Sudeep Pharma Limited (SUDEEPPHRM) Q4 2026 Earnings Call Transcript

Ladies and gentlemen, good day and welcome to Sudhir Parma Ltd. Q4 and FY26 earnings conference call. This conference call may contain forward-looking statements about the company, which are based on the beliefs, opinions, and expectations of the company as on the date of this call. These statements are not the guarantees of future performance and involve risks and uncertainties that are difficult to predict. As a reminder, all participant lines will be in the lesson-only mode and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal an operator by pressing star, then zero on your touch-tone phone. Please note that this conference is being recorded. From the company, we have with us today Mr. Sudeep Bhaiyani, Managing Director, Mr. Shanil Bhaiyani, Director, and Mr. Ketan Vyas, Chief Financial Officer. I would now like to hand the conscience over Mr. Sudeep Bhaiyani, Managing Director at Sudeep Pharma Limited. Thank you whenever you are, sir.

Good morning, everyone. On behalf of Sudheep from our team, I would like to thank you all for joining us today for our Q4 and FY26 earning conference call and for your continued support and confidence in the company. FY26 has been a significant year for us, marked by multiple strategic milestones and meaningful progress across our businesses. During the year, we successfully completed our listing, acquired Nutrition Supply Services, NSS, in Europe to strengthen our nutrition platform, made a substantial progress on our new greenfield manufacturing expansion, and also completed the groundbreaking and initiated construction of our battery materials project at Dahej in Gujarat. What makes this progress particularly encouraging is that it was achieved despite a challenging global operating environment marked by geopolitical uncertainties, volatility in raw material and energy prices, logistics disruptions, and evolving global threat dynamics. Even under these conditions, the company delivered resilient operational performance and growth to conclude FY26 on a positive note. These developments reflect the continued stendling of our business fundamentals, customer relationship, manufacturing capabilities, and long-term growth platforms. As we move ahead, we remain focused on building the business with a discipline and a long-term approach while continuing to create value across all of our key stakeholders. With that, I will now hand over the call to Shanil, who will take you through the business and operational highlights in greater detail. Thank you. Over to you, Shanil.

Good morning, and a very warm welcome to all of you joining us today. FI26 has been one of the most transformational years in Sudhir Pharma's journey, marked by meaningful investments towards building the company's next phase of growth through capacity expansion, strengthening our global commercial presence, deepening customer engagement across international markets, and developing new growth platforms for the future. These investments were undertaken despite a highly volatile operating environment characterized by geopolitical uncertainty, raw material inflation, logistics disruption, energy supply challenges, and evolving global trade dynamics. As we enter FI27, we believe many of the strategic initiatives undertaken over the last 18 to 24 months are now beginning to translate into stronger customer engagement, improved market positioning, and better long-term growth visibility across the business. We'd also like to take this opportunity to sincerely thank all our investors for the trust and support you have shown us throughout the journey. For those joining us for the first time, and as a brief refresher for our long-term stakeholders, I will begin by outlining our journey and the strategic direction that continues to guide our growth. Headquartered in Vadodara, Sudip Karma was established in 1989 with a single manufacturing facility and two calcium-based products. Over the years, the company has evolved from being a manufacturer of mineral-based pharmaceutical recipients into a technology-driven global supplier of mineral excipients and specialty ingredients. Today, we cater to customers across pharmaceutical, food, and nutrition segments globally, supported by a diversified portfolio of approximately 100 products. We currently operate five manufacturing facilities, four located in Gujarat and one in Ireland, which was added through the acquisition of NSS in May last year. NSS is a specialized nutrition blending company with a strong presence in critical segments such as infant nutrition and medical nutrition. At present, Sudip Pharma serves customers in close to 100 countries with operations broadly organized under two key business verticals, pharma, food, and nutrition, and specialty. Starting with our Pharma Food Nutrition Vertical, this business continues to remain the core pillar of Sudi Pharma, contributing approximately 56% of our FI26 revenues. During the year, the vertical reported revenue growth of 10% over FI25. The performance was driven by continued healthy demand across our calcium and iron portfolio, with India and Europe being the key growth contributors geographically. Complementing our existing product portfolio, we are witnessing a strong rise in demand for the next generation mineral molecules such as bisglycinate, which we recently launched under our absorption. These ingredients are clinically proven for enhanced absorption in the human body, strategically positioned within higher value application segments with superior realization and margin profile. With several key customer approvals already secured across North America and Europe, we expect this category to progressively become an important contributor towards both growth and margin expansion for the company, with a total global demand of approximately $1 billion for the bisglycinate ingredient category alone. While the business faced challenges during the year due to sharp increasing critical raw material prices, particularly phosphoric acids arising from higher sulfur costs globally, we were able to successfully pass on the price impact to customers without material margin compression. This reflects the highly critical and functional role of our ingredients within the customer formulations, resulting in a strong customer's thickness and acceptance. The benefits of these pricing actions are expected to progressively reflect over the coming quarters. Importantly, with the addition of our upcoming greenfield facility, which I will discuss in more detail shortly, We believe this vertical is now entering its next phase of growth. Historically, growth in this segment was partially moderated due to infrastructure and capacity limitations. However, the new facility will significantly strengthen our capabilities in higher-value molecules such as gluconate, glycinate, and citrate, while also expanding our overall manufacturing infrastructure for future growth. Coming to our specialty ingredients vertical, this business continued to demonstrate strong momentum during the year and remains our fastest-growing segment. The contribution of specialty ingredients increased from 34% in FY25 to approximately 44% in FY26, with overall revenue growth of 62% compared to FY25, Reflecting the increasing scale and strategic importance of this business. Revenue for the vertical grew from 172 crores to 280 crores during the year. This segment is particularly witnessing strong traction globally across critical applications such as infant nutrition, medical nutrition, sports nutrition, and dietary supplements where customers increasingly value differentiated, high-functionality ingredients supported by reliable supply capabilities. Looking ahead to FI27, we are particularly encouraged by the momentum we are witnessing across North America and Europe. Over the last 12 to 18 months, we have made meaningful investments in strengthening our commercial presence, Technical teams, inventory infrastructure, warehousing capabilities, and customer engagement across both these strategic markets. We are now beginning to see the early benefits of these investments through stronger customer conversion, improving wallet share, deeper engagement with large global accounts, and a growing pipeline of commercialization opportunities. Importantly, these markets represent a structurally higher value product mix for the company and therefore remain strategically important not only from a growth perspective, but also from a long-term margin expansion standpoint. While we remain mindful of the broader macroeconomic environment, we believe FI27 could mark an important inflection point in scaling our international business. The growth during the year was primarily led by product expansion, wallet share gain, and new customer approvals. Compared to FI25, we received around 51 new customer approvals in FI26, which are expected to meaningfully contribute to the growth of the business in the coming financial year. With respect to NSF, the acquisition we made in Ireland earlier last year, the integration process across operations and supply chain continues to progress smoothly. To further strengthen the business and accelerate expansion outside of Ireland, we recently appointed Mr. Matthias Fredrickson as the new business head of NSF. Matthias brings over 30 years of industry experience across the pharma and nutrition ingredient sector in Europe, along with strong market relationships and extensive commercial expertise. His previous experience, particularly with one of the world's largest vitamin and mineral companies, is expected to play an important role in accelerating NSS's expansion across high-potential European markets, especially within the manufacturing project. This facility has been strategically developed to strengthen both our manufacturing infrastructure and future product capabilities for the pharma, food, and nutrition verticals. During the year, the project experienced some delay in commissioning, primarily due to shortages and disruptions in LPG and energy supplies. However, I am pleased to share that we have now successfully completed internal production evaluation and qualification at the facility and have initiated customer approval process. We expect customer qualification timelines to range between 6 to 12 months depending on product categories and customer audit requirements. Once operationalized at scale, the facility will significantly enhance our capabilities in high-value next-generation mineral molecules, including glycinate and gluconate. I would now like to share an update on Sudhi Pedersen's exciting long-term growth opportunities for the company. During FY26, we successfully conducted the groundbreaking ceremony for our battery materials project at the H, which remains on track for commissioning of Phase 1 capacity of 25,000 metric tons per year by April 2027. Work at the site continues to remain a key priority as we push to bring capacities online in line with growing customer demand. At SAM, customer engagement and commercial traction continue to strengthen significantly during the year. Global customers across the LSP value chain are increasingly accelerating their China Plus One sourcing strategies, driven by supply chain diversification requirements, geopolitical considerations, and the need for long-term supply security across critical battery materials. This is creating a significant opportunity for Sudiv Advanced Materials, particularly given our positioning as one of the very few companies globally capable of offering a reliable ex-China source of battery-grade iron phosphate at global qualification pipeline and are currently engaged with 42 customers across the cathode-sab validation stage. 14 customers have progressed to pilot-scale evaluation, and 6 customers have successfully completed commercial validation and are currently in active off-take discussions with us. Encouragingly, we have also started receiving initial commercial purchase orders, including approximately 700 metric ton over the last month alone, supporting customer efforts to diversify sourcing away from China. Based on the strength of current customer engagement, ongoing qualification progress, and commercial discussions underway, we are increasingly confident about the demand environment for our phase 1 capacity of 25,000 metric tons. While we remain disciplined in our execution approach, the current trajectory of customer engagement, qualification progress, and ongoing commercial discussions give us increasing confidence in the demand visibility for this business vertical. We believe the battery materials industry is entering a powerful long-term structural growth cycle. The rapid expansion of energy storage infrastructure, particularly to support the next generation of AI-driven data centers, is expected to remain a major growth driver for this segment. During FI26, we delivered healthy growth across both business verticals, expanded our global customer base, strengthened our international presence, and continued to execute on key strategic priorities. As we enter FI27, we are encouraged by the momentum across the business. The investments we have made over the last several years are beginning to translate into accelerating commercial activity, deeper customer relationships, and a growing opportunity pipeline. With an enhanced operating platform, increasing global relevance, and multiple drivers for future value creation, we believe Sudi Pharma is well positioned to capitalize on the opportunities ahead. With that, I would now like to hand over the call to Mr. Ketan Veya, our CFO, who will take you through the financial performance for Q4 and FI26 in greater detail.

Thank you, Sanil, and good morning, everyone. We are pleased to report strong financial performance for Q4 and FI26 despite of volatile operating environment. This performance is a compression during the period. Coming to financial year 26 financial highlights, revenue from operations for FY26 grew by 27.9% on a year-on-year basis to Rs. 642.3 crores as compared to 501.9 crores. EBITDA for FY26 also grew by 16.8% to Rs. 221.9 crores as against Rs. 189.9 crores in FY25. EBITDA margin for the year stood at 34.6% as compared to 37.8% in FI25. PACT for the year stood at Rs. 174.3 crores as against Rs. 138.7 crores in FI25. Coming to quarter Q4 FY26 financial highlights, revenue from operations for the quarter grew by 15.7% on YOY basis to Rs. 182.3 crores in Q4 FY26 as compared to Rs. 157.5 crores in Q4 FY25. EBITDA for the quarter stood at Rs. 62.6 crores as compared to Rs. 58.8 crores in Q4 FY25. EBITDA margin for the quarter stood at 34.3%. Fat for the quarter stood at Rs. 48.5 crores as compared to Rs. 44.2 crores in Q4 FY25. On the business mix, FY26, our export business contributed to 60%, while domestic business contributed to 40%. For FY26, specialty business contributed to 44%, while pharma, food, and nutrition business contributed to 56%. Coming on the balance sheet side and explaining the working corporate and capital performance, During the year, our working capital days increased from 184 days to 213 days, which was mainly due to increase in inventory days. Our inventory value increased by 88 crores as compared to previous year, of which raw material increased by 41 crores and finished goods increased by 37 crores. Increase in finished goods inventory was largely strategic in nature to support customer commitments in the Europe and U.S. region for the upcoming quarters. We are seeing the inventory getting liquidated in the current and the upcoming quarters. Further, on the raw materials side, our price contracts were scheduled to expire in March 26, especially for key raw materials like phosphoric acid. Considering the significant volatility in global phosphorus and related raw material prices, we proactively increased our raw material inventory to ensure supply continuity and mitigating procurement risk. Consequently, raw material inventory increased from 54 crores to 95 crores, representing an increase in 41 crores. There was also an impact on cut-off sales because of which there was an increase in FG of 10 crores. That said, we are consciously focusing on improving balance sheet efficiency and through tighter inventory management, better receivables collections, and overall working capital optimization, which should support our gradual normalization going forward. We are internally focused on managing our net working capital cycle and targeting to come around 150 to 160 days within this financial year. As of 31st March 2026, the company's net debt stood at 33.6 crores with a net debt-to-equity ratio of 0.04x, reflecting a conservative and comfortable leverage position. With this, I would like to conclude the presentation.

We will now begin the question and answer session. Anyone who wishes to ask a question may press star and 1 on their touchtone telephone. If you wish to remove yourself from the question queue, you may press star and 2. Participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question is from the line of Sanjay Jain from ICICI Securities. Please go ahead.

Yeah, good morning. Thanks. Thanks for this opportunity. I've got a few questions. First, on the pharma, food and nutrition, I understand that we don't look at quarterly. But even for the year as a whole, the growth is 10%. And I believe there will be some amount of pricing benefits which would have baked into it because of the raw material inflation, which is phosphoric assays. It appears that the volume growth in the segment is probably 5-ish percent or somewhere

around it, if I take 5 percent as an inflation.

How should we see this segment and why the growth has been relatively muted when we compare it to the speciality? I thought we were looking for a faster growth even in the same segment.

Yeah, good morning, Sanjay Ji. Thank you for the question. So, I think while we don't have data maybe in the deck, I think pharma food nutrition has actually grown faster from a quantity standpoint. So, product mix has changed. I think the quantity volume growth is north of 20% in this category. What we are seeing is for phosphates specifically, the price increase we have only passed on to the customers in Q1. So we have continued to honor the orders in March and April. You will see the partial benefit reflecting Q1 and more importantly in Q2 going forward. Also, phosphates is the category where our capacity utilization is at its optimum level. So, as soon as we, now that we have the greenfield commissioned, that will significantly be able to give us flexibility in taking on larger off-take agreements or building wallet share specifically for phosphates.

Got it. But even if I look at from the EBITDA standpoint for the segments,

it really doesn't show the

20% growth benefiting into the EBITDA. If I were to believe that the volume growth was 20%, the EBITDA growth is still a little underwhelming, in fact, for this entire year. What explains that?

You mean specifically EBITDA in general?

Pharma food. No, EBITDA for pharma food and nutrition.

So, I think there are a couple of things that we are doing. One is, there is, so, phosphates in general, I would say, as I said, that is where, say, for example, from a margin contribution, it probably has one of the larger margin contributions for the business. Other product categories which we have recently introduced into the category or as a product, this glycinate gluconates, the operational cost is currently higher because we are operating at lower capacity, running a temporary or I would say smaller capacity line. And so you will see all these ingredients materially kind of deliver the margin that they're capable of once we move these product categories to the greenfield. Currently, they are being operated. Plus, additionally, what has happened is for pharma food nutrition, we have gone through a significant recruitment cycle to support the new greenfield that we are going to be operating. But because we have not entirely started generating revenue, all those expenses of employees are also sitting in the pharma food nutrition vertical today.

So next year, how should we see for pharma food and nutrition with green plant already operational? I think we have largely done our hiring. All those heavy lifting we have already behind and already in the course. How should this number look, say, in FI 27, 28? Should it grow at, say, 15% at least in terms of EBITDA?

I think that would be, that would be, that is the, I would say, the expectation. If not, and what we see, what we expect for 27 and 28, Sanjashi, is Europe and North America both were, I would say, underperformers for this category specifically. We are, as I mentioned earlier in the commentary, we have received a lot of key customer approvals, especially both in the state as well as the new category that we are launching. So we remain, you know, fairly optimistic for this category, and I think we should be, you know, comfortably positioned to achieve the growth that you mentioned in this category for both the years 27 and then for 28.

Got it. One for this quarter. On the other expenses, it appears that the cost has gone up quite sharply.

So, Sanjaji, two factors here. I think YOY, NSS was not acquired last year, so that is the reason. But more importantly, for Q3 versus Q4, I would say there are a couple of one-time expenses. So, one, there is an approximate, I think, 3 crore CSR expenditure, which is in this quarter. Second, in March, you know, we had a significant shortage of LPG, and our specialty ingredients vertical runs on this. So, we basically paid a significant premium to CQ, and we built a larger inventory, so around 1.5 crores is towards, I would say, for the month, higher in power and fuel specifically to LPG. And third, I would say there is a, I would not maybe call it, it's a one-time expense, but it hits the expense. Because of certain production delays in March, because of lower capacity, we had to airlift material to our largest customers. So there's a 2 crore impact in selling distribution specifically for this air freight that we did. So that is why you see the other expense higher compared to Q3.

So, this expense going forward should fall, right? Because LPG is now available, airlifting probably not happening, and the one-time expenses not being there.

This will drop sequentially, right, when we look at Q1. Exactly, exactly.

Got it, got it. Now, following on the speciality and one comment you have made in your remarks that you have secured 500 metric ton of battery chemical material from a domestic player, have you started manufacturing it commercially or how it is? How do we plan this 500 metric ton to supplier or some of these supplies coming for us?

So, I suggest you two things. One, I think we received 700 metric ton orders for battery materials, and these are across domestic as well as global. I mentioned last time that we have commissioned around 5,000 to 7,000 tons, depending on how we run the plant, in our existing pharma facility to manufacture battery-grade iron phosphate. So, we are currently utilizing that capacity to service the 700-ton purchase order that we have. And so, the goal is to run 50% of that capacity to fulfill commercial orders and the remaining 50% to help other customers in their validation and scale-up process.

So, next year, it is fair to assume that we will be selling, say, 2,500 metric ton here or this in terms of the battery chemical, in terms of volume, right? Right?

In FI 27?

Yes, FI 27.

That is a fair assumption, yes.

Got it. One of the specialties has been doing quite well, both on margin and growth. How does the order book look like for us in FI 27? Should the growth momentum be maintained in the specialties?

I think, so yes, I think specialty ingredients will continue to be the, say, the faster-growing category. I think for 27 also, we have a very good outlook. I think there are two categories which are growing extremely well. One is the encapsulation technology that we have. There, we were already working with the largest bakery in the world. In the last financial year, we have got an approval with, I think, two of the other top five globally as well. So, we have very good visibility for this category. And then we have, secondly, we have the premix category for which we got approved with, say, the largest infant nutrition company. So, that will also multiplyly contribute to the business in FY27.

Got it, got it. Shanil is really helpful for all those answers, and I wish you the best of luck for the coming quarters. Thank you, Sanjay.

Thank you. The next question is from the line of Nishita from Sapphire Capital. Please go ahead.

Yes. Am I on the phone? Yeah, perfect. So I had a few questions. One is on the battery material, CAPEX, that we are doing. In the presentation, we've mentioned that in four years, we'll add 25,000 metric tons each year. So, is it safe to assume that the capex for each incremental 25,000 of metric tons is going to be 300 croft?

So, hi, Nishita.

No, so the current capex is higher because it also includes the land acquisition. And while we are installing the equipment for 25,000 tons, we are developing the infrastructure, so all the buildings and the raw material processing and the utility area for our phase 2 as well. So I had mentioned previously as well that to achieve our target of 100,000 tons, we are looking at a cap tax of approximately 600 crores.

Okay, so 600 crores is for the full capacity of 100,000 meter ton.

That is correct.

Okay, and what will be the revenue potential from this 100,000 meter ton at peak utilization?

Yeah, I mean, it's a, I would say the pricing has been fairly dynamic recently, but we think it would be fair to assume an average price of around $2, we say between 16 to 1800 crores is the potential for this at 100,000 tons utilization.

Okay, okay, understood. And my next question would be, what is the total KPEX AMAGA spending in FY27, including the back-end tail and the green seal project?

Hi, Nishita, it's Ketan, yes. The total, the gross KPEX spent during the year was 127 crores, of which we spent on SAM land purchase of 34 crores. We had the Greenfield project spent, additional spend of 80 crores, and there was a maintenance KPEX of about 30 nought crores.

What is it going to be in FY27?

In FY27, we'll see, major greenfield expansion is over, so maybe there would be around 10 odd crores for completing the greenfield project, and a maintenance capex of 15 odd crores. That would be in the core business. Shami already mentioned on the SAM capex for the FY27.

Right, right, understood. Also, if you could give some revenue outlook for FY27 and FY28, that would be really helpful.

So, Nishita, I think while we don't, you know, give direct guidance on revenue, but I think, and, you know, as I was maybe mentioning to Sanjay as well, we have a very, I would say we are, you know, fairly comfortable and confident that 27, we will continue the momentum that we have built this year. However, both verticals, we expect actually pharma food nutrition to grow faster than it has grown in FY26 of 10%. And specialty ingredients will continue to track similar growth to what we have done over the last, you know, two, three years. So that is how we kind of build visibility for 27 and 28. Okay.

And you mentioned that our margins in PSL, the pharma, food and nutrition segment, the margins will also grow. So, do we see the overall consolidated margins growing as well?

Yes, so I think if you see our margins for the year, I would say, you know, around maybe 200 business points on the EBITDA side, maybe lower, and also on the PAT. Also, because we have invested significantly in building out the teams across Europe and North America, they will both start to positively contribute to the business this year. So, once that happens, I think in the next couple of quarters, you will see the margin kind of tracking back to the, you know, what we were delivering maybe in FI24 and FI25.

Okay, so we can see the margins at similar level as 37-38%.

Correct.

In FI27.

Thank you. Before we take the next question, a reminder to all the participants, if you wish to ask a question, please press star and one. We will take our next question from the line of Nitin Gandhi from Inorqist Advisors. Please go ahead.

Yeah, thanks for taking the question. Leaving aside battery material, what is the maximum revenue potential of the other business?

Hi, Nitin. Good morning. You mean with the capacity that we are bringing on?

So, excluding battery, once this greenfield now that is commissioned, the business can scale to approximately 1,000 to 1,200 crores without any incremental capex in the existing product portfolio.

Okay. And are there measures to increase margin beyond 35% to some 40% or it will remain flat at 35%, only at peak?

No, so I think, as I mentioned, I think if you see in the last couple of years, we were, maybe our margin profile was stronger than it is this year. There is an upfront cost that we are incurring today or we have incurred in FI26 for mainly on building out the inventory, warehousing, and the team that we have built. They will positively contribute and you will see margins, you know, kind of increase back to the historical average levels of 24-25.

No, no, I think giving aside those one-time adjustment which happened during this exceptional year 26, while building the new facilities, are there any steps, designs, or some other level, way for product mix or something which we aspire to do so that the margin can further increase, maybe complexity level is increased or whatever it is.

Yeah. So, I think I mentioned in my commentary that, you know, we have launched a new product molecule called bisglycinate, which are, again, clinically proven for higher absorption. That product category will be a higher margin contribution, will have higher margin contribution to the business. FI27 will be the first year where we kind of produce at a scale, but maybe in starting FI28, you will see the higher contribution coming from this category towards the business.

Okay. What is the addressable market for that in North America?

I think I mentioned, I think the current global demand for this ingredient is around a billion dollars for the ingredient alone. North America would be 40-50% of that global demand.

Thanks.

Thanks for taking my question.

Thank you. A reminder to all the participants. Anyone who wishes to ask a question, they press star N1. We will take our next question from the line of Shreya Chatterjee from Ageless Capital. Please go ahead.

Hello, so thank you for taking my question. For the pharma and nutrition segment, the new molecules that you mentioned, Could you just give a color as to how, like, what's the margin or the unique pricing or the unique economic profile of your current portfolio versus your new molecules? And, like, what can be the, like you said, it's a billion dollar market potential, but where do we see capturing the market of that and how competitive are we versus our global peers?

So, I think there were a few questions I will try to answer, and then if I misordered on anything, please let me know. So, bisglycinate, I think, like our core business, the competition sits between Europe and North America. I think there is a company in North America which is the largest in this category. The competitiveness is more on, you know, the chemistry or the performance of the ingredient, not necessarily the price. Because if you see, so maybe globally, there is a huge demand or very, I would say, double-digit growth in demand for magnesium supplements, specifically magnesium bisglycinate, which is targeted for better sleep and muscle recovery. We have, I would say, in FY26, we have received approvals from two of the largest consumers of this product in the U.S. market. As you know, it's a clinical product, so it takes time to build wallet share, but we are very, very, I would say, excited for this opportunity. And over the next two years, two to three years, you will see this category becoming a sizable revenue contributor for Sudip.

You also mentioned about the, like, these might be of higher realization, and you also have a couple of products in your portfolio. So how much should one think, like, how much higher realization would it be versus your current portfolio? And similarly, in case of battery chemicals, how competitive are we versus, for example, China or the other players?

So, I think the realization for the bisglycine or the new category is very different to our core business. So, I would say it would not be fair to even compare those. On the battery side, the goal is, and my honest answer is, the goal is not to compete with China. Our focus right from the beginning since we started this business has been to give a product which is highly competitive from a performance perspective against the Chinese iron phosphate because 100% of iron phosphate today is manufactured in China. We are now, we have now successfully achieved the product performance that is required by the customer. And because there are geographic or regulations, regulatory requirements that require a ex-China supply chain, we are, you know, we are benefiting from the China plus one or the regulatory requirements for this category.

So, if I understand correctly, you mentioned that in both pharma and battery chemicals, you are targeting a more high-value performance kind of a chemical. So, that will have a higher realization, and that will invariably place you at a better competitive scenario. So, if you could just quantify how much higher the realization would be for both these verticals, any color to that range or something versus the normal commodity-grade things that you supply.

I think the battery business will operate with very different financial metrics. It will have a very different working capital scenario, different margin profile, and different scalability altogether. As I said, from a margin perspective, we will not talk too much today about the battery as well as the new molecules that we bring into market. We have to also safeguard our, I mean, not to make everything too public because our suppliers, customers, everyone would have access to this information.

Yeah, but then the realizations would be different, like not just battery chemical, I'm talking about the parma, food, nutrition as well. The realization of your new grade molecules that you are bringing, including the molecule that you talked about, that will be higher, like 10%, 20% higher than your current portfolio. The realization I'm talking about, not the margin.

So, realization, as I mentioned, it would not be fair to compare because the bisglycines product that we're talking about has four times the realization of our current portfolio. So, as I said, it really depends on and it gets too technical, but you have to look at the strength of each product and the realization varies based on strength on the application clinical data. So, which is why I'm not giving you a straight 10%, 20% answer for this category.

Got it. And what's the current capacity utilization across all our facilities right now, excluding the battery thing that's coming online across our brownfield facilities?

So, for our pharma food nutrition, without the green field that we are commissioning this year, I would say we are between 65% and 70% utilization on that vertical, which is why the green field. On specialty ingredients, we would be between 35% and 40% utilization.

Thank you. Thank you for taking my question. Thank you.

Thank you. We will take our next question from the line of Aakash from Sahasrara Capital. Please go ahead.

Yeah. Hi. Good morning. Am I audible?

Yes, you are.

Hello.

Sir, you are audible. You may please proceed.

Yeah, hi. So, my question was regarding the proprietary green technology that we have. So, is it only for the battery materials or it is also for the, you know, pharma and food ingredients that we are manufacturing? And if you can help us understand what exactly we are doing and is it, you know, benefit us in terms of, you know, byproduct or the raw material that is left over? Are we doing any value addition in that and is it getting reused?

Hi, Akash. So, when we talk about the six proprietary technologies, that is towards the specialty ingredients vertical that we have. These are techs that we have built and developed in-house, again, to compete with the players across, mainly across North America and Europe. And the second question that you had around battery materials, so yes, this technology also is built, developed in-house as a product. It's not a new product for us. We have been making a food-grade iron phosphate for the past 10 years. We've built on that chemistry expertise and then engineered the product to have the superior performance for the battery industry.

And is it helping? Yeah.

No, no, I was just mentioning maybe to the other question. So, I didn't maybe entirely catch the question clearly, but there is no by-product raw material that we are using for these, say, these product categories.

Okay, got it. Thank you. And will it help us in any way in the margins profile that we have? Right?

Yes, I think specialty ingredients has been a stronger margin profile. That has been the growth driver, and that will continue to sustain going forward. So, based on that, the margin of the overall business should improve.

Thank you.

Thank you. A reminder to all the participants, if you wish to ask a question, please press star and one. We will take our next question from the line of Nitin Kandli from Innoctivist Advisors. Please go ahead.

Yeah, thanks. Coming back on Glycinet, what are we targeting? Pure or buffered? And how are we positioning mid-premium or little higher? And what are the distribution channels you are targeting? Costco, wellness, subscription wellness, whatever best you can share on those parts. And, you know, whom are we benchmarking against the existing product for sale, market share or something?

Hello, Nitin. So, you know, we will be offering both the fully chelated one, the chelated one, and the buffered as well. So, this is as per the need of the market. And, of course, as the companies you mentioned, of course, these are our targets. And we have got good approvals, you know, so that the CMOs for this product. And as you might be aware, the largest manufacturer or the market leader in this product is a company called Volcam in the U.S.

Nitin, can you hear us?

Yeah, I can hear you. I thought you were giving some more inputs. I was quiet. Right.

So, and for the sales, we have our own sales team in Europe and the US. So, our focus is to work through our sales team for getting the optimal benefits in the pricing.

More of a B2B, B2C, what are your targets?

No, so we are a B2B company, and we work with all the large CMOs of the companies you mentioned.

Okay. I wish you all the best. Maybe we will take some questions when we meet first. Thank you. Thank you, thank you, thank you.

Thank you. Ladies and gentlemen, as there are no further questions from the participants, I would now like to hand the conference back to the management for closing comments.

Thank you, everyone, for taking the time to join Sudip Pharma's Q4 and FI-26 investor call.

And we look forward to continuing engaging with all our investors. Thank you. Thank you.

Thank you very much.

Thank you.

On behalf of Sudip Pharma Ltd., that concludes the conference. Thank you all for joining us today, and you may now disconnect your lines.