Ladies and gentlemen, good day, and welcome to Syngene International's Q2 FY 2025 Financial Results Conference Call. As a reminder, all participant lines will be in the listen-only mode, and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal an operator by pressing star then zero on your touchtone phone. Please note that this conference is being recorded. I now hand the conference over to Ms. Nandini Agarwal. Thank you, and over to you, ma'am. Thank you, and good afternoon to everyone. Thank you for joining us on this call to discuss Syngene's Q2 and Half Year Results for Financial Year 2025. To discuss the financial and business performance for the period, we have on this call with us today, Mr. Jonathan Hunt, Syngene's Managing Director and Chief Executive Officer, and Mr. Sibaji Biswas, Executive Director and Chief Financial Officer. After the opening remarks, Jonathan and Sibaji will be happy to answer any questions you might have. Before we begin, I would like to caution that comments made during this conference call today will contain certain forward-looking statements and must be viewed in relation to the risks pertaining to the business. The safe harbor clause indicated in the investor presentation also applies to this conference call. The replay of this call will be available for the next few days, and the transcript will be made available. With this, I would now turn the call over to our Managing Director and CEO, Mr. Jonathan Hunt. Thanks, Nandini, and good afternoon. Thank you all for joining us on the call today. I'll start my remarks with a quick overview of the key financials for the quarter and the first half before getting into sort of the operational and strategic highlights, and then hand over to Sibaji to provide more detailed insights into the financials in his remarks. For the year so far, things are panning out pretty much as expected. Performance in the Q2 and the first half of the year was broadly flat as we continue to see stabilization in U.S. biotech, in the U.S. biotech funding environment, pick up in inquiries from medium and large pharma, and a healthy level of interest in our biologics CDMO market. So while there are early signs of stabilization, some signs of improvement in the early stage discovery market, I think it's a bit too soon to declare victory, so we'll have to wait and watch that for a little bit longer. Revenue from operations for the quarter was INR 891 crore, down 2%. That's about minus 3% in constant currency or US dollar terms. Operating EBITDA was down 4% to INR 245 crore. Reported profit after tax, after exceptional items for the quarter, was down 9% year on year to INR 106 crore. In this quarter, we also reported that revenue from operations increased sequentially by 13%, and I think that's an indicator of things moving in the right direction. I am encouraged by some of the early positive signs of recovery in discovery services. These are being driven by collaborations and pilot projects with large and medium-sized biopharma clients that are looking for alternatives to China and to rebalance their supply chains. As we've discussed previously, clients usually run these comparative pilots for a year or more and then use that as a way of selecting a longer-term partner, which for us would be an opportunity to segue those into larger, longer-term relationships. We continue to receive a healthy interest from clients to increase requests for proposals, RFPs, an increased number of on-site visits, and we also successfully concluded around 60 audits in the first six months of the year. To give you a sense of that, that's up a little over 35% year over year, compared to the first six months of last year. Tone of the conversations with clients has been very much around long-term supply chain resilience, dual sourcing, as well as having the right capabilities and offering best value. I think with the lessons from the pandemic, they've been discussing these things for quite a while. It's not all about the Biosecure Act. Our proposition to clients is that we can make sure that they've got the resilience, flexibility, and dual sourcing they need. And as you know, we're also a buyer of services, and we apply the same logic in our own sort of procurement. Syngene's among the leaders in the industry in introducing sort of China-independent supply chain as an option in our proposals to clients. And to do this, we're sourcing from the Indian local ecosystem, especially for those who are suppliers of niche and complex chemicals. At the same time, we're working with our global supplier networks in the U.S. and Europe to encourage them to also set up shop in India. This not only helps expedite the timelines of materials reaching us, but also ensures business continuity in the case of disruptions. We introduced that sort of China-independent supply offering about eighteen months ago, and we're seeing reasonable traction. About a third of RFPs where the clients opt for that today. Coming back to the quarter, pleased to see a healthy level of interest from clients in biologics. We're also seeing a high number of process development projects compared to last year in small molecules. As you know, we've proven capabilities in biologics, and an additional manufacturing capacity comes online in the second half of the year. Once operational, the biologics manufacturing facility will offer plug-and-play manufacturing platforms. And we can customize those to clients' needs, as they see fit. In the coming quarter, we also plan to strengthen our capacity and capability in discovery services, and we're investing in sort of infill capabilities of antibody drug conjugates, peptides, oligonucleotides. So to summarize, the performance in the first half of the year and the Q2 was as expected. I believe we're seeing a positive change in momentum building in the second half as we see healthy interest from large and medium-sized biopharma clients who are rebalancing their supply chains. Number of requests for proposal and client visits has increased compared to the same period last year. We're focused on executing the pilots, and we've got real potential there to convert a number of them across into longer-term partnerships. With a strong Q3 already underway, we remain on track to deliver within our guidance range for the full year, so with that, let me hand over to Sibaji for more detailed financial comments. Thank you, Jonathan, and a very good afternoon to everyone. Let me begin by discussing the Q2 performance, and I will cover the first half and guidance before I close my commentary. As expected, revenue from operations remained broadly flat for the Q2 at INR 891 crores. This marks a 13% sequential growth and is a revenue decline of 2% year-on-year and 3% in constant currency terms. This quarter saw research services returning to growth on back of multiple pilot projects in discovery services and sustained performance from the dedicated centers. Development and manufacturing services revenue growth was impacted due to more project completion milestones now in the Q3 this year compared to the previous year. We continue to see good traction in our biologics business and early-stage process development projects in our small molecule business. Our delivery of both the early-stage projects and the pilot projects has been strong, creating thereby a solid foundation for the future growth. With improving sequential revenues, operating EBITDA margin came in at 27.5% for the quarter, compared to 22% in the Q1, and broadly in range compared to the previous year. On the cost front, raw material cost decreased by 11% year-on-year due to shift in the revenue mix towards discovery services, which has a lower raw material cost as a percentage of revenue. Similarly, the early-stage process development projects in the small molecule CDMO business has a lower raw materials to revenue ratio, which helps the raw material cost line. We expect the long-term raw material cost to be around 28% of revenue. While our headcount tracked business volumes and did not grow versus the previous year, our staff cost increased by 12% year-on-year, driven by the annual salary increase and recruitment of new employees in the skill areas needed to build capabilities in the business. Other direct costs, mainly power and utilities, decreased by 12% year-on-year due to increase in captive green energy consumption compared with the previous year. Notably, in the Q2, 96% of our total energy consumption was from renewable sources, in line with our focus on ESG and green initiatives. Other operating costs increased by 16% year-on-year due to maintenance and upkeep of our expanded facilities and infrastructure. We continue with our investments in digitization and automation, which we believe are essential for higher efficiency in our business. EBIT from operations was at INR 134 crores, lower year-on-year as depreciation increased to INR 111 crores from INR 105 crores last year. The effective tax rate for the quarter was 22.7%, similar to the same quarter last year. We expect the effective tax rate for the full year to be around 22%-23%. EBIT before exceptional items decreased by 13% year-on-year. Accounting for exceptional items in the Q2 last year relating to transaction costs associated with the acquisition of biologics facility, reported EBIT after exceptional items was down by 9%. We continue to invest in capacity and capabilities to guide future growth. Our total CapEx spend for the quarter was $12 million, with large share of the CapEx allocated to research services, particularly the dedicated centers, expanding our facilities in Hyderabad and adding new capabilities. In biologics, a significant portion went towards upgrading the biologics facility acquired last year, which remains on track to start operations in the second half of the current financial year. We continue to maintain a strong balance sheet, and after meeting our CapEx for the quarter, we have gross cash balance of INR 1,000 crores and a net cash of INR 865 crores as of September 2024. Our first half performance was also broadly in line with our guidance. The movements are very similar to as explained for the Q2 of the financial year. Revenue from operations declined by 2% year-on-year, raw material costs were down by 4%, and staff costs increased by 11%. Our direct costs declined by 10%, again, driven by increased green energy consumption and energy efficiency measures. Other operating expenses increased by 10% as we continue to invest in expansion of facilities and capabilities, including automation and digital transformation across our scientific and enterprise functions. Operating EBITDA margin stood at 25% for the first half, compared to 27% last year, primarily due to lower revenue and increased operational costs, as explained before. PAT, before exceptional items, declined by 25%, while PAT after exceptional item was down 13%, reflecting an insurance claim received in the Q1. Finally, let me say a few words about guidance. We guided for a revenue growth of high single digit to low double digits for the financial year, with momentum expected to build in the second half of the year. We have seen sequential revenue growth in the Q2, and we expect this to continue in the Q3 and onwards, ending the full year with growth momentum. Overall, biotech funding has recovered to pre-pandemic levels, with more directed towards late-stage programs. We also see demand from the big and mid-sized pharma, which should drive growth from next quarter through into the next financial year. We are maintaining our revenue guidance for the year. However, based on current visibility, we believe that the revenue growth for the year is more likely to be at the lower half of the guidance range. As previously communicated, we expect margin recovery in the second half, which should then lead to full year margins around last year, as we have guided previously. Our CapEx execution also remains on track, and we expect to execute $60 million CapEx by end of the year. Our focus will be on executing in line with our strategy, delivering on pilots and process development projects, which we believe will position us for a further growth in the medium to long term. As I hand over to Deepak, which will be by end of November, I feel deeply satisfied with what our leadership team has achieved over the last five years. We doubled revenues during the period while maintaining profitability and resilience in the middle of a global pandemic. Our balance sheet position now is very strong, with over INR 60,000 crores of cash after investing in acquisition and expansion during this period, all of which was from internal accruals. Deepak has joined us at a very exciting time for the industry and the company. I think he has both the depth of experience and the field to steer the finance function of the company, and from here on, he's a valuable addition to the Syngene leadership team. Deepak is with us, and now I hand over to Deepak for his introductory comments. Over to you, Deepak. Thank you, Sibaji. As we know, Syngene is a leader in research, development and manufacturing services, serving companies working at the forefront of human and animal health in the world. I'm just delighted to be a part of this organization and sector. I've now had the benefit of working alongside Sibaji for over a month, and I'm already feeling well integrated into the company. I look forward to being a part of the leadership team in this very exciting time for the company and the industry. Thank you. Thanks, Deepak. And now I will start. I now turn back the call to start your questions. Thank you. Over to the operator. Thank you very much, sir. We will now begin the question and answer session. Anyone who wishes to ask questions may press star and one on their touchtone phone. If you wish to withdraw yourself from the question queue, you may press star and two. Participants are requested to use only the handset while asking your question. Ladies and gentlemen, please wait for a moment while the question queue assembles. The first question is from the line of Karan Vora from Goldman Sachs. Please go ahead. T hank you for taking my question. I hope I'm audible. So my first question is, with respect to a statement which we have made in the press release, saying, the Q2 was underpinned by positive signs of recovery in discovery services business. So, does that imply a growth on a YOY basis as well, or is it only referring to a sequential recovery? That is my first question. Okay, so have you got a second and a third? You may as well get them all out at once. Okay, and, for a full year, on a full year basis, is it fair to assume that our discovery services business growth will be faster than CDMO services or growth? So that's my question. So that's my, all my questions. Super. I'm gonna look at Sibaji to give you an answer. On the latter one, I don't know, I haven't done the mental math, but I think the broader message, the shape of the year seems to be turning out as we predicted and guided at the beginning of the year, relatively flat, if not muted, first half, but growth on a full year basis. So you can back-calculate and triangulate into the guidance and figure out that the second half must have fairly healthy revenue growth embedded in it. So I'm sure you've done that piece. The balance between discovery, development, manufacturing, small molecules, large molecules, for me is less important than the overall rebound and recovery in growth that's implied and is maintaining our guidance. I just want to make sure that you've... There's a quadratic equation there in an Excel spreadsheet, that I'm sure you'll be able to figure out. Any specific comments? I'll just add one thing over there. We have been indicating over the last couple of quarters that we are building up a healthy pipeline for all parts of our business. Same is for discovery services. So, we do expect healthy growth of discovery services, both on sequential basis and year-on-year basis. And to the other question, I'll just kind of add to what Jonathan said. Across all our business elements, we expect healthy growth. Hope that answered your question, Karan. T hanks. So just one clarification here. For Q2, have we seen discovery? So when we say we have seen positive signs of recovery for Q2, does it mean a recovery on a YOY basis as well, or is it just sequential? N o, I got the premise of the question, which is why we gave you the guidance that we gave you. Okay. Okay, fine. But you got my broader message: second half should look good. Yeah, yeah, I got it. Thank you. Yeah? Yeah. All right. Thank you. Thank you. The next question is from the line of Shalinee Kumar from UBS. Please go ahead. H i. Am I audible? You are. On you go. Yes. Thanks, thanks. Thanks, Jonathan. Let me try my luck. So, two parts to the question. Is it fair to assume, you know, that momentum will build on from Q3 to Q4, and, it may continue in, five twenty-six, right? So I'd like your comment on that. And second, do we need to, like, build up in terms of the capacity, CapEx, et cetera? This is more from the medium-term perspective, given, you know, we are excited about the long-term opportunities which can bring upon, you know, with the Biosecure Act, et cetera, right? So do you think that, you know, Syngene should start thinking about some major CapEx plans because the opportunity can be so big that it could be overwhelming, and we may not be ready to capture that opportunity? Okay, super question. This is one of the challenges of giving guidance for the year, and it then actually coming to fruition, is that it catapults us into asking for next year's guidance. We're not yet a half year, only six months in. Let me try and sort of disentangle apart. Just trying my luck. I think we've got sufficient. N o, I know, but I'm happy to make it a conversation. I think we've got sufficient headroom for growth in the business in terms of capacity, infrastructure, and people. We've got more in biologics coming online in the second half, so I don't expect this year or next. Let me put it this way: the restraints or ceiling on growth is going to be us bumping our head on a capacity limit. So from that point of view, it's much more around client demand, sales execution, service delivery, and delivering on our promises to our clients. We're not held back by a capacity constraint. Is that in the spirit of your question? Yes. In a near term, I understand that. If I can extend it a bit then, are there any areas that you're able to identify that you would like to build upon? You know, again, this is more of a long-term, like, seeing that, like, how the opportunities will come up. When you say long term, I know long term. Okay. Let's say medium to long term. And when I say medium to long term, it's beyond what you have answered to me right now. Right, so let's say beyond this, and- Literally, help me out. Help me understand the premise of your question. When you say medium to long term- Yeah. -are you talking, a year, three years, five years, ten years? L et me clarify, so what I mean is, let's say this and next year, beyond this and next year, what you have answered. Right, so this and next year, beyond this year. Beyond next year is not long term. It's a blink of an eye. Okay. S o that's the reason I corrected myself. Okay. I'm actually trying to be helpful. Let me take a step back, why I'm trying to be helpful. So one of the sectoral trends that lots of the investment community and the industry is looking at is China Plus One, geopolitical, sort of rebalancing of supply chains. Mm-hmm. Even if you take the premise of, say, the Biosecure Act, which has an implementation deadline of 2032- Yeah. Work out how many years it is between now and 2032. That seems like a, what, almost, you know, infinite amount of time from a capital markets point of view. Operationally, if you're managing a manufacturing supply chain in a large pharma company, that's not a long amount of time at all. Exactly. A couple of years to decide what your sourcing strategy is, couple of years to do a tech transfer and build and scale. You're there really quite quickly. Yeah. So that, that's why I was pushing a bit on what do you mean by medium and long term? Thank you. I think we've got more than enough capacity for this year and next. Yeah. But I'm hesitant to give you long-term guidance at the moment. No, no, no. So, okay. I didn't get a chance to complete the question. So let's leave aside the timeline. So what I meant, or what I want to intend, what I intended to ask you is, are there any gaps in terms of the capability, which you probably need to build upon in, you know, given this opportunity coming in? And it could be organic, slash, inorganic as well, right? Probably. But again, that's just because we're a growing business. If I look over the last decade, even, at Syngene we have expanded and grown and deepened our capabilities. We've moved into new areas of science as we've seen market demand. We've got quite a good track record, actually, of building new scientific capabilities. So I think it's an almost certainty you'll continue to see us do that. I try and give you some directional hints on where I see the market demand emerging. Mm-hmm. You see these oligonucleotides, peptides, being two or three of those, but we've got decent capability already. Clearly, we have a positive outlook on large molecule CDMO development and manufacturing, which is why we did the acquisition last year, and we're bringing it online in this year. I think that's quite a lot, as well as seeing good growth across the rest of the business. Okay, fair enough. That's it from my side. Thank you so much, and good luck for the rest. Thank you. Thank you. We'll take the next question from the line of Sudarshan Padmanabhan from JM Financial PMS. Please go ahead. Yes, thank you for taking my question. So my question is to understand a little bit more deeper, you know, in terms of the nature of the incremental inquiry that you're getting. You know, I want to understand a little bit more on this, primarily because if I look at the last five-year trajectory for us, we have done so much in terms of not only sort of bringing capacity, but also capabilities. You know, right? You know, if you look at our peptides, obviously, et cetera. So I would like to understand, you know, today, when we are, you know, getting inbound with that from clients, you know, whether it is, you know, Biosecure Act, which is driving the change, or even a China Plus One story. You know, whether that capabilities are something that is, you know, getting tested today with the clients. You know, how do you see traction moving, you know, say in the next two to three years? Gosh! Surprisingly, I don't know if you agree. I'm not sure I get the premise of the question. We're seeing the nature of the inquiry just aligned to what our business structure is. So I'm seeing a step up in discovery, development, manufacturing, large molecules, small molecules. It's across the full range. Sure. What I'm trying to understand here is. Sorry, there's a lot of people. Go ahead. It's quite noisy, so it's difficult to hear you. But if you're not on a handset, if you could pick up, that would help. And then we said, what is it you're really trying to get to? So can you hear me? Yeah. Am I audible? Much better. I would like to understand, I mean, the kind of, you know, if I'm looking at, say, the last five years or, you know, and the next five years, you know, the investments that we have done towards the R&D capabilities and the, you know, nature of projects which our client is giving us. So are we moving towards a much higher complexity chain in terms of, you know, the synthesis and the delivery with our clients? So in a way, what I'm trying to understand is, are we becoming closer to the innovator in terms of partnering with them more and more? No, it is. But that, that's sort of the strategic history of Syngene laid out over 20, 30 years there. We are doing more complex integrated projects. We're also doing some not complex, non-integrated projects. There's nothing wrong with that. There's a market demand for for want of a better phrase, point and shoot chemistry, point and shoot biology, and we're very happy to do that, do it well, and create value for our clients through it. But there's also a demand for more integrated and sophisticated work. That's symbiotic and sort of dovetails rather nicely traditionally with the biotechnology model of being people and asset light, heavy on ideas. They bring the capital and the idea, we bring the capability and the infrastructure, so that works quite well in that space. But we're also pretty good at simple things done well at scale, effectively and efficiently. And we're very happy to have both of those in our offering to our clients. S ure. And, you know, just taking things forward from your previous commentary, we have also built huge capacity. I mean, Bangalore and the biologics capacity we have. You know, now that we are seeing a lot of products coming in, can you... Your capacity, I mean, on the capacities. I mean, now that we are seeing a lot of, you know, one molecule- Capacity. On the capacity side, I mean, now that we are seeing a lot of business coming in and some, you know, several molecules moving up the value chain, one, how do we see the utilization, say, in the next two to three years? And derivative of that, should we see a new high in the margin, say, in the next couple of years? One is complexity, the second driven by operating leverage. Okay. You're not gonna be surprised that I may not give you a full and frank answer from that. It's the midpoint of the year. We set out guidance for the year, but fairly directive that we think the second half is gonna see a good improvement in revenue growth rates. You saw some operating margin improvement in the Q2, year over year. You're gonna see more operating margin improvement, operating leverage in the second half. That's me prognosticating six months out, I mean, draw on a picture. I am actually taking a little bit longer. If you can say about, say, FY 2026, FY 2027. I 'll do that at the full year results, as we do every year. Sure. So but I would assume that directionally, you know, we should be possibly surprised. That's fine. Your assumptions are yours. Sure. Okay, thanks a lot, Jonathan. So, Sudarshan, just, you know, come to your point, it's a no-brainer that as capacity utilization increases, margin would increase, but we'll not stop doing what we are doing, right? We are always investing in future technology, future platforms, future skills. And, it has been our effort to kind of keep the margin within the range of what we are now guiding. So it will be up, balanced, but it is a combination of both, and you can model that out, because we, you know, we've not paused further investment, further acceleration, further skill building. So it will. The ultimate margin will come out as a combination of growth somewhere and investment somewhere else. Hope that clarifies well. Sure. Thanks a lot, Jonathan. Thank you. Thank you. Thank you. A request to all the participants to use their handset while asking questions for optimum audio quality in the conference. The next question is from the line of Tarang from Old Bridge. Tarang, please go ahead. Hi, good afternoon. A couple of questions. One, Jonathan, in your opening comments, you said that, the inquiry pickup that's coming your way, you know, at the current point of time, it's for pilot processes, and, you're not the only partner that your customer is working with. There are multiple pilots that the customer is running, and hopefully you all should be able to convert this. So the underlying question is, what is it that the partner really looks into, and how does the partner, you know, compare? Or, and what are the drivers for the partner to finally, sway the decision in your favor or in favor of one of your peers? So that's one. The second is on your bio, on your large molecules business. As you see utilizations ramping up for this business, say, two years out or three years out, do you believe that this facility will be utilized only by multiple contracts of small value? Or do you think, you know, more likely case of a single or a couple of customers, really taking away the entire capacity? Just to try to get a sense on how this, bio contract manufacturing business will emerge two to three years from now. Thank you. Okay. So I'll probably try and answer them in reverse order. No, I would expect it to be multi-use, multi-client in terms of the mix in the biologics business. But that just reflects the size of capacity that we've got there and also the amount of space and headroom to scale it. I mean, we're gonna bring unit three online, but it's not fully built out. There's further space on the site, and there's infrastructure there to go for a second and even third wave of further capacity expansion over the long term. So I... It's a bit of a non-static frame that you've got to put around your question. The capacity can expand to meet the demand, and therefore you become circular in your logic. You end up with multi clients, multi-product, I think is the strategy there. And then on your other question around what is it clients are looking for? Nothing new and insightful. It's what they've always looked for. Have you got the capability? Are you competitive and capable? Can you deliver to time, to cost, to quality? Do you have scientific creativity alongside good service? And do you offer good value for money? So I don't think there's anything new under the sun around how our customers select their CRO, CDMO partners. I think the China Plus One rotation, if you want to view it through that lens, or supply chain resilience and dual sourcing, it's all the same thing, so different drivers behind it. If you're looking at Big Pharma, they tend to be steady to the point almost of being glacially measured in the speed of change. But when they change, they change with little purpose. They've got a 2032 deadline out of the Biosecure Act, so they'll move over the next two, three, four, five years. It's not an overnight sensation, but it's a really positive tailwind on the industry for those of us that have got capacity in this part of the world and outside of China. Sure, Jonathan. Just to follow up, I mean, to my first question, all things equal, but say, at a slightly elevated price point, do you believe that customers in pursuit of wanting to have a more sustainable supply chain, are willing to go ahead with that proposition? What do you mean by sustainable? Are you- I mean- Using that in the ESG? No, no, no. Sustainable in the sense, a de-risked supply chain, if you may call it. I mean, are the customers willing to pay a little more to ensure that it's a more robust, de-risk supply chain? ... Not massively, no. I mean, are any of us looking to pay more if we think that if we bring volumes, we can get good prices? Sure. But we make good margins at existing market prices. Sure. Thanks. Thank you. The next question is from the line of Tushar Manudhane from Motilal Oswal Financial Services. Please go ahead. T hanks for the opportunity. Am I audible? Yes, you are. Yes. Okay. Sir, with respect to the Stelis facility, just would like to understand, you know, post-acquisition, like, where are we in terms of, let's say, in terms of the product development phase? Are we into the stage where we are getting exhibit batches for the customers, or we are still some away? Not really. We're still in the engineering, upgrading, kitting out, getting it ready to operationalize phase. Absolutely on track, maybe coming in a little bit early, coming into budget, if not a little bit under budget. Perfectly happy, but, maybe our sort of prior comments didn't land. Since we bought it to today, we're looking to convert what was a plant designed to make vaccines into one, set up to make antibodies, and that's the phase we're at the moment. Got it. So, effectively, the exhibit batch level, the commercial benefit would be like a quarter or two away, is that a safe assumption? No, you're jumping ahead, assuming there's exhibit batches in production, and it's a revenue drive. It's a new capacity play, brings us headroom for future growth. Oh, but by then we, I mean, the facility would have been already showcased to the potential customers, right? So any RFPs on that facility while we, you know, sort of re-engineer and make the facility ready for the customers? I think that's a level of forensic detail that we've never shared. I mean, I roll all of that up into our annual guidance. I'll go back. Biologics demand in the market looks healthy. Our businesses performed well during the year. Strategically, we were starting to worry we were gonna run out of capacity, which is why we were delighted to bring our organic capacity expansion forward by a number of years through acquiring the site from Stelis. We'll have to start calling it Syngene Unit Three and not Stelis. We're getting a lot of free advertising from your questions. And we're bringing it up to our standards and retooling it from a vaccine plant to an antibody one. In terms of future outlook on sort of revenue potential, I'll roll it all up into the guidance we'll give you at the full year. Got it. And lastly, sure, this helps, this helps. And lastly, on the second half, FY 2025 guidance, while the guidance as far as revenue growth is sort of maintained, just would like to understand what we'll drive this, whether it is discovery, development, or commercial. And it's not in terms of quantifying it, but if you could at least help in the pecking order. Yes, no, and across all three. How about that? Y es, you've understood us correctly. We expect there to be growth in the second half. Actually, it's gonna be reasonably well-balanced across all the aspects of our business. So which means that at least the profitability... Sorry? Go on, go ahead. Which effectively means that the profitability growth will be much better compared to the revenue growth, right? Oh, what a super question! Given that it's Sibaji's last conference call, that one's going to him. To start you off, but we, instead of kind of making it a relative statement, if first half is 25%, and if you are, if we are saying that the overall year would be close to last year, which was 29%, automatically we are stating that, you know, second half profitability would be pretty good, right? A nd, and that profitability would come from revenue growth happening across all businesses, which should then ideally pull down the profits after adjusted for the direct costs. Looking towards good second half, good growth and good profitability. That's how I'll sum it up. Sure. And lastly, just one more, if I may. This OpEx related to Stelis facility, is that already captured in the P&L? Can you repeat the question? Operational cost related to Stellis facility, is that already captured in the P&L? So if we go by the accounting standard, any engineering cost directly attributed to the modification of the facility is capitalized, but otherwise, operating costs for running a place like utilities and all is in the P&L. Got it. So basically, the employees and all are already onboarded, and so that cost is already in the P&L. I'll qualify that by saying that the operating employees costs are in the P&L, but some part of that, which is directly attributed to the modification of the facility, is capitalized. So when it becomes operational, the operating costs may go up from what it is currently in the P&L, but only to a certain extent, because large part of that is already in the P&L. ... Fair point, sir. Fair point. Thanks, thanks a lot for addressing it. All right. Thank you. Thank you. Ladies and gentlemen, this will be the last question for today, which is from the line of Deval Shah from RBSA Investment Managers. Please go ahead. H ello. Good afternoon. So, I basically have two questions- Mr. Shah, I'm sorry to interrupt. Your audio is low, sir. Can you please increase the volume a little bit? Yes. Yes. Just a second. H ello, am I audible now? Yes, sir. Yes, you're much better. Go ahead. So Jonathan, I have two questions. So one is surrounding. So both are strategic. So I was reading a report, and it said that your international larger peers or competition, I would say, they, when they were in their growth phase, they gained immensely by establishing the labs and the smaller operations proximity to their innovation hubs in the US and Europe. And they retained the larger delivery operations in China and their domestic place. So just wanted to know your thoughts with regards to this, with respect to Syngene, how we would like to develop ten years from now, or whether having a lab in US or Europe would help us in getting more business. So your thoughts on that. Super. That's one question. Was there a second one? The second question is with respect to your domestic. So it is now the open thing that, there is a China Plus One Biosecure Act, and many innovating companies are looking in India to have a partner. So what is the evolving landscape in India? How your competition. So how we as a Syngene are standing with the competition within India, and what is our right to win in gaining the incremental business or the RFPs we are getting? So that's the two questions. Super. Good question. I mean, the first one, I actually strategically, I'm open-minded on it. It becomes much more about how and when, but there are elements and segments of the market that you can't access if you're only in one geography of the world. By the way, that's true for people that are only in one geography in the world, but it's another part of the world. So if you've got a European-only footprint, you're gonna struggle to provide service to people who want an Asia-only supply chain or a US-only supply chain. I'm not intrinsically for it or against it. We're open-minded, and we'll address it on its merits. There are certainly some segments where you can see, you know, very local regional supply, so people who are in the US want to partner with people that are in close geographical proximity. Mm-hmm. So it's a means to an end. Is that... It's a neutral enough strategic statement. I can see some merit in it, but we judge every case, whether it's an organic build-out, an inorganic acquisition, a partnership model, on its merits, and we'd be looking to create good shareholder value in a risk-managed way. As for the domestic element, our competition's good. It drives up sort of overall capability within the industry. I don't think there's anything to fear. We already compete with some very good competitor companies from around the world, and we do reasonably well, I think. So I don't particularly worry about the competition. Hopefully, they're worrying more about us than we are about them. Oh, and- You know, there’s a lot of private equity capital, you know, on the hunt around the world on the China Plus One story. There are companies in adjacent sectors considering sort of pivoting towards, you know, the CDMO part in particular. You see a number of generics companies considering it. It’s different business. Different business means different rules of operating, different ways of doing it. They’ve got a lot to learn and figure out, but I don’t mind competition, and I don’t mind if it drives up standards for everybody. Oh, I really like that confidence, and all the best. S o sorry, sorry. Please go ahead. B ut also just be pragmatic. Please, there's no element of sort of hubris or nonchalance about that. You've got to come into work every day assuming that somebody out there is planning to eat your lunch. Mm-hmm. We certainly come in thinking about other people's lunches. Makes sense. Thank you, thank you, Jonathan. All the best. Thank you. Thank you. As that was the last question for today, I would now like to hand the conference over to Ms. Nandini Agarwal for closing comments. Over to you, ma'am. A ctually, before we do that, I was going to dive in. It would be remiss of me not to publicly thank Sibaji for a fantastic innings. Thank you. It's certainly his longest innings, and for those of you, and it won't be visible to the capital markets. He's had a real impact within the company, way beyond the realms of just finance. He's done an awful lot of good things to raise the standard of our supply chain in many other areas, and also has been a thought contributor in all of the discussions with the management team. I was asked earlier on a TV interview, you know, what changes are looking forward as we segue from Sibaji to Deepak? And I gave an honest answer, which is: I don't want to see very much change. Continued impact and excellence would be very much appreciated. So we've got to thank Sibaji as... Well, you're not going yet. There's a couple more months of hard work before you go on to pasture. And of course, welcome, Deepak. It's not his first rodeo, to use the cowboy expression. This is his third or fourth time out as a CFO, so I know he starts with a good understanding of what the role is, and he's only been here a month, so it feels more like an internal promotion than a new hire. So I thank you, Sibaji. Welcome, Deepak. And then the other comment from me, of course, is to wish everybody a happy Diwali. So with that, we're looking at you, Nandini. Anything you need to do in closing? Yes. Thank you, everybody, for coming on today's call. Thank you, Sibaji, Deepak, Jonathan, for all the comments. And if you have any queries, please feel free to reach out to the IR team. We'll be happy to help. Thank you, and have a good day. Thank you. Thank you, members of the management. Thank you. On behalf of Syngene International Limited, that concludes this conference. We thank you for joining us, and you may now disconnect your lines. Thank you.