Acutaas Chemicals Limited (ACUTAAS) Q4 2026 Earnings Call Transcript

Ladies and gentlemen, good day and welcome to the Equitas Chemicals Limited Q4FY26 Earnings Conference Call hosted by 361 Capital. 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 test on phone. I now hand the conference over to Mr. Rohit Nagraj from 361 Capital. Thank you, and over to you, sir. Please proceed.

Thanks, Elendra. Good evening, everyone, and thank you for joining us on ACUTAS Chemical's Q4FY26 earnings conference call. We thank the management for providing us the opportunity to hold this call. Today, we have with us Acutas Chemicals Management, represented by Mr. Nareesh Bhai Patel, Chairman and Managing Director, Mr. Abhishek Bhai Patel, Vice President, Strategy, and Mr. Bhavin Bhai Shah, Chief Financial Officer. I would like to invite Mr. Bhavin Shah to initiate the proceedings now. Over to you, sir. Thank you.

Thank you, Rory. Good evening, everyone. We are pleased to welcome you all to our earnings conference call to discuss Q4FI26 financials. Please note that a copy of our disclosure is available on the investor section of our website as well as on the stock exchanges. Please do note that anything said on this call which reflects our outlook towards the future or which could be construed as forward-looking statement Must be reviewed in connection with the risk that the company faces. The conference call is being recorded and the transcript along with the audio of the same will be made available on the website of the company and exchange it. This call will be recorded. Please also note that the audio on the conference call is a copyright model of Equitas Chemicals and cannot be copied, rebroadcasted, or attributed in press or media without specific and written consent of the company. Now, I would like to hand over the floor to our Chairman and Managing Director, Mr. Naresh Patel, for his opening statement.

Over to you, sir. Thank you, Bhavin. Good evening, everyone. I hope you are all doing well. I will provide an overview of industry and about our future strategies before handing over to Obhishek for detailed business updates. The chemical industries once again navigated turbulent conditions driven by the ongoing conflict in the Gulf region. It has disrupted supply chain for key feedstocks and consequently pushed raw material prices higher. Tipping fuels and vessel availability have also been affected. We are closely monitoring how the situation evolves. On our part, our procurement and operations teams have acted swiftly, and we do not anticipate any raw material shortage that would impact our production continuity. On the demand side, momentum remains strong. New product inquiries continue to come in at a healthy pace, while demand for existing products remain robust. We are working closely with our customers to ensure one-time delivery and uncredited supply through its period of market uncertainty. Turning to our strategic initiatives, I am pleased to say that we are making strong progress on our journey to build a diversified multi-vertical chemicals company. In our battery chemical business, the foundation is firmly in place. We have successfully commercialized our first two products and have a healthy pipeline of new products in development. We expect to bring two original products to commercial scale in FY27. Further strengthening our revenue visibility are backed by long-term customer contracts. In our semiconductor business, the product expansion strategy at BFC is clearly gaining traction. New products other than Harrier's products are expected to be a meaningful contributor to growth in the coming year. And we will continue building on this momentum to establish BFC as a sizable business over the medium term. On Indicam, our South Korea joint venture. While Abhishek will walk you through the capex details, I am pleased to say that the R&D center is up and running. We have already started sending samples to prospective customers, a critical step that we expect will significantly reduce our time to market. On the CDMO front, we continue to build a strong and differentiated pipeline. While commercialization in this business takes time, the ramp-up on initiative tends to be steep and pristine. Overall, I believe that my FY28, sorry, my FY28, our both businesses verticals, which are in investment phase now, biochemicals and semiconductors, will be evolving into independent, self-sustaining growth engines, each contributing meaningful to our top line along with pharmaceutical intermediate business. This multi-vertical model is central to our vision of building a truly diversified chemicals company. Turning to our financial performance for the year, I am pleased to report that we have continued our strong growth trajectory, closing the year with revenue of Rs. 1,339 crore and our highest average fat of Rs. 356 crore. These results reflect the strength of our business model and the discipline execution of our teams. I will take this bowing to take you through the detailed financial shorting. To conclude, we enter FY27 from a position of strength with a clear strategy, a strong pipeline across all three verticals, and a proven track record of execution. I am confident of delivering 25% revenue growth in FY27. With that, I would now like to hand over to our Vice President of Strategy, Abhishek Patel, who will walk you through the detailed business update. Over to you, Abhishek.

Thank you, Narish Bhai. Good evening, everyone. Let me take this opportunity to share further insight into our business performance for the quarter. Starting with advanced pharmaceutical intermediate segment, this segment continued robust performance with revenue of 392.4 crore in Q4 F526, reflecting a strong year-on-year growth of 43.9%. Growth was primarily driven by CDMO business. Complimented by steady contribution from our core advanced pharmaceutical intermediate segment. Here, I would like to mention that our process of reshuffling portfolio was mostly over during first nine months, and we have seen healthy growth in this business sequentially. Moving on to the specialty chemical segment, revenue for this segment stood at 40.3 crore during the quarter, resisting a steady year-on-year growth of 12.3%. Our commodity chemical sub-segment recorded degrowth during the quarter, which was offset by strong recovery and BFC business. Now turning to a capital expenditure, capex for FY26 stood at 195 crore, primarily directed towards the Jagadia site for battery chemical project, and then pilot plant at Sachin site and maintenance capex. Let me provide some additional updates on our Cree project. Regarding the electrolyte additive capex at Jagadya, the first phase of electrolyte capex is completed. The second phase of capex is currently ongoing and expected to get completed by Q1 FY27. Pilot plant capex is slightly delayed due to delay in equipment arrival. It is now expected to get completed by Q2 FY27. Apart from this, another major cash outlay during the year was our investment in South Korea Joint Venture in DKIM-IMC. We have invested 190 crore in this JV during the year FY26. Turning to our Strategic Infrastructure Update, while Nourishby has covered our key growth drivers in detail, I would like to focus on the infrastructure that will support and enable growth in the years ahead. Our existing infrastructure is well positioned to support our growth through F528. However, looking Further ahead, we have already begun laying a groundwork for the next phase of infrastructure development, which will undermine our growth over the next 5 to 10 years. As immediate priority, we are embarking on ambitious expansion of our R&D center, one that will elevate it into world-class, internationally renowned facility, purpose-built to meet the demand of tomorrow's industry. With planned 10x capacity expansion, the new center will feature dedicated sections spanning pharmaceuticals, battery chemicals, semiconductor, electronics, and cosmetics, etc. Each house has a distinct division under one roof, bringing together deep specialization and power of cross-disciplinary innovations. This is a defining investment for our future designed to sustain our innovation pipeline and fuel long-term growth in the years ahead. In parallel, we are actively evaluating land acquisition opportunities to develop new infrastructure that will support our long-term growth ambitions. Alongside physical infrastructure, a key pillar of strategy is deliberate migration of our portfolio towards higher value products. The first step of strategic reshuffling of our core advanced pharmaceutical portfolio has been completed. The next phase involves a systematic replacement of commodity chemical products with a higher value differentiated offerings. We will begin phasing out select commodity products this year, replacing them with a new product using same infrastructure with slight modification in calibrated phase manner. Moving on as nourished by outline, we are guiding 25% revenue growth in FY27. On margins, while we remain mindful of the near-term cost pressure steaming from global supply chain disruption, we are confident in our ability to maintain EBITDA margins at a similar level in the coming year, underline our product portfolio upgrade strategy, and improving business mix. I also want to highlight a key trend given by our business cycle. Q1 is typically our weakest quarter, with revenue steadily increasing sequentially till Q4, which is always the strongest quarter. This pattern results in H1 contributing around 40% of our top line, while H2 accounts for generally around 60%. With that, I will now hand over our floor to our Chief Financial Officer, Bhavin Shah. We'll walk you through the detailed financial update. Over to you, Brian.

Thank you, Abhishek Rai. I would like to briefly highlight the key performance metrics for the quarter and FI26 before we open the floor for questions. Let me start with quarterly performance. Revenue from operations for the quarters reached 432.8 crores representing 40.3% growth YOY. Gross profit for the quarter was $268.3 crore, reflecting 83.8% increase compared to the same period last year. The gross margin expanded by 14-16 basis point YOY to 62%. Gross margin was driven by improved product mix. A bit tough for the quarter was. 183.5 crore, which represents more than two-fold increase compared to the EBITDA of same period last year. EBITDA margins were at 42.4% up 1487 basis points YOY. EBITDA margin was driven by expansion in gross margin as well as operating leverage. Paid for the quarter was 134.3 crore, up 114.1% VOI. Pet margin for the quarter were 31%, which show an expansion of 1070 basis point YOY. Moving on the FI26 performance, revenue from operations for FI26 reached 1339.4 crore, representing 33% increase in YOY. EBITDA for the FI26 was 480.4 crore, which is 2x compared to the same period last year. PAID for FI26 is at 356.4 crore, which more than doubled compared to the same period last year. Moving on to the balance sheet item, net cash and cash equivalent were at 198.3 crore as on 31st March 2026. Our working capital for the year increased to 120 days from 114 days. There was some improvement in data and inventory days which was offset by lower payable days. With that, I request moderator to open the floor for questions. 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 1 on their test-owned telephone. If you wish to remove yourself from the question queue, you may press star and 2. Particents are requested to use handprints while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. We have first question from Rikenshaw from Boring AMC. Please go ahead.

Hi team, congratulations on a fantastic set of results. I would just like first a little bit if y'all can expand on the R&D center that y'all mentioned and you know what is the idea behind that going ahead.

So thank you. The R&D center which we are doing is for upgrading and enhancing our capability and capacity with our existing R&D center because our existing R&D center is having a capacity which can Thank you very much. All the requirements, but we are expecting a lot more inquiries and more traction towards the new molecule. So we don't want to remain out of capacity when it came. That's why we decided to have a new expanded RNA center, and this RNA center will be equipped with facilitating all the particles in the chemical sector, which we are catering right now. So it is designed in a single complex. With all multiple outlets in the chemical sector.

Got it, sir. Thank you so much for that. Another question. So, naturally, you know, if I see our... Specchem business is not relatively grown as quickly as our advanced intermediate business, and thanks to our marquee CDMO project, the differential is far higher at this point. But going forward, even within advanced intermediate per se, we have spoken about churning our lower margin products in Q3. So, what is the base business looking like today, and do we have any growth plans for the same for the next two financial years? Thanks.

So, basically, as we mentioned, we had some portfolio reshuffling for our pharma intermediate business X of CDMO, and that has yielded us truth in terms of margin expansion. I have already mentioned during my commentary that after nine months of FY26, it has gone sequentially in Q4 FY26 and expected to grow further in FY27 as well. The volume-wise, that business has grown despite of being a flat in terms of revenue. And obviously, going forward, we are expecting good kind of revenue expectation from our ex-CEDMO, CMO business also. Now, coming to your question related to intermediate, sorry, stack-cam business, we have to understand that initially what the business we acquired through an acquisition of sites, That business has grown in the range of 12 to 15 percent despite of some price reduction. But now, this segment is expected to grow with additional revenue coming in from battery electrolyte additive space. And that the plant has already been constructed and the production has started. So this year, we will have a very good exponential growth coming in from spec cam business as well.

Got it, sir. So, within that, let's say in battery cam, we had 10 samples, and now we've completed our first leg of capacity expansion. So, in terms of contributing, you know, a little bit meaningfully to FY27, maybe if we cannot give a number on today, but do we have that sort of Target or understanding inside that this segment will contribute meaningfully this year. I understand you have that sort of longer-term vision of scaling this as a big business, but in FY27, does this seem like a decent contribution?

Definitely, in FY27, it will have a meaningful revenue contribution. It will start slowly with Q1, and till Q4, it will keep on ramping. And at the end of complete financial year FY27, we will definitely have a meaningful revenue contribution. I will not put any number to it as of now, because there are many variables, but it will be a meaningful contribution.

Sure. Thanks. And are we taking any sort of contribution from the two new electrolytes we have added or this is just the two products we have discussed before?

So, as I mentioned, the CapEx is already going on for the third electrolyte additive product, and which is getting completed by Q1 FY27. So, once that gets completed, it will also start contributing in the revenue. And the fourth product, we are in the phase of business development.

Got it. Within the CDMO piece, we have now, I think, a basket of five products other than the key project that is going on today, and we have been in the process of validation and approval with the innovators and originators. So, yeah, the longer-term thousand-claw guidance in CDMO for FY28 is intact, but within that, obviously, for FY27, do these four to five products also contribute something?

Yes, definitely. As you mentioned, those are all validated products, and we are building a good revenue expectation from these four products as well, apart from the first product.

All right. And last question from my side.

Sir, I reckon sir, sir. Please, two questions per participant, sir. Please get back into the queue, sir.

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 two. One or two participants. Should you have a follow-up question, we would request you to re-join the queue. We have next question from Bharat Slah from BCS Capital, Ideas, Inc. Please go ahead, sir.

Yeah, hearty congratulations, Naresh Bhai, and the entire ACUTAS team. Once again, very, very robust delivery. I had only one suggestion to make. And which is, in general, the feature of Indian corporate sector, per se. You see, a lot of businesses which have been successful over a period of time. But remain under-invested in building the future by under-investing into the innovation pipeline, under-investment into research and development capability. In short, building the future. Software services businesses is an example of that, where huge cash flows, but very limited investment into building the future technology, and therefore, the struggle is evident as we have seen. Similarly, we have seen in consumer businesses in India, which have been very successful, but have under-invested in the new consumer-facing technology and the way of delivering. Even a lot of banks are under-invested in technology to build it in the contemporary manner. Therefore, ACUTAS, which has displayed remarkable capability in a relatively smaller size of our operation, I don't think we should remain limited in ambition by our current size. If we want to build a future, I think meaningful, intelligently kind of planned within our balance sheet capability, but sustained investment in building future is absolutely vital, especially in our chemical business like this, because otherwise the business will get commoditized at some stage. So, to kind of summarize, if you don't want the business to be commoditized, investing into the future to build it is an absolutely very vital one, and we have done very well by taking up intelligent bets, and we have to consolidate. So, I think we shouldn't get deterred by our current size in order to build our future, which can be very exciting. I thought I will just put in that word, Nareshkan. But once again, hearty congratulations. Very heart, I mean, delightful results. And the entire team deserves the credit. And congratulations.

Thank you, Bharat Bhai. It's a good advice, and it is coming from the veteran. It's really meaning to us. And if you remember, in my commentary, I said that we are going to put up a new R&D center, which will be versatile. It is not a conventional R&D center, but it is a versatile R&D center, which will be catered across the sector of semiconductor electronics, electrical, battery, pharma, agro, and cosmetics. So, it's a versatile R&D center with a different segment. So you rightly say that we need to invest into the innovation, and this is what we do continuously. Initially, we started with the conventional chemistry, the flow chemistry, which is successfully imparted and now commercialized. Then we have Interforce in India, in the electrolyte, then in Semicon. So we're continuously making ourselves learning and then putting into the system and then executing it. So we've taken serious note on that, what you suggested. And in future, we will keep in mind when we do any new things. Thank you very much, Bharat Bhai. Thank you, sir.

Thank you. Next question is from Gavit Goyal from Sirian Alpha. Please go ahead, sir.

Hi, am I audible?

Yes, you are.

Good evening, sir, and Congress for a good tip of numbers. My first question is on the goodwill. Can you please elaborate on this increase in the goodwill happened in April 26 over April 25? Specifically, if this pertains to the Indicam, which is a newly incorporated entity, I would like to understand what is the rationale for goodwill at this stage? And further, can you also give some clarity on the basis for which the management is showing the confidence on the recoverability of this total good deal of 104 CR? That's my first question.

So, when you talk about 104 CR, it is, it has a two-part. One, Goodwill is, which was created in the past, that was towards the acquisition of our BFC business. And for the year, there is an addition of around 48 crore in the Goodwill. So, when we have made an investment of 190 crore in Indicam, So, the partner has bring in the capital that was at par value only for 25% which is there for our partner. So, whatever we have paid 190 crore, out of that 25% is going towards the goodwill in our books of account. Now, since this is the investment we have made, and we are very much confident that this business in coming years is going to do excellently well. There is a valuation also attached to it. This is the future projection. So, this has been correctly account as per the accounting standard, guided by ICI.

And regarding your partner with this JV, what is the background of that partner? Like, what kind of expertise they are bringing? Because this JV is not having any revenue so far. So, booking the goodwill is something which I am not able to understand. Maybe they are bringing some tax. So, can you be elaborate on that part?

First, about the background of our partner, he has been working in this space for more than 30 years. And he is a veteran in this business, understands the Korean ecosystem well, apart from the international customer outside Korea, like Taiwan and Japan. And he has assembled a good team of people coming from the production and R&D and regulatory side. So this is how we have joined hand with our partner. Your question related to Goodwill, as Basabai has mentioned, for this JV, All the investment, financial investment has been done by AcuTask, and we have given the 25% equity to the partner. So that's the reason we have to account 25% of those investments in the Goodwill as per accounting standard. This is how it is going. And as we mentioned, we have a good confidence in our business with the projections and we see that definitely the goodwill is recoverable in future.

Got it. Got it. And sir, your revenue contribution from Baba Fine Chemicals has remained limited. And now we are doing this JV with Indicam. So just wanted to understand from you, how do the product offerings of Indicam and Baba Fine Chemicals complement each other? Are there any clear synergies in the terms of products, in the terms of customers, or maybe in the terms of hand applications, sir?

Hello. We mentioned previously also for our semiconductor business, we have two different stream of revenue. One is our baba fine cam business, and then in Korea, it is an advanced stage product than what we offer in BFC. So these are complete and which is different from what BFC is manufacturing for Harriers. So these are a more value-added product and a different stream of revenue.

Okay, so what kind of peak revenue are we anticipating, maybe from the status of 200 TR in Indica?

We are expecting around 1x kind of revenue from this plant.

What kind of margin, sir?

It is very premature to say as of now, because it is in a construction phase. But generally, you can expect a good margin from semiconductor business as an industry you're studying.

May be in line with your specialty... Please return to the queue, sir. Just one last. Just one last to follow up only. May be in line with the specialty chemicals, sir?

No, no, obviously not in line of this traditional specialty. It should be in line of the BFC business.

Okay. Okay. Thank you, sir. Thank you very much and all the best, sir. Thank you.

Thank you. The next question is from the line of Sanil Jan from Ambit Capital. Please go ahead.

Hi, sir. Am I audible? Yeah, congratulations on a good set of numbers. So I just have a couple of questions. So the first question from my side is, can you give us some developments on the new CDMO products? Under progress, other than the fermion contract, and what can be the potential opportunity size of it?

Okay. So, obviously, we have a long pipeline of CDMO products, but we have announced validation of four more products after the first one, and those are, when we say validation, it's a commercialized product already submitted to the customer, and now it's a process of getting regulatory approval from those customers. Once that gets completed, it will keep on going on large quantity, and in terms of revenue potential, we are expecting those products to be between 50 to 100 crore each at a peak level.

That is 50 to 100 crores each, right?

Each, right.

Okay. And the second question is that we have reported excellent EBITDA margins of 42 percent. So, can you tell us what was the EBITDA margin for specialty chemicals and in the advanced intermediates separately?

Okay. So, For our pharma business, for this quarter, EBITDA margin is around 44% and for speciality, it is around 13%. 28%, 29%. Sorry. Sorry. For pharma, it is 44% and for speciality, it is 29%.

29%, okay. And just one more, that are we planning to expand our Fomion capacity, given the improved outlook by the innovators?

So, as we earlier also said that we have got good visibility from this particular CDMO contact, and we have already built our capacity, which can suffice those production requirements.

Understood. Thank you. That's it from my side.

Thank you. The next question is from the line of Nikunj Gupta from MAKA Investment. Please go ahead.

Hello, am I audible? Hi, team. Congratulations for the great set of numbers. My first question is, previously we had talked about semiconductor chemical shipment to Japanese and Korean customers. So, has it already been started?

Yes.

Okay, and my next question is, what is the revenue potential from the semiconductor chemicals and battery chemicals business over the next three to five years? And also, if you can put some light on EBITDA margins as well, that would be very helpful.

So for electrolyte additive business, it's a function of capacity what we have built in. And as of now, the capacity for electrolyte additive is 2,000 metric tons for VC and FEC. So based on that, you can see the revenue potential coming in from that business. And related to semiconductor business, that business has been going through some difficult phase in last financial year, but now it has recovered from Q4 onwards, and it will continue to ramp up in future also.

Okay. Thank you, TD, and all the rest for the future.

Thank you. The next question is from the line of Sai Kumar from Family Fund. Please go ahead.

Yeah. Hi, sir. Congratulate on a great set of numbers.

So, my question is on this, sir.

This year, you have consolidated yearly EBITDA margins around 34.5%, somewhere around 35. So, for the FY27, what kind of range you are expecting?

So, as I mentioned during my commentary also, we are expecting a similar kind of margin in FY27 also. For us, the margin is a function of a product mix, and we expect similar kind of product mix in FY27. That's the reason we see that it should be in a similar range only.

Okay, yeah, got it, sir. And regarding this Indichem JD, so you said like around... End of FY26, you are going to commercialize the plant. When can we expect the supplies, and do we need to go in a validation phase for that molecules, and when can we expect the commercial revenue from that Indicam JV?

So, as soon as the plant gets constructed, we will have a commercial production going on from the plant. As Narishbae mentioned during this commentary, that we have already started our R&D center in IndyCamp, and from we have already started supplying the samples to the customer. So, parallely, by the time the cap is complete, we should have some customer onboarding happening, so it can make our process faster in terms of commercial production ramp-up.

Okay, yeah, and one last question. I see, I mean, in the SENA, the BYD is shifting more of their battery from lithium to sodium ion. So, what is the risk you see for that shift coming for sodium ion batteries? Or do you supply the molecules eligible for sodium ion battery technology as well?

See, sodium-ion battery is not new. It started inventing seven, eight years back, and now it is slowly, slowly maturing. Whereas lithium battery has still potential of next 10, 15 years. So it's not that 100% replacement of sodium-ion battery with lithium. So whatever we are targeting is even not a 1% of the demand. So for us, it's not an impact. Contrarily, whatever the new molecule which is coming into the electrolyte segment, there are some which is also going in this kind of area, but we can't disclose based on our contrast. So it's a confidential for us, but yes, whatever the segments are working in electrolyte battery area, either it's a sodium or lithium or solid state battery, we are there, we are trying to supply our molecule in that segment, okay?

Okay, yeah. And one last question. Thank you, sir. Please limit your question, Satoshi. Thank you.

Thank you. The next question is from the line of Jason Sons from IDVI Capital. Please go ahead.

Yes, sir. Thank you so much for taking my question. First question just pertain, just wanted to know the capacity utilization for the Sachin plant, the Jagadia plant, and the Ankleshwar facility.

For this quarter under review Q4, utilization at Sachin plant is 75%, Unit 2 Ankleshwar is 31%, and Unit 3 Jagadia is 50%.

So I just want to also understand in terms of this, you said the EBITDA margin for specialty chemicals in this quarter is 29%, right? Now, generally, the margins are quite low. I mean, 15-20%. That is the kind of margins we clock. So just want to know what is the reason for this jump?

So, Jason, we need to understand that chemical segment includes our traditional product as well as semiconductor and electronic business. So, over the quarter, we have seen a very good growth in the BFC business, which has a very high EBITDA margin and which is recovering from Q4 onwards. So, because of this, we have seen a better margin in chemical segment.

So, basically, that's a mix of both traditional spec chem margin as well as the BFC product margin.

Okay, battery chemicals also will be a part of this only, right, the specialty chemicals.

Yes, it is part of this business only.

It is a part of this business. Okay. And just one question, if I may just add on. So just, I mean, I understand 2000 tons of the both products in the battery chemicals, electrolyte additive segment. Just wanted to understand what utilization are we looking at? I mean, just you have long, you have those binded by long term contracts. So you would have some idea if you could give some color, whatever possible of what revenue we can look at in.

Yes, so we have 2000 metrics and capacity for both and as we mentioned during our last commentary also that this plant is fully covered back by the customer contracts for all the capacities in next three years time. I will not put in any figure around the capacity that is expected in this financial year, but as I mentioned during my first Q&A, production has already started and it will keep on adding quarter by quarter from first quarter to fourth quarter. It will definitely have a meaningful contribution from electrode additive space.

So, thanks. I'll join. Thank you so much.

Thank you. The next question is from the line of Raj Agrawal from Nibishai.com. Please go ahead. Hello. Yes, sir.

You are welcome. Sir, thank you so much for the opportunity and conversations of great sector number. Sir, I had a question on CDMO business. You know, we have a lot of these new businesses like battery chemicals and tarotata chemicals that are scaling up. So, and we have provided for 25% kind of growth for the next year. So, are we anticipating any kind of slowdown in CDMO or basically if CDMO performs well, then we can, we can supply them on the offside.

No, we are guiding 25% growth with mix of all the vertical and over the total top line what we have achieved in F526.

Got it, sir. Got it. And so on the margin side, so this CDMO business as a whole has a relatively higher margin, right? So this battery chemical business and our specialty chemical business, on the other hand, does not have that kind of margin profile. So will it be difficult to maintain the current margin profile in FI27 or we will be able to do it with the current mix?

So, as I mentioned during my commentary also, we are expecting similar kind of margin in FY27 because, as I said, the margin is a function of product mix, and we are expecting similar kind of product mix in FY27 as well. So, as I mentioned, there will be some meaningful contribution coming from electrolyte additive space, but there is additional data coming from CDMO business also. So, that's the reason that we are expecting similar kind of margin.

So, just on last thing on this, if you can just explain, what do you mean by the mix will remain the same? Because the mix will change, right? Because you have new business that is entering this mix.

So, as I said, there is some portion of additional revenue coming from the spec cam business because of battery electrolyte additive segment. And there is a CDMO additional revenue also coming. So, percentage-wise, it looks similar.

Got it, sir. Thank you so much, sir.

Thank you. The next question is from Mihul Panjwami from FortySense. Please go ahead.

Hello, sir. Congratulations on the great set of numbers. My first question is what proportion of our growth in FY27-28? It is backed by conform orders and long-term contracts across CDMO and the battery segment, battery chemical segment.

For CDMO business, as I mentioned, for this customer, first customer, we have long-term supply contract already in place for 10 years. So that's backed by good visibility from the customer. And on the electrode additive space also, as I just mentioned, we have already got customer contract in place and already signed.

Right. Sir, can you throw some light on, because I'm new in tracking our company, you mentioned in one of the responses that we have a partner who is having 30 years of experience. So, is it a firm or it's an individual or can you just elaborate on the contract which we have signed with the entity?

So that partner is the contract which we have entered is a proprietary firm. And the experience of that partner, which I just mentioned during our Indicam business partner profile.

Okay. Okay. Okay. Thank you so much. Thanks. All of us.

Thank you, sir. The next question is from the line of Krishan Pavani from SBI Mishra Fund. Please go ahead.

Yes. Hi, sir. Many congratulations on, once again, a great set of numbers. Just two questions. First, on the CDMO pipeline, I believe, you know, we had certain production and validation phases in the last quarter, and we expected them to commercialize in the first hour of 527, so we wanted to know. Has there been any update on these new products? Have we commercialized it? Yeah, so that's a question about it.

So, these are already commercialized products because these are already supplied. Now, it's not in our hand or customer's hand because it's a regulatory approval, and we have already got some projections from the customers. That's the reason I'm saying in FY27, we will definitely have a revenue coming from other 4CDMOs as well.

4CDMOs, I think.

Right, apart from the first one.

Okay, and the ramp up of those will be majorly seen in F28, correct? Yes. Okay, and that's great. And secondly, on the margins, I believe, Rishik Bhai, you mentioned margins at a similar level as 4Q or similar level to F526?

Similar level as F526.

Q4 is too ambitious. Ambitious is good, but okay, no problem. In 36% is also great. And just lastly, if I may squeeze one more. So, this Baba Pintan, I think Narej Nai in his opening remarks mentioned that there is a strong kickoff that you expect. So, you know, are the things really picking up pace right now or what stage are we?

Just we mentioned that in Q4, the spec cam EBITDA was 29% given by the very good recovering business of BABA fine cam in Q4, so that's a sign of already recovered business for BFC, and we have similar kind of visibility for F527 as well.

Okay, and I believe you don't need to do a large apex for the BAP, because I think you didn't mention in the plan, so is that correct?

Yes, that's correct.

Okay, okay. Thank you so much for recently answering my question, and I wish you all the best. Thank you so much. Thank you.

Thank you. The next question is from the line of Hemant, as individual. Please go ahead.

Sir, thank you for providing me the opportunity, and congratulations on a very good set of numbers. Sir, what I understand is that since you have graduated for 25% kind of revenue group in FY27, so I think the main contributor will be the electrolyte additive division, right? So, if I... Take a little longer view, maybe from FY28 and all, what can be the growth drivers for the company, sir?

No, it's not only electrolyte additive which would be driving growth for FY27. Both our pharma intermediate business is also growing very fast, and that is the biggest engine for us, for the growth. And then slowly, slowly, this additive business is also taking charge of our growth. And then we have a battery, sorry, semiconductor business picking up, first started with BFC, and then maybe in next two to three years' time, it should be from Indicam as well. So there are three different growth engines which is driving our growth for next three years.

So, can we expect a similar kind of run rate, sir? I think you had earlier mentioned that 25% kind of revenue growth till FY28, I guess, in one of the previous phone calls. So, can we expect the same?

Yes, we have always guided that we are growing 25% growth. That's our history for more than a decade, and this is how we guide the market also going forward also.

So, any other major CapEx lined up and what is the contribution from CDMO side? Because I think we have a guidance of 1,000 crores of revenue from CDMO by FL28.

Yes, that is the guidance, correct. And on the capex side, I have already mentioned that for next year, capex will be the sum of the spillover of FY26 capex, which is around 50 crore. And around 40 crore will be from maintenance capex. And then there will be capex around the R&D center and then. But the figures are yet to get finalized. We will update at 11 times.

Thank you. We have a follow-up question from the zones from RDVI Capital. Please go ahead.

Sir, thank you for taking my question again, right? I just wanted to, you know, ask you on the, this Indicam acquisition, I'm sorry, the Indicam investment has been done, but earlier in the last on call, you had guided for that the facility will be on stream by the start of CY27. Is that plan on or has it been delayed or something like that?

No, it is planning on. In fact, it will be even earlier than what it was guided. So as I said, it should get completed in second half of calendar year 26.

Okay. And sir, one of the CAPEX you just mentioned, some spillover CAPEX of this year. So basically, probably around 100 crore odd number for 27 CAPEX should be fine. And after that, for the R&D center, I know you would need to form up those numbers. So 100 crore odd for 27 would be okay. That would be a good figure.

So that is already planned CAPEX. And then, as I mentioned, the R&D and any other CAPEX, we will update as and when it gets finalized.

Okay. And I just lastly wanted to know, of course, we know the Fermion contract is doing very well. I mean, the numbers are there, $5 billion kind of peak revenue potential by the next three to four years. So just on the ground, how do you see this contract ramping up? I just wanted to get some color on from your side. How is it doing, label extensions, etc.? How do you see the contract ramping up for you?

So, those things are already available in the presentation of Bayer as well as the Permian presentation, and they have also guided the market about the growth of those products. So I think being their primary supplier, we should be the beneficiary of those business, and we have already guided the market that how the business is going on and further expected to ramp up in FY27 and going forward as well.

Okay, sure. Thanks. Thank you so much, sir, for answering all these questions. Thank you so much.

Thank you. The next question is from Dharagunatra from ValueQuest. Please go ahead.

Thank you for taking my question, sir. Just to follow up on the previous participant, you mentioned that there is a 50 crore spillover of KPEX that will be done in FY27. What is this 50 crore spillover, sir? What is the KPEX?

It is related to KPEX of electrolyte additive and the pilot plant.

Additive and pilot plant. Okay. Thank you, sir.

Thank you. The next question is from the line of Mr. Ankit Mittal, individual investor. Please go ahead.

Yes, sir. Thank you for the opportunity and congratulations for a great session.

Mr. Ankit, we are unable to hear you.

Yes, can you hear me now?

Yes, you are audible. Please go ahead.

Yes, so I was asking for the first question, and that is regards to the revenue growth guidance. So, as you mentioned in the last question's reply, we already know about the Furnian project and the... The growth guidance given by Bayer, which is for 50% growth in the calendar year 2026, given that we have that outlook from Bayer, and also we have this electrolyte business coming up in this financial year. So I wanted to know if we are being conservative in giving this 25% revenue growth guidance for this year, and would it be like if all the things remain? In which condition, with respect to this Parneon project, we might have an opportunity to revise this guidance later in this year?

So we have always guided the market about 25% growth CAGR, and that has been our history. And we would be happy to revise our guidance if that business potential goes beyond those 25% at a relevant stage of this financial year.

And secondly, on the seasonality of the business, which you mentioned in the introductory remarks, which is 40% in the first half and 60% in the second half, but with this fermion contract this year, which has already been ramped up to a decent price, do you think that seasonality will reduce this year? And, I mean, the QoQ decline, which we usually see in the first quarters, that might be a little bit this year, given that the kind of growth we are seeing in that 21%?

Yes, that is also expected in F527 as well.

And expected meaning in Q1, I mean, wanted to check if, I mean, the usual seasonality was there, because usually we see 20-30% revenue decline Q1Q in Q1, but given that the significant ramp-up of Permian project…

See, in fact, the first contract was there in FY25 and FY26 as well. And both here has shown the similar kind of revenue trajectory Q1 to Q4. And that's our history for more than decades.

Okay, any particular reasons why we see it? Because we don't see similar, I mean, seasonality when we look at the numbers from Orion or Bayer. Any particular reasons why we see it at equity risk level?

Sir, this is my company. History is that we have always Q1 is lower than Q2, Q2 is lower than Q3, Q2 is lower. In last 15 years, it's like that. We are not only dealing with Permian, we have more than 600 customers. So each customer has different requirements at different times. And we have more than 100 products. So it's my company's seasonality and working like that. I'm not representing Permian.

Thank you. Thank you. Thank you. All the best. Thank you.

Thank you. Ladies and gentlemen, due to time constraint, we will take this as a last question. I now hand the conference over to management for closing comments. Over to you, sir.

Thank you. We 61 Capital team for hosting our first call. We appreciate everyone's questions and hope we have addressed most of your queries. If we miss any of your questions, please reach out to our investor relations team, and we will get back to you promptly. Once again, thank you very much, and good evening to all of you.

Thank you. On behalf of Equitas Chemicals Limited, that concludes this conference. Thank you for joining us, and you may now disconnect your lines. Thank you.