Ladies and gentlemen, good day and welcome to Alkem Laboratories results and planning conference call. 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 touch-tone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Tushar Manudhane. Thank you, and over to you, sir. Thanks, Vishwa. Good evening and a warm welcome to Q2 FY 2025 earnings call of Alkem Laboratories. From the management side, we have Dr. Vikas Gupta, CEO, Mr. Nitin Agarwal, CFO, and Ms. Purvi Shah, Head of Investor Relations. Over to you, Purvi. Thank you, Tushar. Good evening, everyone. Thank you for joining us on our call for Q2 and H1 of FY 2025. Earlier in the day, we've released our financial results, press release, and investor presentation, which are also posted on our website. We hope you all have had the opportunity to review it. Before we proceed with this call, we'd like to remind everyone that it is being recorded, and the call answers will later be available on our website. We'd also like to add that today's discussion may include certain forward-looking statements, which must be viewed in conjunction with the risk that our business faces. After the end of this call, if any of your queries remain unanswered, please feel free to contact us. I now hand over the call to our CEO, Dr. Vikas Gupta, for his comments. Over to you, sir. Thank you. Thank you, Purvi. Good evening, everyone. We really appreciate your presence for today's second quarter as well as H1 FY 2025 earnings call. We are pleased to share that the outcomes of our strategic initiatives designed to enhance the profitability have proven effective. We are prioritizing a high-margin product mix, aligning more effectively with the market demands, and implementing various cost control measures to mitigate inefficiencies, which are supporting EBITDA margin growth. In the domestic market, our focus remains on augmenting the growth of our large brands and making strategic portfolio additions. We also see significant opportunities for growth in our emerging market business. I'll now present an overview of the operational and financial achievements for H1 as well as the second quarter of FY 2025. Key highlights for H1: the total revenue from operations saw a modest growth of 0.6%, but earnings before interest, tax, depreciation, and amortization were INR 13,615 million, resulting in an EBITDA margin of 21.1% versus 17.7% in H1 FY 2025. EBITDA increased by 19.9% year-over-year. Net profit was INR 12,638 million, with year-over-year growth of 36%. As per IQVIA data for H1, the company has registered a growth of 7.1% year-over-year. During H1, we have outperformed in six therapy areas, which are namely GI, VMN, anti-diabetic, neuro, gynec, and derma. Coming to the key highlights of Q2 FY 2025 financial performance, the net profit was INR 6,886 million, with a year-over-year growth of 11%. As per IQVIA data, the company registered a growth of 6.3%, and we have outperformed in seven therapies as far as Q2 is concerned. According to IQVIA data, our company registered a positive volume growth of 1.1% in a challenging market that witnessed a 0% volume growth in Q2. Pan Group is growing at 12.8% compared to the market growth of 7.3% on a MAT basis. I am also happy to share that for the first time, we have reached the second rank in the IPM. The Pan is a second-ranked brand as far as the whole pharmaceutical industry is concerned. Thank you for your patience in listening, and I would now open the floor for any questions. Thank you so much. We will now begin the question-and-answer session. Anyone who wishes to ask a question may press star and one on the touch-tone 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 Kunal Dhamesha from Macquarie. Please go ahead. Hi. Thank you for the opportunity. The first one on the US business, I believe that we are supposed to launch more than one product in this quarter, and there were a few relaunches also planned in this quarter, but I see we launched only one product. So are we expecting more products to be launched in the coming quarter, and how should we think about the US overall run rate for FY 2025 since H1 looks quite weak? Yeah. So thanks, Kunal. So I'll give you an overview on the US business and not only about the new launches. Yes, we launched one product in Q2, which was also a very small product, differentiated product. But if you look at Q3, we are expecting to launch another product, which we have received the CGT with the 180 days exclusivity. And we are also planning. We have also received approval for Sacubitril/Valsartan in the US market, which we will see how we are doing with the launches. But if you look at the overall US business, as I mentioned in the last quarter as well, we had certain supply chain challenges in the US business in the past, because of which we, in the last two quarters, have seen significant volume regrowth and perhaps a price erosion as well. So because of that, in the first half, our U.S. business has been quite weak, but going forward, we expect that to improve. So in the second half, we are expecting much better performance as far as the U.S. business is concerned. So that's all. And on the new launches, I think I've already answered. So sir, on a year-on-year basis, how should we think about? Will it be a slight decline on a year-on-year? Yes. So looking at the H1 performance, we are expecting a mid-single-digit kind of erosion in the overall US business. But if you look at the Q2, we have had a volume regrowth of around 18.7%. We have had price erosion of around 6%. So that puts us, overall, on the H1 basis at a 15% regrowth as far as the US market is concerned. But as we look at the annual numbers, we expect H2 performance to be better. So annually, we may land at a flattish to a mid-single-digit kind of erosion in the US business. Sure. And sir, on the profitability with the measures that we have taken, and probably volume regrowth is a function of some of those efficiency measures, which I assume. Can you please be a bit louder, Kunal? I'm not able to hear you. Yeah. So I'm saying that on the profitability of the U.S. business, probably because of the efficiency measures we have taken, are we doing better in the first half versus, let's say, full year last year? And how should we think about the trend going forward for the U.S. business profitability? Yes. The profitability has definitely improved in US business because, one, we have improved the efficiency. And second, there have been certain calls that we have taken where certain products the pricing has become unviable. So rather than just chasing a top line, I think our focus largely on US business has been on improving the profitability. So that is something that has really improved. Even in the product mix, if you see, our product mix is very different from what we had in the last year. And perhaps those have been some of the reasons that have contributed to the overall erosion in the US business. But I think so far, also H1 to H1, our profitability is better as compared to last year from the US business, and we expect this trend to even get better in the H2. So on an R&D basis, would we be mid-single-digit, low double-digit, EBITDA? Kunal, you'll have to be a bit louder. Yeah. I'm saying on a pre-R&D basis, our U.S. business would be at what kind of profitability, any particular range that you can direct us to? We have never shared the segmental country-level profitability. But yeah, overall EBITDA-wise, we all know that U.S. is a lesser EBITDA business as compared to our overall EBITDA. But we are improving over there, and our intent would be to get it closer to our at least overall EBITDA margin and not be dilutive, which will happen over a period of time. Sure, sir. Thank you. I have more questions. I'll join back to you. Thanks. Thanks, sir. Thank you so much. The next question is from the line of Damayanti Kerai from HSBC. Please go ahead. Hi. Good afternoon, and thank you for the opportunity. My first question is on India business. So can you explain the key reason for why Alkem has lagged market growth in key therapies like anti-infectives, gastro, and cardiac for second quarter? And since in H1, Alkem is below IPM, so in that context, will you be revising your guidance of on par growth with the market for FY 2025? Yeah. Thanks, Damayanti, for your question. Actually, if you see, it's only anti-infectives where we have had. See, cardio is we do not have a big cardio portfolio. So I would say, and in GI, if you look at the overall H1, we have outperformed the market. So in GI, we do not foresee too much of a challenge. In anti-infectives, at first, I will take the question on the overall growth being maybe 1% lesser than the overall market growth. So the delta is not huge, but what has happened is since acute market has grown much lesser, and as a company, we have a higher weightage of acute business. While the market is just 62% acute and 38% chronic, in our case, we are more than 80% acute business. So what happens is when acute business slows down, it's more of a weighted average issue. That becomes a little issue. Second, on the anti-infectives, if you look at the portfolio mix of anti-infectives, we have had a struggle on the injectable piece of anti-infectives, which is a very low-margin business. So with our improved focus on profitability, we have always given more weightage to doing more profitable sales. So I think that is one area where we need to do much better in the coming months. Coming to the overall guidance of our domestic growth, we are very bullish about our domestic growth. Even if you compare H1 to H1, we have grown faster than what we were growing in H1 of last year. On an annualized basis, I foresee still I will maintain our overall expectation of close to 8%-9% kind of growth. So that is something that we are very bullish about. And H2 will be a lot better than H1. There were certain other measures also that we had taken internally, including the efficiency. So we've had certain challenges because of that. So on domestic, I would maintain our guidance of 8%-9% growth even for the annualized basis. Q4 is? In that, Q4 is going to be pretty strong for us this time. That's our outlook. Yeah. So just want to understand this acute, sorry, anti-infective piece better. So I think when we do year-on-year comparison, last year obviously was, I guess, washed out in terms of low rain or erratic rain, etc. But this year, I guess the monsoon has been much better, right? And then in that context, I thought we'll be seeing better pickup in anti-infectives. But do you think there is some delay in terms of seasonal uptick for this category? And maybe we will see some recovery in third quarter? Like I said, nobody can predict when the diseases would set in. I can just give you a broad outlook as that this year, it was expected to be far more better than last year. It is a shade better, but clearly nowhere you can see the volume growth of the industry. In Q2, the industry has had a 0% kind of volume growth, whereas we have had a good, at least 1% volume growth. So that's the silver lining. What is also happening is we have a higher weightage of the NLEM portfolio, and that's largely on the anti-infective side. Again, this year, the price increase possible on the NLEM portfolio is 0%. It's 0.05% kind of, which is negligible. Whereas last year, there was a 12% increase that was possible on the pricing as a lever. So I think all factors put together, the industry is where it is. But as far as our internal growths are concerned, even in the current scenario, the way the market is moving, even in that scenario, we are pretty bullish about our 8%-9% growth coming from the domestic. Sure. My second and last question is, can you update us on status of enzyme plant in terms of completion, start of supply sector? So enzyme plant, you mean the U.S. one? Yes. Yeah, so the work is in progress. We maintain with our expected timelines of Q4 to, at the most, Q1 of next financial year. And we expect, so our book has already started. It's already started getting orders based on the progress of the plant. We expect the production to begin latest by Q4 to Q1. That is how I'll put it, so there is no significant delay that I would like to report as of now. Sure. And you are already getting orders, as you said, order book is being put in. We have started getting a lot of queries. We have started getting some orders. Of course, further details we'll give you at an appropriate time. But that's how I'll put forward. Thank you. Thank you for your response. Thank you, Damayanti. Thank you so much. The next question is from the line of Saion Mukherjee from Nomura. Please go ahead. Hi. Thanks for taking my question and good evening. My first question is regarding the full year guidance. I think you talked about 10% growth on top line, I think 18% EBITDA margin. What's your new guidance overall for the company now? So overall, looking at the struggle that we have had in H1 from the US business, I would say on the top line, we would be mid-single-digit kind of growth as far as the overall top line is concerned. But when it comes to the overall margin, we are bullish about at least a 100 basis point kind of improvement, somewhere between 18.5% to 19%, I mean, kind of EBITDA. That's the outlook that I would maintain. Understood. On the US business, we have seen fairly large volume decline, and also you mentioned about price erosion. If you can take us through, is there something you have seen in the recent past, things have deteriorated for the portfolio? And how are you thinking from a slightly longer-term perspective for your US business? So like I mentioned, we had some internal challenges. Okay. So, please say hello after this. Sorry, am I audible? Yeah, yeah, sir. You're good. Yeah. So as I mentioned, we had certain supply chain-related issues. So U.S. is, one, a perennially price-erosive market for vanilla generic kind of portfolio. Like I had said, and we are seeing that trend as well. We have seen 6%-7% kind of price erosion from the U.S. market in terms of pricing. The volume degrowth has largely been on account of our supply issues, which were there in the past. If you will look at our inventories at Bonleiser, if you see last year, we had reported a service-level penalty to the tune of INR 140 crores because of our inability to supply a lot of products. In fact, when we started this year, we were at 38% back orders. Our back orders are now down to 2% in U.S. So what we have done is we have improved the inventory over there, but there were certain contracts where we had lost because we were not able to supply. Now, gradually, since our inventory position is better over there, we expect US to be better. But we would not go aggressive on pricing and erode margins to win back the top line. So that's the outlook on US. So like I said, US in H2, we are looking at a better performance. And on an annualized basis, we may be somewhere between a mid-single-digit kind of erosion overall on the top line. But in terms of profitability, we have improved as compared to last year, and we will continue that journey even in time to come. So that's the way I'll put forward. Okay. Sir, just one last question on generics, if I can. So firstly, sir, on this facility that we are putting up in the US, you mentioned commissioning by Q4 to Q1, but you would require FDA inspection and approval for the facility before you make commercial production. So are you talking about starting operations there, or you are talking about booking revenues starting from 4Q and 1Q? And second, what's the kind of cost structure that we should bake into our estimates when this plant comes on stream? So this is a CDMO biologic plant, and there we would be doing more of preclinical to clinical kind of small production. So whatever the regulatory requirements would be, we would be complying with the same. And the timeline that I'm giving is when we expect the production to really begin. So I hope that answers your question. Yeah. And sir, what would be the cost structure? So there is a CapEx outlay that we had specified even in the previous call, close to the tune of INR 450 crores, which I think that is what we are maintaining even for now. Sir, operations wise, I'm looking at the P&L cost that will come when you start operating, and maybe today you are capitalizing those costs. What is the cost structure there for this facility? So I think once we start running the operations, it will be better that we give you more color on the operating cost over there. But if you look at our, I think that will be covered by the order book that we will have because this is more CDMO work. So in our pricing, yeah. And we are not capitalizing enough for expenses. The plant is still not ready for the operation. So by quarter four, it will be ready. And we are very hopeful that in the first year itself, this will break even. But as of now, we are not capitalizing any of the expenses. So you are not incurring any expense, or you're not capitalizing the expenses? See, those are not very material expenses we are incurring. Okay. Okay. I'll join back with you. Thank you. Thank you so much. Ladies and gentlemen, in order to ensure that the management is able to address questions for all participants in the conference, please limit your questions to two per participant. Should you have a follow-up question, we would request you to rejoin the queue. The next question is from the line of Neha Manpuria from Bank of America. Please go ahead. Yeah. Thanks for taking my question. So my first question is a little bit on the margins. Based on your guidance, is it fair to assume that the INR 100 crore to INR 110 crore additional cost that we were talking about for the new businesses hasn't really started flowing through our P&L, and a large part of that will come in the second half? Is that the right way to read that? Because you are talking about better India growth in the second half. So I'm just wondering if bulk of that cost is yet to come. Hi, Neha? This is Nitin. So you're right that in quarter one, we said that around at max around INR 100 crores, we will incur at pre-operating expenses for our MedTech and gen business. So as of now, we don't think we will cross at max INR 60-70 crores for both the MedTech and the gen US plant. And that is why, as we just said, that there will be an improvement of around 1% in the EBITDA margin against last year by the year-end. So the estimate for both for MedTech and gen which we have shared for the pre-operating expenses has come down now. And this will flow in from the second quarter, right? I mean, from the third quarter, or has it already? It's already in the third quarter almost. Yeah. Actually, Q3 and Q2. So in Bharat, it'll spill over to Q4. Got it. And sorry, on the gross margins, I'm assuming part of the benefit that we are seeing in gross margins is because the U.S. mix is lower. So how should we read the gross margins for the second half? Should this normalize to what we were doing previous year? Yeah. Well, see, there are three elements to why the gross margins have improved. First is definitely the API prices. As you must have seen, we monitored all the pharma companies also. So we also got a benefit of lower API prices that helped us to improve our gross margins. The second, rightly said by you, that because of the lower sales in U.S., which is a lower gross margin business as compared to our domestic business, so that has actually resulted into a better gross margin. And the third reason is within international also. And within domestic also, our product mix has improved. The margins which we get in ROW market is much better. So the contribution of ROW market has increased in the overall business. So that has also resulted in better gross margin. Okay, and last one, if I may, any update on the MedTech part of the business that we are investing in? What is the progress there? How should we think about this business over the next two years? MedTech, as we have already shared in the press release on our deal with Exactech, which is a hip and knee replacement company back in the U.S. We have signed a licensing technical know-how transfer agreement with them. Our plan is to launch the product sometime in quarter one or quarter two of next year. Got it. Thank you so much. Thank you so much. The next question is from the line of Yash from iThought PMS. Please go ahead. Yeah. Hi. Thanks for the opportunity. Am I audible? Yeah, you are. Yeah. First of all, my question was regarding the anti-infective therapy again. So if I look at our MAT numbers, I think our brands like Clavam, Xone, and Taxim, they have regrown on a MAT basis, MAT October 2024. And even if I look at our annual report, so it gives us the market share, molecule market share. So Clavam has lost market share from 15.6% to 15%. And even Xone has lost market share from around 18% to 16.5%. So I mean, along with acute growing slowly, we have also lost market share on these certain molecules, which are supposed to be our big brands. So if you can share anything on this, that would be very helpful. So I think I did address this point till sometime back. See, slight fluctuation in market shares keeps happening. If you will look at, you have to look at this data more from a long-term window. So if you remember a few years ago, all the top brands during COVID period, when the market uptick had gone up, had seen significant gain in the market shares, and a lot of smaller players who were competing in these markets had gone out of market during that time, so the market shares consolidated with the top brands. Now, what has happened when the normality is actually coming back to the market? We see a lot of smaller players also coming back to the market. That is one reason. Second, you also have to see the geographic dependence on where these brands are. We have very strong presence in some of the eastern part of the market. So if your market growth would slow down on the eastern side of the country, we will have a bigger impact on market share. But those are nitty-gritties. I would say I wouldn't go into those kind of nitty-gritties into specific brands, why they have lost market share and these things. I think these are all short-term trends. I would maintain our overall growth of the portfolio that I'm talking about. And we are seeing in the recent months, the internal growths are pretty encouraging on actually most of the brands that you mentioned. So market reflections sometimes keep fluctuating. Sometimes you get reflected more. Sometimes you get reflected less. I think what we would be worried about is looking at the data in the more long-term basis. And as long as we are on the right track, which I think we are, and that's why I'm maintaining from our domestic market the overall growth guidance of around 8%-9%. We expect even the overall IPM also to be within that range. I think if you will look at the overall financial year as we end the year, we should be very close to those numbers. That is what I would maintain. Yet, some brands are doing pretty well. If you will look at Pan and Pan-D, for that matter, we are seeing some of the highest growths that we have seen in the recent times as far as that portfolio is concerned. If you look at our other large brands, there is Pipzo. There is A to Z, which are, again, significantly large brands for us. Those brands are really outperforming. Look at Uprise-D3. Uprise-D3 has seen a very significant growth. So it's also sometimes a matter of how you align your internal focus. So I guess there are more positives than concerns in our domestic business that we have. And that's why we are very bullish for our overall growth of 8%-8.5% as far as the overall year is concerned. Yeah. Right. Sure, sir. Thanks for that. That is very helpful. And my second question actually was regarding. Sorry? Yash? Yash? Are you there? Yes, I'm audible? Yes. Now you are. Hello. Yash, you can go ahead, please. I think we can take the next one. We can take the next one, please. Thank you so much. The next question is from the line of Rahul Jeewani from IIFL Securities. Please go ahead. Yeah. Thanks for taking my question, sir. Sir, on the MedTech business, if I'm correct, our partner, Exactech, is going through bankruptcy proceedings in the U.S. So would that lead to any change in terms of our partnership with them? And would we be looking for other partners then for this business? Yeah. So you're right that they are going to a bankruptcy proceeding. But I think that is. I don't want to comment on that because there may be some internal arrangements within the company. And just to address a few of the litigation which they are facing, they may be transferring the ownership and all. But in terms of our, say, contract with Exactech, that still remains. And we are going to get those brands assigned the technical know-how transfer. So we are in constant touch with them. And operationally, we don't see any challenge or we don't see any change at Exactech, which will actually make us deviate from the original plan. So we are still on track. And we are very confident that we'll launch the product in quarter one of next year. Sure, sir. My question was more from the perspective that given that the company would be engaged in those bankruptcy proceedings, so operationally, can they focus on transitioning, let's say, or committing to the partnership which they have with us? And whether we can actually launch the MedTech business in India in one Q or two Q of next year, as you have guided? As I said, they have already started assigning many of the brands they have already assigned to us. And even in terms of technical know-how, we have been in touch with them on a daily basis. And we don't see any challenge. So I think this is more for their internal rearrangement which they are doing, the change in ownership and all. So I'm not the best guy to comment on it. But as per the information provided by them, I don't see any challenge in terms of their running their operations. And also the proceedings and all the legal claims and all because of which they are doing all this restructuring, I think those are not related to the brands which we are getting assigned from them. So these are related to old brands which I don't think we are going to sell those brands in India. For us, another thing, we are going to add US to our old brands. Sure, sir. And sir, my second question is on the anti-infective business. Now, you pointed out to the fact that our underperformance in the anti-infective segment has been partly due to the fact that the weightage of the NLEM portfolio is higher on the anti-infective side. But that would have impacted the growth for the overall anti-infective market as well this year. But despite that, we have underperformed market growth in the anti-infective segment. So I'm not quite sure I picked it up correctly in terms of what is driving our underperformance in the injectable segment in anti-infective. So are we rationalizing some of these injectable anti-infective products which are low-margin products and hence we have been underperforming market growth? I think there are two parts to it. First, my comment on the NLEM was on the overall portfolio, not related to only the anti-infective portfolio. The second part was on the margin. What I mentioned was that the injectable piece, anyway, if you see the injectable anti-infective market is a low margin as compared to whether your overall portfolio or whether you compare it to even amongst the anti-infective, that's the lowest margin portfolio. You need a very different cost structure. And there are certain growth opportunities that you have to walk away with, right? But I wouldn't overplay onto that. I think there is some delta of performance that needs to come up on the anti-infective side as well. What I meant was overall, our domestic guidance, irrespective of whether it's the anti-infective therapy or whether any other therapy, overall, our domestic growth guidance would continue to be around 8%-9%. And that is what we are bullish about. Yes, there will be certain segments where we will have certain struggles, maybe because of operational reasons, maybe because of certain geographies which have underperformed, and we have a higher weightage from those geographies. So I think my point was more on the weighted average side of some of the geographic dependence of certain brands. But in the coming months, we see even that aspect to get covered. Everything all put together has to contribute to an overall growth of the organization and a profitable growth for the organization. So I think that is our intent, which is on which we are moving. So even on this aspect, we have taken a note of it, and we have taken certain corrective measures also, so coming quarters, we would see a better performance even on that particular category. To date, in last quarter, there are seven therapies where actually we have outperformed the market, so this is one area which still needs some more time for us to come back, and I'm sure over a period of time, we will start outperforming in this category as well. Sure, sir. Sir, just one last question. Let me tell you, internal growth numbers are not so alarming for us for some of the therapies. Sometimes market doesn't pick up the temperature, but I mean, I take it the way it is reported. I guess we have taken our actions in the right direction, and we will report good numbers even going forward. Sure, sir. Just one last question from my end. The growth for the overall acute market in India has been pretty weak for the past, let's say, an 18-month period. And when we were initially coming out of COVID, expectation was that the high base of COVID was impacting growth for some of these acute therapies. But that doesn't seem to be the case as such. So what can you highlight in terms of what is leading to weakness in the acute market? And when do you see things picking up on the acute side? Thank you. I think there are various elements to it. One, the COVID base that we have spoken about. When you see this kind of growth that happens in one or one and a half year that happened in the acute side, it takes a while for it to really come back because there's a channel buying that happens during that phase. And that channel buying takes a period of time for it to get normalized. So I guess some of the numbers that we are looking at are more onto coming off that very high base. Now, second impact has been on the NLEM side as well. The wholesale price Ind AS-related, the price increase possible on NLEM this year portfolio has been zero. The price as a lever of growth is also contributing to slow down the overall growth on the acute side. Now, I think on the volumes, we would start seeing it's a matter of time, but I guess from Q4, we should see better growth even in the overall market. That's my estimate. But of course, that will be crystal ball gazing, and we would see when we get there. Fundamentally, I can tell you nothing much has changed. These are some of the therapies where a lot of external factors play a role sometimes. I think we are just going through that patch of a time where it is showing sluggish growth. But I think from a long-term basis, if you will look at it on a three-year to five-year window, this gets normalized. That has been the trend in the past, and that is what we are seeing. My sense is we'll see that even in times to come. Because even on the acute side, if you have to break it down further, there are therapies which are going much faster. So it's only anti-infective which is seeing that kind of step. The other therapies have started showing good numbers as far as their growth are concerned. So I think it's a matter of time that these growths will also pick up. Sure, sir. Thank you. Thanks for answering my questions. Thank you so much. Ladies and gentlemen, in order to ensure that the management is able to address questions from all participants in the conference, please limit your questions to two per participant. Should we have a follow-up question, we would request you to join the queue. The next question is from the line of Abdulkader Puranwala from ICICI Securities. Please go ahead. Yeah, hi. Thank you for the opportunity. A couple of questions. First, on the US front, so any color you would like to provide with regards to Sacubitril launch and any update on are we into a litigation into this product or by when we can launch this product into the US market? So we got the approval for Sacubitril launch patent. But as you know, there is a litigation going on with one of the players with Novartis. So we are just waiting, and we will watch how that proceeds. And then accordingly, we will take a call on going ahead with the launch for that particular product. Okay. Sure. Understood. And second, on the NLEM business, so in terms of the biosimilars, can you provide us any update on the development timeline of the existing products what you are doing? Sorry? On the biosimilars? Yeah. If you could provide us with any update on how many launches we have done so far and how do we see the portfolio ramping up? And in the past, I think we have talked about incurring close to 100 crores of R&D. So is that number intact or is it scaling back as well? So far, we have got seven products to the market, seven biosimilars. And we are actually, if you look at for the global markets, we are working on five products. But our sense is that at least two products to three products is something that we will be very clear to. Yeah. And that's a long-term play. That's for more than if you have to ask me a five-year plan. So that's our plan. The most recent being the clinical trial for Denosumab. We have completed the clinical trial. And now the further work for that will begin. So that is for the US market. And I'm talking for the global markets now. In India, we have commercialized seven of the biosimilars as of yet. Understood, sir. Thank you. And I'll get back in touch with you. Thank you so much. The next question is from the line of Forum Parekh from BOB Capital. Please go ahead. Yeah. Thank you for the opportunity. My first question is on the domestic side. So the chronic side is around 20%-21% currently. So any strategy or any thought process to increase the chronic side of the business and to what extent can we see the contribution increasing in the near term is my first question. Okay. So I've always maintained chronic is our highest focus within the domestic segment. You would have seen the IQVIA data as well. We are outperforming in the focus markets within the chronic. The chronic, our focus has been in diabetes, in actually four such segments. We are actually outperforming in IQVIA. Now, I haven't done the calculation of the percentage to chronic, but I can clearly tell you that chronic will grow much faster than our growth in acute going to two reasons. One, the chronic market is growing faster. Second, our base is lesser. So we will outperform the market also even on the chronic growth side. So you can do your calculation and math a bit better. But I would say as we move along, for the next three years, our growth in chronic is going to be much, much higher than what the market growth is. That should result in an improvement in the overall percentage of chronic business as compared to our overall pie. Okay. So in that case, can we expect our EBITDA margin to inch up to closer to 25% from current run rate because as the chronic pie increases? Yes, but that will happen over a period of time, so I think you're very bullish on some of these things. I have always maintained that we will work on improving our EBITDA every year by at least 100 basis points, which is what I'm giving the guidance even for the current financial year, and so far, touch wood, the results have given us this confidence that we are on the right track, and we should be able to do that. Now, as we move along, or if we are able to lay our hands on some asset which helps us get there faster, that might happen, but otherwise, I'll continue with our similar expectation that over a period of time, we would look at improving our EBITDA margins by 100 basis points with every passing year. Okay. And my second question is on the ROW side. So could you just give us what's happening in the ROW side? I mean, what is driving the growth there, and how sustainable would it be? So if you look at the ROW, our focus has been really very good. Other than the U.S. and Chile, if I look at the other ROW markets, we have grown by almost 30% as far as second quarter is concerned. So all other markets where we have improved focus, we are going to do more filings now. We are looking at strategic partnerships. We are looking at outlicensing partners. There are key markets that we are going to focus on going forward. So I see that kind of growth to continue. And that will reduce our overall dependence on the U.S. and the Chile business that we have as of now. So I think it's only U.S. market where we have this concern among the international business. But our ROW business, we are pretty bullish. And see, all these markets have a gestation period. Whatever doses we would start filing from now would start showing us results two years from now. So we are doing a lot of work to grow the ROW business. So I think two years, three years down the line, that would also show a very different picture. And that's definitely a much higher margin business as compared to the U.S. market. So I think overall, that should also help us in improving our overall EBITDA. Yeah. That's helpful. Thank you for answering the questions. Thank you, Purvi. Yeah. Thank you so much. The next question is from the line of Kunal Dhamesha from Macquarie. Please go ahead. Hi. Thank you for the opportunity again. So for our India business, what would be the split for trade and branded generic business? So it's around 80/20. So around 20% of our business is trade generic. Yeah. But even on the trade generic business, we are seeing good improvement in the overall margins. So I think that's a point I would like to highlight. And then what is driving this improvement, sir, for us? Better mix, better pricing. Okay. And when we are seeing this lower growth on the India side, is there any part either it's chronic business or the trade generic business which is growing more slower? See, I'm not getting into the therapy level growth and the division level growth. But I would say overall, again, I will repeat, we are very bullish about our domestic market growth. By the year end, we should see between 8%-9% kind of growth if everything goes well. And Q4, especially, we are pretty bullish about our overall domestic growth to come back. So I think we will see similar kind of growths on both sides of the portfolio. So it's not that one portfolio is not growing and the other portfolio is growing. I think we are seeing similar kind of growths, 1% year-to-year on both sides of the portfolio. So we are very bullish about the entire piece. On the Q4 comment, typically Q4 is roughly on a sequential basis around 8%-10% lower. Sorry? Q4 typically is 8%-10% lower than Q3 on average for. I'm talking growth. I'm not saying absolute value. What I'm saying is our Q4 growth may be much higher than so I was talking more about growth. Yes. So then the rest of the quarter. Yeah. Probably because the base is favorable because last year, same quarter, we had 2% degrowth. Is that one of the reason? Yeah. Some of it is base, but some of it is also the work that we are doing on the demand side. We expect our demand to reach at that level that it will translate into good growth as well as Q4 as well. Sure, sir. And one more question. Chronic businesses take a while for the overall sales to grow, for the demand to grow. And the way it is growing, I'm bullish that in Q4, that will help us report overall much better growth than what we have reported in Q1 and Q2. Sure, sir. One for CFO, sir. On the Opex Forex gain or loss, is there anything baked into other expenses for this quarter? Any gain or loss? So this quarter, we actually had a Forex gain. So there's nothing which is built into the other expenses. So at YTD level also, the rates have been favorable for us. So we have gained on account of Forex, which is reported not as part of EBITDA because it is reported under other income. But yes, last year, there was a component of Forex loss in quarter two and three. Okay. And one last one on the U.S. business. I think we have 145 products approved. How many products would we have in the market currently? Around 100. Around 100. And others, we have basically rationalized. But we are still keeping the ANDAs active for that. Is that the case? We have the ANDAs. Some of these products, we are bound by the agreements that we have to launch when the market opens. We are settled with the innovator. Some of these products do not make sense for us to launch because the pricing is so unfavorable for some of those molecules that it would not make any sense for us to get these products to the market. Sure, sir. And the last one on this product called generic Myrbetriq, I think we have tentative approval there as well. Do you think that could be a near-term opportunity for us? Sorry, come again. Can you repeat your question, please? The generic Myrbetriq, I think we have a tentative approval. You mean Mirabegron? Yeah, Mirabegron. Yeah. Can that be a near-term? So I think I had answered it in the last call as well. We are bound by the settlement that we have with the innovator. So others who have launched it, it has been an at-risk launch for them. So we will be launching it only post-26. So that is how because we are already bound by the agreement that we have signed with the innovator. Is it calendar 2026 or FY 2026? I think it is. I do not have the exact month at hand, but I think it is post-FY 2026 is what we will see when that market opens up. Okay. Thank you, sir. Thank you. Thank you so much. The next question is from the line of Saion Mukherjee from Nomura. Please go ahead. Yeah. Thanks for the follow-up. Just a couple of items on the balance sheet. So Nitin, can you explain? There is an increase in inventory level. I mean, though we haven't grown much in the first half, and raw material prices in general have come down. So I see from March period, the inventory levels have gone up. Even from a year-ago period, it is quite high. And the second on the balance sheet is on the non-current investments. Can you explain the rise there? So on the inventory part, we have purposely increased our inventory levels in the U.S. because in FY 2024, our inventory levels went down quite substantially in the U.S. market. And that was also planned because we wanted to focus on high-margin customers and also on high-margin customers. And we did a lot of failure-to-supply penalties in FY 2024, which was around INR 140 crores. And also, we lost a few of the customers in the U.S. on account of not having adequate inventory. And that is one of the reasons that you see a lower growth in H1 for the U.S. because the way we planned things in FY 2024, I think there was a loss of sales and also increase in failure-to-supply penalties. So purposely, we have increased our inventory in the U.S., which will actually give us positive results in quarter four onwards, where we will be able to ensure supplies to our customers and also give back to the customers for a few of the products which we have lost in FY 2024. On the non-current investment? Non-current investment. Previously, we used to park most of our money in fixed deposits with bank deposits. Now, since we are looking for a few of the M&A opportunities, so we want to have investments which are marketable or tradable and which we can encash without paying any penalties. So we have started parking a few of our investments in NCDs and mutual funds and not in bank deposits. And that is why you see increases in non-current investments. So you classify this as non-current, is it? Yeah. This is as per the Ind AS requirement. So if you want, I understand that maybe worry about whether our cash levels have gone down. So just to share that we have increased our cash by INR 400 crores in this quarter. And the overall net cash is around INR 4,250 crores as of 30th September. And in fact, just to add, if you look at last one month and a half year, we've almost doubled our cash position. So our business that way has been in 18 months. Yeah. That's one and a half years. Yeah, so basically, I was just looking whether these are not high-risk investments, right? The non-current type. No, no, no. All are in this category investment, and maybe 30 crores. I think we have invested in a company which is strategic in nature. Otherwise, all these are more of cash and bank in nature. There's no strategic investment. And just one last one on the other expenses. So it was quite low last year. Last quarter, this has come back now. So has it normalized, the other expenses? And how should we think about that going forward? See, in quarter one, we also shared that our R&D expenses were lower, and you can say that this will be more or less other than the R&D expense part, more or less, this is a normal quarter in terms of other expenses. Understood. Thank you. Thank you so much. Last question is from the line of Yash from iThought PMS. Please go ahead. Yeah. How are you, sir? Thanks for the follow-up. Sir, as you mentioned that the cash pile and you are also looking for an M&A. I just wanted to understand internally, what is the IRR or the payback period that we target when we look for an asset? And secondly, what sort of an asset would we be looking at or be interested at the most? So I think more than the IRR, of course, IRR calculations are the standard calculation that anybody would apply to deploy capital. The M&As have to be more strategic in nature, and the M&As have to be such where we can add value to whatever asset we acquire. So I guess we put various filters based on what is that asset better in our hands? Can there be a synergy that we can build in and create more value whenever we look at any M&A? So I think I would answer it more on those kinds rather than just being a financial calculation. Of course, financial calculation is very important, but I guess there are other filters which are equally important before we actually go about doing an M&A. Okay. And our cost of capital is around 12%. So this is a standard. And so definitely, we will not go anything within what they say, 14%-15% of IRR. But as Vikas said, that all depends upon how strategic it is in terms of our portfolio and also the growth drivers for the future. Got it. Sure, sir. Thank you and best of luck. Thank you. Thank you so much. As there are no further questions, I would now like to hand the conference over to the management for closing comments. Yes. Thank you, everyone, for participating in today's call and making it a meaningful discussion, and thank you, Tushar, for hosting us. I'd just like to reiterate that if there are any queries that remain unanswered, please feel free to get in touch with us. Thank you and have a great evening. Thank you, everyone. Thanks so much. On behalf of Motilal Oswal Financial Services, that concludes this conference. Thank you for joining us, and you may now disconnect your lines.