Ladies and gentlemen, good day, and welcome to the Natco Pharma Limited Q1 FY25 post-result earnings conference call, hosted by Batlivala & Karani Securities India Private Limited. As a reminder, all participant line 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. Hrishikesh Patole from Batlivala & Karani Securities India Private Limited. Thank you, and over to you, sir. Thank you. Good morning, everyone. On behalf of BNK Securities, I welcome you all to the Q1 FY25 earnings conference call of Natco Pharma. Hope everyone is in good health and doing well. On behalf of Natco today, we have with us Mr. Raju Nannapaneni, Director and CEO. Mr. Rajesh Chebiyam, Executive Vice President, Crop Health Sciences. I now hand over the call to Rajesh for the management's opening remarks, post which we'll open the session for Q&A. Over to you, Rajesh. Thank you, Hrishikesh. Good morning, everyone, and welcome to Natco's conference, discussing our earnings results for Q1 of FY 25, which ended June 30, 2024. During the call, we may be making forward-looking statements or statements about future events. Anything said on this call which reflects our outlook for future must be reviewed in conjunction with the risks that the company faces. I'd like to state, material of the call, except for participant questions, is the property of Natco, cannot be recorded or rebroadcast without Natco's express written permission. So, I'll begin with the results highlight, and then we'll have an open interactive Q&A session. So again, hope everybody received the financials and the press release that was sent out earlier as well. It's also available on our website. Natco recorded consolidated total revenue of INR 1,410.7 crores for the first quarter, which ended thirtieth June 2024, as against INR 1,160.2 crores for the same period last year, reflecting a growth of 21.6% in revenue. The net profit for the period on a consolidated basis was INR 668.5 crores, as against INR 420.3 crores same period last year. This reflecting 59% growth in profits. The growth in revenue and profits was primarily driven by export formulation business, as our domestic pharma business remains stable. On the segmental split overall, what we have disclosed, formulation exports, including profit share and foreign stocks, carried INR 1,210.10 crores. Formulation domestics, INR 102.2 crores, API, INR 39.2 crores, Crop Health, INR 15.6. Other operating and non-operating income to roughly INR 43.6 crores, all totaling to INR 1,410.7 crores. Thank you all. Now we'll open up for Q&A. Thank you very much. We will now begin the question-and-answer session. Anyone who wishes to ask a question may press star and one on their 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, in order to ensure that the management is able to address questions from all participants in the conference, please limit your question to two per participant. [Foreign Language] The person you are speaking with has put your call on hold. Please stay on the- Ladies and gentlemen, it seems like the management line has been disconnected. Please stay on the line while we reconnect. Ladies and gentlemen, we have the management back on the line. Yeah, let's open up for Q&A. Sorry for the disconnect there. Okay. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question is from the line of Nirali Shah from Ashika Stock Broking. Please go ahead. Hi, good morning. Congratulations on the good set of numbers. I had just two questions. First, on the Revlimid front. So, it appears that the contribution from Revlimid is our significant driving factor. Any insight on the market share would be valuable here. Additionally, just a follow-up question on Revlimid, that after January 2026, we have a profit-sharing agreement with Teva, which is what the management mentioned in the last con call as well. Could you provide any estimate of the potential variance in profitability numbers for Revlimid when we put into perspective a comparison of FY 25 to the post-patent expiry scenario? It's very difficult to judge, Nirali. I mean, how the market will form over a period of time. I think, in terms of market share and all, I think it's already publicly stated, we start off with a single digit, and we go up to one third of the market, before January 2026. So, I think, that answers your share question. Regarding the price environment and all, you know, hard to judge. I mean, you know, for now, it's doing well. That's all I can say. I mean, market dynamics change. So, for now, it's doing well, and we see that it'll do well in the coming quarters also, I think it looks good. Beyond that, I think I can't comment further. Thank you. This being the third year, we are expecting a significant ramp-up in the Revlimid side. So could you say that again, Nirali? Yeah. This being the third year, we are expecting a significant, ramp-up in Revlimid contribution. I think, yeah. In the last year, I think we are expecting to go to one third of the market, yes. I think based on the agreement that we have. But again, how much it will do and how well we'll do and all, it's all, you know, it's all function of the market at that time. Got it. Got it. Okay. My second, my second question is that we do hold a certain FDA status on certain strengths of semaglutide pen, and even for the weight loss indication, we have the sole FDA across all strengths. Do you want to understand the potential opportunity here, again, specifically on the market share or maybe some internal targets that we have? Or what kind of market positioning and any financial impact that we are projecting from these, the two, the two of these FTFs, right? I mean, we are in a good position in semaglutide. It's too early to say anything, Nirali. I mean, it's very early. I think the file is still under review. It's... You know, Mylan is obviously the, our partner here. I think it's tough to predict when the market formation will happen with the patent litigation pending. So, at this time, it's very early, Nirali, to say anything about what the potential is. I think it's a good filing, and I think we are working towards getting the approval. I think that's, and then that's all I can say at this time. Okay. Okay. Thank you. Thank you. Next caller. Thank you very much. The next question is from the line of Kunal Dhamesha from Axis Capital. Please go ahead. Hi, good morning. Just, Rajiv, if you can shed some more light on how the ex-Revlimid business has been performing? I think the domestic has been stable. I think we are doing about INR 100 crore per quarter. I think that's been fairly stable. If you remove the one-off, I think on an overall base business-wise, we remove the one-off, it's growing around 8%-10%, so we are fairly happy with how things are in domestic. Our agro has not done well. We had first year full launch—you know, launch last year, and we billed about INR 50 crore gross, so but it's just that we had some returns, so we prudently made the provisions for discounts and returns. That's the reason why our net sales are only INR 15 crore. But, but it's, I mean, it's a new business for us. This is our second full year of operation, so I think, you know, we will take some time to settle down. But overall, I think the prospects look good, and, the season has just started, so we think that we should do well in the coming quarter. Our export business has done extremely well. You know, our Canada has the highest turnover, ever, and then, if you can give me a moment, I'll just... pull up the numbers. So, the, the subs, you know, which represent, you know, a significant part of our ROW business, is about doing, did last quarter is about INR 180 crore and fairly profitable. So, we had a PBT of INR 43 crore, so that business has done well. So overall, I think we are happy. I mean, we are building a reasonable business in ROW and Middle East as well. So, we're doing reasonable amount diversification. So, I think we could do better in agro. I, you know, we reflect, we could have done a little bit better in agro, and I think, and we're looking for better momentum in domestic, but otherwise the export business has been very stable for us, Revlimid and non-Revlimid both. Yeah. So, Rajesh, just to clarify, even non-Revlimid, there's been a growth in revenues as well as margins, right? Correct. Correct. Got it. Got it. Second, just a clarification on semaglutide. Do you have sole FTF or the shared ones? I think, the weight loss one, I think we have sole FTF, and on the diabetes, some strengths we have sole FTF and some strengths we have shared FTF. The strengths and all, I can't recollect on top of my head. But yeah, I think some strengths we have... Let's say 50%-60% of market value of the diabetes also we have sole FTF. Some strengths we don't have. Right. And at this point in time, you know, I know it's a bit early, but could you, I mean, I mean, would the launch be in this decade, or would it be around 2030, 2031? I can't answer that, Kunal. I wish I knew, yeah. I can't answer that question. So yeah, I, when it... I mean, there are a lot of moving parts. I mean, we have to get the approval, we have resolution of the court case and then all, and then... You know, there's so many moving parts. I can't answer that question. Understood. But would this be more like a 50/50 kind of profit share agreement? No, I think it's little bit higher with Mylan. I think, I don't recollect the agreement exactly, but with Mylan, and we have a little bit of sharing with our contract manufacturer, who is Stelis. So, net, I mean, I can't - I don't know the economics exactly, but I think we'll have substantial, but there's a, you know, there's a share between Mylan and us, and then what we are getting, some we have to share with little bit with Stelis. Okay, so you would be getting a bit more than Mylan, right? So, No, no, the Mylan will be getting- Oh, Mylan. will get the most, yeah. Got it. I just, I can't recollect. There's a lot of, I mean, nuances in the agreement, so I don't want to get into it because such leaders, I think, will give more clarity and guidance, but when we're closer to market formation. But, yeah, I think broadly, those are the terms, yeah. Okay, that's great. Thank you, and all the best. Thank you very much. The next question is from the line of Arun Malhotra from CapGrow. Please go ahead. Yeah, good morning. Just wanted to check, you, I know you mentioned on the pricing. Could you give a sense of, the pricing of Revlimid in the US, how is it faring right now? That's one. And secondly, you said one third of the market share. What would be a tentative market share right now for us in the Revlimid, in the US market? I can't answer that question, for competitive reasons. I think what we have disclosed, I think I'll repeat that same thing. I think it scales up, goes to one third. Pricing and all, it's all handled by Teva. Teva is our front-end partner, and, again, it'll be, you know, for competitive reasons, and I think because in the end, the strategy is there, so I think I can't answer that question. Okay. Any sense on the competitive landscape right now? How many players are there? There are multiple players. I think, everybody has their own market shares. I think that's all I can say at this time. Lastly, on the Agrochem business, that has still not ramped up as per our expectations. What would be your sense here? It is, I mean, I mean, I would not say it's been a, you know, it could have done much better, clearly. I think we had a reasonable start, I would say. I will not say that we're not present in that segment. So, we have launched with a very aggressive strategy by going after patents, and we're waiting the first day of launches. I would say we had a reasonable start. I think last year we had about INR 105 crores of sales. So, I mean, it's for a business, and we're building a brand business with farmers reach and building a brand, running TV ads and doing a lot of campaigns. So, it's a reasonable start, I mean, for an upstart which had no experience in agro. But I would believe, see, if you want to build sustainable long-term businesses, you need to wait. I mean, things don't happen overnight. I think my personal view is you have to give it about two years. So if you have, give it about 2-3 years from now, I think you'll probably have a INR 250-INR 300 crore nice branded business with stable income. So but to reach that stage organically, it takes time, and we just have to be patient. Sure. Thank you. Thank you. The next question is from the line of Saumil Shah from Paras Investments. Please go ahead. Hi, sir. Congrats on a very good set of numbers. So, this quarter with about INR 660 crores of profits, so, now can we assume 400, 400 and 450 crores of quarterly revenue for the remaining quarters of the year? Quarterly guidance we're not giving. I can't give you such precise numbers. I can say Q2 should also do very well. I think it'll, like Q1, it should do well. Overall, for the year, we're giving guidance of a 20% growth over last year's numbers. So last year, I think our profit was that was little less than INR 1,400 crores. So, on that, I think this thing will grow at least 20%. Okay. Sure. Sir, I wanted to know about the FDA outcome of the warning letter which we have received for our Kothur plant. I think it was in the month of April. Any update on the same? As of now, we don't have any update. I think we continue to supply from that plant into the U.S. market. So, it does not stop any of the supplies. In terms of the filings, the impact has been that new approvals are now getting from that side. So, we have taken a risk mitigation program, and we have started moving things out of that plant which are critical. So, I think we have a plan to move everything out. So, some we already moved out, so and then some of the products we already moved to Vizag. And some we've already got approvals after moving them, so, and some we are in the process of moving out. So, in the next few months, I think we're doing... While we continue with the remediation work, parallelly, we are moving out all the critical filings. So I think, so I think we're doing both these ideas. I think that's how we're going forward. Yeah. Okay. But, but normally, how many days it takes for the FDA's reply? Because I think in one of the calls, if I'm not wrong, you mentioned around 90-120 days, they tend to reply or no? No, it takes time. I can't really answer that question. I mean, typically, 90 days is all, I mean, when you receive the observation, giving the answer for those sort of things, but not, when a re-inspection will happen and all, it's very tough to judge. I think we are doing our remediation program. I think, I think once we have an update, we'll share with you. At this time, it will be premature to comment on that. ... Okay, so even if there is an adverse impact, I mean, we are, we have the other plant where from where we are supplying, right? So what we've done is two things. So one is we have the other plant in Vizag, and over and above that, we are also, like, especially the injectable portfolio, we have gone to a CMO. So we moved, we have 2-3 ANDAs that we moved out, and a couple of oral products also we have moved out, and we refiled from the other side, with the updated data. So we are very actively moving to some internally we're moving out, and some we are externally moving out. So, so both are parallel, yeah. So we are, you know, we are not linking one with the other. So, so while we work on remediation, parallelly, the critical filings where we think, where, you know, 80% of our future earnings are going to lie, I think those we are moving out. Okay. So but the current Revlimid sales are from both the sides or how- Initially, I think some strengths were from Kothur and some strengths were from Vizag. So post, we have moved everything to Vizag. Okay. We got it approved. We had two strengths which were not approved from Hyderabad, so those we have moved it to Vizag. So that's already approved and we're already supplying from Vizag. Okay. Okay. Thank you. That's it from my side. Okay. Thank you. The next question is from the line of Ankit Minocha from Edelweiss Ventures. Please go ahead. Yeah, hi. Good morning, and congratulations on the great momentum in terms of the numbers. So, the question was, I mean, in terms of the guidance, we've already done, say, INR 660 crore of PAT this quarter. Do we feel, and are we being too greedy, but do we feel that, because the rest of the year then kind of looks pretty much at par with last year. So, do we feel that the guidance could be slightly conservative, and we would wish to overachieve? Ladies and gentlemen, it seems like the management line has been disconnected. Please stay on the line while we reconnect it. Ladies and gentlemen, we have the management line again. So shall we move on to the next participant? Yeah, I think the gentleman's question I didn't answer. He can repeat the question one more time. For some reason, I just got disconnected. I apologize for that, Ankit. You can ask the question one more time, please. The next question was from Ankit Minocha. Please go ahead, sir. Please ask your question again. Yeah, yeah, thanks, thanks for the opportunity and, congratulations, Rajeev, on the fabulous momentum in terms of the top line and growth. My question was that considering that we've done such great profit after tax this quarter already, do we feel that the guidance for the rest of the year could be slightly conservative? Because it would come out mostly as flat over the last year for the next three quarters. So, I just wanted to understand that could we expect upside in terms of that? Sure. I mean, anything can happen, Ankit. I, I'll not say that. I generally like to say conservative numbers, Ankit, and generally, I don't want to give aggressive guidances. It can... We can do better. I mean, at least I can tell you that on... If you ask me for Q2, I think I can have a sense that, you know, the numbers will hold up. So again, market formation is so tricky to tell, right? So, and how will you end up? It's very difficult to judge. So, I mean, if you're saying, "Can we do better than that?" Hopefully, yes. I think that's my expectation. But again, I, I prefer to remain conservative, right? You put me in a spot and ask me what it's going to be, I'll say, I'll say the conservative number. I'll not say the... But again, you know, there's so many moving parts, so it's hard to judge. But yeah, I think for now, I'll answer for Q2. I think Q2 should do well, and then we'll take it from there. Yeah. Right. Thank you. That's appreciated. And, I, the previous participant asked about Kothur, but, but just from a more, from a slightly higher perspective, is there any risks then, considering that you've mentioned that Revlimid is now largely moved to Vizag, then in that case, in case of any anything adverse, which hopefully does not happen, but in case of any adverse regulations on Kothur, then do we have any severe risks then baked into the numbers? Whatever has happened has already happened, no? We can't get worse than we already can. So, it's already, it's all built in. So, the risk itself is the fact that we should move the things out and get them approved on time, so that we don't lose the business opportunity. I think that's what I was trying to say. The risk here, if anything, is, I would say, our execution of moving things out and getting it done. I think that's, that's, that's all it is, especially the first two files. We have to move them out and get the batches done quickly. I think that's, that's the only risk that, that will affect the future if we're not able to execute that. That's the only variable that I'm worried about. So, whatever could have, could have worse, could have happened already happened. You can't, it is what it is. That's the only concern I have at this time. I think just to make sure that all the filing, the good filings we have, we should move it out. Thank you, and appreciate the, yeah, the clarity and the confidence and the conservative guidance as always. Thank you. Awesome. Sure, sure. Thank you. Next caller, please. Thank you very much. The next question is from the line of Abdulkader Puranwala from ICICI Securities. Please go ahead, sir. Yeah, hi, good morning, and thank you for the opportunity. So, on the subpart, you just disclosed about the revenues. So, in the next 2-3 years, you know, how should we look at the contribution coming from your Brazil and Canada subsidiary? Any ballpark growth indication, if you could provide? I think they're doing well. I mean, and we have good filings from these subsidiaries, so hopefully they'll continue to grow. I think, see, this business, Abdul, is, it's essentially the filings that you have. That's what drives the earnings and the good filings you have, you get great earnings. And see, it's a very product-specific strategy or product-specific strategy, and I think the more interesting filings you have, the better they do. And they're all function of, you know, what the market formulation is gonna be. All we can tell you is that we are doing multiple filings in multiple geographies, and we believe that the growth will happen. As of now, it's, as I said, it did INR 179. It's probably, and we had one tender order in Canada, that's why it had a higher sale. But, if you normalize it, it's little less than one, you know, it's probably INR 140-INR 150 crores a quarter. But see, I think our idea is to build more such pipeline in this and hopefully acquire, you know, a business which is outside these four geographies that we are actively present, which is Brazil, Canada, U.S. and India, and hopefully build a more diversified business so that there's less volatility in our earnings. Okay? Sure. Understood. Okay, thanks. Next caller, please. Thank you very much. The next question is from the line of Nitin Jain from Fairview Investors. Please go ahead. Yeah, thank you for the opportunity. My question is more related to the payout. Year on year, there is a decrease, so is this, like, keeping in mind, you know, we want to conserve cash for acquisitions or something along those lines? If you can elaborate. You mean payout in terms of dividend, you're saying? Yeah, yeah. Yeah. I think, yeah, see, last year we, I, I'm not, I'm not able to recall exactly, but I think INR 9-INR 9.5, I think we paid as a dividend last year. So, this quarter we paid out INR 3. I mean, we'll, I think we'll pay out reasonably well, but if you want me to say, will I give out a larger dividend? I don't want to give out a larger dividend, no. I think I want to keep the capital for a possible acquisition. I think that's, that's my thinking. We'll pay out reasonable amount of dividend, but I, I, again, I don't want to pay very high dividend because I want to keep the money for any possible, acquisition, if anything were to happen. Yeah. That, that clarifies. Thank you. Okay, thank you so much. Yeah. Next. Thank you very much. The next question is from the line of Yash Dantewadia from Dante Equity Capital. Please go ahead. Hello. Can I just understand if you're sharing the Revlimid sales for this quarter? Like, what percentage of your sales were, are you sharing that number? We are not doing that, Yash. No, we're not. Right. Can you like, what is the cash that you have on your books right now, post this quarter? Without the receivable of Q1, right now, right now, I think we have about INR 2,000 crore of cash in our books. Yeah, so, what's the plan with the cash? I mean, how are you planning to use the cash? Acquisitions, are you looking at something actively? Is there something in the pipeline? I mean, where is the next... What I'm trying to understand basically is where is the next leg of growth going to come from according to you? Let's look beyond FY 2026, right? Beyond FY 2026, where do you see the next leg of growth coming? Once your exclusivity ends with Revlimid, where is the next leg able to come, according to you? What would be your best guess? Good question. I think, see, the way I look at this business, right, I mean, you need to do interesting filings, okay? So, if you look at the next 10 years of our future, I mean, I, I don't take a one year, two year view, I take a 10-year view now. Right. If you leave out, so we have Revlimid now, we have Revlimid next year, and obviously it's gonna, you know, as all products, it all tapers off. Right. So, first question to ask is, what is it that we have which is, you know, interestingly large? I mean, you'll have the smaller ones, $5 million, $10 million, $15 million, but that won't move the needle. So, the first question I ask myself is, what do we have which is worth more than $50 million or $100 million of, you know, net present value? Right. So, to answer that question, I mean, obviously, semaglutide is my number one pick. Then we have, you know, subject to the litigation, of course, and the approval on time. And then second one is obviously olaparib, which is already disclosed in the, in this presentation. And another one that we have is, erdafitinib, and, again, the product is only $100 million, but we hope that we are, we're gonna, it'll become a bigger product over a period of time. So, and then we have Imbruvica. I mean, obviously, we lost the case, but we are trying to see what else we can do, to revive it. Right. So, I mean, if you look at the next 10 years, I would say comfortably that we have ideas for about 5-6 years. So the question is, first question is, how do I fill the next, next, 3-4 years? I think this year, I, like, for example, before, you know, you know, we, we have done about 3 filings in this year, and all are, you know, FTF. So is it going to be shared FTF or sole FTF? I don't know. I don't have an answer to that question. Right. So, in the next few months, you'll probably hear from us on maybe, hopefully, we'll pull off another 1 or 2 FTFs. So, if you, in the next 2 years, you pull off another 3 or 4 FTFs of interesting ideas, then you have about 10 ideas for the next, let's say, 8 years. And even if you get half those ideas right, I think you'll do well. The elephant in the room, if it drops 2 years later, the earnings will drop. Possibly, yes. I, I will not run away from it. It will, but, but you, you gotta, you can't look at a particular year or year or 2 in isolation. You ought to take an 8- to 10-year view on this business. If you take a 10-year view and say that, you know, for most of the, most of the time, I'll have these very interesting products, I think I'll be a happy person. Hopefully, as shareholders, you'll also be happy, so. Right. So- You can't, I mean, obsess too much about, you know, you know, one bad year. I mean, if you start doing that, then, you know, it just, it would take you away from the larger picture, so. Right. So basically, and you end up with maybe INR 3,000-INR 4,000 crore cash, right? By the end of this financial year. Will I end up with INR 3,000 crore cash by end of this financial year? Possibly, yes. Yeah. Yeah. So, what's the pipeline like? Is there anything already? You're breaking up. You're breaking up. Your voice is not clear. I'm sorry. Is it, is it clearer now? Yeah. Keep so- Yeah, I'm- What's your question? Yeah. Yeah, so my question... You're still breaking up. Your voice is not clear. You're breaking up, sir. Can you please come in the range? One second. Yeah, please go ahead. I guess the participant had disconnected. Can we move on to the next question, sir? Yeah, sure. Please go on. Right. Next question is from the line of Sanjay Kular from Acme Private Limited. Please go ahead. Yeah. Congratulations for giving good results. Sir, you are an entrepreneur. As an entrepreneur, we always see that our wealth should be best measured in terms of market cap. You know, companies like your size, which earns nearly INR 2,000 crore, are quoting around INR 80,000 crore-INR 100,000 crore market cap. So, what do you think are the reasons why we end up enjoying a little less market cap? And what measures should be taken to increase the market cap? I wish I knew the answer to that question. I honestly don't have an answer to that question. All I can do is tell you what we're doing in our business, and I can tell you how we see the business and what I see in the future. And I think we're being fairly forthright, and I think I tell it the way it is, and that's all I can tell you. Beyond that, I can't answer that question. All I can say is that I am very comfortable with the strategy that we do, and I think we make very good return on capital. And I think, if you look at, you know, our profitability, and our strength of our balance sheet, I mean, you know, it is very strong, so. Sir, sir, that is the reason I think we should enjoy at least 45 multiples, but we are enjoying just 10 total. You see Mankind Pharma and Mankind- I wish I could answer that question. Yeah, I do understand. I have no idea how to answer that question. Okay. No? Okay. Okay. Thank you. Thanks. Next, next caller, please. Thank you very much. The next question is from the line of Sanjaya Satapathy, Ampersand Capital. Please go ahead. Yeah, yes, sir, thank you a lot for the opportunity and congratulations once again for the fantastic result. So, you have tried to answer this question about cash and its utilization in many ways. Can I just ask that, if at all there will be the acquisition, will it be more to diversify your revenue stream so that it will have lesser volatility, or it will be more towards increasing your capability in R&D side? I think a lot of the money that we are spending right now is only in R&D right now. I think if we look at our numbers, you know, these are all post-expensing of all the ideas that we are pursuing. We're pursuing very interesting ideas, which are worth, you know, $ millions. And I think we, we have been consistently able to deliver this pipeline. I think you look at these things in two buckets. One is the R&D ideas we continue to deliver, we continue to spend, and whatever we are earning is after expensing all these R&D ideas. Okay, that's one. The second portion is consistency of earnings and gaining geographical spread. I think that's the piece that we need, the cash for. I think that's where I'm preserving the cash for, so that we get less volatility and more geographical spread, so there's more consistency in our earnings. Yeah. That's why we're preserving the cash flow. But the R&D ideas, I mean, we continue to spend, and I think we believe in the next 2 years, we'll be able to accumulate enough ideas, which will give you, you know, our vision and our clarity of, you know, in terms of the pipeline in the next 8-10 years. And that's what we're working on. Understood, sir. So can I just, I mean, again, try my luck to understand it better, that now you have a fantastic R&D unit which is delivering all these great molecules from time to time, and you know, the company will have all this big cash which will go into more of a capital intensive kind of a business, which will stream or smoothen the overall growth trajectory. Can one kind of look at it this way? I mean, we're looking at it- ... Ladies and gentlemen, it seems like the management line has been disconnected again. Please stay on the line while we reconnect it. Ladies and gentlemen, we have the management back on the line. Sir, you can please go ahead with your question again. So you were saying. Could you repeat that question, my friend? I'm sorry, we're just having a very bad day in terms of this connection. This is the third time. I apologize again. I, I don't know why it's happening, but anyway, please, please ask your question. No, my question is that, considering that your R&D unit is already delivering so, so nicely in terms of, products and approvals, will you kind of use this big capital, getting the money to get into more of a capital-intensive business like the PLI-driven API or something else? I'm just trying to kind of understand the thought process as to where the acquisition or investment will go into. I don't like these commodities PLI type of businesses, my friend. It's not our business model. Our focus is always to niche in high value and do difficulty to do generics, rare disease products. I think that's the strategy. And we get some PLI for that, but it's not like, you know, it's not like the antibiotic PLI or any of that more mass volume. I think PLI scheme is different because they want to ensure security and localization of these commonly used products. So, which is not part of our, you know, course, it's not our course strategy. So, to answer your question, the answer is no. I would do an acquisition so that we can strengthen our geographical spread, so that we can take our portfolio elsewhere. I think we have gaps. I mean, we're not present in Europe, we're not present in Africa, we're not present so strongly in Southeast Asia, we're not present in Australia, we're not present, you know, there's so many parts of the world we're not present. So, those are the markets we could possibly do, so we can fill the gaps. Yeah. Thanks a lot, sir. Okay. Next caller. Thank you so much. The next question is from the line of Nikhil Upadhyay from SIMPL. Please go ahead. Yeah, hi, good morning. Just two clarifications, Rajesh. You mentioned, so if you look at our subsidiaries, they've scaled up pretty well. And as you said, we are trying to broaden the set. So if I'm just trying to understand, the current revenue profile, both for Brazil and Canada, would be across how many products? Multiple products. I mean, is it like 10 of them? Like, Canada has a portfolio of more than, you know, 40 products today, right? And- Is there a concentration risk? Huh? Revenue concentration for few products, is there a risk for that one? No, we generally don't reveal the strategy of which product makes which market-how much money. So, I think that's- No, I'm not asking for which product. I'm just trying, is there a concentration risk on few products? Always in any business, my friend, there'll always be those 3, 4 products will give you 80% of your profit, so, or 60%-30% of profit, depending on which market you're talking about. So that's. But the idea here is that you spread over multiple geographies and have multiple products, so that the volatility of 1 or 2 products doesn't give you, doesn't cause too much concentration challenges. Okay. And second question, see, Revlimid was equally good in Canada. For semaglutide, is it a similar thing? Like, is it, does it provide good opportunity in markets ex of US also or? semaglutide is with Mylan, so they're only following, they're doing a strategy for the ex-US business. Okay. The major regulated market businesses are all handled by Mylan. I think that's the way the agreement is structured. The ROW business, we have some rights, but the regulated market business is mostly with Mylan, with us. Okay. Okay, fine. Thanks. Sure. I just want to clarify one point, since it is Canada-related, right? So my 40 number is the number of dossier files, right? Today, sales activities is more than 20 products in Canada, just to give you a sense. And then some concentration profile is always there for different countries, as Mr. Rajiv mentioned. Okay? Sure. Thanks. Thank you. Next caller. Thank you very much. The next question is from the line of Gagan Thareja from ASK Investment Managers. Please go ahead, sir. Yeah. Good morning. Hi, am I audible? Yeah, yeah, go ahead. Go ahead. Two questions, sir. One, on semaglutide, I mean, given the current situation where there are shortages, compound pharmacies were allowed to supply. If you look at the pricing of compound pharmacies, it's around one-tenth of the, the pricing that innovators give. Do you think this is a reasonable, this reasonably represents what could happen, you know, later on when, when the market goes generic? I'm not a big fan of this compounding pharmacy business. I don't think it's... I mean, I don't understand enough about it, but I'm and I don't know enough about it either, so I... You'll have some exceptions here and there, but the real value is when you do it as an ANDA. Okay. The second one, you indicated that, you know, once the Revlimid patents expire, there could be a transition period where, you know, there'll be some stagnation in earnings. Just trying to understand, is the base case scenario one of stagnating earnings for a short period of time? Or could we perhaps also look at base case scenario as one where earnings drop, you know, there's a drop in earnings, and perhaps it sort of stays down for a certain amount of time before you then recover? I mean, you know, obviously, you know, I can't tell you what the future holds. You know, it's very hard to predict, you know, your earnings in a particular year. I think one thing is very clear. I think I can answer that, you know. We're doing well now. I think we see that the next one year and half year, I think we should do well. Obviously, when your profitable product drops, obviously there'll be a slight dip. But again, the trick here is that you are able to find something else that replaces it. So, what we can do is we can tell you, like, these are the ideas that we have, which will replace. And these are the pipeline for the future. So, you're gonna have some dips, but, you know, but overall, as I said, you need to take an 8–10-year view on, on your business. You can't take, you know- Which would be the critical one's for you to compensate for, you know, from a time perspective and from a magnitude perspective, to compensate for Revlimid? I spoke about that, no. I think a few minutes ago, I touched on the product. I also mentioned that, you know, there are other filings that we're doing in this financial year. Hopefully, they will also come in. So, we'll have... The trick here is we have about 10 or 12 ideas. I think I mentioned about 4 or 5 ideas. I think hopefully in the next one and a half years, we'll accumulate another 5-6 ideas. So, we'll have about 10 ideas for the next 10 years, and hopefully we'll pull off about 6 or 7 of these ideas, and then you'll have some consistency. On the India business, what are your thoughts, sir? I mean, in terms of sustainable growth rate with your current portfolio, what can- I think, you know, we're doing well. I mean, I wish we could do better, obviously. But, you know, we have some good launches. I mean, obviously, the biggest one is being semaglutide. semaglutide, we think, March twenty-sixth is the patent expiry in India. So, I think hopefully, and the regulatory approval comes on time, so I think we'll be in the first day of our launches. So that is probably gonna be a very interesting product for us in the domestic space. And that will have a b ecause we have a low base in our business, so semaglutide can actually jump up the numbers quite a bit. So that's probably a major disruption we're expecting in the domestic business in about the next one and a half, March twenty-sixth, so to speak, yeah, so which is a little over a year and a half away, so. So we have ideas. It's not like, you know, it's you just have to just continue with your R&D focus and then do these very smart products, and you'll get a breakthrough someday. So I think it's all about just keeping the pipeline hot and then and pursuing things. Will you need to add sales force for Sema or your existing? No, we actually have a diabetes setup. We have a diabetes and a cardio setup, so I think we have a division, so... But this, we don't have to. We have enough coverage. So we have already built that ground, reps and all, so it's only a question of launch. Thanks. Thanks for taking- Thank you, sir. Thank you. Next person. Thank you very much. The next question is from the line of Rajiv Jain from R K Global. Please go ahead. Yeah, hi. So, generally, you don't give guidance, but this is probably the time that you have at least given visibility for the current quarter. I'd just like to one clarification, like, you said that the current quarter looks good. So is it on YOY basis or also on QOQ basis? I was comparing QOQ. Sorry? I was comparing QOQ. I was comparing my this Q1 with Q2, and I'm saying Q1 and Q2, Q2 also we should do well, like Q1 is what I said. Okay. At what price would buyback be attractive? Like, if, let's say, the share price dips to INR 100, will you consider buyback or you don't have it in your plans at all? I think we did a buyback already. I think we last year, I think we did a buyback. So that's already done. I was looking at the tax implications. They don't look very good, honestly. From what I can see, but again, as of now, I'm just conserving cash for some big acquisitions. At this time, we don't have any plans for buyback. But if something changes, you know, we will speak about it. But at least my thinking now is no, not at this time. Okay, sir. Okay, that's all. Thank you. Thank you very much. The next question is from the line of Bhumika Jain from Dolat Capital. Please go ahead. Good morning, sir. Hi. My question was, revenue has been increased by 21.5% QOQ, so what are the factors like geographically and otherwise, both, which led to the boost? And, it is recurring revenue at the base or due to any large order? I, Bhumika, I didn't understand it first. Your voice is, yeah. Can you repeat? Can you repeat that and ask that slowly, please? Yeah. Sorry, sir, can you repeat? Can you repeat your question, please? Okay, can you repeat? Your voice is little muffled, so if you can repeat your question, please, one more time. Okay. Thank you. Sure, sir. Sir, I was saying revenues have been increased by 21.5% QOQ, so what are the factors geographically and otherwise, both, which caused the boost? And is it recurring revenue at the base or due to any large order? Sorry, your question is not clear. Sorry, Bhumika. You need to go slow and maybe rephrase it. Okay. Okay, sir. I was asking, the revenues have been increased by 21% QOQ, so what are the factors like geographically and otherwise, which led to the boost? And, is it recurring revenue or any large order, one particularly? So I understood your question. What is the factor for the growth in the revenue and the profits? Is that the question? Yes. Yes, sir, and is it the recurring one or any one particular thing that led to the boost? I think there are multiple factors. I think obviously, you know, development played a role as well. Yes, I think that's what has driven the earnings, and I think things are stable, and I think overall our businesses are—our international generic business has done well. So I think that's one of the factors why, one of the many factors, why the earnings have been good. Okay, thank you. Next call, please. Thank you very much. The next question is from the line of Rahul Chaudhary, individual investor. Please go ahead. Hello, sir. My question is regarding the API revenue and domestic formulations. API revenue seems stagnant for, you know, many years now, and in domestic formulations, if I'm not wrong, you had said last year, last con call about some jackpot idea. So, is this semaglutide the jackpot idea, or is it something else? No, I think semaglutide is one of our great ideas. So I think that's what I was trying to tell a few minutes ago. Yes. Domestic, it's been semaglutide has been our one of our biggest ideas that we have, but subject to us getting approval and then getting launching in the first phase on patent expiry. Regarding your other question about API business being, you know, not growing, I mean, a lot of API consumption is actually captive. So that's the reason why you don't see that reflection grow. In terms of output and all, I think it's been fairly occupied and there's a lot of captive consumption. That's the reason why we are unable to service the outside customers. But there's obviously scope for improvement. I think we're always looking at that. I mean, obviously, we're trying to add some capacity so that we can service our outside customers and also improve our internal capability. Okay? Right, sir. So my, my other question was on the, the 28 products on the Para IV pipeline. When you say 13 are approved tentatively or fully, it means, what does it mean? That litigation is ongoing, or we've got the final clearance to launch in the particular future? Some of them are tentatively approved, meaning tentatively approved means that they're approved and they are not given final approval. Some of them we have settlements, and some of them are under review. I think it depends on the product. Right. Thank you very much. That's all. Thank you very much. The next question is from the line of Yash Dantewadia from Dante Equity Capital. Please go ahead, sir. Yeah. Am I audible now? Yes, you're much audible. Yeah. So basically, my question was, by end of this year, you might have approximately INR 3,000-3,500 crore in your books, right? In terms of cash. Can you highlight the, for the lack of better words, the shopping environment or the takeover or acquisition environment that is out there for your industry? What kind of companies would you look at? Is there something in the pipeline? And basically outline the environment. I mean, if I'm a company with INR 3,000 crore in your sector, and if I go to acquire companies, what's the environment like? Do you see something happening in the year or next year? Like, just highlight that whole portion, because obviously, your ROCE has been exceptionally high, right? Over the last decade at least. And, you, like you said, you're not going to focus on- I'm sorry to interrupt, sir. The management line has been disconnected. Let me just reconnect. Please be on the line. Yeah. Yeah. Ladies and gentlemen, we have the management back on the line. Mr. Dantewadia, can you please go ahead with the question again? Yeah. So, my question is, by the end of this financial year, right, we are going to be, we're going to have at least, I think, INR 3,000 crore in our books in terms of cash. What I wanted to understand is, could you outline the environment out there for somebody in your industry? What kind of opportunity you see there for acquisitions and utilizing your cash? You've been a high ROCE company over the last decade, so obviously finding opportunities of that scale and size with high ROCEs might not come at a, you know, at a decent valuation, will obviously be much more expensive on that side. So if you're a company with INR 2,000-3,000 crore cash, and if you go out to, you know, buy companies out or takeover companies or acquire companies, what is the environment that you see out there with that much cash? Are you seeing any opportunities that might materialize in the next year or two? Good. Thanks, Yash. Yeah. So it's honestly very tough. I mean, as you rightly said, our sector is, you know, everything that you wanna buy is very pricey. It's very difficult to, especially in the domestic formulation space, the valuations are extremely rich. And, but it is what it is, right? So you need to figure out a way how to do a transaction. Personally, I find it very difficult to find a transaction. Maybe I'm too conservative, but we are unable to find anything. Outside India, we are finding reasonable opportunities. I think there's a fairer return of capital there, compared to domestic. But, you know, it's... We are evaluating. I mean, I'm not in a hurry to do a transaction. I don't want to do a bad transaction. So- Like this. I mean, I prefer to leave the cash alone rather than to do a bad transaction. I think that's always my thinking, yeah, so. No, that's great. But when you look at the environment, what would be a great opportunity? I mean, what are you looking in terms of ROCE? Like, what is a great opportunity to you that you would go and like to buy? Like, would you be able to picture that business and, like, tell me, like, this is, this is the kind of business I would want to buy, or that you, you, which sector, what exactly, I mean, what chemistry? Anything, basically, on how you spend your cash. Spend my money. If you, if you leave out the R&D that you're doing, organic growth that you're doing, I would spend all my money on only two things. One is on new technologies, companies or startups, which are, will give you something very disruptive, which can, you know, have a significant impact on, you know, on your earnings and, and something that's extremely disruptive and unique. Or two, buy a business where you have a gap in your portfolio, let's say we're not covered in a particular market. Like I said a few minutes ago, we're not there in, you know, Africa, we're not there in Western Europe. So if you get an access to one of these markets, then it's worth spending, because whatever you're doing, you can extend your pipeline there. I think those are only two reasons I would spend my money. I would want to get a good return. I would not get caught up in this craziness. I believe that, you know, everything is very rich, and it's very tough to justify a return on capital. But you gotta do it the way you know, I think. You can't feel pressure to do a transaction, then you're in a way getting into peer pressure, right? I mean, in, in- Right. Individually, you'll always say that you should never, you know, succumb to peer pressure. So it's same for businesses, too, right? You can't succumb to peer pressure to do a bad decision. A good decision is always a good decision. And even if everybody else is doing it, doesn't mean that it's the right decision. So you gotta, you gotta know what you're doing, and, and as long as you get a fair return on capital, then you do it based on what you think is right. Okay. Great. Thank you so much for taking all my questions. Have a great day. Thank you. Yeah. Thank you. Next caller. Thank you very much. Another question? Yeah. The next question is from the line of Ankit Minocha at AB Ventures. Please go ahead. Yeah, hi, good, good afternoon. So just to follow up from the previous question and your comments on the acquisition being probably in a different geography or a complementary asset. Is it necessary that this acquisition has to be in the pharmaceutical space? But I mean, considering the current environment for something like your allied business, which is agrochemicals, I mean, we could look at an environment where valuations are a lot more favorably. So I just wanted to get the management's sense that if there is a niche business in the agrochemical space, could that be viable in terms of acquisition? Yeah, I think even agro also we can do. We can do any business. Obviously, we have to stick to our core capability, which is... And it has to add synergy to what we have. You know, so I think as long as it makes sense, I know we can look at different levels of diversification. But again, we are a, you know, a core healthcare company, so any idea that we do is obviously related with healthcare and obviously, we're doing a bit of agro also. But it has to be complementary, disruptive, unique, I mean, and a reasonable return on capital. I think unless it checks all the boxes, we should not be in a hurry to do a transaction. Okay? Fair enough. Thank you. And, my last question is basically, you spoke about the three large opportunities, whether it was semaglutide or the other two molecules. What, how would you put these in scale in terms of what we are seeing currently with Revlimid, or if I was to look at those individual opportunity sizes? I mean, these are all large opportunities. I mean, all the IMS data on these products are already there, so you can make an extrapolation. It all depends on market formation. So it's a lot of multiple factors. So, I mean, these, I mean, the ones that I'm mentioning are reasonably large opportunities. So I think when I said reasonably large, I mean something that, you know, will make you $50 million-$75 million or $100 million type of upside. So I think those are only ones I'm talking about. So I think that's, I think that's, that was the... Assuming that they all work out, assuming we win the litigation, we have a good launch, we get the approval on time, and, you know, everything goes well. So, okay. Great. Thank you so much. Have a good day. Bye. Thank you very much. Let me apologize for the telephone disconnection. I mean, it happened 3 or 4 times. I sincerely apologize. We're just having a technical challenge. Again, I appreciate the time that you guys have come and engaged with us to ask us about what we're doing. I appreciate your time, and thank you for coming, and thank you so much. Yeah. Thank you. Thank you all. Thank you. On behalf of Batlivala and Karani Securities, that concludes this conference. Thank you for joining us, and you may now disconnect your lines.