Ladies and gentlemen, good day, and welcome to the Q1 FY 2024 earnings conference call of PI Industries Limited. As a reminder, all participants lines will be in the listen-only mode, and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal an operator by pressing star then zero on a touch-tone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Nishid Solanki from CDR India. Thank you, and over to you, Mr. Solanki. Thank you. Good evening, everyone, and thank you for joining us on PI Industries Q1 FY 2024 earnings conference call. Today, we are joined by senior members of the management team, including Mr. Mayank Singhal, Executive Vice Chairman and Managing Director; Mr. Rajnish Sarna, Joint Managing Director; Mr. Manikantan Viswanathan, Chief Financial Officer; Mr. Prashant Shende, CEO, Domestic; Mr. Atul Gupta, CEO, Exports; and Mr. Anil Kumar Jain, MD, PI Health Sciences. We will begin the call with key perspectives from Mr. Singhal. Thereafter, we will have Mr. Manikantan sharing his views on the financial performance of the company. Thereafter, the forum will be open for question-and-answer session. Before we begin, I would like to underline that certain statements made on today's conference call may be forward-looking in nature. The disclaimer to this effect has been included in the investor presentation shared with you earlier and also available on Stock Exchange website. I would now like to request Mr. Singhal to share his perspectives with you. Thank you. Over to you, sir. Good afternoon, good evening, everyone. It is my pleasure to have you with us on this call. I shall now share my perspectives on the industry landscape and the progress that we are making with our strategy. The global crop protection industry is witnessing a tough phase over the last couple of quarters. This intense destocking by the distribution channels due to increased availability of certain categories of products post the normalization of the COVID disruption and scenarios of steep price reduction of these products, leading to cautious procurements by the channel. On the other hand, the Chinese economy is experiencing flat domestic demand, and it seems to be exporting deflation to speed up exports of goods. This is already impacting the chemical sector across the value chain. Given that, we at PI, overall, year-on-year basis, during Q1, we have delivered a 24% revenue growth and a 35% increase in EBITDA and a profit after tax recorded a 46% growth year-on-year. PI has maintained course of healthy performance in its CFM exports with a 33% growth year-on-year. This performance comes back with continued strong growth in further endorsement of our approach to the business. Our domestic business performance for the quarter has been subdued due to the delay on set of monsoons. On the positive side, we have kept tight control on trading working capital and overall market scenario and focused more on qualitative elements of the revenue than the volumes. We are confident of getting back on a growth path with the normalization of rainfalls during the second half of the current season. We continue to maintain the momentum of new product launches, five innovative pro-products, nine in the business earlier. In the Q1, we have launched Eketsu. Eketsu is India's first three-way herbicide mixture to provide maximum weed control and efficacy for total control of rice herbicides. This will further fortify our portfolio of rice crops, already one of the best in the industry, with businesses long pipeline of products, yet exciting launches ahead. Our business model is aligned to commercialization of advanced molecules for innovators. Thanks to our very visible track record, our engagements of scale up as well as goes beyond active near 30. It is our intent to create a dedicated platform, for the pharma CDMO, CRO CDMO play. I would like to share that this process of integration of our pharma CSM acquisition is underway and tracking internal milestones. Our combined R&D capabilities with a brand new integrated pharma research center being developed in Hyderabad for the CRM and CDMO offering further builds on to our business proposition. Our forte has been a vast library of knowledge of complex chemistries with high scalability and competitive manufacturing footprints, and are able to tailor our solutions with specific circumstances to meet and be customer-centric. The continued traction is delivering and driving healthy accreditation to our order book position in a virtual cycle between innovators and PI. During the quarter under review, we have commercialized 1 new molecule and remain well on track for commercializing four to five new molecules every year, as guided earlier. While the industry outlook for the demand is soft, with some forecast projected, single-digit contraction in the year 2022-2023 is relatively to the previous year. However, PI will especially focus on new chemistries and balanced portfolio of products will give the visibility that we enjoy and remain cautiously optimistic to achieve the given target between 18%-20% revenue growth in the current fiscal, despite the headwinds explained above. We shall, however, keep a close watch on the market scenario and review our guidelines after the upcoming current season. This will be supported by ramped up production of already commercialized molecules and the introduction of new molecules. For the long-term perspective, India remains the locus of growth in chemicals. It is believed that India has achieved the active exporter worth $5.4 billion in 2023, up by 10%, making it the second largest exporter of active in the world. With policy supported by manufacturing outcomes, these exports are expected to double in the coming three to four years. India is already the fourth-largest producer of active, now number two in the world, from the previous year. The government is considering a PLI scheme for chemicals and petchem domestically. That can further accelerate this trend. With policy activation as a catalyst, the industry plug the gap in the value chain in order to. Innovators of chemistry as well as customers at the end, adding incentives to expand here. The long-term perspective of the specialized chemical industry remains bright despite the current grips. We are remain dedicated to the driving progress in a sustainable manner. ESG will remain the center point of every initiative on a growth execution. We deem it as our responsibility to align our process, production, products for thriving and a vibrant environment for our purpose of reimagining a healthier planet. This reflects and can be tracked through our outcomes we have scripted. I now close my perspectives and hand it over to our CFO, Mr. Manikantan, to take the discussions forward. Thank you once again to all of you. Over to you, Mani. Thank you. Thank you, Mr. Sanjay. Good evening, everyone, and thank you for joining us the call today. I'll summarize the company's financial highlights for the fourth quarter ended June 30th 2023. Please note all these comparison are on year-on-year basis and refer to the consolidated performance. During Q1 FY 2024, we reported a revenue of INR 19,104 million, a growth of 24% year-on-year, including newly acquired pharma business, and 21% revenue growth in Agchem. This was driven by growth in export revenue by 37% to INR 16,630 million, offset by a 13% decline in domestic revenue to INR 3,474 million. Export revenue growth in Agchem was 33%, comprising volume growth of 29% and 4% from five currency and favorable product mix. This quarter, total export revenue included pharma revenue of INR 443 million, comprising around two months period for Archimica from 27th April 2023 onwards, and one month period for Therachem Research Medilab for, from June 2nd onwards. Domestic revenue was contracted by 13% year-on-year due to the base margin leading to volume growth. Growing margin increased to 47, gross margin increased to 47%, including pharma, and 46% excluding pharma. Pharma, including pharma, had jumped by 201 basis points. Pharma gross margin was 75%. EBITDA increased by 35% to INR 4,726 million for the quarter on account of favorable product mix and operating leverage. EBITDA includes pharma EBITDA loss of INR 54 million after one-time acquisition, integration, and initial business setup ex-expense. Profit after tax increased by 46% to INR 3,849 million, attributable to EBITDA growth and lower effective tax rate, despite higher depreciation. Cash flow from operating activity during Q1 FY2024 was INR 3,028 million. Trade working capital in terms of number of days of sales increased to 83 days as of June 30th, 2023, compared with 102 days as of June 30th, 2022. Inventory levels reduced in terms of days of sales to approximately 73 days to INR 14,049 million, excluding pharma inventory of INR 1,216 million, compared to 89 days as of June 30th, 2022. Our balance sheet further strengthened during the year. Net worth increased to INR 76,094 million as on June 30th, 2023. CapEx in Q1 was INR 6,490 million, including pharma acquired assets of INR 5,249 million through business combination. The CapEx, excluding the acquisition, is INR 1,241 million. During the quarter, we completed pharma acquisition of Archimica and Therachem group, amounting to INR 8,560 million. Post acquisition outflow, the surplus cash, cash net of debt is INR 28,066 million, including balance in QIP funds of INR 11,320 million. QIP funds remain invested into deposits and debt mutual funds with SLR philosophy, while final deployment aligned with PI's long-term growth strategy is underway. This concludes my opening comments. I will now request the moderator to open the floor for Q&A. Thank you. 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 touchtone telephone. If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. Thank you. The first question is from the line of Aditya Jhawar from Investec. Please go ahead. Yeah, thanks for the opportunity. Congrats on strong set of numbers. My first question is on our pharma assets. How is the integration process progressing? If you can give some, you know, qualitative information on the same. How should we think about growth of this business? Do you foresee a significant increase in capacity utilization in these two assets versus around 50% what we saw last year? Thanks for the question. I'm Anujan here. I think, your first question is about the integration team. You know, we are integrating the three pieces. One is the clinical, which we acquired entry, and there is the GRN, which is U.S. and India, and then our center, which is, you know, we build up and also in full chain for the business staff. Currently, I think our progress and operating model, understand an IT integration of these units. We are also working on the, you know, global level for the business partners across these areas, in R&D and manufacturing. Right now, we are on the track, and this activity would continue to for almost a quarter more during the, you know, this path. The second part is that, you know, on the pharma revenue, I think our aim is to get the, I mean, the INR 550 crore, which we have set, we are aiming in that direction. Gradually, on the quarter and quarter, this will build up right now. In this quarter, we are only talking of one company operating on 26 days, another on 34 days. That's the right number, which is, which is not very less than to, you know, the plan we submitted. Gradually, this will improve, and I think we will be home what we are committed to this team. Okay, okay, that, that's quite helpful. Now, in this, you know, quarter, there was a one-time acquisition and integration cost. If you can just call out what was the cost, and how should we see the margin trajectory of the pharma business, in the remaining part of the year? So in this quarter, in terms of financial, there were two, you know, one-offs. One is obviously the acquisition and business setting up costs and all, to be, you know, more than, I think, INR 100 million or INR 120 million. The other is the impact of the Ind AS 115, because the acquired entity, particularly the Indian acquired entity, was not accounting as per the Ind AS, whereas in CIS times, we follow the Ind AS. Because of these impacts, those one-off impacts have come. Going forward, as we have indicated earlier also, that, you know, there are going to be some initial phases where we will be investing in the development of the development of these businesses, acquired businesses, and also transformation of some of these businesses. Obviously, the bigger margins that we are looking at is going to be on a lower side. On maturity, we would surely expect and target 20%-22%+ kind of, you know, 20%-24%+ kind of margin once we get to the maturity, which will take few quarters time, or maybe more than a year's time. In the initial phase, we are expecting anywhere between, you know, 14%-15% kind of margins that we have indicated earlier. That's quite helpful. My final question is, sir, what would be the total CapEx guidance for FY 2024? Break, it would be great if you give a breakup between CSM and domestic, as well as, the pharma piece. The core business and the acquired assets, sir, separately. We had, as you recall, we had indicated close to INR 850- INR 900 crore kind of CapEx for the CSM business, okay. Yeah. For pharma, we have already also indicated close to $10 million-$12 million is what that we will be investing. That's the current guideline on the CapEx. We, you know, maintain that guideline. Perfect. All the best. I'll call back in queue. Thank you. Thank you. 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 or two per participant. Should you have a follow-up question, we would request you to rejoin the queue. Our next question is from the line of Rohit Nagaraj from Centrum Broking. Please go ahead, sir. Yeah, thanks for the opportunity. First question is, you have mentioned in the presentation that 13 top molecules identified for capacity enhancement. These are the molecules which have been launched in the recent, you know, years, or these are more mature molecules, and we have seen a good amount of scale-up happening from the offtake perspective. Thank you. Yeah, these are all operating, you know, objectives that are taken by our cross-functional teams on a regular basis, and these are not recently launched molecules. Over the years, we have commercialized many products, and out of those products, so many of these products, as the processes improve year on year, and then our teams have identified opportunities of throughput improvement and all. That is pertaining to that, you know, activity of continuous improvement. Right. I've got it, sir. Sir, second question is, in commentary as well as in presentation, we have said, cautiously optimistic on the CSM segment. So in the last one and a half months of the current quarter, have we seen any kind of slowdown in terms of volume offtake? A concurrent question to that, the 18%-20% guidance, does it now include the pharma piece as well, or does it, is it excluding the pharma piece? Thank you. ... As far as the trend is concerned, the global scenario, et cetera, is concerned, it's not only last one month, 1.5 months, but we have been seeing this for last three quarters, that there are certainly headwinds in general in the industry. Okay? That is more particularly towards certain category of products in the, on the generic side. So far, we have not seen a dramatic change as far as the demand scenario for our products are concerned. Why we are saying cautiously optimistic, because ultimately, you know, some such longer term trends may have some impact on overall general industry demand scenario as well, though we have not seen it so far. As indicated, we would also like to review this overall plan and guideline, maybe post Kharif season. By that time, by that time, we'll have a better understanding and better visibility as well. At this point, we do not see a, any dramatic change or new development. All right, sir. That include pharma as well? Just to clarify. Sorry. For the 18%-20% guidance that we have. Our idea is that, that pharma, whatever contribution it comes, will be on top of it. As I said, we will review all this post Kharif season. Sure, sure. That's helpful, sir. Thank you so much, sir. Thank you. Our next question is from the line of Sumant Kumar from Motilal Oswal. Please go ahead. Sir, can you talk about the domestic business, 13% degrowth, and how the things are panning out in the current season, in the coming quarters? Yes, Nikhil. Yeah. The first quarter, you already might have seen from the industry. In fact, we anticipated it from at least last year, 12 months. That is why we are also cautious in terms of our procurement, especially on the generic products, knowing this volatility. However, from July onwards, the positive momentum has built up. We having, especially commercialized, seven new products last year, those are doing good. This year also, we have a plan to launch four new products, in that one we already commercialized in quarter one. This has definitely helped us, and this will continue to, basically help us in terms of, showing positive results in, coming quarters. Basically, just to add, in terms of market sentiments, market activities, there is certainly improvement, compared to what we have seen... Yeah. In the first quarter. Yeah, I mean, still there are couple of months to be monitored and seen that how overall Kharif season it pan out. Yeah. Sir, can you talk about pharma like-to-like growth, quarter, YOY, and also what is the quarterly run rate if, we'll consider as a, from, from the month of April, but for, for the both entities? Yeah. First of all, it is not possible for us on YOY, like-to-like, because as Anil explained earlier, I mean, one business, we have the revenues of maybe 30 days or less than 30 days, the other business we have revenues of maybe, I think, 50 days or something. We certainly do not have past data of these companies' businesses for the previous year. That is the reason we do not have that like-to-like comparison. And why this business or, I mean, current quarter performance, I think Anil has already explained. Maybe you may want to add something? As I said, now it's only 1 month performance right now, and you know, the CRO and CDMO businesses, generally, they are all the customer delivery driven, they are not driven by the month. That's the-- sometimes it comes up, but then they are confident, as we said, in the coming quarters, we would be able to meet our expectation of the number as well as the, you know, margins also. I am asking, whatever the number we have published in the acquisition note, for the FY 2022-FY2023, or say CY 2023, is there will be... There will be any growth on that? Yeah. Those numbers, if you see, those numbers were for, first of all, calendar year, if I'm not wrong. I mean, one business is calendar year, the other business is also calendar year. Part of it is financial year, so we'll, we'll have to see. That on annual basis, what is that we will be finally seeing the number. Yes, in certain business, we are expecting growth. In some other business, it is kind of flat as per the current rate. I mean, on like-to-like, on quarterly basis, it is, the data is not there for us to give you the, you know, straight answer. The line for the participant will drop. Maybe I request the management, we move to the next question, please. Yes, please. Clear. Thank you. Our next question is from the line of Vishnu Kumar from Avendus Alt. Please go ahead, sir. Thanks, sir. Thanks, sir, and congrats for rockstar numbers reported this quarter. I wanted to understand on pharma, I mean, just some continuation. Now that all the plants will be running fully, is it like INR 150 crore-INR 170 crore at least would be a current run rate that we'll achieve from Tuki on it? If I just do some approximation on the pro forma numbers. That, that's not our guidance page, you know, but we, we are open of, you know, going in this direction in the coming quarters. Understood, sir. Also on the on the CSM side, we see that 29% volume and pricing continues to be positive. With with across raw material deflation, I wanted to understand how long this pricing will continue. Generally, when we talk to the customers, when does this price negotiations happen, like, because there's a deflation, should we continue to believe that this will help us on the margins, or at some point we'll see some pricing cut? First of all, with deflation, raw material deflation, is not all across the product, and obviously, that varies from product to product. That scenario also, the raw material price trend varies accordingly. Yes, wherever there is substantial improvement in raw material prices or reduction in raw material prices, obviously, going by our business model, I mean, those prices are factored in, in the next supplies or, you know, next, next contracts or the purchase orders and all. Yes, that always takes place. Okay, this, so this 25% margin would be a new normal to be considered, or any guidance on the margins, if you could help us understand? We have, as, you know, in the past also, we have explained that, you know, this 24%-25% margin obviously is coming from 2, 3 factors. One is obviously the operating leverage, the other is the product and business mix and all. Yes, I mean, we are relatively confident that given the kind of visibility of plans, business plans, volumes, values that we have, we should be able to maintain, sustain the margin. Got it, sir. One final, if I may. We've done almost 30% growth plus in the CSM, and you also mentioned that our growth is not impacted. If I take 18%-20% guidance, it looks like even if you do 10%-12% or 12%-14% growth is enough to achieve the guidance. Is this like we are taking a conservative approach, or you have some indications that your delivery schedules in second half will be slightly lower? Just some sense, here. No, we are cautious. It is not conservative or optimistic, but, yeah, I mean, we are cautiously optimistic that, yes, and in any case, as indicated, we will review this overall situation maybe three, four months down. Got it, sir. Thank you. All the best. Thank you. Our next question is from the line of Abhijit Akella from Kotak Securities. Please go ahead. Yeah, good evening, thank you so much for taking my question. Just, two from my side. One is on the CapEx for the quarter. It seems to be about INR 120 odd crore, excluding the pharma acquisitions. We've guided to almost, I think, INR 850-INR 900 crore for the full year. Should we expect a big acceleration in the remaining part of the year? Yeah. This is as per the plan only. You know, the major part will be coming in subsequent quarters as the execution happens. Yeah, I mean, the overall year plan remains what I indicated, around INR 850 odd crore. Okay, thank you. The second thing is just that on the guidance, 18%-20% growth. You know, earlier, I believe it included the, the domestic business also. In light of this quarter's challenging performance there, you know, do we sort of stick with that expectation, or should we assume the 18%-20% is only for the CSM piece for now? Yeah, you are right. That's the reason at this point, we are saying we are, we are optimistic cautiously that, if things pan out well for the remaining period of current, we should be able to get there. If not, then we will surely come back with our revised estimates. Okay, sir. Understood. Thank you so much. All the best. Thank you. Our next question is from the line of Vivek Rajamani from Morgan Stanley. Please go ahead, sir. Thank you, sir, for the presentation, congratulations on a very strong result. A few questions from my side. Firstly, on agrochemicals, if it's possible to give some color on, you know, what is the kind of inventory situation that you're seeing for your specific products. We've obviously been hearing that there's a lot of inventory across the system, but if you can provide any kind of color with respect to what you've been hearing from customers, that would be really helpful. The second question I had was on margins. Again, very, very strong margins that we've seen this quarter. Just wanted to get a sense if there was any specific factor that you would like to call out, which was driving this sequential jump. Just going forward, should we be aware of any seasonality in the upcoming quarters? Thank you so much. Well, in terms of inventory, in general, we do not see a significant, you know, challenge of stopping in the kind of products that we are dealing. Yes, I mean, there are maybe few products where we may have some sort of indication. In general, there are no such big stopping issues, okay? The kind of products that we are dealing in our exports. In terms of domestic, maybe, Prashant, you may kind of highlight. Yeah. Thank you. Yes, overall, we know the price has been volatile, so that is why we were cautious, even in Q1, in terms of our placement as well. Now, with the demand picking up, we don't see any major concerns so far, so because the overall domestic side demand is now from July onwards, we are seeing that it is coming out stronger. However, again, it is last 1.5 months only. We are cautious. We have to wait and see how these things progress for remainder of the current period. Your second question in terms of margins, I already explained to the earlier participant that last year from 20%- 22.5%, 23%. Currently, we are whatever few hundred basis points that improvement is there, is mainly on account of the operating leverage and, you know, kind of, product mix, and the kind of revenue policy, particularly in the domestic business, where the volumes were becoming challenged given the overall market scenario, monsoon situation. We have very clearly focused on the quality of revenue and margins, and that is obviously clearly reflected here. Got it, sir. Thank you so much. No further questions. Thank you. Our next question is from the line of Ankur Periwal from Axis Capital. Please go ahead, sir. Yeah, hi, sir. Thanks for the opportunity, and congrats for good set of numbers. My first question on the R&D side. You know, looking at the annual report, we have seen a sharp increase in the R&D manpower as well as spends. Just, you know, your thoughts there, is it largely related to the Agchem side or the new chemistry side, or it is also focusing on the pharma? Probably one can expect a larger number of new product launches there. Clearly, in March 21st, we didn't have the pharma business on. We were clearly focusing the Agchem side and the process research and development side, and also the biotransformation side that we put in there, yes. Sure. The incremental addition that we have seen now, will this also be including the allocation for the pharma R&D? No, that is going to come now, as I said, because the pharma business come up later, right? Sure, sure. You know, looking at the last three years number, there is a almost doubling of the, the manpower there. Anything you'd like to share on the, you know, the other performance chemicals or the electronic chemicals that we have talked about earlier? Yes. Clearly, we have taken some of those areas to work. I think it's a good part of we definitely can update about where we are in the commercialization of the fine chemical area. Yeah. There has been, you know, a good amount of traction around the electronic chemical segment, and there are a good amount of inquiry in pipeline and with the advanced development history. We will be commercializing, possibly another 4 or 5 molecules in the electronic chemical space. As you know, Mr. Nair said that there are other adjacencies where we are trying to build a platform for the biotechnology fermentation and the other new technology, and that's where, you know, the additional, you know, the resources have been come back. Sure. That's helpful. Secondly, we also talk about, you know, rejigging our product portfolio, focusing more upon, you know, the EAG angle or the environment part of part of it. Is this comment largely focused on the crop protection, the domestic business, or you are including CSM also here? No. If you look at, it's a part of the PI strategy in every facet of our products, just not in one business area or two. I mean, we definitely look at this, whether it's Agchem brand, whether it's manufacturing CSM, automotive cell punches, automotive electronics. We will keep that anchor as a key driver. Sure. Sure. Sure. That, that's helpful. That's it from my side. Thank you. Thank you. Our next question is from the line of Rohan Gupta from Nuvama. Please go ahead, sir. Yeah. Hi, sir, good evening, thanks for the opportunity. Congratulations on such a strong set of numbers, despite this industry scenario. First question is on further clarification on that. While we are seeing that the entire industry is suffering from the inventory stock, especially in the global market, we still have been managed to grow 39% in terms of volume growth. Sir, if you can explain a little bit more, is it some because of the nature of our product or the product basket which we have, that continuously seeing the higher volume growth, there was no inventory buildup has happened in last one year at all, that is driving the growth? Or it is just only that customers keep on buying from you without any pushing or without any delays or spillover, that is still driving the growth for you and may impact our growth going forward if they are consuming or if they are sitting on the inventory on our behalf? No, you know, the earlier is the reason. It is all about quality of product portfolio, okay? Which is, which is driving this growth for us. These are, as you know, early-stage molecules. They are growing in different markets. So far, our customers have also, these are basically, these are not mature products per se, compared to some of the generics, which are getting beating in the market, global market. As a result, I mean, our customers are also not facing some significant challenges or concerns around, you know, inventory pileups and other things. That is the reason that the continuing the growth is there in these kind of products. Sir, if I extrapolate this thing, and if since we have not stuck with the higher inventory in the system, and there is no Chinese dumping probably in our case because we are early-stage of products. End customer demand, and especially for the new molecules for products like us, is still so solid that we have been able to deliver a 29% kind of volume growth. Having, I mean, if the industry would not have stuck right now with the high inventory, which is the case for most of the products in the market, do you see that the farmer maybe demand is still so strong, as what is in case of your products? Definitely, your product are in early-stage molecule, but still is, farmer level demand is very strong. Well, my, my personal view is that farmer level demand is strong even for generics, by the way, where there is a beating currently. The challenge is coming because of high inventory in the channel. The, the inventory destocking is happening at the channel level. That doesn't mean that the consumptions have gone down or acreages have gone down. That is not the case. Yes, I mean, even in, in the generic products, it is more about the channel destocking than the significant reduction in consumption. You take any global scenario and also local scenario in terms of acreages, Prashant may then add in terms of acreages, crop acreages. We have not seen any significant reduction, or reduction in, in products, any significant reduction. Yeah, the other impact, before you come up, the, the other impact is of price. You know that some of the, the generic products, the price impact has come. The products, prices have gone down, and therefore the values have come down. This is not a major issue in, in case of products that we are dealing. Yes, Prashant. Overall, in terms of acres, there was a delay in terms of sowing. End of June, we have seen somewhere around 60%-20% reduction, especially in rice. If I look at the pure impact, overall, it is more or less similar to last year, if I look at all the crops. Rice is up. That is a positive news. However, cotton is down by around 2%, rice is up by around 3%, and pulses are down by 9%. All other crops, more or less similar to last year, and overall, drought crop area is 0.2% down compared to last year. This is nothing. It's more or less the demand, is definitely looks like coming up, but, as I said, still, we are early into Kharif, and we have to wait and watch. Sir, just on the extrapolation of the same thing, since you are saying that we are not stuck with high inventories in the market and demand from the farmer level remains strong. When other companies are giving the commentary, they are not sure about how much inventory is there in the market and what is going to come up from China. In our case, we should be fairly confident about it, if the farmer level demand is strong. I still didn't get the reason that we still making a statement, statement like, you know, cautiously optimistic, while we are seeing that the farmer level demand is coming and it is still strong. I understand that the domestic market may have over 50 with the Kharif crop volatility, but as far as the global markets are concerned, we should be fairly confident about the volume growth in the current scenario, isn't it, sir? No, well, that is a rather, a very optimistic way of looking at it. If you look at it, because that being rather high in the inventory and the price point go below a certain point, it does have a temporary glitch, right? You can't say that it doesn't have any impact. Those are the things we are cautious about. We are watching. Yeah, the buffer is there, but that obviously becomes little impactful. You don't go out and say, "Okay, because of that, I'm going to start doing erosions, which are short-term in order to meet that," because that's not gonna help, not gonna change scenarios. I think this is, you know, there's a balance while economy which you need to keep, to look at demand scenario, competitive price, product availability, and how the balance between availability and value creation. Actually, just to add one more point, there is always a lead and lag even in getting the information on the ground. You see, this is not a, a very advanced industry per se, I mean, from the agriculture and rural streams or even, even in the global arena, the, the inventory data coming from, the rural markets, it's, it's not. I mean, there is always a lead and lag, so we have to be a little cautious and careful in all these, even reading these data points. Oh, fair enough, sir. I need one more clarification, if I'm allowed, otherwise I can come back in queue. Sir, looking at the control and standalone numbers, your implied cost seems to be significantly higher on control that talks about the subsidiary, which I mean, pharma, we acquired roughly INR 23 crore is a difference. While I understand that, the one-off item which you have mentioned will be in other expenses. A INR 23 crore probably for one month, where we had accounted, it seems fairly high. I just wanted to understand any particular adjustment there? Can you repeat your question? I missed your earlier part of question. Sir, implied cost on control is INR 180 crore, and standalone is INR 150 crore. That means that for the subsidiaries, pharma asset, which we have acquired, roughly INR 23 crore. That is fairly high number. I believe that the one-off, which you have mentioned, will be adjusted in other expenses. Yes. Yes, yes. There are both the aspects. I don't know how you have come to this comparison that, that number is high or that number is, you know, low. First of all, how you are relating this to is also not very clear to me. Yes, if you look at the acquired business, the overall revenues and et cetera, are for a very, very small period. There are also setting up expenses that are happening. For example, we are setting up, still setting up our Hyderabad lab. We are still setting up, we are also hiring, acquiring, many of these, top leadership players in the pharma space to, to, you know, overall, unleash the overall value out of the acquired assets. Yes, I mean, in the initial phases, as indicated earlier, we are certainly going to see some of these, development spend, including the manpower, spend. Sir, in the consolidated reporting, when we have started giving segmental financials, we also have some part of business coming from pharma, but that is not clubbed in the pharma segmentation. Any particular reason for that? In the, in the segmental thing, what is coming under pharma is already stated in pharma only, that is- That is our subsidiary. We had like 5%-10% of our revenue coming from pharma. Yeah. 443 is coming from pharma. That's right. INR 44 crore, right? Yes, yes. That is only from the subsidiaries which you have acquired, right? Yes, yes. The subsidiary, PI Health Sciences, which is comprising of the entity that we have acquired in Europe, that entity we have acquired in India, and also- The, but the PI, but the PI standalone basis also had some pharma business. We understand 5%-10% of the revenue used to come from pharma. By- No, no, no. I don't think... I don't know where you have got this number. 10% from pharma? No, not at all. Not at all. Not at all. Okay, sir. That's, that's... Thank you. Thanks a lot for the time. Thank you. Thank you. Thank you. Our next question is from the line of Vishal Biraia from Bandhan AMC. Please go ahead. Thank you. The question is, on-. Sorry to interrupt, Mr. Vishal, you are not audible, sir. Could you please use your handset? I am using the handset. Sir, we can't really hear you, sir. The question is on the future growth for the PSN business for the next few years or so. If you guide us for 18%, 20% this year, then what would be the growth for the next-? You're not audible. Sir, your voice- Gentleman, you're not audible. If you can please change your mic. I'm not clear. Mr. Vishal, may we request you to rejoin the queue? Thank you. Our next question is from the line of Naushad Chaudhary from Aditya Birla. Please go ahead. Thanks for the opportunity. Firstly, follow up on the electronic chemical piece, which you indicated 4, 5 molecules, we are planning to commercial. Just wanted to understand in terms of the size of opportunity you see here in this piece of business, and how big can it be for you in next three to four years? In the market? In the electronic market size. Well, let me answer that. To tell you that the electronic chemical business is just an entry point right now. This is not going to be a significant number in the year, but in the next five years, we do believe in the specialty chemical, and we now have a specialty but fine chemical area, we will see some decent numbers. Not just electronics, electronics or semiconductors or specialized polymer, which all going to be same application. We could see a few percentage points in that area. In 5 years, can it be, in terms of capital deployment, can it be as big as we currently have, the PSN, Agri and the plan which you have in pharma? Can it consume? Certainly, certainly not the same size as Agrium that we have, because you'll appreciate that where are we in Agrium today is the work of last 25 years, okay? Investments made over this period. What is being said is that with our efforts in last three, four years, we have already now got to a stage where we are commercializing several of these products, non-ACM products, including electronic chemicals, specialty polymers, et cetera. This would surely become a reasonable% of our overall revenue. This cannot be the same or, or I mean, it would be speculative to think that it will become of similar size as our CSM business today. No, it won't. Understood. Secondly, on the pharma side, so INR 900 crore we have deployed, on the remaining INR 1,000 crore, INR 1,100 crore. Any development on that side? Come again, I mean, your question was not clear. The capital deployment piece on the pharma business side, we had around INR 2,000 crore of plan. We have deployed around INR 1,000. The pending INR 1,000, any development? Let me clarify here. First of all, the QIP, the INR 2,000 crore that was raised was not only for pharma acquisition. That was for several of our strategic long-term initiative products, including pharma, of course, for diversification into other things including pharma. For pharma, we have already allocated close to INR 900 crore, as you mentioned. For the remaining, we are also looking at several opportunities, including some of the bolt-on opportunities in pharma. We are also looking at other opportunities in the space of, you know, CSM, domestically also and also from outside India. We are also looking at opportunities in organic opportunities in other technological areas like biochemicals, bio solutions, and several other such opportunities, maybe including brand, distribution, et cetera, beyond the pharma. I hope this clarifies. Understood, sir. Thank you so much, and all the best. Thank you. There is a gentleman in the interest of time and fairness to all participants. May we request all participants to restrict it one or two questions per participant. Should you have a follow-up question, we would request you to rejoin the queue. Thank you. Our next question is from the line of Ramesh Sankaranarayanan from Nirmal Bang Equities. Please go ahead. Thank you very much, and congratulations on the pharma acquisition. If you were to look at the pharma capital employed, is it possible to share what is the working capital in, under these and any accumulated losses? Secondly, once you reach that normalized revenue of INR 515 crore, what is the kind of investment you'll require on both gross block and working capital? How do you see the growth in the revenues over the next 2-3 years? Is there any clarity on the order size you can share with us now? Yeah, there are several questions in your question, but let me try and answer them one by one. Yeah, I think we indicated earlier that, yes, next three, four years, we would surely want to more than double this business, the kind of business that we acquire. That is one. The investment details are already there in our presentation also and also earlier released. Going forward, as we are scouting for more business, and particularly of better quality business, of course, we'll be making certain investments. We already indicated close to $10 million-$11 million investment in the current financial year. Likewise, depending on the business opportunities that we are able to scout, we will be deciding on further investment. In nutshell, the overall idea is that we would surely want to, and we are, we are, you know, internally, committed to kind of, build this a scalable, differentiated business over the next three, four years' time by making further investments. Okay. The second thing is on the domestic market, there's a mention about 9% of your revenue coming from biological products. How, how do you see the domestic business performing and the normalized demand based on the new launches? What is the kind of aspiration for the share of biological products in your domestic portfolio? Yeah, Prashant, maybe you can explain that. Yeah. Biological products, as I said earlier as well, we have a plan to launch 2 products in this year. 1 which we are launching in this month and one in quarter three. Definitely there is a good traction, even though there are many products, especially generic side, which we have seen some challenges. Biological products are growing in double digits, and they will continue to grow. That is what which we are basically estimating at this point of time. Okay, thank you very much, and all the best. Thank you. Our next question is from the line of Krishan Parwani from JM Financial. Please go ahead. Yeah, hi, sir. Thanks for taking my question. Just two small clarifications from my side. The first is, has there been any purchase order detriment in the ongoing quarter? Not, not really. Okay, thank you. The second is, since second half is usually strong for us, do you see that trend changing, changing, in any sort in this fiscal? No, as, as explained earlier, I mean, so far we have not seen any dramatic, you know, change in the scenario, demand product scenario, the kind of product that we are dealing in. Given the overall industry, situation, we are also very cautiously monitoring the situation, and in next three, four months' time, we will have certainly much better, understanding, visibility. Understood, sir. Which we shall certainly consider while coming out with our guideline for the second quarter. Understood, sir. Fair point. Thank you so much, and all the best, sir. Thank you. Thank you. Thank you. Our next question is from the line of Rohan Vora from Purnartha Investment Advisers Private Limited. Please go ahead. Before the opportunity and congratulations on the strong- Sorry, Mr. Vora, may we request you to use your handset, please? Congratulations on the strong set of numbers. Am I audible now? Yes, yes. Okay. My first question was on the organic side. Have you seen that working efficiency- We are losing your audio, please. Yeah. Sir, my first question is on working capital days. We have seen efficiencies in working capital days in this quarter, so can we treat this as a norm? Is there a scope of still better working capital days, or, you know, the days will go up from here on? No, we see, we certainly see, some more opportunities of improving, working capital in some of the business areas, which will, which will obviously the turn up will happen. Yes, in short, yes, we see some more opportunities of further improvement. Sure, sure. Sir, my second question was on the horticulture business. Just to get a, you know, idea about what, what would be the size of our market, you know, in that particular segment, horticulture, the product that we're dealing? Which segment you said? Horticulture. Okay. Huh? Yeah, overall, in terms of AGM revenue, if I see what is contributing, from horticulture, it is roughly around 30%. 30%. What would be the size of the pie, you know, the market as a whole, which we, for the product that we're dealing? The, the revenue which, basically what, the horticulture products are contributing to our domestic revenue is around 30%. Understood. Understood. Sir, I wanted an idea on the market, if you can. You know, just, just a ballpark number would be fine, like just size of the market. Overall, if I look at what is contributing horticulture, roughly in the industry is somewhere around 25%-30%. If you look at what is the Agchem market in India, around 25% is contributed by horticulture. Thank you. Thank you so much, sir. Thank you. Ladies and gentlemen, our last question for the question and answer session is from the line of Yash Mehta from Steinberg Asset Management. Please go ahead. Hi. Thanks for the opportunity. One question is that after the acquisition of the two entities, now that you are currently in the middle of the integration, how has your view evolved on how you think about this business from a longer-term standpoint in terms of you, you always maintain you want a differentiated model, but incrementally, as we see more and more businesses, they are becoming similar to each other, in, who are operating in the field industry? Actually some, Yes, if I may interrupt, you are absolutely not audible. Not audible at all. If you can please, turn your mic and... Your handset, please. Repeat your question. Yeah. Certainly, I hope I'm audible now. Better. My question is that, now that you've acquired and are currently in the middle of the integration, how have your thoughts, evolved on the pharma piece? You've always maintained you wanted a differentiated model, but as we analyze the different businesses that are operating in this space, they seem to be getting more and more similar to each other. Would you be able to kind of shed some light on this? Yeah, yeah. I mean, yeah, you know, I think, if you see the entire value proposition right now, we, we have many CRO, CDMO players in the market, and, you know, they are offering the services, which includes discovery, which includes the manufacturing. In the PI, we are also offering the end-to-end pipeline, right, starting from the pre-starting material to the API. That's what the initiative is going to the PI. We will be taking the, our legacy of, I mean, strong footwork in the, you know, basic chemical manufacturing, which covers a lot of reactions, medical, pharma reaction come across, you know, fluorination, chlorination, bromination, oxidation. All, all the many reactions, they are all the present part of the, you know, our PI legacy. With this, we have become much more stronger than the market. We are offering the entire value proposition, starting from RSM to TSM to, you know, discovery, development, manufacturing, and API. That's how the unique, you know, proposition we have and different from the market. Thank you. Thank you. That, that's very helpful. Thank you. Ladies and gentlemen, that brings us to the end of our question and answer session. I would now like to hand the conference over to the management for closing comments. Thank you. Thank you, gentlemen and ladies, for joining this call and your continued interest in PI. Thank you so much. Have a good day. Thank you. On behalf of PI Industries Limited, that concludes this conference call. Thank you for joining us. You may now disconnect your lines. Bye.