference will begin shortly. Please stay connected; your conference will begin shortly. Welcome to Advanced Enzyme Technologies Limited, Q2 and HI FY 2026 earnings call. Please stay connected; your conference will begin shortly. Welcome to Advanced Enzyme Technologies Limited, Q2 and HI FY 2026 earnings call. Please stay connected; your conference will begin shortly. Welcome to Advanced Enzyme Technologies Limited, Q2 and HI FY 2026 earnings call. Please stay connected; your conference will begin shortly. Welcome to Advanced Enzyme Technologies Limited, Q2 and HI FY 2026 earnings call. Please stay connected; your conference will begin shortly. Welcome to Advanced Enzyme Technologies Limited, Q2 and HI FY 2026 earnings call. Please stay connected; your conference will begin shortly. Welcome to Advanced Enzyme Technologies Limited, Q2 and HI FY 2026 earnings call. Please stay connected; your conference will begin shortly. Welcome to Advanced Enzyme Technologies Limited, Q2 and HI FY 2026 earnings call. Please stay connected; your conference will begin shortly. Welcome to Advanced Enzyme Technologies Limited, Q2 H1 FY 2026 earnings call. Please stay connected. Your conference will begin shortly. Welcome to Advanced Enzyme Technologies Limited. Your conference is being recorded. Good evening, ladies and gentlemen. I am Akash, moderator for the conference call. Welcome to the Advanced Enzyme Technologies Limited Q2 and H1 FY 2026 earnings conference call. As a reminder, all participants will be in 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 and then zero on your touch-tone telephone. Please note, this conference is being recorded. I would now like to hand over the floor to Mr. Ronak Saraf, Manager Investor Relations. Thank you, and over to you, sir. Thank you. Good evening, everyone. Welcome to the Advanced Enzyme Technologies Q2 and half year FY 2026 earnings conference call. We hope you all have gone through our financials briefly and the presentation, which has been posted in the investor section of our website and on stock exchanges. We have with us Mr. Mukund Kabra, Full-Time Director, and Mr. Beni Rauka, Group CFO. Today, the management will discuss the performance and the business highlights, update on strategies, and respond to any questions that you may have. As usual, for the ease of discussion, we will look at our consolidated financials. I would like to draw your attention to the fact that some of the information shared during the call, particularly regarding our plans, strategies, and future outlook, may contain forward-looking statements. These statements involve inherent risks and uncertainties and are based on current expectations, forecasts, and assumptions. Actual results may differ materially from those expressed or implied in these statements, influenced by a range of factors, including, but not limited to, economic conditions, changes in government policies, regulatory developments, and other unforeseen circumstances. Recipients are cautioned not to place undue reliance on these forward-looking statements, as they are not guarantees of future performance and should not be viewed as a substitute for independent judgment. The company undertakes no obligation to update or revise any such statement, whether as a result of new information, future events, or otherwise. Without any further ado, we shall commence this call. Over to you, Mukund. Thank you, Ronak. Good evening, everyone. I really appreciate you all for taking out your valuable time, and I extend a hearty welcome to everyone joining us today on the conference call for the quarter and a half year end date 30th September 2025. I am happy to announce that we have reported good numbers for the Q2 fiscal 2026, continuing the growth trajectory. We have witnessed growth across all business segments of our presence. Our top line for the quarter stood at INR 1,845 million, reflecting a 26% year-on-year growth and marginally decreased by 1% compared to the previous quarter. EBITDA came in at INR 601 million, which is a 42% increase year-on-year and a 6% higher quarter-on-quarter. Our EBITDA margin for the quarter stood at 33%. Moving to profitability, our profit after tax reached INR 447 million, registering a 34% growth year-on-year and 11% increase quarter-on-quarter. The PAT margins stood at 24% for the quarter. Now, I will take you through our segment-wise revenue performance for the second quarter of financial year 2026 and compare it both year-on-year and sequentially with Q2 financial year 2025 and quarter one financial year 2026. Let's begin with human healthcare. Our largest segment revenues for Q2 financial year 2026 stood at INR 1,212 million, making a 22% year-on-year growth and a marginal decline of 1% quarter-on-quarter. This growth was driven by higher sales in the pharma, API, and nutritional business across both domestic and international markets. Human healthcare remains the vital of our portfolio, contributing 66% of our total revenues. Next, we have animal healthcare. Revenues rose to INR 193 million, delivering a 6% increase year-on-year and a 26% decline quarter-on-quarter. Animal healthcare accounts for 10% of our total revenues. Turning to bioprocessing, this segment recorded strong growth of 52% during the quarter, reaching INR 255 million and an 8% sequential growth. This growth is primarily on account of robust performance of our food business. The food business grew by 77% on a year-on-year basis and 18% on quarter-on-quarter basis. The non-food business underperformed during the quarter. It did grow by 4% on a year-on-year basis and 20% on quarter-on-quarter basis. Lastly, the specialized manufacturing segment delivered a strong growth of 54% on a year-on-year basis and 30% on sequential basis, reaching INR 185 million. This segment represents 10% of our overall revenue. We anticipate that our strong growth trajectory will continue across all business segments in the foreseeable future. With this, I will now hand over the call to Beni Rauka. He will walk you through the financials and key subsidiary numbers. Thank you. Thank you very much, Mukund. Good evening, everyone. I hope you all are in good health and doing well. On the company's consolidated financial performance for the second quarter and year-to-date of fiscal year 2026, let me talk about year-on-year. Our revenue grew by 26% from INR 1,461 million to INR 1,845 million. Our EBITDA increased from INR 424 million to INR 601 million. Profit before tax increased by 41% from INR 422 million to INR 595 million. Profit after tax increased by 34% from INR 334 million to INR 447 million. On quarter-on-quarter basis, our revenue slightly decreased by 1% from INR 1,859 million to INR 1,845 million. EBITDA increased by 6% from INR 564 million to INR 601 million. Profit before tax increased by INR 46 million, 8% from INR 549 million to INR 595 million. Profit after tax increased by 11% from INR 404 million to INR 447 million. For six-month performance for FY 2026, as compared to FY 2025 six-month, revenue increased by INR 698 million, about 23% of increase, from INR 3,006 million to INR 3,704 million. EBITDA increased by INR 229 million, from INR 936 million to INR 1,165 million, and it stood at 31% of our revenue as compared to 31% during six months of FY 2025. Profit before tax increased by INR 236 million, 26% increase, from INR 909 million to INR 1,144 million. Profit after tax increased by INR 168 million, 25% increase, from INR 684 million to INR 852 million, and profit after tax stood at 23% of our revenue. Now, I would like to give you numbers of our subsidiary companies. Revenue of ZC Biotech stood at INR 186 million, EBITDA of 37 million, and PAT of INR 17 million for Q2 of FY 2026, as compared to INR 158 million of revenue, INR 20 million of EBITDA, and INR 5 million of PAT. For six months, the revenue of ZC Biotech stood at INR 397 million, as compared to INR 317 million, 25% increase, and EBITDA of INR 70 million, as compared to INR 44 million, 59% increase. PAT at INR 31 million, as compared to INR 13 million. EWOC's revenue stood at INR 74 million, and EBITDA of INR 17 million, PAT of INR 14 million in Q2 of FY 2026, as compared to INR 49 million of revenue, INR 12 million negative EBITDA, and INR 19 million of negative PAT during Q2 of FY 2025. EWOC's six-month numbers stood at revenue INR 144 million, as compared to INR 96 million, and EBITDA of INR 31 million, as compared to negative INR 19 million, and PAT of INR 21 million, as compared to INR 35 million negative during six months of last year. SISEC revenue stood at INR 185 million, EBITDA of INR 33 million, and PAT of INR 15 million in Q2 of FY 2026, as compared to INR 120 million of revenue, INR 14 million of EBITDA, and INR 3 million of PAT. For six months, our revenue in SISEC was INR 330 million, as compared to INR 232 million, 42% of increase, and EBITDA of INR 38 million, as compared to INR 36 million, PAT of INR 8 million, as compared to INR 13 million. The top 10 customers contributed 27% in the total revenue in Q2 FY 2026, as compared to 25% in Q2 of FY 2025. For six months, top 10 customers 23%, as compared to 22% last year six months. B2C segment contributed $1.29 million, as compared to $1.1 million during the same period during the previous year. Let me also give you the breakup of our human nutrition business. Our Q2 numbers for India sales is about INR 570 million, as compared to INR 659 million during Q1, and the Q2 of last year, INR 419 million. International sales during Q2 is INR 642 million, as compared to INR 562 million in Q1 and INR 573 million in Q2 of last year. Domestic numbers from human nutrition is about INR 570 million, as compared to INR 642 million. I'm sorry. Domestic is INR 570 million. International sale was INR 642 million during Q2 of FY 2026. In Q1, it was INR 659 million from the domestic market, and international market was INR 562 million. In Q2 of FY 2025, domestic was INR 419 million. International sales was INR 573 million. Our R&D spending during Q2 is INR 78 million. Revenue expenditure and CapEx of one total is INR 80 million, as compared to INR 85 million in Q2 of last year. On consolidated basis, R&D spend is about 5%, INR. 84 million during Q2, and 6% in Q2 of FY 2025, this is without considering intercompany elimination. On consolidated basis, R&D spend is about 3% during Q2 and 5% in Q2 of FY 2025. That was from my side. Now, we shall open the floor for Q&A session. Thank you, sir. Ladies and gentlemen, we will now begin the Q&A session. If you have a question, please press star and one on the telephone keypad and wait for your question. If you would like to withdraw your request, you may do so by pressing star and one again. The first question comes from Rachna K. from SCIL Ventures. Please go ahead, ma'am. Opportunity and congrats on a good set of numbers. I have a couple of questions. My first question would be, could you provide color on how could we achieve year-on-year good growth rates across our geographies like India, Europe, and Asia, and what caused a slight decline in the U.S.? If you could please provide color on drivers of growth for this quarter across each geography individually. This is my first question. We will give you some numbers. Okay? What is the next question? Similarly, for our product categories: animal healthcare, human healthcare, food processing, and specialized manufacturing, what were the growth drivers? If you could give some color on each category separately, and what caused a decline or industrial processing revenues to remain flat? Do we see the growth trajectory sustaining over the long term? These would be my questions. Good evening, Rachna ji. I would say this way, when we talk about India, Europe, all the different segments, numbers can be given by Rauka, but in general, it's like the marketing we're putting up from the last so many days into the different areas, different geographies, Asia, as well as Europe, and all of this, it's a long-term effort. You cannot just go and say that in one day growth can come and go. I would put it this way. It's like into all the different segments which we are working. In Europe, we were working into the baking areas. In the U.S., we were working into those different food areas. In India, as well, we were working on different food areas. In other markets, Asian markets, we were working into the different pharma areas. All of those give you some effect. At the same time, we did have some backfooting because of the tariff issues which is there. What we anticipated, a little more growth went because of tariff issues which are still there. We anticipate that may continue. We do not know when it will be because the uncertainty is there. Probably that is the one area which has caused a little bit of loss in the U.S. as of now. Also in some of the areas where the indirect market is there. We are waiting for how these tariff issues pan out to make further strategies, what we should do, what we should not do. What I would like to say is that it is like long-term efforts which are turning into some sort of growth. Yeah. I would like to give you the numbers. Total revenue, 50% has come from India on six-month basis, year-to-date, fiscal year 2026. 30% has come from America, where we see a decline of 4% in our numbers as compared to last year six months. Europe is about 6% of our revenue, and we have seen 61% of growth in this particular from this geography. Asia is about 12% of our revenue coming from there in the six months of current year. We have seen 4% growth in this particular geography. The rest of the world, which constitutes about our revenue, and 30% increase in six months this year. Do you need absolute number, or you will get some idea from this? I'll get some idea. On the product categories, if you could give some color? I mean, product categories in what sense you are saying? Anti-inflammatory is our last product. Yeah, the drivers of growth because the growth rates this quarter are very good. Just wanted an idea on those aspects. It's all the different areas and different products. Everything is showing growth if you really look at it. Our anti-inflammatory product growth is also there. Our baking enzymes growth is also there. Animal feed enzymes also there. All of them are growing at this point of time. There is a lot of research which is happening. Those are also supporting into some of the areas, and those are also going to support in the future. That's all what I can say as of now, Rachna ji. Okay. Thank you. One more question. How will we offset the impact of tariffs? You said you have some strategies in place. If you could provide some color on that as well. Rachna ji, I don't want to reveal those strategies. We will wait and see how the things pan out, and then we will take an appropriate call at a given time. How do we need to do? We are still working on different areas. If this persists, then what do we need to do? How do you think the growth in H2 FY 2026 will pan out? If you could provide some color on that as well. There are a lot of uncertainties out there. What I would say is that we will still stick with the numbers and the initial guidance what we are given that we will have this year mid- double-digit growth. I would like to continue with that as of now, and we will see how the things pan out in the given time because I see a lot of uncertainties around the world. I do not want to comment too many things as of now. Okay. Thank you so much. Thank you. Thank you, ma'am. The next question comes from Mr. Umang Shah from Banyan Tree Advisors. Please go ahead, sir. Hello. Am I audible? Yes, Umang ji. You can be a little louder. Okay. Sure. Thanks, sir. Congratulations on a good set of numbers, and thank you for the opportunity. Sir, I have two questions. First was the specialized manufacturing business, right? Last two years, the bottom line is around INR 4 crore or so in that subsidiary. At what scale do you think the margins will scale up, and what is the current line, and where do you think the margins will land at for the next two years? I mean, see, margin in that particular business is really low, and currently, a lot of expansion is happening. I think the depreciation expenses have gone up, and capacity utilization has also gone up. Yet, the margin is low in that particular segment. Particularly, when you have the geography-wise, if you look at the numbers, then I think the domestic market is a little bit more competitive in the sense in getting the kind of margins. I think we will go with the same kind of margin that is what we had in the last year. In this particular company, I think maybe about 8%-10% of the kind of the margins we are going to have. Okay. Okay. Sure, sir. Very helpful, sir. Sir, and how is the competitive intensity for Sera Peptides in India? Competition is always there, Umang ji, and it will continue. Right. Right. Right. No, because last year, the competition had significantly increased after many years. Do we continue with that intense competition, or now you see that the rates are still firming up? No, I would say that rates are more or less stable, and competition is going to be there, and you need to deal with the competition with whatever the tools which you have. Right. Right, sir. In the last call, you had helpfully mentioned the total impact on our profits for the full year if the U.S. tariffs go to 50%. Now, they are at 50%. Do we work with those numbers? Right now, what are the conversations like with our customers? Are they taking some impact of the tariffs? As last time also, I think we mentioned that at the worst case, we will have a 2% impact on the EBITDA if we absorb everything going forward as well. Right. The way we will work it out is some of them probably we will absorb. Some of them we will try to pass it on. It depends on the customer. It depends on the strategies. It also depends on the volume of the customer, size of the customers, and what different actions we need to take. It is absorbable if the volume goes up. We are open on that as of now, and we will see how it works out. Got it. Got it. Thank you so much, sir. All the best. Thank you. Thank you, Umang ji. Thank you so much, sir. The next question comes from Mr. Raman KV from Sequent Investments. Please go ahead, sir. Hello. Can you hear me? Yes. Yes, Raman ji. Greetings, sir. Thank you for this opportunity. I'm fairly new to the company. If you don't mind, can you please explain me the business vertical? My second question is, what are the key growth drivers for your double-digit growth for the year? As in, are you planning to launch more products, or are you planning to scale the existing products? Raman ji, the business segments which we have, and we have mentioned on our presentation on the website as well. I will just, for your info, I will give you in short. We do have a nutraceutical business where all the pharma and nutra business is a part of it. The second one is a bioprocessing business where food and non-food business is a part of it. The third one is the animal feed business. I would like to say that the growth is always with the existing products as well as the new products. We are more like an R&D-driven company. We heavily work on the R&Ds, and the new products and new launches are always into the pipelines. All the products do not scale up that fast or that quickly. There is always some time lag in our areas. We intend to increase our R&D intensity as well going forward. We are coming up with the new R&D center as well, where we would like to increase our R&D capacity multifold than what we have at present. The simple answer is it's a combination of both existing products as well as the new products which we are going to launch. Some of them not maybe like an individual form, maybe in the blends and formulation form. Understood, sir. Sir, while looking at the historical figures, I have noticed that our historical margin before COVID, it was around 44%- 46%. Can we assume this 30%-32% kind of margin is the new normal, or can we go back to the 44% margin? In the last few calls also, we were saying that at this point of time, our view is this is going to be the new normal for us. If it improves, it is good, but we will go with these numbers as of now. Okay, sir. Sir, my last question, it's more of a doubt. If you can give a ballpark figures, which is your high, which is a better margin business amongst all the vertical? We don't really track with the different products, different margins, different areas to that level. I would say that all of the segments are more or less equal. Whenever there is a sale from our U.S. subsidiary, it adds up to the margins. Understood, sir. Thank you, sir. Thank you, Raman ji. Thank you, sir. The next question comes from Mr. Lakshmi Narayan from Tunga Investments. Please go ahead, sir. Thank you. To understand our largest product sale, what has been the sale for the last six months versus the previous year six months? Yeah, Lakshmi Narayan ji. INR 829 million as compared to INR 555 million. Okay. If you look at it, what is our India market? This is entirely domestic, I believe, right? Now, in this, what is the total market size for this product? It's difficult, Lakshmi Narayan ji. I would say that we command maximum percentage of it. Okay. I mean, when you say, is it another 35% or 20% more, would be that? I mean, I just want to understand what is the broad number? What is the range it should be? See, the application can be different. It can be like into the other areas as well. You can extend the applications, right? So it's very difficult to put it into the actual number, but if you. I think that's the problem. Three hundred. Anti-inflammatory. [Inaudible]. I don't have exact number. Same number is not exact. It changes, it changes. I know. That's the challenge. That's the challenge, Lakshmi Narayan ji, to tell you exact number. Got it. Got it. Now, how many players are there right now? Because if you see, the market itself is around INR 2 billion or so. I mean, then it's a different thing as well as when the market is large. Because it needs a minimum order, minimum size for somebody to set up this particular product, correct? Now, in your view, what is the minimum revenue somebody has to generate to actually enter into this particular business? I would put it this way. Individual single product, probably it's very difficult to survive. Or survive, yeah. Or survive. You need to have different batteries of the products. You need to have different products. You need to take the capacity utilization very differently. Because just giving you one product does not work out. Got it. We talked about the American business, and there has been tariff impact. Now, is it that the entire product that is being shipped to the U.S. suffers from this tariff? Can you just tell me what is the percentage? Because if you add value, then the tariff becomes different, right? What is the weighted average thing for this? How do you, what kind of mitigation you can actually do? I know you talked about some other things like 2% is an impact. Just want to understand how much would get suffered with this tariff, what is the weighted average, and what are your mitigation steps? If I go with the last year's number, at the worst scenario, probably we'll have an impact of INR 70 million-INR 80 million. Okay. In the EBITDA? Yeah. Yeah. I mean, total, whatever we can call it. Right. INR 7-12 crores and INR 10-12 crores of EBITDA. Sorry, sir. I didn't get it clear. Can you just repeat? INR 10-11 crore is impact on EBITDA and INR 7-8 crore on PAT on overall basis. How do you intend to mitigate it? Is there a way that you can mitigate by changing the source of origination or keeping the place at which the value is being added? Is there something which you can mitigate? Yeah. I think that's what we are working on. We'll explore. We'll explore all of those areas. Sir, and if you look at India non-pharma business, right? Can you just give me a bit of India non-pharma and how it has actually grown? When we talk about India non-pharma, it is basically textile and leather, and we mentioned many times that that is not our focus area, Lakshmi Narayan ji, but we intend to be there and see how the market is moving. Maybe in the future, we will like to come out with the products into those areas. Sir, yeah. Because I thought that is a sizable amount of animal feed business, which is. Animal feed doesn't come under the non-food areas. The non-food areas basically comprise textile. Textile, leather. And leather. I was looking for non-pharma, sir. Sorry. I think I wanted to know the non-pharma part of India. What is the revenue that has actually for the last six months and how it has grown? Excluding pharma, domestic sales. Raukaj ji can give you the numbers of the food business, how it has grown, and basically, the other one is the animal feed overall numbers. We do not have numbers separately geography-wise or others, right? You can give the six-month comparison, Raukaj ji. I am just giving you a number for food segment. For six months, it is about INR 380 million as compared to INR 312 million. Other than that, the animal health, so animal feed business, that is what we call it, is INR 453 million as compared to INR 353 million in last year's six months. This is India. No, it's not India. It's all like India plus. Sorry. International. Total number I'm giving you. Okay. Okay. Sir, and moving on to Europe, which has also grown for us, can you just give me a bit of what is growing in the Europe? Is it the. No, I would put it like Lakshmi Narayan ji, we shouldn't go on a quarter-on-quarter or half-yearly basis. Overall yearly basis, it has more relevance. I would say that the focus area is still the same. What we have into the food areas and particularly into some of the nutraceutical areas, which is still there into Europe, we are registering our few products in the EFSA, and we are waiting for the novel food approval. If that works out, then probably the Europe business can grow much faster. Similarly, we are waiting for some of the approvals for some of the pharma areas into the Asian areas. If those happen, probably that should really increase the growth into those areas as well, particularly. It's a long time-consuming process. The process we started one and a half years back, and still we are waiting. Maybe like six- eight months down the line, we expect that that should materialize. Sir, just last question. The American business has shown a little slower growth. Is it completely related to tariffs, or is it something outside the tariff issue that is actually leading to this? We don't know at this point of time, Lakshmi Narayan ji, but what we can say is that in the last, particularly last two, three months, there is a lot of slowness, what we have observed. The number of inquiries, which used to be, let's say, about 100 in a month, dropped down to 4, 5, 6 new inquiries. That just shows that there is a lot of slowness, which is happening in the market. Now, is it because of the tariff or some others, or because of the price rise? What is happening in the years? We still need to wait and watch. What I would like to say is that there is some slowness, which we can see. We believe that it has to do more with the tariff and other cost increase, what is happening in the U.S.. Thank you. I'll come back in to you. Thank you, Lakshmi Narayan ji. Thank you, sir. The next question comes from[Mr. Nitish Rajji from ChrysCapital]. Please go ahead, sir. Hi. Thank you for the opportunity. Hope I'm audible. Just a question on the guidance, which you said you want to maintain at the mid-teens level. Do you expect our revenue growth rate to decline? We've done 23% YoY in the first half. If you want to do mid-teens, do we expect that to be a slower growth for us? I think that's what we have been telling because of a lot of uncertainties around the world. We feel like we need to have the same guidance for the time being. Got it. And just if you could share some color on margins, do you expect it to be at this 32.5% EBITDA margin levels? Go ahead. I'm sorry. I did not get the margins maintained. The margin, I think we already mentioned, except the impact of the tariff. Otherwise, I think we will continue to have the margin of maybe about 21%-22%, EBITDA of 30%-32%. That's what we are still maintaining. I would say that still we will not go with the quarter-on-quarter. I would still like to see more certainties as to, I mean, some more clear picture how the whole situation span out. As of now, what we are trying, we are getting some results. We expect some more results. Some of the results did not come up because of tariff issues and other issues. We will wait and see, wait and watch how the things pan out. Got it. Sir, we've got close to INR 600 crore of cash on our balance sheet right now. Is there any M&A we're targeting or any such acquisitions where you have in mind you're assessing right now? Acquisitions and other things are always there in the mind. We always work. We are working on a few of them, but it always depends on the cost and what we are getting out of it. We do not know whether it will happen or it will not happen as of now. Are we looking for targets which are in the human nutrition or in the industrial bioprocessing? Anything we are favoring? I mean, that's an ongoing process. It is more of forward integration. We are looking at, say, animal feed business, of course. In human nutrition, we are looking more at probiotics. That's the area of our interest. Okay. Just lastly, from my side, what traction are we seeing on the biocatalyst side? We do have a lot of good traction, which is coming up. We do see that there are a lot of products which are into the pipeline, and probably they should also add up to the growth going next year, maybe some, maybe the last quarters. We will see, wait and watch how the things pan out. Any number you can give you? I won't be able to. Beni Rauka ji can give the numbers, but the market work which is going on, that's all what I can say as of now. Beni Rauka ji can give you the number. I think biocatalysts total for six months stood at about INR 128 million as compared to INR 104 million last year. Got it. Thank you so much. Thank you. Thank you, sir. Thank you, sir. The next question comes from Mr. Rajas Joshi from Chrys Capital. Please go ahead, sir. Yeah. Good afternoon, and thank you for the opportunity. Sir, I just wanted to get your sense on the growth that we've reported both for the near quarter and this quarter. How sustainable is this growth? Are there any one-offs, per se, so to speak, in the numbers for each one, both with regards to revenue and/or margin? I would say that there is no one-off, but there is not every quarter you get the same, I would say, the same orders. Some quarters may be here and there, a few here and there. I would say this is a little bit long-term growth rather than we just go with the quarter-on-quarter basis. It is difficult. There is no one-off customers, but we still need to wait for how this tariff comes up because there are a lot of times the indirect sales are also there, which also goes to the U.S.. We need to wait and watch how the things pan out. Understood, sir. Has the strategy in any sense changed, especially, I mean, with regards to, let's say, sales and marketing or business development? Any other kind of changing strategy that you've done over the past one year or that you would like to highlight specifically? No. No comment. I don't want to comment on that, Rajas Joshi. Okay. Okay. Understood, sir. Secondly, on the gross margin, right? I mean, Q4 was kind of the bottom, and then last Q1 also, we were about, I think, 73% odd. This quarter, now we have given about 76% odd in terms of gross margins. If I look at the sales in the U.S., which is, as you had rightly said, a higher margin market for us, quarter-on-quarter basis sales are down for this higher margin market. What is really driving this gross margin expansion, per se, on a quarter-on-quarter basis? Overall, operational efficiency is driving. Operational efficiency is as well as some of the research is there and some of the product mix, which varies with quarter to quarter. On mix, could you highlight what exactly is higher margin and what is lower margin, which would help us understand going ahead as well how we should think of gross margin? I think for you, it will be difficult to arrive at such things, frankly speaking, because the complexity is you have animal nutrition, human nutrition, biocatalysts, probiotics. I mean, it's very difficult to drive in that sense those numbers. Even qualitatively, not from a number perspective, you could, I mean, let's say animal nutrition is higher margin or some other product is lower margin. Anything of that sort? No, I don't think we will be able to give you that kind of guidance. Okay. Okay. All right. Thanks a lot, sir. Thank you, sir. The next question comes from [Zakina Her Nasir] from Nasir Investments. Please go ahead. Sir, congratulations on a very strong set of numbers. Sir, you have given a guidance of a mid-teens growth, which I think is on the cards. Sir, how do you foresee the company three years from now? How do you want Advanced Enzyme Technologies to shape out as a company in the global scenario, sir? Because it is a complex company with the products itself are pretty complex. Also, I would like you to throw some light on your sector of industrial and bioprocessing. What do you foresee there because that has had a good growth this quarter, sir? If you ask me, we always wanted to maintain the growth trajectory of mid-teens over a longer period on an average, if I would like to say. That is always a goal. In terms of bioprocessing and all of these different areas, we are coming out with different new geographies. We are adding up new products which we are working on. Some of them are in the R&D. Some of them are into the final stages. Some of them we already added and marketed into the market, right? To support that, you need to add more geographies, just not dependent on the baking. We are working into the different areas, into the food categories as well. We are coming out with the new products, new R&Ds. That is how we are working on the bio-processing. That is how we need to grow in each and every area. Sir, and would you have a broad idea of what your share in the world market would be or how large would Advanced Enzyme Technologies be as a world player, sir? Would you have 10%-15% market share or more, sir, in this area? I would say that we are very small. Even though we will be among the top five or top ten players, there are very few companies in the world. If you just go and compare the revenues of the biggest Novozymes or Novonesis right now, we are very, very small. So we won't be commenting even 5% of the share in the world market, probably. Less than 2%. Huh? Less than 2%. Less than 2%, somewhere around that. That is what our share is as of now. There is a huge headroom, sir, if you have a good couple of years. Yes. Yeah. That has to be supported with a lot of R&Ds. This is a complex business, as we always say, right? It needs a lot of research, and that is what our focus is going forward as well. Thank you, sir. Best wishes. Thank you. Thank you so much, sir. The next question comes from Shereyans Gathani from SG Securities. Please go ahead, sir. Hi. Good afternoon, Mukund and Rauka ji. I had a couple of questions, sir. The first one was that we've seen a big pickup in high-protein foods in India, especially high-protein yogurts and milk. Are we providing any kind of enzymes towards those, specifically lactase or in that particular area? What kind of growth are you looking at? We are working on those areas. As of now, we do have certain products under the trial. Even though our Indian market share is smaller in those areas, in India, there are little different challenges, but we are overcoming those. You need to have a lot of different product batches. When we talk about lactase, there are a couple of types of lactase, particularly in this area. Probably you need a neutral lactase. We do have a very good acid lactase. Neutral lactase is also under the R&D. There are a lot of different aspartic enzymes, proteases, and all of those are also in the customer testing phases and all of that. Yeah, in giving short answers, we are working in those areas. As of now, we don't have too much of the sale in the Indian market, particularly of those, but those are the products under the. Different stage of development. Different stage of development. Okay. Okay. So we are testing phase. We develop the product, is what I can understand. Correct. Is it under customer testing or what phase are you at? There are a lot of different products, right? Some of them are at the customer testing. Some of them are in our lab testing. Some of them are under the development stage as well. Okay. Okay. Second question was on the B2C India business. How do you see that shaping up? Any kind of traction that we are seeing, and what's the strategy over there? We are a main B2B company, and that is where we are separating that arm from Advanced Enzyme Technologies to the new company, which we just recently formed. We will be transferring that business. As of now, we do have a good growth on a smaller number. This year, probably we will be hitting somewhere around 1%-1.5% here, which is lower than what we budgeted initially. We will see. There is a young dynamic team which is working behind it, and it is a different company. That is what we are trying to aim at, to develop it further. Got it. Got it. Is there any update on how we are going with the R&D center and what plans of hiring and people in that, sir? R&D center is at different stages. I would put it this way, probably by the end of March, it should have some kind of shape should come up. Probably we are targeting to capitalize some of the assets during that time. Partially become. It will partially become active by the end of the fiscal year, sorry. By March? Okay. Okay. Yeah. Yeah. Yeah. Okay. Okay. Got it. Last is the European subsidiary. We had an order. Any kind of similar orders we are looking at? We did see a revenue jump there. If you could give some color on how that is doing and, yeah, just some update on that. Yeah. European subsidiary is more like R&D, but we are working on some of the similar contracts out there. Some of them are at the advanced stages. We see good growth if those materialize maybe in the next two years, one year down the line, and two years down the line. We will wait and see how things work out because some of them are still under the development stages for them. Okay. Got it. All right. That's all from my end. Thank you so much. Thank you. Thank you, sir. The next question comes from Mr. Aditya Khandelwal from SIMPL. Please go ahead, sir. Yeah. Hi, sir. Thanks for the opportunity. This question has been asked before, but I'll also try my luck. See, the growth which we have witnessed in the first half, more than 20%. If you could just provide some flavor of what is leading to such high growth. Is it that we have one new customer or some of our products have clicked, which is leading to this high growth, or is it just purely a base effect playing out? If you could just spend some time and help us understand what is leading to this high growth. We are getting good growth in all four segments. In human nutrition, we are getting a good growth of about 21%. This is our largest business. Here, we have different products and different product mix. Many of the products are getting good orders, and because of that, I think the growth is good in this particular segment. In animal health segment, again, we are getting 28% of growth. That is coming from India as well as from the international market. This is because mainly we have done a lot of work in the last three or four years. I think we are getting now a lot of orders from our customers. Bio-processing food is another area where we see the good growth of 22%. All these segments are doing well in these two quarters. There are several things because the efforts have gone in the past. Now you are getting those kind of numbers from different customers. It is not only one particular thing which we can say, "Okay, it is only because of A, B, C, D reason." There are several things which have gone back into getting this kind of support and numbers. If you look at the contract manufacturing business, I mean, where we have efforts and based technology, we could see 42% of growth in this particular business as well, which is run by our subsidiary company. All put together has given a kind of growth of 23%. Thank you, sir. We will take up the next question from Mr. Abhishek Kohli, an individual investor. Please go ahead, sir. Am I audible, sir? Yes, Abhishek ji. Yeah. My question one is, I see high inventory in your balance sheet. Is it like preparing for, is it like in preparation for U.S. tariffs that you are maintaining this high inventory? That's my question, ma'am. Abhishek ji, in our business, the inventory is always high. If you look into the historically as well, you will see that the inventory is always high because we have multiple different products, different locations. The product cycle is bigger. Let's say if you want to make one product today, you will at least need one month's time. That depends on whether the capacity is available because when there are multiple products, there are different batch campaigning as well happens. At the same time, we have different plant locations in India as well as out of India. That makes it always our and the delivery time has to be as short as possible. Historically as well, same inventory levels. Okay. So as of now, there is a business between India and U.S., as in you are able to do that despite these tariffs. We anticipated that, and we did some movement into the first quarter, some of them, which can take care of another one quarter or so, one and a half quarter. Okay. Yeah. That was actually my question because I see INR 173 crore inventory, which looks big compared to your past. I was asking, were you preparing for that in the form of finished goods? A little bit built up, yes. Little bit built up. Yeah. Question two. I think two quarters back, I remember you mentioned about a pharma intermediate that was in pilot stage. Any update on the commercial orders for that pharma intermediate? We had a few, but there are a few challenges as well, which we are working. We are working on a few of the intermediates as of now. We will see how it span out. Probably after one or two quarters, maybe we will be able to do more highlight on that. Okay. My question three, this is my final question. I remember our CEO mentioning that there was a reduction in the number of inquiries. Despite that, you are guiding for mid-teens growth. My main question is, will this reduction in inquiries be affecting the H2 or next fiscal year, 2027? This is already affected. If you really look at it, our U.S. sales is down by. 7%. 7%-8%, whatever that number is. So it's already affecting us to some level because we see some of the slowness. If we really go back, and when we were calculating, it was like we were anticipating some 9%-10% of growth in the U.S. business this year. But this has already affected us. Okay. Okay. The U.S. tariff-related slowdown, is it affecting only your U.S. business, or is it affecting the global supply chain? Is that what you're feeling as of now? It's mainly U.S. business. It's mainly the U.S. business and some of the indirect U.S. business. Okay. The reason I'm asking is your businesses are more countercyclical business, right, like precision-proof businesses because food and pharma, these products, textiles anyway. I would put it this way. Our enzymes go into the pharma intermediates as well. Also, most of the enzymes categorize in the U.S. as a nutraceutical. When it goes to the nutraceutical, let's say if I'm selling some enzymes to the tablet manufacturing company and they are exporting to the U.S., that is not happening because of the 50% tariff which is there onto their final products as well. That is how indirectly also it affects. It did affect us in the last one or two quarters. Really fantastic job, actually, what you guys did despite all these headwinds, a 20% growth rate. I think without that, it would have been more than, I think, close to 30%, right, by what you're saying. Thanks. Thanks a lot. Great job. Thank you, Abhishek. Thank you, sir. We have a follow-up question from Mr. Lakshmi Narayan from Tunga Investments. Please go ahead, sir. Yeah. Sir, just wanted to understand whether people who are taking material from us in the U.S., have they found alternate supply sources or that is number one? Second, with respect to the growth in Asia, the growth has been stupendous. Can you just help me understand what are the levers of growth in Asia and this U.S. question, please? Thank you. I would put it this way, Lakshmi Narayan ji, I don't see there is an alternate supply or this. We haven't raised the prices or anything as of now to a level which it should be, right? We are not like we might take some hits as well, as we are saying, and we will wait and watch how the things pan out. One thing what we can look at as of now is everywhere there is going to be a price increase in the U.S., which will happen by the next year. This is what our anticipation is as of now. We'll wait and see how things pan out in the U.S. What was your second question? Was Asia. Yeah. Let's go back to the growth in Asia. Which segment? See, nothing happens in one day, Lakshmi Narayan ji. You need to do a lot of registrations and other things. It is the efforts of the last one, two years, what you put in, this starts getting materialized, right? Nothing is in a one-day process or this process. We were working on it. We got some success. We are still working on some of the geographies, and we will wait for those geographies to materialize. Is this animal feed or is this human nutrition? What actually drove the growth in Asia, sir? It's all the segment, I would say. Except food, I would put it more into the animal feed and into the. Human nutrition. Human nutrition business. Other than human nutrition, Asia business has grown up. Got it, sir. Thank you so much. Thank you, sir. We have a follow-up question from Mr. Umang Shah from Banyan Tree Advisors. Please go ahead, sir. Hi, sir. Thank you for the opportunity again. Sir, some time back, Rachna ji had mentioned on one of the calls that our market share in the U.S. is 15%. Just wanted to confirm the number. Is the understanding correct? 15% of, I think we must have mentioned about the neutral lactase, and that too, I think the bulk, right? Yes. In nutraceutical market in the U.S., that is the right understanding, right? Right. With that 15%, what would be our rank? Would we be first, second, third, fourth? I think there are three, four players. Yes. Okay. Three, four players ahead of us or three, four players in the market? They are ahead of us. Major. I would say that three players. So you will be one of them. There will be some small players, but mainly two players. Sure, sir. Sir, and the second question was, this food business revenue that we've got in this quarter, is it sustainable or is it based on a contract or one-time? Because previously, also, we have seen some volatility in this segment. I would not say that it's a one-time business. I would say that some of the, I will still go with not a quarter-and-quarter. Some quarters probably you will have a lower, but I would say that this is a more sustainable business. Right, sir. Got it, sir. Just last one thing, R&D expenses, is it simply a function of higher sales due to which they have declined, or have you also gone down? I think in absolute number, we have about, I think, INR 190 million or so this year and last year also the similar number. Year to year, we are spending a lot of money, which we have not capitalized. We are not taking those numbers into account when we are talking about our total R&D spend. Sure, sir. And sir, once the R&D center comes on stream next year, how much R&D are we budgeting from the P&L? I think this will increase substantially in the sense supposing we are spending, say, about INR 250 million. Roughly for the next year, it is going to go about INR 100 million-INR 120 million higher than whatever we are spending. We are going to spend in FY 2026. Gradually, it will ramp up. Gradually, it will ramp up. Got it. Got it. Thank you so much, sir. Thank you, sir. Due to time constraints, that will be the last question for the day. Now, I hand over the floor to Mr. Ronak Saraf for closing comments. Thank you, everyone, for taking your valuable time for attending our earnings conference call. We will keep you all posted for any further updates. I request you all to kindly send in your questions that may remain unanswered. The audio recording and the transcript of this call will be uploaded on our website and on stock exchanges in due course. Looking forward to host you all in the next quarter. Till then, stay healthy, stay safe. Thank you. Ladies and gentlemen, this concludes your conference for today. Thank you for your participation and for using DURSABAS conference call services. You may disconnect your lines now. Thank you and have a pleasant day. Your conference is no longer being recorded.