Ladies and gentlemen, good day and welcome to Q4 and FY25 Earnings Conference Call of Concord Biotech Limited, hosted by IISL Capital Services Limited. Before we begin, a brief disclaimer. This conference call may contain forward-looking statements about the company, which are based on the beliefs, opinions, and expectations of the company as of the date of this call. These statements are not the guarantees of future performance and involve risks and uncertainties that are difficult to predict. As a reminder, all participant lines will be in a 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 your 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. Naman Bagrecha from IISL Capital Services Limited. Thank you, and over to you, Mr. Bagrecha. Thank you, Sasha. Hi, good afternoon, everyone, and a very warm welcome to Concord Biotech's fourth Q&A for 2025 earnings call hosted by IISL Capital Services Limited. On the call today, we have representing Concord Biotech Limited, the management team comprising of Mr. Sudhir Mehta, Chairman and Managing Director; Mr. Ankur Vaid, Joint Managing Director and CEO; and Mr. Lalit Sethi, CFO. I will hand over the call to the management team to make the opening comments, and then we'll open the floor for questions. Please go ahead, sir. Good afternoon, everyone, and thank you for joining us on our Q4 and FY2025 earnings conference call. We are pleased to report that Concord Biotech has delivered a steady and sustainable growth in both revenue and profitability for the fourth quarter, as well as the full financial year. For Q4, FY2025, revenue grew by 35% to INR 430 crore compared to INR 319 crore in Q4, FY2024. For the full financial year 2025, revenue stood at INR 1,200 crore, a growth of 18% on a year-on-year basis. On the profitability front, PAT for the year stood at INR 372 crore, up from INR 308 crore in FY2024, making a growth of 21% on a year-on-year basis. FY2025 has been a year of focused execution and disciplined progress. During the year, we undertook two strategic investments that align with our long-term strategies and sustainable objectives. We made a strategic investment in Palwela Therapeutics, a biotechnology company based in the USA that focuses on developing treatments for rare genetic skin diseases. Palwela is currently developing Q-Torin, a topical treatment for rare skin conditions. This investment supports our long-term strategic growth plans. Through this collaboration, we aim to strengthen our supply capabilities and grow our presence in global regulated markets. We have also made a strategic investment in a renewable energy company, CleanMax, to support our sustainability goals. CleanMax operates wind and solar power facilities with a combined capacity dedicated to supplying renewable energy to our Dholka plant. This initiative highlights our strong commitment to ESG principles. By transitioning to clean energy sources, we aim to significantly reduce our carbon footprint and contribute to global climate action. Alongside environmental benefits, this shift also offers long-term financial advantages through lower energy costs and improved operational efficiencies. On the regulatory front, we continue to enhance our compliance and preparedness across all facilities. Our API facility at Dholka, Unit 1, successfully underwent inspection by US FDA, which concluded with 483 observations. All observations were procedural in nature, and none of these were related to data integrity. We have already submitted a comprehensive response to the US FDA and are confident of receiving the EIR in the coming month. Unit 1 also underwent successful inspection by the Ministry of Food and Drug Safety, South Korea. Our formulation facility, Unit 2 in Vatva, successfully completed an inspection by the Saudi Food and Drug Authority. Additionally, the Health Products Regulatory Authority of Ireland awarded an EU GMP certificate to our Vatva facility, Unit 2, reinforcing our adherence to international quality standards. Another significant milestone this quarter was the successful commissioning of our injectable facility at Vatva. This facility has been designed to meet stringent global regulatory requirements and is equipped with advanced technologies to ensure robust, high-quality, and compliant production capabilities. The commissioning of this state-of-the-art unit represents a strategic advancement in our long-term growth and capacity expansion roadmap. In FY 2025, Concord has also filed two DMFs, Nystatin and Voclosporin, and got ANDA approval of teriflunomide tablets. Going forward, these niche opportunities would give a positive momentum to the growth of the overall business. Concord also has a robust and diversified pipeline of products across both APIs and formulations. The company is actively developing a wide range of niche APIs catering to various therapeutic segments while simultaneously expanding its formulation portfolio. This approach not only strengthens Concord's market presence but also positions it as a reliable partner in a global pharmaceutical landscape committed to delivering high-quality, affordable health solutions. Looking ahead, we believe we are well positioned to accelerate growth in the coming years, supported by several key strengths: a broad portfolio of fermentation-based APIs and formulations, strategically expanding into the injectable space with a focus on domestic and emerging markets. This marks a significant milestone as we commercialize our state-of-the-art injectable facility. Robust and diversified pipeline of products across both APIs and formulations. Continued success in securing regulatory approvals across major regulated markets for our facilities. A strong track record of delivering consistent, high-quality products to a diverse customer base. Large manufacturing capacities to support the expansion of CDMO businesses. These factors collectively provide a strong foundation for sustainable growth. We remain committed to disciplined execution, ongoing innovation, and delivering long-term value to all our stakeholders. Thank you, and with this, I hand over the call to Mr. Ankur Mehta, Joint Managing Director and CEO of Concord Biotech. Thank you, sir. Good afternoon, ladies and gentlemen. I'm pleased to report that we have achieved strong financial performance with a 35% year-on-year revenue growth in Q4 and an 18% increase for the full fiscal year. Notably, our EBITDA and PAT grew even faster by 43% and 48% year-over-year, respectively, demonstrating our continued emphasis on operational efficiency and profitability. API revenue for Q4 FY25 stood at INR 362 crore, reflecting a 37% year-on-year increase. For the full year, API revenue stood at INR 940 crore, marking a 14% growth compared to the previous fiscal year. It is important to highlight that the reported API revenues exclude inter-unit sales to our formulation business. As a result, the reported growth may not fully reflect the actual performance of the API segment. When we include the inter-unit API sales to formulations, the segment reported a growth of 16.15% on a year-on-year basis. We would like to re-emphasize that API business is subjected to quarterly fluctuations due to uneven customer procurement patterns. Therefore, evaluating the API business on a full-year basis provides a more accurate view of our underlying performance. Turning to our formulation segment, we achieved a year-on-year revenue growth of 26% in Q4 FY25 and 38% for the full year. This strong performance underscores our ongoing efforts to enhance capabilities and expand our product portfolio within the formulation business. With the recent commissioning of our injectable facility, we anticipate significant scaling of this segment in the upcoming financial year. Multiple audits are currently underway at our formulation facilities, and we are optimistic about revenue contributions from the injectable unit in FY26. However, a full ramp-up in the revenues is expected over FY27 and FY28. Our domestic formulation business, particularly in critical care, nephrology, and rheumatology, gains strong momentum in FY25, supported by several new product launches and an expanded market footprint. With a field force of over 200 sales and marketing professionals across India, we successfully built strong connections with specialized doctors, reinforcing our presence in key therapeutic areas. Backed by a robust pipeline and a growing customer base, we are confident of sustaining revenue growth in this segment. Strategically, we remain focused on strengthening our presence in domestic and emerging markets while selectively exploring regulated market opportunities. As this business evolves, we expect meaningful growth in both product offerings and customer reach during long-term growth. The split between our API and formulation business was 78% API to 22% formulation for FY25, aligning with our long-term guidance of 80/20. With our API business, OSP formulation segment, and the addition of injectable formulation facilities, Concord stands out as one of the few companies globally offering a fully integrated platform. This includes in-house API manufacturing, backward integration up to key starting materials, and end-to-end capabilities in the formulation segment. On the business front, we received ANDA approval from the USFDA for teriflunomide tablets, 7 mg and 14 mg, used in treating relapsing forms of multiple sclerosis. This milestone highlights our strength in developing and commercializing a differentiated product portfolio for the U.S. market. According to IQVIA, the U.S. market for teriflunomide tablets is valued at approximately $402 million, with the global market estimated around $908 million, presenting significant growth opportunities both domestically and globally. While India and emerging markets remain our primary focus, our approach to the U.S. market is strategically selective. We are committed to pursuing ROI-driven opportunities rather than chasing high-volume, low-margin products. Our U.S. strategy is rooted in value creation over market share, and we will continue to expand in this space in a measured and targeted manner. Additionally, we have filed DMF of Nystatin and Voclosporin and registered these products in several global markets, creating greater opportunities to broaden our customer base and expand our geographical footprint. In FY 2025, we added 118 new customers across various business segments, reflecting our strong ability to penetrate diverse markets and customer profiles. With these new relationships, we are expected to contribute to revenue generation and serve as key drivers for future growth. Regarding our CDMO business, we view this as a significant and rapidly expanding opportunity for Concord. We are actively involved in ongoing development projects and trials supported by robust infrastructure that requires no immediate capacity-related investments. Our CDMO pipeline includes both innovator and generic companies, many of whom are seeking to diversify their supply chains or outsource manufacturing for the first time. We are pleased to inform that we have commercialized one CDMO project with one of the innovator companies, and we continue to file RFQs and are in active discussion with several potential clients. With proven capabilities, a strong regulatory track record, and global compliance facilities, we are well positioned to leverage this momentum. What truly differentiates Concord is our deep expertise in fermentation-based APIs and complex formulation, positioning us as a trusted integrated CDMO partner for companies seeking specialized manufacturing solutions. With these strong foundations in place, we look ahead with confidence in our strategic direction and a firm commitment to building a future-ready, innovation-driven organization. Backed by solid fundamentals, a growing product pipeline, and customer base, and strong execution capabilities, we believe Concord Biotech is well positioned to achieve sustained long-term growth. We are also pleased to share that the Board of Directors have recommended a final dividend of INR 10.7 per share for FY 2025, subject to shareholders' approval. This reflects our commitment to delivering consistent value to our shareholders while continuing to reinvest in growth opportunities. With this, I hand over the call to Lalit Sethi, our Chief Financial Officer for Financial and Operational Performance. Thank you. Thank you, sir. Good afternoon, everyone. Let me take you through the financial and operational performance for the quarter ended March 2025. On the revenue front, our revenue for the Q4 of this financial year stood at INR 430 crore as compared to the INR 319 crore in Q4 of the last financial year, a growth of 35% on a year-on-year basis. Revenues for financial year 2025 stood at INR 1,200 crore, a growth of 18% on a year-on-year basis. Revenue from API business grew by 37% in Q4 this year and stood at INR 362 crore, and for the financial year 2025, it grew by 14% with revenue at INR 940 crore. Revenue from the formulation business in this quarter stood at INR 67 crore as compared to the INR 53 crore in the same period last year, a growth of 26%. Formulation revenue for the financial year 2025 stood at INR 260 crore, a growth of 38% on a year-on-year basis. Domestic revenues grew by 50% and 24% respectively for the quarter and financial year 2025. Exports revenue for Q4 this year grew by 19%, and for the full financial year, exports revenue grew by 12% on a year-on-year basis. Speaking on EBITDA, our operating EBITDA for Q4 of this financial year stood at INR 190 crore as compared to INR 134 crore in the same period last year. EBITDA for the financial year 2025 stood at INR 506 crore, which represents a growth of 17% on a year-on-year basis. Our operating EBITDA margin for Q4 of this year stood at 44.3%, and for the financial year 2025, it stood at 42.1%. On profit after tax, our profit after tax for Q4 of this financial year stood at INR 140 crore as compared to INR 95 crore in the same period last year, a growth of 48% year-on-year basis. Our profit after tax for financial year 2025 stood at INR 372 crore as compared to INR 308 crore in financial year 2024, a growth of 21% year-on-year basis. PAT margins for this quarter stood at 32.7%, a growth of 286 basis points on a year-on-year basis, and PAT margins for the full financial year 2025 stood at 31%, which represents a growth of 67 basis points on a year-on-year basis. With this, I shall now leave the floor open for question and answer, please. Thank you very much. We will now begin the question and answer session. Anyone who wishes to ask a question may press star and one on 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 Manoj Behura from Canara Bank AMC. Please go ahead. Hi. Am I audible? Yes, sir, you're audible. Yeah. Hi. Good afternoon, Ankur and team. First of all, congratulations for a good set of numbers and consistent performance as always. A couple of questions from my side. Can you help me understand the reasons for dip in gross margin? Is it because of change in business mix, or are we seeing some kind of pricing pressure on immunosuppressants with, I think, more and more competition coming into this? That is my first question. I will come back for the second question. Manoj, on this, basically, this could be on account of change in the product mix. Also, if you see that since the base of formulation business is increasing and that business has also been growing at an equivalent at a faster pace, it is worth noting that our API products, which are being transferred to formulation units, have a certain market price, and all the sales get booked in the formulation business. Net-net there can be some impact on the gross margin, but at EBITDA level, it gets netted off, and EBITDA has been growing as such. Okay. As more and more formulation getting built up, do we expect that the gross margin will keep on going down as the formulation keeps on going up? No. See, that is not the case. As Lalit mentioned, there is some component of this. Of course, product mix also plays some bit of a role because if you see, while we have said that all the products, the underlying principle is the same, which is niche products with limited competition. Again, the margin profiling across all the 30 products are not the same. There could be some bit of impact because of the product mix. While formulation, if in a particular year it grows significantly higher than that of the API, yes, there could be some impact on that particular year. As we have mentioned earlier, the capacities are built such that the 80/20 ratio should, on a long-term basis, prevail. If you would look at it from a long-term perspective, we do not see any significant impact. Yeah, as rightly mentioned, on a year-on-year, if something, say, the API, the formulation increases, there could be a little bit of impact on the gross margins. Of course, EBITDA, as Lalit mentioned, has been in line with what we see. With the injectable facility coming in, I think the margin profile, even in the formulation segment, will improve than what it is when it is only an oral solid facility. Got it. The second question is, in fact, I have two short questions. One is if you can give a little bit more update on CDMO. As you mentioned that you have started seeing green shoots there. Secondly, on the balance sheet side, we have seen some deterioration in the receivable and inventory side. Is it a year-end phenomenon? More sales might have happened in the month of March. These two things, if you can answer. I think, Manoj, you've answered the question. If you see that, of course, our last quarter has been on the higher side. Even if you consider a 90-day credit period, 90-110, that is as on 31st March as sitting on the books, and that's why you see that as a higher number. From a circulation perspective or from a cash flow perspective, there is no challenge to us. This is just a phenomena as on the closing of the books, and that is primarily on account of larger sales, higher sales happening on quarter four. Coming to your question on the CDMO business, yes, I think we are seeing good positive momentum. We have already commercialized one CDMO project with one of the innovator companies, and I think supplies to them are going to start soon as well. Being a new product that they are launching, we do not have how much the quantum is going to be of this business, but since they are very optimistic and seeing it as a big opportunity for them also in the global markets that they have launched this product. To Concord, we would still see how the product gets into the market. We are quite pleased that we now have a CDMO project at a commercial scale with the innovator company. There are a few other projects that are quite at an advanced stage. We just need to kind of keep working on that but are hopeful that things would be going positive also in that direction. Great. Thank you so much for taking my question and wish you good luck. Thank you. Thank you. Thank you very much. The next question is from the line of Alankar Garude from Kotak Institutional Equities. Please go ahead. Hi. Good afternoon, everyone, and congrats to the team on a good set of results. One question on pricing again. Can you comment on the pricing dynamics in the immunosuppressant portfolio and if you can split it across developed and emerging markets? This question is over the past couple of years. Yeah. If you see the pricing, again, there has not been much change when you look at it from a customer-to-customer basis. As we have mentioned earlier also, when you look at some of the customers that are not with us and they are larger customers, sometimes you may have to give somewhat of a rise to them because of the nature of, because of the kind of volume that they are bringing in. Again, it's a trade-off between larger capacity utilizations that are happening, which would bring in operational efficiencies versus the kind of somewhat of a price discount that you may have to give. That is something that we would continue to look at. It's not that we have given those to larger customers. If the opportunities that we are evaluating do come by and it does demand, then that's something that we would be open to consider. When you talk about the price difference between developing and regulated markets, I do not see much of a price differential there because many of the companies have global footprints. When I say many companies, those are formulation companies. When we sell our APIs to Indian companies and they have competition in, say, the U.S., competing with U.S. formulation companies, in today's world, everybody knows what is the price that Indian companies are getting or U.S. companies are getting. There is not much of a delta that has been left when it comes to API pricing between emerging and regulated. There is not much difference. As I said, the pricing at a customer level has not changed much significantly, but for newer opportunities, it could change. Got it. That's helpful, Ankur. Just on that point, if I look at the 14% growth on API in FY25, broadly, how would you break that between pricing, volumes, and new introductions? There has not been any price increase that we have given to customers. All the growth has come from volumes only. If we see, the anti-infective business actually has started picking up quite well. As we had mentioned a couple of years back also, our intent is that our dependency on immunosuppressant goes down while we do not see a risk to the immunosuppressant because all the APIs that are there in immunosuppressant, we are manufacturing. While the value base of immunosuppressants has grown, the percentage of immunosuppressants contribution has come down, which has been primarily on account of anti-infective products that are getting launched. If you see the new DMF that we have filed, one is voclosporin, which is again an immunosuppressant. Any product that comes into the immunosuppressant, we are present there. That has an integrated approach because the key starting material cyclosporin, we also manufacture. The kind of cost dynamics that Concord would have, nobody else would be having on voclosporin, even when the product gets commercial. Right now, it is a para-IV product. We see a lot of opportunity on voclosporin. The other product is nystatin, which is a large volume product, but a product which has limited competition. There also, we are seeing a lot of opportunity in nystatin. Over a period of two to three years, we see that these products that are getting launched in the last two years and going forward would be contributing significantly. Over a period of time, we would be looking at bringing our immunosuppressant contribution from maybe 5%-10% lower from what it had been a year and a half back. Already work is going in that direction. Got it, Ankur. The second question, can you comment on your R&D as well as manufacturing capabilities on peptides? I'm asking this because at least as far as our current commercial presence is concerned, we do not have much of a presence. Of course, we have a strong R&D team of over 150 people working across API and finished formulation. A lot of work is happening on new fermentation API development. I mean, to the market, we have talked about 10-plus products, but we have a much larger number of products that are there in the pipeline, which again are niche products with limited competition and are complex enough projects. The R&D team is working on these molecules, plus a lot of CDMO projects are something that we are evaluating and working towards in addition to the formulation R&D. Coming to peptides, we are seeing opportunities in other segments than peptides, which are adjuncts in fermentation, which we are currently evaluating and exploring. I would say peptide is not something that we are trying to do something in-house. If things work inorganically, that could be something that we would explore. Right now, in-house, we are developing some other adjuncts to fermentation, not peptides. Got it. One final question before I come back. In the last two years, our first half, second half sales split was broadly around 45%, 55%. Should we expect a similar revenue split going forward? See, again, Alankar, it's very difficult. If you see a year and a half, two years back, our quarter two numbers, our quarter two sales significantly changed compared to what it was historically. As I've said, that on a quarter on quarter, at time, becomes quite lumpy. While we say that our second half is better than the first half, the exact split is something on a quarter-on-quarter basis, we won't be kind of able to put a number to it. Fair enough, Ankur. That's it from my side. Thank you. Thank you. Thank you very much. Participants who wish to ask a question may press star and one at this time. The next question is from the line of Vivek Agrawal from Citigroup. Please go ahead. Hi. Thanks for taking the question. Ankur, you highlighted that you want to bring down immunosuppressants by around 5%-10% lower from the current level. Is it possible for you to share what is the current share of immunosuppressants in your API revenues? Two years back, when we had come out with our IPO, that time, the contribution was around 80%. Today, it has come down to around 74-75%. In two years, we have brought it down from 80% to 74-75%. Our intent, as I said, is to bring it to 5-10% lower than what it was a year and a half, two years back. Understood. You also talked about, actually, in some of the previous calls, that you want to launch around 8-10 products in the anti-infective, antifungal segment. What is the progress out there? Any specific products, actually, if you want to talk about a few products that can contribute meaningfully, let's say, over the next couple of years in these segments that we need to watch out for? Yeah. As we had mentioned, every year, we'll have around two to three products that we would be commercializing. I think, as we mentioned during the call, this year, we have commercialized two products, which are voclosporin and nystatin. Going forward also, we have quite a few products right now which are at quite an advanced stage of commercialization. We expect that in this year also, we would be going with a similar or maybe slightly better launch of the products. Even at the finished formulation level, we have done quite a few filings in the U.S. We expect commercialization on those products also in the U.S., which would then be extended to global markets. We have a strong pipeline of products for the oral solid also. In addition to that, a lot of efforts are now also being put in commercializing projects in the injectable because of the newly launched facility. We have already taken exhibit batches of around two products, and we have quite a couple more products that are there going for exhibit batches. A lot of work is happening on all the three fronts, be it API, oral solid formulation, or the injectable product portfolio. Understood. Thanks. Actually, just one question on the teriflunomide approval, right? It looks like the product is fairly commoditized. A lot of competition is already there in the U.S. market. What makes you quite excited about this product or how you are basically in a better position compared to the competition in this product? The teriflunomide, if you see, is a para-IV opportunity product. While there are four or five players, still the kind of penetration that is needed is not there. I think like those three or four players, Concord also is in that race of once the market truly opens up, we would be able to get a significant contribution to the U.S. business. In addition to that, as I mentioned, out of that $900 million, close to $500 million is ex-U.S. As I mentioned, we are focused also on India and emerging markets. Extension of these dosages into the emerging markets is also something that we are seeing from a value recognition, from having more ROI from an ROI-driven perspective. Thanks. Thanks, Ankur. That's from my side. Thank you very much. Before we take the next question, we would like to remind participants that you may press star and one to ask a question. The next question is from the line of Chintan Chheda from Giriraj Capital. Please go ahead. Thank you. Thank you for the opportunity. Am I audible? Yes. Yes. Yeah. Hi, Ankur. Hi, Maliki. Very strong comeback for the fourth quarter. Congratulations to the team. I have a couple of questions from my end. One is, again, halfway update on gross margin on the annualized basis. I understand that the share of formulation has increased over FY2024, and that has resulted in a slight margin compression at the gross level. If I look at the current quarter, the API share has been pretty strong. The margin for gross margin contraction has been pretty sharp. If you can just provide some input on how should one look at, even if we see the share of API to be very strong this quarter? It has been strong, but as I said, not all APIs that we have, we have close to 30 that we have now commercial. Not all of those have the same kind of margin profiling. There could be some bit of variability to it. That is one. Second, as Lalit mentioned, the way that the API is getting transferred to the unit two at market price, the impact of that is playing out also. If you see at the overall level, if the price erosions would have happened, then that should not, the EBITDA margins would not have been in the same level. It is a bit of the two things that is primarily playing out, which is the significant contributor to the gross margins that you are seeing. Got it. Got it. On the CapEx that you mentioned, even in the CDMO side, you do not anticipate a huge investment going into the project we are currently discussing with our clients. I am just trying to understand how should one look at CapEx given the injectable to a very commercialized and largely capitalized? Some part is still left, which is sitting in CWIP. If you can highlight or guide something on the CapEx split, that would be helpful. No, I think all the capital expenditure with respect to the growth is already over. The injectable is already in commission now. As far as the capacities for API and formulations is concerned, it's also available as of now. There are no plans for having any additional CapEx for the capacity expansions. If you will look at. Then. Yeah. If you look at Chintan, just to add to what Lalit mentioned, for our API and formulation business, we do not see any new CapEx happening over and above the maintenance CapEx of INR 20-30 crore that is there. We would continue to look at growth in the agencies, whether organically or inorganically. That is something that we continue to explore. Got it. That is more than sufficient for the CDMO project which you are referring to. In case the other CDMO project comes through, there is a significant infrastructure which is available, which can be bid with a small amount of capital. The teriflunomide tech opportunity, we are also exploring through CDMO too or it's largely for the. No, that is our own ANDA. And we will be marketing that under our own. For the formulation. Yeah. Okay. Got it. Okay. I'll join back in. Thank you. And all the very best. Thank you. Thank you very much. Participants who wish to ask a question may press star and one at this time. The next question is from the line of Naman Bagrecha from IISL Capital Services Limited. Please go ahead. Hello. Am I audible? Yes. Yes, sir. Thanks. Thanks for the opportunity. I just wanted to understand on teriflunomide. What my understanding is, you're targeting both the markets seriously. I mean, both in the sense U.S. and ex-U.S. markets as well. While you highlighted that ex-U.S. market side would be closer to, let's say, $500 million, just wanted to understand what is the competitive landscape over there and what kind of, let's say, market share targets are we keeping in mind? See, again, right now, we are not going with that we would have a 10% or a 15% kind of a market share. I think the efforts right now are to kind of extend these dose years into those markets. Most of these players are companies which are mostly focused on the U.S. market. In the emerging markets, sometimes you may be the early entrant in those markets, but being an early entrant also plays to your advantage, which is a slow and steady market share gain when you are the next in line to, say, the competing only with the innovator. That being said, I think right now, the efforts that we are putting in is filing the dose years in the emerging markets. We have already started selling this product in India under our own brand. Similarly, we are now going to be extending this dose year to the emerging markets. And then we'll see how the progress happens. I don't want to be giving out a number which kind of looking at a larger value kind of takes the discussion into a very different pathway. But yeah, the opportunity is huge, and we are kind of seeing how we can grab that opportunity to the maximum extent. Okay. Okay. What kind of margins would be there for this product in the U.S.? I mean, you can probably just say whether it is above corporate EBITDA margins or lower corporate EBITDA margins. That would also be helpful. It's pretty much in line with our oral solid dosage margins, formulation margins that we currently have. That would be lower than the 40%-42% margins? That's correct. Because that 40-42 is a blended of the fermentation and the finished formulation. My next question is on the gross margins. If you look over the past two, two, three years, while our formulation business has increased, gross margins have also declined. However, EBITDA margins have kind of remained largely stable to some extent if I look at 2024, 2025, 40-42%. How should we look at the gross margins going ahead? Will this decline? And then how is that basically being offset by the other OpEx items? Where are we seeing savings? If you look at our five-year historical numbers, the gross margins on a CAGR number would not have changed more than 2-2.5%. When you look at a five-year period, any variability is on account of raw material fluctuations, product mix, formulations picking up. As I said, this was not the case until last year or so, or it would have been quite a low number because of different reasons. As I said, it is difficult for us to say how things would look going forward. If you are one of the only players or the newer products that you're trying to launch, the competitors are somebody, say, in Europe, and which, say, even with a good profitability margin, you're able to gain market shares, there could be years where you would see expansion even in the gross margins because, say, a product like Nystatin, if it starts working, or a product like daptomycin or any other product, or teicoplanin, if you see that if they start contributing significantly over the next few years, that's something that we are also seeing as our anti-infective segment is picking up. It could be in particular years you may see gross margin expansion also happening. If you would look at on a five-year period, there has not been significant change in the gross margins that we have observed. Okay. That's helpful. Just on this one, fidaxomicin, is this also a para-IV opportunity for us or it could be? No, it's a generic product now. It is something that we are actively working towards. All right. Thanks. I'll join back in. Thank you very 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 one to two per participant. The next question is from the line of Mehul Dalmia from Edelweiss Mutual Fund. Please go ahead. Hi. Good afternoon, sir. Thank you for the great numbers. Sir, my question is to again do with the gross margins. Just want to get a better understanding. When you look at Q3 versus Q4, margins have obviously compressed by roughly 8% on the gross level. The formulation revenue is roughly flat at INR 67 million. And the API revenue has grown by nearly 100% on a Q3 basis. At the same time, your export domestic mix, it's more skewed towards domestic this time. My understanding was generally that the formulation would carry a lower margin. In this case, obviously, we do not see that variability. API formulations are roughly flat. API is the one which has actually taken up the larger portion of the mix. We have seen the decline. How do we kind of understand this better? Is it that API is being supplied to domestic or going at a lower cost? Or how do you kind of understand that? In the formulations that we have, it is being supplied at the market price. Now, the domestic sales has increased for the APIs. That is primarily something that we have also talked in the past, that one of our customers who was contributing around 6-7% has closed down their facility in the U.S. and moved a significant part of their operations in India. There has been some contribution coming from that shift of the customer also, which was contributing 6-7% of our API business. The newer products also that we are launching have several customers who are basically Indian customers but have much larger market share in the global market. I think we do not see any major change happening in the domestic export. As mentioned earlier, the prices also between domestic exports are not that much different. I do not see any much significant variation on account of domestic export. Yeah, the change in the gross margin is something that we have kind of mentioned previously also. I would not have anything further to kind of add. Understood. Understood. I think the variability is there between the other quarters also, even last year and in Q4, you have higher, lower gross margins. If I were to just go to the EBITDA level in that sense. Just to add there, Nehul, that sometimes what happens is that if a significant inventory is also sitting in the books as a stock inventory, that also has a component of the overhead into it. Sometimes that also kind of plays out that if you have significant inventory sitting there, it could have an impact on the gross margins also. There are a lot of factors which kind of play out on a quarter-on-quarter number. It becomes a little tricky to kind of look into that what is actually playing out. It could be a factor of multiple things. Understood. On the EBITDA side, obviously, it is majorly a factor of leverage playing out. Can we say that? If I look at the numbers, at least the employee costs are flat, and the other expenses are slightly higher or in the same run rate which is normally there for the other quarters. That's correct. Understood. Perfect. Thank you, sir. Thank you. Thank you very much. Participants, please limit your question to two per participant. The next question is from the line of Pranav Chawla from Ambit Asset Management. Please go ahead. Good afternoon, sir. Congratulations on the stellar set of results. Sir, a couple of questions. Can you share what is the utilization level across the manufacturing facility? Sure. For the unit one, it was 84%. For unit two, which is a formulation facility, it is 36%. For the Limbase facility, which is unit three, it is 40%. Sir, unit two, does it include the injectable? Are you ingesting for that? No, no. Injectable is recently commissioned. The capacity utilization will start from the next year onwards. That is Unit 4.. That is Unit 4.. Okay. Perfect. Sir, during the quarter, what would be the quantum of expenditure from the new unit? Currently, as I said, we are just kind of, it just got commercialized in the month of March. It will be difficult to give a number right now because we are still kind of ramping up our team and the work. At this moment, it will be difficult to kind of give a number to that. Okay. So finally, from my end, can you, two questions from my end. One, can you share what the therapy mix is right now in APIs? So we already know that immunosuppressant is around 75-odd%. What would be the other therapies' contribution for the year? We don't give therapy level data, but 74% broadly is the immunosuppressant. The rest is the other segments, wherein the major contribution is coming from the anti-infective segment. Okay. Sir, can you also share a bit more color on the CDMO contract that you mentioned will be commercialized in the coming quarters? Sorry? Can you give some color or share further details on the CDMO contract that we have mentioned we've called out recently? Yeah. We have three to four projects wherein we have kind of at quite advanced stage of discussion. Right now, I think the ball is in the customer's court. We are kind of engaging with them to see when they would like to start, complete the evaluation process, and see where Concord stands in that. I would say that there are a couple of projects quite advanced. We have few projects across different segments, particularly enzymes and others as well, wherein we continue to engage with some of the customers. Sir, given the fact that you see-. Sorry to interrupt, but can you please rejoin for a follow-up? Sure. Just one last, if the management is okay with it. Yeah, please. Sir, given the fact that the unit three is already at around 40-45% utilization level, and we have a CDMO contract, we are in discussion with a couple of CDMO contracts. Do you think we may require more capacity sooner than we anticipated, maybe in the next two to three years? It could be possible. We are putting all our efforts that CDMO becomes a significant contributor to the overall business. Even if that happens, the incremental capital that would be needed is very low compared to the kind of revenue that it would generate because we have only utilized 30% of the land. Putting up a fermentation unit while all the other supporting infrastructure is in place would not require significant CapEx compared to the revenue that it could generate. If we reach to that level, I'll be more than happy to kind of go with that CapEx. Sure. Thank you so much, sir. I have a couple of more questions. I'll get back in a bit. Thank you. Thank you very much. The next question is from the line of Vamsi Hota from Antique Stock Broking. Please go ahead. Hi sir. Am I audible? Yes. Yeah. Congratulations on the great set of numbers. I just had two questions. Firstly, for both FY 2024 and 2025, within the formulations business, what is the breakdown of the domestic and international sales? Between domestic and international for? Formulations business. It's around 50/50. Around 33% goes to the rest of the world market, 17% goes to the U.S. market, and remaining 50% is in the domestic market. That's helpful. Also, on the CDMO front, I heard the management saying that you would expect a lot of ramp-up happening there. Over the next two to three years, what kind of revenue mix would you be anticipating from this vertical? See, I mean, currently, if you see CDMO contributes less than 1% of our business because we were mostly focused on the development than the manufacturing part of it. In the last six-nine months, our focus has been towards more on the manufacturing opportunities in the CDMO. I won't be able to give a number, but our intent or our efforts are being to kind of get this CDMO business to a double-digit contributor to our sales numbers. Thanks a lot, sir. I'll join back to you. Thank you very much. The next question is from the line of Alok Dalal from Jefferies India. Please go ahead. Yes. Alok, good afternoon. Are you providing any revenue growth guidance or margin guidance for FY 2026? No. I think what we talk about, Alok, is in terms of the long-term guidance that we have. I think, as we have mentioned earlier, that the kind of products that we have, commercial products that we have, the kind of pipeline products that we have, the capacities that have been there, including the new injectable coming in, and some of the agencies that we are working towards, I think we have the right ingredients and the mix in place to kind of go for the CAGR growth that we have spoken earlier. When you kind of start breaking it down on a quarter or yearly numbers, then quarterly, you will see a lot of volatility. The annual numbers should go progressively towards the kind of CAGR growth that we have set. It is going to be a gradual move towards the CAGR growth that we have. That is something that we have also demonstrated in this year. That is how we would be looking towards. There is no specific guidance on a year-on-year basis. Okay. So just to understand, when you move towards that CAGR number, which is 25%, so progressively from 18% that you've achieved in FY 2025, you will move towards that 25% gradually, is what you're saying? See, the capacities and the portfolios are designed such that we can go for a 25% growth. Our efforts are also being put that we can go towards a 25% growth. When we talk about the injectable facility also, with the kind of asset turnover it can give, as I mentioned earlier, I think during our calls also, it has the capability to give close to ₹600 crore of turnover. Even if I consider INR 300 crore over the next three to four years, that itself is a 30% growth on our current baseline, which translates on a five-year period to 6% on our 18% CAGR growth also. There are a lot of other opportunities like the injectables which could play out. Maybe in a particular year, something plays out, something does not. We would just need to see that there could be a little bit of fluctuation and volatility on a year-on-year, not too much. There is going to be a gradual progression towards going from 18% to 25%. Understood. Second question, Ankur, when you talk about the mix between API and formulation, and you're referring to sustaining this 80/20 number, now, given that formulation will grow much faster than API, mathematically, it does not work out that you will keep this 80/20 ratio. Am I missing something? How do you reconcile this? Yeah. If you see the assets that we have at the API and the formulation, the capacities have been designed such that the maximum output that you can get out of that capacities would end up having to be at the 80/20 split. That is one. The second is that even if we go, say, even if at a particular time point, the formulation starts contributing slightly higher, that indirectly actually helps me gain the API market share. That is why, since the last three or four calls, we have started talking about that inter-unit API transfer also, what it is, because the overall API market share is the same. It is just that instead of addressing it by pure API sales to that market, I am addressing it both via API and formulation. The thing for Concord to look at is that how do I address the overall pie, whether it is through API or through formulation. Even if there is a little bit of mix change between API and formulations, I think to us, it really does not matter that much because the addressable market is something that we are catering to. Okay. All right. Got it. Thank you. Thank you. Thank you very much. Due to time constraint, this is the last question for the day. I now hand the conference over to the management for closing comments. Thank you, everyone, for joining on our Q4 FY 2025 earnings call. We hope we have been able to address all your queries. For any further information, please get in touch with us or SGA, our investor relations advisor. Thank you once again. Have a good evening. Thank you very much. On behalf of IISL Capital Services Limited, that concludes this conference. Thank you for joining us, and you may now disconnect your line.