IOL Chemicals and Pharmaceuticals Limited (IOLCP) Q4 2026 Earnings Call Transcript

Ladies and gentlemen, good day, and welcome to the IOL Chemicals and Pharmaceuticals Limited Q4FI26 Earnings Conference Call, hosted by MUFG In-Time Investor Relations. As a reminder, all participant lines will remain 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 the operator by pressing star, then zero on your touchtone telephone. Please note that this conference is being recorded. I will now have the conference over to Ms. Prati Amre from MUFT Investor Relations for opening remarks. Thank you, and over to you.

Thank you, Ryan. Good afternoon, everyone, and welcome to IOL Chemicals and Pharmaceuticals Ltd. Q4 and FY26 Earnings Conference Call. Today on the call, we have Mr. Pradeep Kumar Kanna, Chief Financial Officer, Mr. Abhairaz Singh, Senior Vice President and Company Secretary, Mr. Kushil Kumar Rana, Director of Works, and Mr. Rakesh Mahajan, Finance Advisor and Strategic Head, to provide insights on the company's operational and financial performance. Before we begin the call, I would like to give a short disclaimer. This call may contain some of the forward-looking statements which are completely based upon our beliefs and expectations as of today. The statements are not a guarantee of our future performance and involve unfortunate risks and uncertainties. With this, I would like to hand over the call to Abai Sir for his opening remarks. Over to you, sir. Thank you.

Thank you so much, Prachi. Good afternoon, everyone, and welcome to the Q4 and FY26 earnings conference call of IOL Chemicals and Pharmaceuticals. Thank you so much for joining us today and for your continued trust and support. We truly appreciate your time and your interest in the company. I hope you have had an opportunity to review our financial results and investor presentations, which have been uploaded on stock exchanges and the company's website. FY26 has been a good year for the company, marked by consistent operational execution, improving efficiencies, and healthy progress across both pharmaceuticals and chemical businesses. Despite continued geopolitical uncertainties and volatility across global markets, the company maintained strong business momentum and resilient growth. Q4 FY26 was particularly encouraging for us as the company reported its higher-ever quarterly revenue, supported by cost optimization, improving product mix, and enhanced capacity utilization across key products lines. More importantly, the quarter also reflected meaningful involvement in profitability in line with the operational direction and efficiency. and efficiency focus we have been consistently working towards. Within pharmaceuticals, non ibuprofen API continues to witness healthy traction with key products such as paracetamol, metformin, clopidogrel, pentaprozole and other API. ...improved demand across markets. The company further strengthened its non-ibuprofen segment through the launch of Noxidil and the expansion of pentaprizole, capacity to cater to growing demand. This reflects the steady progress of our diversification strategy and operational strength. Our chemical business also delivered a strong performance during the quarter with improvement in both realization and profitability, supported by stable demand conditions and operational efficiencies. Also, the capacity enhancement in products such as ethyl acetate and acetic anhydride along with recent commissioning of triacetine will further strengthen integration and supply chain efficiencies. During the year, the company continued to invest towards capacity expansion, process automation, infrastructure enhancement, and operational improvements while maintaining a disciplined approach towards capital allocation and balance sheet management. Overall, the year reflects consistent execution of our long-term strategy, improving business fundamentals, and continued focus on building a stronger and more diversified platform for sustainable growth. With that, I now invite Mr. Pradeep Khanna, our CFO, to take you through our financial performance for the Q4 and FY2026.

Thank you, Mr. Abhay. Good afternoon, everyone. I will now share the financial performance for the quarter and full year, following which we will open the floor for questions and answers. During Q4 of 1926, the company reported a strong top-line performance with revenue from operation of Rs.600. 19 crores as compared to Rs. 528 crores in the corresponding quarter last year, reflecting a year-com-year growth of around 17.4%. For the full year of French Year 26, revenue from operations stood at Rs. 23. 19 CR representing a growth of 11.5% year-on-year. On the operating front, EBITDA for the quarters stood at Rs.94 CR as against Rs.68 CR in the quarter four of financial year 25, resisting a growth of nearly 40%. While EBITDA margin improved by 251 basis point to 15.2 percentage. For the full year of 1926, the EBITDA increased by around 29% to Rs.290, with margin improving to 12.4% from 10.7% in the previous year. Coming to the bottom line, Profit After Tax for Waterfall. Stood at around Rs.53 growth compared to Rs.32 growth in the corresponding quarter of the last year, witnessing a growth of 68%, with pat margins improving by 262 basis point to 8.6%. For the full year, initial year 26. Pat increased by around 36% to Rs.138 crores. The stronger bottom line performance was supported by improved operating profitability and efficient working capital management leading to healthy cash generation.

During financial year 26, the company entered capex of around Rs.

160 crore towards capacity expansion, operational improvement, and infra enhancement, and were funded entirely through internal accolades, reflecting disciplined capital allocation. Going ahead, the company remains focused on sustaining growth. to mention through increasing contribution from the non-IBU portfolio, higher utilization of recently commissioned trustees, and continued improvement in operating efficiency. We remain confident of delivering mid-teens to high-teens revenue growth over the medium term, along with gradual improvement in return margin from the trend. Trajectory, supported by an operating leverage and efficiency enhancement. We now open the floor for questions and answers. Thank you.

Thank you. Ladies and gentlemen, 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 their handsets while asking a question. Ladies and Chairman, we will wait for a moment while the question queue assembles. We take the first question from the line of Jenna Gelani from Swan Investments. Please go ahead.

Hi, sir. Congratulations on a good set of numbers. Sir, we have acquired 100 acres of land near Vartinda Highway. So, sir, any timeline as to when do we wish to do the new KPEX and what could be the quantum of that KPEX? Since it's such a huge land, I'm sure we have a mega project in mind. So, any estimates on that, sir?

Thank you so much, Jainam, for asking this question. As I think we also discussed these questions in the last few conferences also. So the new land is being under the regulatory approvals as of now. Few regulatory approvals we have already secured and few are awaited. Environmental clearances is also done. And I think we are expecting this project to come up in next six to eight quarters. Or maybe four to six quarters. The investments I see, the model at that land is going to be the more or less similar of the existing IOL plant. The mix of chemical and the API. And I think we always keep on saying that the... CapEx we are doing, we will be doing mainly through internal accruals, and on an annual basis, we will be doing around 200 to 250 hundred crores annual basis. Because all development will be done in a gradual and a phase manner, the whole investment will be completed in the next four to five years.

Okay, so almost we can say, like, almost 1000 crores is the broad, we have a broad mindset, we have total outweigh.

Broad mindset, yes, yes, broad mindset is around the 12 to 1400 CR.

Okay, 12 to 1400 CR. Okay. And, sir, in this quarter, our gross margins have improved substantially. So, do we expect the margins to be in this particular age, or was it a one-off because the price has increased and it was an inventory gain for us in this quarter, and going ahead, we should return to our normalized gross margins of 35-36?

So, no, no, this is not that way we can read the numbers. The numbers is the result of everything. This is mainly because of the operational efficiencies from our side and good tractions in the non-IBU. The Aibu also performed well, and if you see the capacity utilization for all these products and including the Aibu for last, around the last quarter and before even that also was, we were doing very well, and we were keep on saying all these things. See, the change what has been in this quarter is the uptick in the prices, because we were having all the quantity volume we were having. So the little bit prices just coming to that number, resulting into that number. But inventory, I don't think that we were having any meaningful inventory gain in that quarter because the uptick was, I think, in the very later part of the quarter. So we are hopeful that this will remain at least next around one or two quarters as well. But see, if the prices are going for this... So, in its products, the prices of raw materials are also going up. So, I think this is not the way that we are not passing through the raw material prices. We are also passing through the raw material prices to the customers as well. But I think the more result is the company's efficiency and the product picks and the capacity utilization.

Okay. So, sir, in our previous on-call, we had mentioned that for FY27, we should see 10-15% revenue growth and 15-20% improvement in PAT levels. But I think, do we maintain it or I think we upgrade that because if you're saying margins can mean 14-15%, so can you comment on that?

So, I think we are still maintaining that. The improvement, I think, quantity, actually, when we given that improvement this year, we set the 27 by 27, so we are very sure about that we will be achieving it, but I think we will be remaining to that level, perhaps, maybe a little bit improved. But on a conservative side, if we say 27 by 27 from this, so I think it's around mid to height in growth numbers.

Okay, so almost 15 to 20 percent revenue growth and EBITDA margin 14 to 15 percent revenue.

We expect 15 percent growth in top line. It may be more or 1 percent, 2 percent more or less. And for a beta margin, we expect 14%. Okay.

That's it from my side, sir. Thank you.

Thank you. We take the next question from the line of Malik Varya from 360, one capital. Please go ahead.

Hi, sir. I hope I'm audible. Congratulations on a good set of numbers. Sir, just wanted to understand. So, we've seen growth across chemicals and pharma segment. So, in terms of products which you mentioned, paracetamol, clopidogrel, pantograzole, metformin. So, how much was the volume growth in these products, which drove this growth, and along with that, how was the volume growth for our other products as well, which is ibuprofen and the chemical side.

The product which you have just mentioned, just as you have named, all our existing products, including ibu, metformin, clopidogrel, and this pano-favorite, they are running almost at 85 to 95 percent capacity utilization. This is a quarter and a year as a whole. It is around 90% average capacity utilization. And for recently added enhanced capacity of paracetamol, we have achieved around 55% capacity utilization on enhanced level. So, as regards to our chemical in which we are producing acetic. Anhydride and ethyl acetate, they are all also running at almost 100% capacity utilization, 98% to 100% capacity utilization, even after increasing their capacity also. So, though, a major portion of increase in revenue is... From increase in capacity totalization and sale of these products, in addition to a little bit hike in finished goods prices, but that prices are also complemented by increase in raw material prices also.

Okay, sir. Just follow up on that. We were seeing a little bit of weak demand in the previous year, and then last two, three quarters, you had guided that the demand is expected to revive, and that's what has happened, and we've seen that in the numbers as well. So can you, sir, directionally or qualitatively help us understand that, you know, what had led to the weaker demand and what is driving this demand and if this demand will be sustainable in the coming four to six quarters?

As we have mentioned earlier, the demand is not in every product, but in specific, like in Igurufan, around three, four quarters ago, the demand was lower due to overstocking of Igurufan in 23, 24, year 23 and 24. But for an entrance of new PR also in the market. But we were expecting that demand will be stabilized after destalking out these levels. And we were expecting these demand of especially from October 25 onward. And that has happened. And we... NT states that these levels will maintain upcoming four to six quarters. And then, as regard to IUL, our parasitamol capacity will expected to rise to around 75% in current financial year. From 55 to 75%.

Okay, we are expecting capacity utilization increase from 55 to 75.

For paracetamol, and for other propellers, it will be at optimum capacity of 85 to 95%.

Okay, okay. Sir, just one last question from my end. You, I think, mentioned that the price increase happened in the later end of the quarter and we do not see a lot of benefits from the price increase. So, is that benefit expected in Q1? And are we expecting that the price, I mean, I am pretty sure the prices of raw materials also would have increased proportionately. So, will there be any benefit in Q1 or will that be passed in Q1 itself to the customer?

As a philosophy, we discuss with our potential customers and also for increasing prices of finished goods along with corresponding to the increase in the prices of raw materials. And a certain portion of increase in cost has been passed to the customers also. So we are expecting, because we are... Most is flying to the direct consumers, not to the traders. So, the scope of getting the abnormal gain from the price is limited.

Okay, okay, okay. So, these gross margins are broadly sustainable is what you're alluding to. Am I understanding it right?

So, basically, you need to know the quarter to quarter basis. However, we have more interest on discussing the full year basis. So, if we, because quarter to quarter basis predictions is very complicated and is very risky to say about that also considering this so much of dynamism globally is happening. So I think the quarterly... Leaving apart from the quarter to quarter basis, if we see the quarter annually, we are very hopeful that we will be improving the EBITDA number as well as the sales number as compared to the FY6, and that level will be growth-wise if top line, we say that it's something around mid-team and mid to high-team, and then the EBITDA is something around, like Pradeepji just said in the previous question, around 14 to 14.5. Percentage. So, this will be definitely be translating into the annual terms.

Understood, sir. Okay. Thank you for answering, sir.

Every quarter cannot be the same. Yeah. Thank you so much.

Okay. Okay. Thank you, sir. Thank you.

Thank you. We take the next question from the line of Sachin Kassera from Swan Inverness. Please go ahead.

Yeah. Good afternoon, sir. And congratulations on a good set of numbers. My first question was regarding ibuprofen, so one of our other listed peers, they have mentioned that the prices are not remunerative and not making margins there, and hence they want to close down. Is that an issue specific to maybe that player whereby their, you know, cost of production or commercials are not in track, or are you also experiencing such type of scenario where the margins in ibuprofen are under severe pressure?

No, not at all. I don't know what they are feeling or their concerns are, but regarding the IUL, this is one of the best products for the IUL, and that is witnessed by the capacity utilizations we are doing right now and for last few quarters. So we are managing around 90-95% capacity. And for the next two, three quarters, we are not foreseeing any problem or any conditions where we should be worried about this. And we are maintaining our leadership globally.

Sure. Second question was, we understand that the spreads in ascetic business of yours, Ethel Acetate, has moved up from $110, $120 to, it did spike to $200 plus, but now stabilized around $150, $160, which is in line with historically. So, is that understanding correct? And what is your view and comment on the spreads there?

Can you repeat your question?

And see, we have understand that in your chemical business, these spreads have improved by over $40-$50 per ton. Is that understanding correct? And what is your view and comment on the sustainability of these improved spreads in case they are improving the chemical part of the business?

As I'll hesitate, we have increased our capacity from 110,000 to 120,000 ton also, and that is also running at around 98 to 100% capacity utilization. Some of the figures you have mentioned is contributed by the capacity utilization on enhanced level, and little bit also contributed by the margin expansion. No, from ethyl acetate due to the increase in ethyl acetate prices.

Is your understanding correct that currently the ethyl acetate margins are running much better than they were in the March quarter, for the month of at least April and May. Is that understanding correct, sir?

It is good, absolutely correct.

Sure. My next question is regarding the spend on R&D and our performance in terms of new product launches that we plan to launch in the pharma business. And also, we have been looking at increasing our revenues from the dialogue markets. Because there, the margins are better. So, can you tell us how is the progress happening there, and are there any exciting new products that we are looking to launch in the next one, two years, and plus, how is the progress on increasing the share from the developed markets in the pharma part of the business?

So, for pharma part business, we are covering the approximately more than 80 countries worldwide. And this includes the complete Europe, Brazil, Latin countries. These are the countries we are already covering, and relating to the non-ibuprofen portfolio, which we are maintaining, our exports are underway, because we have the CEP for all the products, and we are in touch with so many customers relating to the increased export. So I think we will be increasing this export, and the export numbers will be increased in these financial years as well. So, I mean, definitely the export will be more for the non-IBU products. For IBU, we are already having around more than 40%, more than 50% export as of now. So, that will also be increasing. And, yeah, this is the export.

Sir, I do apologize to interrupt you, but your audio is not clear.

Is it better now? This is better. Please go ahead. My question, sir, was more specific to the revenue contribution from developed markets like US and Europe. I understand that the exports you mentioned are increasing from other markets. It's been investment, sir, right?

No, so, realization, Europe, as compared to, because there was a lot of voice disturbances, so I'm just repeating the question you were asking, that the realization with the domestic sale versus the Europe, or the Europe versus...

Hello?

Sachin? Sachin, are you there? Since there is no response, we'll move on to the next question, which is from the line of Dignesh Ayer from Sequin Investments. Please go ahead. Yes, English, please go ahead.

Yeah. So, my first question is on, you know, the... The increase in realization that we are seeing across different products, primarily ibuprofen and paracetamol, wanted to understand if we are seeing a higher realization coming from our export business or are we seeing the price increase also domestically? And if you could quantify, I mean, how much percentage increase that prices that we have seen compared to, you know, from February to, say, now at this point of time.

So, I think prices, in fact, will be more in the coming time because, as we said and discussed the pricing, the last quarters were not very – the later part of the March, if we say. And this is not only the prices of the finished products is increasing, the raw material prices are also increasing. So, I think we should not bank up on that, the increase in the prices. This is the company's efforts for last few quarters and rather few years where we are working. So, improved operational efficiency, better assets utilization. Obviously, the market uptake has also contributed to the good set of the numbers. Relating to the product-wise prices contribution, so I think that will not be possible for us to discuss the product prices and their exact contribution, so we will not be able to quantify that.

I didn't want the exact number. I wanted to just understand the spread has improved for us. Despite the increase in cogs, are we getting a faster, higher realization versus a higher increase in raw material?

It means the spread, I think, is more or less same or might be a little bit increased because whatever the prices have been increased, the prices are also being adjusted into the leafless products. So not much, we can say the spread is not much. Okay.

Sir, one last question from my side. I wanted to understand in case of procurement of raw material, is there any issue on that side? I mean, on the supply chain side that we are not able to procure the raw material for some reason? Because there are a lot of companies who are facing such issue.

In the first week of March, we have made some crude waste, chemical, and gas, which are provided by oil marketing company and government refineries. But within one week, they have developed a matrix where they started supplying to all the manufacturers on a certain pro-life basis. So, that one week, there was no... Thank you, everyone, and welcome to the call.

Okay, sir. Okay, sir. I'll get back in the queue. Thank you.

Thank you. We take the next question from the line of Surabhi from NV, Alpha Fund Management. Please go ahead.

Congratulations on the set of numbers. So, my first question is if you could throw some light on how much contribution has come in terms of revenue from ibuprofen and non-ibu segment. And within the non-ibuprofen segment, you know, you mentioned that we have CPs for all products. So, have we started exporting to the European nations? And so, what is the contribution to the European nations from the non-ibuprofen products?

So, thank you, Subhi, for asking the question. I would like to take the first part of the question. I have contributions from the IBU and the non-IBU within the pharma. So, this is 62 percent, around 62 for this quarter contributed to IBU and the remaining around 38 percent from non-IBU. And the non-IBU products exports relating to the CPEs, we started last two years, and yearly basis this is increasing, and we will be having better export numbers for non-IBU products in this current financial year. So we are expecting that we should achieve around 25% in this year by 27.

25% of exports to regulated markets from non- ibuprofen, is that right? Correct.

Yes, that's right.

So, currently, we are not doing as much regulated markets.

In non- ibuprofen, we are doing, but as compared to the overall, not very much.

So, are the margins depressed to that extent? Because once you start exporting to the developing nations, like European nations, the margins have the scope of increasing further. Is it possible?

Yeah, it is possible it has the scope because the export realization is better than the domestic sales, but that depends product to product. Some products have some better realizations and some have little bit. Well, significant is not just significant. Like, for example, if we take an example of clovidogrel, it can be significant, but in case of others, it may not be very significant.

Okay, and just one last question from my side. You know, a previous participant also asked, a major competitor from ibuprofen is looking to sell its assets, and they were largely in longer-term contracts in regulated markets. So, is it possible that some of those regulated markets, long-term contracts, do you have to service those contracts? Thank you.

I think the last part of the question could not understand. What I understand is that you are saying the long-term contacts for the customers, which is being gathered by some other pair of hours relating to the Aigo profile, is that possible that the Aigo can be taken by the Aigo? Yes, well, but it is possible. It is possible. The marketing team, our marketing team continuously works on such things. I'm sure they will be taking care of all these things.

Okay, sir. Thank you. Thank you. That's also nice.

Thank you. We take the follow-up questions from the line of Sachin Cacera from Swan Investment. Please go ahead.

Yes, sir. Audible now? Yes, please. Yeah. So my question was regarding how are we looking to increase the revenue from regulated markets of US and Europe? How has been the progress in the last year, and how do we look to improve that in the coming next one to two years?

I think we are also discussing the same with Suviji's previous question. See, for ibuprofen, we are already doing around 45% of the exports. And that mainly include the euro. Relating to the Americas, the U.S. on ibuprofen, that we are doing, but not directly. We are not doing directly much. We are doing it indirectly. Because the U.S. has already been the factor relating to the ibuprofen, and there is not much difference whether we are selling into the euro or into the... The US, because it is around 20 years back, the generic products in US were getting more prices, but that is not the case right now. And relating to the non-Io, as of now, we are having around 30% export share, and 80% comes from domestic share. So we are focusing to increase this 20% share into the developing countries, mainly Europe, because we have very good customers in Europe, and the European customers indirectly also goes to the U.S. We also have the game files for all the products.

Also, you know. Ladies and gentlemen, we have lost the line of the management.

Please stay connected while I reconnect the management. Thank you. Ladies and gentlemen, we have the management line reconnected. We'll take the next question from the line of Sachin Pasera from Small Investments. Please go ahead.

Yes, sir. My question was regarding R&D, how much we are planning to spend this year, and what are the new good products we are looking to launch in the current financial year, and maybe if we can throw some red also in the next financial year.

Sachin, the R&D, we are having around 2% to 3% expenses annually. And there are a lot of many products we are working on, and the R&D is basically relating to the process related. It's not the product development R&D we are having. We are having the R&D for process-based R&D. R&D has basically two sort of the functions in the company. Number one, just to validate the process for the upcoming product we think for, And the second is the ongoing products we are having. So R&D keeps on continuing, working continuously for various products, but I think the product pipeline, we are having a very great pipeline, but normally we announce the product when we decide to go ahead.

Sure. But any exciting products you are trying to launch this year, which you think can be a meaningful contributor going at?

I think we can expect.

Sure. Next question is regarding the CapEx. What is the capital expenditure for the current financial year at the existing Fed as well as the Greenfield Fed? And this $1,200 to $1,400 of CapEx at Greenfield, Can you share some more details with us? How much time are you looking to do it and what type of model that you're looking to put up there?

Sachin, for greenfield, there has not been much capex as of now. It has not been initiated except the infrastructurally developing the plant, boundary creations, etc. Because the plant is under various approvals seeking stays, we procure certain approvals like environmental approvals. Approvals is already in place. And apart from that, there are many more approvals in the process. And we are hopeful that in the next three to four months, we will be able to secure mostly all the process and we will start working there on. So the CAPEX is not initiated as of now, and as before, I mean, during this call also, we discussed that we will be doing around 200 and 250 CR. TAPEX on annual basis at this new site as well, because we will be having this more or less same model we are having right now, and all the projects will be coming up in next four to five years.

Sure. This 200 course capacity in the current year, sir, is focused on efficiency or it is also some existing products that are looking to increase capacity or is it for some new products? Can you give us some understanding on this 200 course of capital expenditure plan for financial year 27?

It is a mix of both. Both for growth and infrared developments and efficiency improvements. So, generally, we are doing 60% growth and 40% for development of infrared automations and land procurements. So, generally, 60% on growth activities.

But last part of this CAPEX is for pharmaceuticals. Is that fair understanding? Yes, yes, yes. And sir, in one of I think previous questions you mentioned that the capacity utilization is paracetamol is 55% currently. Did I hear that correct?

You hear it correct, but you need to understand the background also, because 55 is of the recently increased facility. This is 10,800. Earlier, we were having 3,600. That was running around more than 100%. So from 3,600, we reached to the 10,800 new plant. So, this is capacity, 55% utilization. We are talking about the new plant having the installed capacity of 10,800. So, if we compare year-on-year basis relating to the 3,600 we were having previously, now we are having close to 11,000. So, this is off that.

And how do we see this in the next two to three years? Should we look at the way we are looking demand? We are looking at two to three years, this reaching full capacity, 10,800 terms.

10,800 ton, we are using that in the FY26. We are hopeful that we will be reaching to around 70 to 75% capacity utilization in FY27 itself. And I think in FY28, we will be having the full capacity utilization by that time.

And sir, with the 3x increasing capacity, is the cost become better, and we have passed that on, are we able to get some better margins, if you can comment a bit on this?

The existing Parasetamol plant is fully atomized, and because we have started around 3-4 quarters ago, The increase in the capacity utilization will result in the lower cost of production.

Sure, sir. That's very good and very positive outlook and thank you and all the best, sir.

Thank you. Thank you so much and sorry for this hiccup during this call.

Thank you. We take the next question from the line of Harshit Singhania from RoboCapital. Please go ahead.

Hi, I'm Audible.

Yeah.

Yeah, thank you for the opportunity and congratulations on a great set of results. So, I was just trying to understand, like, according to the capacity increase, what would be a prox, like, maximum revenue potential be right now?

On which product?

Like, on the overall plant.

We have already discussed that here. We are targeting around 2700 crore in the next 25 and we are expecting around 15% annual growth for top line every year on the existing level.

So, is like 2,700 crores our top capacity right now, top revenue potential as of the current capacity?

No. So, I think the answer, Mahanji, given is relating to the how we are going to grow. But what you are asking is, what is the maximum possible revenue can be generated from the existing capacities, if I understand you correctly? Is that correct? So, I think having, considering the... If we achieve 100% for all, this will be around 3,200 to 3,300.

Okay, great. I think that will be it from my side. All of my other questions have been already answered. Thank you so much.

Thank you.

Thank you. We take the next question from the line of Kano from Boring AMC. Please go ahead.

So, we would like to know what type of customer base do we cater for the regulatory market? Are there generic giants, you know, European generic giants or U.S. giants or innovators or OTC, big OTC players, or they are small-scale manufacturers?

Our customer base is the all A-grade customers, top customers we have. In the pharma, though, they are into the both generic as well as the branded products and you call OTC. So they are the mix of it.

Understood. And sir, would like to know your strategy on scaling products which we have got approvals. For across regulated and unregulated markets, for which we had made investments over the last few years, and which are getting approvals right now. Not Metformin, Ibu, Para, and all. Any other products which you think can scale up to that level, such as Alupron or anything, 300-400 levels.

300, 400 crore level you are talking about.

Yeah, and it can scale up.

I think this is the product you have mentioned that paracetamol, metformin, they are a commodity product with high value, but whereas the other products like Colopy, Penta, Phenno, they have the potential of around 100 to 150 crore in the upcoming two years.

Okay, okay. Clopidagol or Pentafrogol? Okay, okay. Understood. And sir, the Indian company which is selling a ibuprofen asset, are you interested in it and taking the assets so you can get more clientele which were not under your basket?

Oh, I think we

cannot comment on this sort of question because of the regulatory as well as we are not sure about it or anything. We perhaps will not be able to comment on it.

Understood. But what's your view on that asset? Is it as a competitor?

We could not understand. Can you please come again?

We'll like your view on that asset, whether it is good or it's a sub-scale asset compared to...

No comment, sir. No comment, sir.

Okay. Understood. Understood. No questions for us. All the best for the future.

Thank you. Thank you so much.

Thank you. We take the next question from the line of Vandid Dharamshi from Anantra, Growth Capital. Please go ahead.

Congratulations, sir, on a very good set of numbers. I just have one question, particularly on the pharmaceutical side. Could you please give some kind of directional margin numbers that we would do for, say, IB and non-IB business?

Company as a blended, we discussed that top line, we expect that the next rent sale year, we can achieve around mid to high teen revenue side, and we would like to have maintained the better EBITDA margin, but product-wise, it will be difficult to comment as of now. So, Aigu and non-Aigu, we consider it as a one segment. So, we do not share the number what Aigu is giving. In the bottom line, revenue number we discussed, but the bottom line is not being discussed.

Okay, okay. Two problems, sir. But would it be safe to assume that it would be around the company average EBITDA margin? As pharmaceutical as overall business for both of you?

Overall, blended, blended, blended, the margin for this year is 12.4%. And what we expect for the next year is around 14 to 14.5%.

Got it, sir. And last question, more on IV business directionally. While you spoke about me looking at exports, do you think there can be some growth in this business for the next two, three years?

Yeah, definitely we can have, we can expect some growth in the Aigu also, because still there is a little bit of scope of improving the capacity as well as the export market.

And the annual growth rate of 3% to 4% every year for Aigu within demand also.

Okay, okay, okay, got it. Thank you so much. Best of luck. Thank you.

Right here. We take the next question from the line of Ruchi from Vora Family Office. Please go ahead.

Hi, I'm my Oliver. Yeah, okay, so my question, most of my questions are quite clear right now, but I just wanted to understand we are almost to the, we've completed two months of the first quarter, and of course when you said that we cannot analyze quarter on quarter, but how far do you see the company's position for the next three to six months from now considering the geopolitical situations also?

I think we will be able to maintain the momentum for the next one or two quarters, but as you also accepting, we also said that it will be better if we gauge the company's performance on the yearly basis rather than the quarterly basis because so much dynamism is. So, this is risky to comment on a coming quarter or next quarter, but because we have some expectations, we also have the market study, and we also know about our efforts, which direction we do. We also know the development relating to the various customers, so on an yearly basis, we feel more comfortable to discuss.

Right. So, currently, if we settle guidance for FY27, how are we looking forward and what are our targets for the near-term development?

So, this is around mid-team revenue growth we foresee, we will be achieving, coupled with the EBITDA around something 14 to 14.5% for this FY27. And I think last year we also discussed, so we will be able to achieve that number.

Okay, perfect. All the very best. Thank you. Thank you so much.

Thank you. We take the next question from the line of Malik Varya from 361 Capital. Please go ahead.

Hi, sir. Just thank you for the opportunity again. Just wanted to check, is there any update from the USFTA regarding the inspection?

See, the inspection, because U.S. already made two inspections for us, all the products are CP approved, and we have also the approval from Brazil and other, so I think considering the products we are in January, so whenever there is a product comes for this approval, I think U.S. FDA is approving the products considering their requirement as well, even without discussing, without budgeting us. In that sequence, metformin was approved by the U.S. FDA and followed by the phenofibrate and other two, three products. Enda is already filed in, so they have certain questions, so we replied, and if they are going to approve the enda of the formulator, we also get approved with that. So this is not necessary for the U.S. FDA to visit us for approving. They are approving even without visiting.

Understood, sir. Thank you. Thank you for the opportunity.

Thank you.

Thank you. We take the next question from the line of Sheikh Mohammed, an individual investor. Please go ahead.

Thank you. Thank you for the opportunity and many, many congratulations for the excellent set of numbers. My question is, we are making many chemicals. I heard that there is a price rise in the chemical price. But my question is, what kind of business we are doing with the chemicals meant for in-house utilization?

So, in-house utilization means they are the part of the backward integration process for the API products. So, we are using for manufacturing the API, and in case acidic and hydride, whatever the capacity we are having, around 50 to 60 percent is being utilized for the form captively, and remaining we are selling into the open market. However, ethyl acetate is the product which is 100% being used for the merchant's sale because we do not have any use for captive consumption of this product.

Sir, what kind of price increase we have received in paracetamol? First of all, is there any price increase in paracetamol in India or non-regulated markets? Because I have read the transcript of Grand Uels India. They have told that there is no price increase in paracetamol. Mostly they are catering in the regulated markets, so maybe. But I need to ask this question to you also, because we are also doing in India.

So, basically, prices increase was there across all the products, chemicals, and APIs because of some disturbances globally. Logistics problem were there. The raw material prices also gone up. So, to that extent, the prices were gone up in India and also outside.

So, are we having inventory? See, the registered distribution started in the March month only, starting of March, and the price increase?

Pricing, increasing pricing, in fact, the effect was later part of the March, and that was due to the increase in the raw material prices.

Uh, in, uh, results section, I have seen there is some 30 crore inventory. What kind of inventory you are having? 30 crore?

Inventory? 27 or 30 crore inventory. Inventory of 371 crore.

So, it's a 371 crore inventory, not 30 crore.

Okay, well, sir, maybe I am concluding with that. Okay.

So, inventory, basically, basically, whatever product we are maintaining, we are also maintaining the inventory of the products we manufacture.

Okay, okay, okay, okay, okay. I don't know.

Maybe you can ask this question separately as well with the details. We will be happy to answer.

What is that way to ask the question after the conference call?

Our presentation has the detail and the last part of that the email IDs are provided of the IR team as well as the companies.

Next question is, what are the effects of crude oil pricing and West India conflict on the company performance? I am talking about logistic issues, raw material procurement issues. Are you having any issues?

I think not much issue, but the prices across the board of all the raw materials has gone up to the extent that crude is having the impact. Logistics has also gone up and is going up, and some delays into the logistically across the globe, so to that extent it is impacting us. Oh, but no major and no direct.

Okay, okay.

Sir, do we import some material from China? Yes, we, we do.

Okay.

Sir, regarding Metformin, some key sourcing materials are prokered from China only, right? So, is there any company which is manufacturing in India, have started manufacturing in India? As of now, no company is manufacturing. Sir, any buyback scenario you are in consideration? Of traditions?

As of now, no, because as of now, this has not been discussed in the board, but I think whenever this will be discussed, you will be able to get it. Because as of now, we are focusing on the growth. If we start buying back, then the growth will be impacted.

Yes, yes, yes.

Because you know that we also come up with another land of 100 acres, so we also need to invest therein. So the company funds majorly will be utilized for the enhancing and just having the growth. Because we have a lot many growth projects, so till the time we are having a lot many growth projects, I think buyback perhaps may be the second option.

So, we are having lots of capacity in our growth.

Yeah.

Atar, the purpose of tri-asset in production, what is the rationale behind that? Are we using that in some API production?

Basically, it gives us technological advantage as well as the supply chain advantage internally. So, that is the basic purpose that we have come up with the tri-asset in.

Where it is being consumed, try to sit in, you know, a lot of...

It's a many uses we have outside the company also, because it's used into the food industry, pharma industry, cosmetics, perfumery. So it has the wide applications. And it can also be the import substitute. It is also used into the filter, cigarette filters. So it has a lot of money.

The next question is employees benefit expenses and other expenses are rising continuously because what I have observed is the employees benefit expenses around two years back was around 35-40 crores. Now it has been almost 70 crores. So we are hiring lots many employees, right?

Because, see, for this quarter, I think, or this financial year, whatever the increase you are looking at, mainly because of the variable which we give the next year, we have provided for this year. So, that is the reason, and there is no. There is increase in the numbers because we have come up with the new plans as well. So that is another reason. But there is no substantial change beyond this.

Can you give just guidance for that employee benefit expense for full year?

So, no, relating based on the turnover, we are having around the 10%.

10% of revenue, right? 9 to 10. Okay, sir, all the very best for the next video.

Thank you so much.

We take the last question from the line of Kano from Boring AMC. Please go ahead.

Sir, I have two questions. Are we any planning to do... Some R&D on reducing our imported bill for the country, any product you think you could indenize over the next couple of years, which has dependency on China. And second, are we seeing decreasing API assets across Europe and Western nations leading to more API demand for India and China, and particularly for us? For the last couple of years, due to the environmental regulations getting stricken in Europe for the last two years.

API demand from India keeps on increasing on a regular basis. So, I think this momentum will remain the same.

No, no, I was asking. There has been decreasing investment in API across European and Western nations. Which is leading to any demand increase from them for our products?

So that is what I am saying. The demand is increasing and we also expect increase in the demand because either maybe because of the reduced investment by the European countries for last few years and the investment is also coming into India and the demand from India is increasing.

Okay, understood. And any product you could, you are planning to improve substitute from China? In API? Yeah, in API.

No, no, no. As of now, we do not have any such product.

Okay, understood. No questions. Thank you.

Okay, thank you so much.

Thank you. With that, we conclude the question and answer session. I now hand the conference over to the management for their closing comments.

Thank you very much for joining us today and for your continued support towards the company. FY26 has been an encouraging year for the IOL with strong improvement in the operational and financial performance. Despite a challenging global environment, the progress we are witnessing across both pharmaceutical and chemical businesses supported by improving product mix. Optimum capacity utilization and discipline execution give us confidence in our ability to sustain growth going ahead. Our continued focus on expanding the non-IBU portfolio, enhancing integration capabilities, improving scale across key APIs, and maintaining prudent financial discipline will remain central to our long-term strategy. We believe that the company is well-positioned to build on the current momentum and deliver consistent growth. Thank you very much, and for any further query, please feel free to contact our IR team. We would like to thank all our stakeholders for their continued trust transport. Thank you once again, and have a good day.

Thank you, sir. On behalf of MUFG In-Time Investor Relations, that concludes this conference call. Thank you for joining us, and you may now disconnect your lines.