Operator
Ladies and gentlemen, good day and welcome to Natco Farmer Ltd.'s Earning Conference Call for the second quarter FY27. We have with us on the call Mr. Rajiv Nanapeni, Vice Chairman and CEO, Mr. Amit Parekh, Chief Financial Officer, Mr. Rajesh Chabian, Executive Vice President, Crop Health Sciences, and Mr. Rajiv Menon, Lead Investor Relations. Please note that all participants' lines will be in lesson only more, and there will be an opportunity for you to ask questions after management's opening remarks. Should you need any assistance during the conference call, please raise your hand from the participant tab on the screen. While asking questions, please identify yourself and your company. Please note that this conference is being recorded. I now hand over the call to Mr. Rajiv Menon. Thank you, and over to you, sir.
Thank you, Andhep. Good evening and welcome everyone to NatCo's conference call discussing our earnings results for the second quarter of FY27. I am Rajiv Menon, Leap Investor Relations at NatCo. We hope you have received the earnings presentation and press release that was sent out earlier. Let me draw your attention to the fact that on this call we may be making certain forward-looking statements, which are not necessarily historical facts, and anything said on this call which reflects our outlook for the future must be reviewed in conjunction with the risk that the company faces. We undertake no obligations to update these forward-looking statements. I would like to state that the material of the call, except for participant questions, is a property of NADCO and cannot be recorded or e-browscarted without NADCO's express written permission. We'll begin with the financial highlights and then follow up with an interactive Q&A session. With that, I request RCFO Amit Farek to discuss the financial highlights. Over to you, sir.
Thank you, Ben. Greetings to everyone, and thank you once again for joining us in today's earning call. The company recorded consolidated total revenues of 1,019.4 crores in quarter to FI 27 compared to Rs. 794 crores in quarter one of FI 27 and 1,463 crores in the corresponding quarter of the previous year. The quarter-on-quarter increase was primarily driven by the strong performance of our international formulation business. The YOY decline was largely attributable to lower lenalidomide revenue during the quarter, which was partially offset by the growth in the base business, which also includes our subsidiaries. EBITDA, including other income, for the quarter stood at 310 crores, with EBITDA margin of 30.4%. Consolidated profit after tax stood at Rs. 202.6 crores compared to Rs. 206.5 crores in Quarter 1 FY27. With regards to our associate company Adcock Ingram Holding Limited, South Africa, the revenue for the quarter stood at Rs. 1,344 crores and profit after tax at Rs. 80.5 crores. In July 2026, we acquired additional 13.25% stake in ADCOG INGRA Holdings Limited, taking our total holdings to 49%. This further strengthens our strategic position in South African market and unanswered our participation in the performance of ADCOG INGRA. ADCOG's share of profit based on 49% holding as on 30th of September 2026 was 29.2 crores. After adjustment relating to purchase price, the location. Our domestic formulation business revenue stood at Rs. 145 crore. We also saw strong growth in our Brazil business. Revenue from Brazil stood at Rs. 121 crore, representing the growth of 66%. Thank you all. With this, we'll take question and answer. Over to you. Thank you, sir.
Operator
We will now open the call for Q&A session. We will wait for a few minutes until the queue assembles. We request participants to respond to two questions and then return to the queue for more questions. Requesting to please introduce yourself and your company before asking the question. Please raise your hand from the participant tab on the screen to ask the question. We will wait for a couple of minutes for the participant to raise their hand and ask the question. The first question is from Shikhar Jain.
Hello, can you hear me? Yeah, I am an individual investor. So I had two questions. In March, when we announced that we have first to file status for pomalidomide, I was hoping for a bit of a bump. So, what happened with the pomalidomide first to file status? And the second question is, what do we plan to do with the rights issue proceeds? Any color on that will be very helpful. Thank you.
Thank you, Shikhar. First question was on Pommel and Amai. We did get the first to file, Shikhar. I think we did, but it's a shared first to file. I don't remember the exact number of generic comparators. I think about five to six generic comparators came in the first way. And because we're five or six comparators, the price erosion was quite steep. So even though we had 180 days, the earning bump was not. To, you know, which was, you know, substantial that could move the earnings. It is the way that it sustenates from business. The second question is on the rights. So I think we have multiple end-use requirements. I think primarily it's to reduce the debt that we have or be raised for Adcock. And also, we're also giving some money for the possible acquisition. We're looking at various acquisitions. So that's the end-use expectation.
Thank you, Shri. Next call, please.
Operator
The next question is from Bhuvanesh Bhubi.
My name is Bonesh. I'm an individual investor. So I think as of now, Revlimit sales is exhausted. So what's the next big shot drug is in our pipeline?
Next big, I think we have a few launches that are coming up in the next few quarters. One is definitely Carpillazomib launches that it is coming up in the next few quarters, and of which one strength we have first to find. 60MG is shared, what do you call, first to find. And then we have traffic today coming up. Which is a smaller product, but we are the one among the two first two files. And then we have, these are two major ones in the US. And then we have, we're expecting launch of Ola Paribals in the next three quarters in Brazil and Canada. So these are the major launches coming up, subject to launch and legal strategy.
And, sir, what's the plan about spinning off our agri, you know, agri-drug, agri-fetilizer business going forward?
Yeah. Hi, Ganesh. This is Rajesh. So, I'll answer that. See, as you are aware, we did a rights issue, which basically what it does also, the cap structure is now changed a bit. Because of that, we have to resubmit the file to SEBI. So it pushes out by four to six months from the original plan. So we're looking at, you know, maybe by mid-year, next year is when we hope to get the de-merger Okay.
Thanks. Next caller, please.
Operator
Thank you. The next question is from Ramakrishnan.
What are the plans regarding the QIP?
We have done the rights issue, Mr. Ramakrishna. So, we have not done QIP. So, we already completed our rights issue. And essentially, we use the funds to reduce some debt that we have and we kept some money for some working capital payments and for a possible acquisition that we are looking at.
But the QIP makes the, I mean, equity diluted, you know?
It's already done, Mr. Ambish. It's already done. Rights is already done. So I think this was done last month. So it was already completed. There's a dilution. Yes, there was a dilution, but we gave opportunity for all the shareholders to participate.
Sorry, does QIP bring more dilution?
It is already done. The dilution is done. We've done a 10% dilution overall. It's already done.
My next question is, I mean, this is related to the stock performance. What is happening is PE is still quite low as compared to the equal or maybe less market capitalization companies in this segment. What steps you are taking? I mean, some general observation is communication, broad market communication is still not up to the mark. Are you making any steps like appointing a separate person exclusively for corporate communication so that positive things will be communicated to the market so that the market takes in the right spirit? But what is happening is I have been observing last, I mean, if you look at five, six years, returns are practically nil or negative. So the important factor for any company to grow is to take care of the investors' interests also. So that's the only way. When you want to increase the capital, when you want to go for further expansion or acquisition, the only possibility is, I mean, proper value to the shares. Then the dilution will be low. So what steps you are taking? I think you need to apply mine more seriously on this subject as you have been doing on the products.
Mr. Ramthesh, I'd like to differ with you on this. I think if you look at our model, it's a high-risk, high-return model. So if you look at our earnings in the last five years, I think we are probably the best earnings in the industry. If you look at the top 10 earnings in the company and among the farmer listed space. But there is a lumpiness in our earnings, which has been always communicated to our shareholders. You asked the question. Let me answer the question. I gave you our opportunity. Give me two minutes. So there's a certain lumpiness that is there. And I think what we try to do with our investors and when we engage, we have a dedicated IR team that we engage and we mention what upsides we're looking at and what are we chasing. And we have done that in a regular fashion. And you look at whatever is there in first files or our investments in eGenesis, for example, which has done the first kidney transplant in humamine from a pig. So these are all very... You know, exciting, high risk ideas. And there's an amount of lumpiness. And regarding PE ratios, this is what my personal feeling, because you asked me this. I think the market appreciates more steady earnings, which are low risk, and they give a higher multiple for that. And I think our market is unwilling to, you know, appreciate. And I think our job is only to communicate what we're doing. And so I don't look at stock prices, we look at the logic grid as a company. We look at our earnings in the last four or five years. I think the part of our earnings has been substantially larger than a company which has a high NPD. I think just look at the math. I think we have done well. And this is the nature of our business. I think our job is only to tell you what we do. And I think I don't control stock prices. So I think our strategy is this way, and this is how we run our business.
See, but ultimately, the return on investment is also equally important.
Yeah. See, return is also important. Governance is important. Strategy is important. I think all these communications are done in a fair manner. And in the end, I think you just have to, this risk appetite is based on the investor's perception. So I think that I can't. Okay. That's the best thing. Thank you. Next call.
Operator
Thank you. The next question is from Rashmi Shetty.
Yes, sir. Please go ahead.
Congratulations on good set of numbers, sir. Sir, just wanted to reconfirm that whatever guidance you gave in last quarter, that, you know, FI27 revenue should be in the range of 34 to 35 billion and that should nearly 700 to 750 crores. Do you still hold that? And you feel because in the First half, we have done around the 400 goals of that.
I think we can do better, Kashmir. I think where things are going right now, I think we'll probably be a little less than 800 crores of that. I think we'd like to bump it up a little bit. I think it'll be between 775 to 800 is what I feel. Q3 also looks good. I think Q4 is a little weak, but at least from what I can see. But for the year, I think we should do, I think, a little less than 800. So I think we'll probably do better than what year, start the year.
And this will be largely driven by which of the segments if you can talk on, you know, domestic business, even Brazil earlier, you mentioned that you will be able to achieve sales of 55 to $60 million this year. But I think in this quarter itself, we have done so how much if you can give some breakup, you know, in first half, what we have done in the subsidiary that is Brazil, Canada, rest of the world, US, and then how should we look at it for the full year?
So I think, see, in terms of budget and all, for the half year, I think we've done nearly 300 crores of revenue in Brazil. We don't do a job that we can split for Brazil, I think we're doing because we have our own stuff. In terms of like the earnings itself has not come concentrated manner like the way it used to come in the previous financial years. I think it is fairly diversified. I think a good portion has come from South Africa, a good portion has come from Brazil, a good portion has come from a base US business. And this has come even without lalidomide being in the numbers. So I think that way it's a more well-diversified earnings. I think in the past, the challenge has been that the earnings have been so concentrated by lalidomide. Anything else that used to do well also would pale in comparison to lalidomide. I think that change you could see in other things. I think it's relatively more diverse.
So, sir, in your base U.S. business, you have seen a better traction in the volumes as well as pricing, or you're seeing a better pricing, and that is, you know, driving the entire growth.
U.S. is a tough bet, Rushdie. I think U.S. is the most important market in our genetics business, and you cannot ignore it, but at the same time, you also need to see... That sometimes you will be in a product and you can make a lot of money and sometimes when there are more competitors, there is, you know, obviously no margin, but you have to run the basket game and you just have to be patient and there are always opportunities that come. But US still, in my personal view, is always a good business if you have limited competition. It's not a great business when you have a lot of competitors. And that's been the case. And you just have to be patient with that business. But overall, I think relatively, the rest of the world is a more stable business compared to US, but you can't ignore US. I think that's how it goes.
Understood. And just last question on the operating margin front. This is the kind of margin which is sustainable, right? Whatever we have done in first quarter and in second quarter.
I think so, Rashmi. I think where things are going, I think, yeah, this is a sustainable base, yes, absolutely.
Okay, okay. Thank you, sir. That's it from my side.
Thank you so much. Next question, please.
Operator
Thank you. The next question is from Rahul Chaudhary.
Hi, good evening, sir. I was looking at the cash flow. There's a difference from associate 78 crores. Has that come from AdCorp?
Sorry, what's your question? Can you repeat?
He said profit from associates. I think first quarter is 80 crores that came from the... Yeah, you are right. It's come from AdCorp. You can go on with the next question or we'll go to the next call. Okay, we'll go to the next call. Thank you.
Operator
Thank you. The next question is from Abdul Kedar.
Yeah, hi. Thank you for the opportunity. So, my first question is with regards to your quarterly run rate in India. I know that has been growing quite well. So, I wanted to understand, you know, whether it is entirely driven by semaglutide, and in terms of this Onco price cut, you know, how do we see that getting impacted on India growth ahead?
The onco price cut itself is not impacting our sales so much because a lot of the distributive margin has been shrunk. So it's not affecting the company. So I don't see much impact. There could be a small marginal impact, but it will be more than made up by the volume. And the first question you had was what I just forgot. What was it?
On the run rate front, is it mainly driven by semaglutide?
Run rate, I mean, we had some stocking quantity of semaglutide to our partners. That's the reason why it's a little bit higher. Domestic is like, I would say about 130 to 135 would probably be the base domestic. Is what probably we're running. This particular quarter was 145, but I think there's a little bit of stocking of samaglutide, which it's not going to be repeatable. So I think 135 is the base for mistake now. I think that's the sense based on the represent portfolio.
Okay. And the second question I had with regards to your R&D spend, so this quarter, if I see your other expenses has gone up, so safe to assume it would be mainly because of R&D, and if you could quantify that amount for this quarter versus what you were doing last year for FI26, would it be helpful?
So, Aptul, largely the reasons are primarily R&D spend itself. But there are a couple of other spends as well, like, you know, annual FDA facility fees and program fees are also there. And there are some legal expenses, etc. But a large portion of the increase is R&D. That's how I put it. Okay. You know, R&D is very unpredictable. You know, quarter and quarter, it depends on the milestone what we achieve in the program and etc. So compared to last quarter, this quarter, the R&D spend has been substantially higher.
Yeah, so what I was trying to understand basically is that from a foliar perspective, are we seeing that trend increasing in terms of what we, you know, in terms of the rendered what we were at last year? And, you know, in terms of say some additional products entering into the pipeline or into development, that is feeling this increase?
So I think the run rate, so overall R&D spend, the way we look at it, and most of the farmer looks at it as a percentage of the sales. Last year, obviously, our R&D spend was more than 400 crore. This year, overall, it would be 8 to 10% of our top line. So, we may end up around 300 to 350 crores, depending on how the program runs. So, yes, there will be like quarter one was a little lower spend. Quarter two is high. Even I think I'm expecting quarter three to be a little higher in R&D, but other spend will be moderate. So, and quarter four would be okay. So, this is how I look at it. So, that's, I hope I've answered your question.
Yes, that helps. And, sir, I had a couple of more, if I may. One on, you know, your profit share from Adcook. So, if we look at the annualized run rate versus this particular quarter, you know, the run rate looks a little lower. So, I went through the press release. It talks about certain provisions. So, if you could, you know, quantify and help us understand what can be the steady state run rate. Right.
Sure. So there are two reasons for lower number in the quarter. One is quarter one profits from Adcock was very high. And that is a seasonal effect. There was a flu season in South Africa because of which quarter one is the highest quarter for the South Africa companies. And that's the reason the major portion came in from there. This quarter, obviously, we had the additional acquisition of 13.25% and we had to purchase price allocation. There is a one-off amortization because of that allocation, which is around 6.5 croons.
And plus there was also a bit of VRS in one of the facilities, so that also there's a one-time charge. The way you want to think of it is it's probably a 12 million per pack set up. I think 12 to 14 million depending on the seasonality of the quarters. But I think what 12 million seems about right, I think.
And you get 49% of it and a little bit of amortization. So I've got four or five girls out of attention. So if it does about 12 million, I would pay 6 million to pick up, order that 6 million, maybe 4-5 crore automatization. So 55 to 60 crore sort of consolidation should look.
Understood. Very helpful. So, last one, if I may, this is with regards to your investment in eGenesis. So, I believe, you know, there is some additional investment being done. So, you know, what is our stake currently? And in terms of, if you look at the trial data, you know, after the phase three trial, you know, what, how do we plan to commercialize this opportunity, whether it would be kind of a licensing deal, which can happen, or you may look for that. For a partner to kind of, you know, take that ahead.
Regarding the stake percentage, I'm not supposed to disclose. Substance is a single legit stake, so that's all I can say. And in terms of, you know, we have put about 20, maybe less than $25 million into the entity. And in terms of how do we expect to monetize, I think there are multiple ways. One is we're asking for a license for the India market so that discussions are ongoing. So if we get a license, that would be one way of, you know, monetizing the asset. Second, obviously, is, you know, the company were to go IPO. So that is another way of monetizing the asset. I think a lot of it will revolve around how the asset does in the clinical trial. I think we have one patient who is approaching almost one year now without dialysis. And if that readout looks good, and then we have more patients coming in, then I think we are sitting on a, you know. So, let's see how things work. These things are, again, very high risk, high return. So, we just have to be patient how things go. But I think next 12 months, I think we'll have clarity on the data. But so far, so good. I think that's all right. And next call.
Operator
Thank you. Thank you. The next question is from Ruchi Setya.
Yeah, so my question is around what is the volume share that we are looking for, the semi-groutine market?
In India, one-groutine, will she?
In the India market, how much share we have, we ask, volume.
Yeah, India, semi-to-ten market.
I think PEN has not done so great. The VAR has done better. I think if in terms of volume, I'm just making an estimate. I mean, it's an educated guess, right? I would say we have probably about 5% to 6% share in terms of volume. In value, maybe we only have like 3% share. So I think that's my estimation. But I think, again, I'm going by, you know, approximate.
Yeah. And can you give a percentage split between the vials and the pens?
I'm sorry, Ms. Say that again.
Can you give a percentage split between the vials and the pens?
Percentage split, I can't recollect. I think the brand does like one and a half to two crores a month, depending on the month. I would say 50 lakhs comes from the pen, and I think about 1.2 to 1.5 comes from the wire. So, wire is obviously much cheaper. So, I think, obviously, the more volume we get from there.
Okay, and given the number of generic entrants that we've had, what is the percentage of patient that we've seen a change in realization per patient?
It's been pretty crappy. I think it's not been great, honestly. I think everybody's starting to get market share, so the pricing has been really bad. I think everybody's hoping that you just stick in there and then hope, get that 5-6% share and just hope that the wave gets better over a period of time in the next two, three years. And then as the market size or some annularity increases, you keep your market share. And then as the size increases, you benefit from it. I think that is the hypothesis all of us are working on. I think I'm no different. So, I think we made a dent. I think we're there. But is it profitable? No. And do I see any profits coming in the near future? No. In the long run, maybe. I think it should do well as a size of semi-increases.
Operator
Thank you. We will wait for a few minutes until the queue assembles. Raise your hand from the participant tab on the screen to ask the question. Next question is from Gagan Khareja.
So, the first question is on your working capital and tax rate. I think it would help if you could give the working capital in day sales and enumerate the inventory, debtors, and, you know, payables, and what could be the sustainable tax rate for your head?
Let's take that question. He's asked, first question was on the tax rate, and second is, what did you do? And your voice was very soft, so we couldn't pick up what you said. Tax rate, I'll just do it. And then, can you ask, you want data, as you said?
Yeah, I want to working capital. I believe working capital has increased year on year in day sales. So, can you give the number in day sales for working capital?
Right, I invented that. So I think our tax rate for the quarter is around 27% in India. And overall, I think it's around, on console level, it's around 29%. So we expect, and this variation comes because of the subsidiary profitability mix. We expect at the overall level, on a full year basis, our standalone tax rate would be around 27 to 27.2, and at console level, it may be ranging between 29 to 30 percent. Coming to the working capital, yes, I think, you know, it's a mix of, if we just look at from our India business perspective, I think the DSO would be between 90 to 120 days, and that is the range we expect to continue.
Next call, please. I have one more question.
I think you gave some commentary on Brazil. Can you also give some flavor of how Canada and the other ROW markets have done for you in the first half of this year? And how do you expect, you know? The other geographies in RW to pan out for the balance of the year.
I think the R&W business, especially the MENA region, has done well. And Canada has been stable, it's not increased, but we have some big launches coming up in 2027. So we expect 27 will be a lot here in Canada. And Brazil also continues to do that. And I think we had almost 80% growth in Brazil-based business this year. And we expect that it will continue to do well next year. So I think Brazil... Middle East, and Kamala will drive our rest of the world. And of course, the U.S. exclusivities are also there, so that will also help us. Thank you. Next caller, please. Next call, please.
I have one more if I can go ahead. Okay, fine.
No, I'll just give, yeah, you can come back again if you don't mind. Yeah. Okay. Thanks.
Okay. All right. Thank you.
Operator
Thank you. The next question is from Sheikhar Jain.
Thank you for the opportunity again. And you gave some commentary on the semaglutide market in India, which was very helpful. Can you comment on the semaglutide market in the rest of the world? And if you are looking to expand to the rest of the world, that's one question. And the second question is about our upcoming launch on Karfil-Dimambib. I'm a bit confused because different companies seem to have different, seem to have exclusivity status for different strengths. So why does that happen?
I'll explain. I'll explain. So let's start with cartolisman. So there are three strengths in cartolisman. So majority sale is 60 mg. So there's 60MG, there's 30MG, and there's 10MG. And so 60MG has, I think I don't remember exactly, about six filers, I think, or multiple filers. I can't remember the exact number of filers, but there's multiple filers. So even though we have 180 days, it has multiple filers, the value of it will not be that exciting. On the lowest strength, one strength, we have sole FTF. So that's the one that we intend we'll do well. And the other strength, we don't have expository, so launch will be later after the first wave of launch. So that's how it is.
Yeah. So my conclusion, why doesn't a company apply for FTF in all the strengths when it does the application?
No idea. There was a quirk there. See, what happened was 60MG was the first product that was launched. So everybody applied on NC-1 date when that product was filed. But 30MG and 10MG got approved much later. So then because it got approved much later, it was anybody could have filed. There's no date limiting. Whoever files first will get it. So then it was a race. So the single winner. So NC-1, what happens is If everybody piles on day one, then everybody gets late. That's why 30 and 10 was later. Because it was later, that's the reason why there's no multiple FT or so on now, 30 and 10.
Okay, thanks. And any comments on the global semaglutide market? Is it as complicated?
We are not, like the way our contract is written, we are not focusing on R&W. Our focus is probably on US and the regulated market. The US filing, we are answering the queries, so we can't give any insight about our approval. But I think at this time, you know, we are continuing to pursue our regulatory queries. So I have no insight even this time.
Thank you. That's helpful.
Operator
The next question is from Kunal Randhiri.
Hi. Good afternoon, Rajiv. Nathiv, you said your domestic-based business is around 135 of water, right? Till last year, I understand it was around 100-100 cents of water. So, is this a sustainable number and what has driven this?
I could not give dal well. I think one is amanglutide as well. Getting, you know, six, seven crores of samunglutite, and the residue plan has done well, that is also helping us, and overall our base business has done much better. So I think we've seen a good 20% bump in our domestics. And even if we remove the one-offs of, you know, samunglutite stocking quality, I think, as a whole, our domestic business has improved dramatically. So yes, you're seeing the value of that. That's good to hear.
And what do you think of a sustainable growth rate going forward?
I think the internet target is based on what we have planned. We feel we can compound another 15-20% next year also.
Oh, wow, that's good. That's good, yeah. Secondly, Rajiv, apologies if you've answered this. See, there was almost a 200-floor increase in, you know, international general business. Is there an element of tender or one-off or anything in this?
Yeah, the base is around 800, Kunal. Then the one-time set, yes.
No, sorry, you did 668 in the quarter, right?
No, I'm saying console numbers, console numbers are about 1000, so what I'm saying is that base is around 850 and then we always get these one times so that that's why it's up to 1000. Base is around 850, 900, I think that's what it is.
Got it, got it. And just one more question. So, obviously, you shared the crop health fans' revenue contribution, but in terms of EBITDA, the loss quantum, if you can, and secondly, are we on track for the de-merger by the end of this fiscal?
Kunal, can you say that again? I did that.
Apologies. Yeah, so I was asking you about the aggregate and business. What will be the EBITDA contribution?
We're done for the half year. Okay, Padish, you can answer that question.
Yeah. So, in fact, this quarter, we just have a slight marginal profitability. Okay, so that's similar to me, but they tell you from a segmental perspective, about 10 lakh profit on that. So that's what we have. So compared to Q1, this is a positive quarter for us. But having said that, Kunal, again, there are multiple things. We are also battling a few other trend-related provisions that we have taken. So from a business perspective, I would say last year to this year, about 15% to 17% growth. But our aspirations were even much higher. And as you know, the LNO and effects related to that was quite horrendous. So all in all, I'd say the quarter is positive. And looking ahead for the year itself, we are quite positive compared to the last year, in terms of maybe around 15-20% growth.
You got it. And then Spillow, is it on track for this end, year end?
Yeah, I think we mentioned this earlier on. Because we have the rights issue and then some recapitalizations happened, so we are going back to SEBI for the filing and then there's an NCMT process. So we are estimating mid-year calendar year 27 for the team of children.
Got it. Got it. Thanks. Thank you. All the best.
Operator
Thank you. Anyone who wishes to ask the question, please raise your hand from the participant tab on the screen. The next question is from Shubhash Gupta. Hi, Subhash. Requesting you to unmute yourself. We will go to the next caller. The next question is from Rahul Chaudhary.
Yeah, please speak up a little bit.
Yeah, I just wanted to know something about our parafore pipeline. I'm sorry, I might have missed it earlier. With regarding to Zenpick, and we have settled with the innovator, but have we got everything else from the regulator, sir, whenever we are?
Raoul, I think, yeah, we don't have an approval yet, Raoul, so we're answering some queries from the FDA. Subject to us answering the queries and getting the clarity from the FDA, then we can speak about our exclusivity. But at this time, we don't have approval.
And what about Imruvika? There also, it continues to be listed in our presentation, but there also, there is a, we've hit a hurdle, isn't it?
No, no, no, it's done, Raoul. Settled.
It is settled, and we got it approved in 30 months, so we believe the exclusivity is there, so no problem there. That is solid. That's calm.
Sir, I just also was looking at the cash flow statement of H2. So, there is a dividend received from an associate, so is that Ad Corp?
Yeah, you're right. It's from Ad Corp. Hadcock has been announcing dividend also, so we get that coming to us.
Right, sir. And so just a broad-based question. I mean, you've always told us that 26-27 is going to be, you know, a very low-key year. And the market is still, I think, valuing it as 19-20 price to earning. But anyway, leaving that aside, so what's the outlook for 27-28? Do we have any big launches coming up which you may not be able to see?
I think we mentioned that, no, Rahman, I think we mentioned about, I think in the coming few quarters, we'll expect about the products, Garfield, Travectidine, and Ola Paget. So these are the major nuances. So based on how they do, I think that's a drive deal.
regard to this South Africa company now that we have acquired. Are we moving ahead with launching anything in the African market through that?
We are working on it. So we have actually filed multiple products. It's been about one year since we bought this company. So we have made multiple filings. Regulatory approval takes about 2-3 years. So I think we will see the value of our portfolio coming in. In the next one and a half, two years. So, but now the regulatory approval process is on. So, we believe, I think, we'll see the value in the next two years.
Sir, any new parafore thing that we have filed or we are waiting? I mean, how does that happen, sir? Because R&D is happening continuously.
Sir, I think now we are targeting some parafores, so we are targeting something. So, hopefully, in the next few quarters, we get the position and we will be clear. But as of now, I have nothing to do.
Operator
Okay, thank you, sir. Thank you. The next question is from Digvijay Patil.
Yeah, thanks for the opportunity. So, I just wanted a couple of specific clarifications. So, first is we have announced a dividend. So, I just wanted to understand the rationale behind the dividend given that we have just raised funds. And second, that our debt is coming up in 100 crore tranches every quarter, I think. So, do we plan to prepay it upfront or are we planning to prepay it every quarter as in when it comes to you? And the third question is on the acquisition. So what would be the price to earnings or some flavor of the value of acquisition that we plan to do given that we've just raised for us?
So let me answer your first question, the dividend question. We've been given steady dividend decisions. This is no difference from what policy we had in the past. And I don't think we are really... Raising the funds is not anywhere linked with the dividend. The steady income that we are given to shareholders, and let's continue to do that. Regarding acquisition and all, I mean, you're looking at different assets. Hopefully, we'll be able to close something. But we look for value for money. So, you don't have a target P that you can talk about, but you look for value for money, and we're not in haste to do a transaction. And you have another question, didn't you?
So in terms of the loan, yes, as on 30th September, we did have loan. But once we raise the funds, we have repaid the entire loan. So as on today, we don't have any loans right now.
So the PAC guidance that we've given, that would include the interest saving and the demerger, which would be probably PAC dilutive right now, like a loss at the PAC level, right?
So the loss of the agrochemical business will be in the earnings. So we expect that the agro business will lose about 20 crores at EBITDA note. So that is already embedded in the earnings. So when we give a fat guidance, the loss of the agro is part of the fat guidance. And the interest income is also included of the money that gives us that's good.
Operator
Thank you. Next question is from Arjun Krishna. Hi, Arjun. Are we audible?
Operator
I think there is some audio issues with Arjun. The next question is from Gagan.
Yes, thanks for the follow. I just wanted to get some idea from you regarding your ROW outlook for the next year. This year will be a strong one clearly. But how do you foresee FY28 for ROW and also based on the launch pipeline in the US?
I think overall we believe that our business should grow. I don't want to give guidance for 28 March yet. I think I want to wait till the end of the year. But we expect to blow around 10 to 50 percent. I think that's our expectation. But I think more precise guidance will give, I think, closer to the end of the financial year. And it will be driven by our RW and our U.S. business, but I think it will give you more clarity as we close it to the time.
Yeah, if I refer back to your commentary at the start of this financial year, you had indicated that FY28 and FY29 could be strong years from that call post-27. So, if you're targeting, you know, 15%, you know, top-line growth, is there potential for margin improvements, which lead you, I mean, to believe that these two years could be strong?
I think the challenge here is, see, that's driven by the base business. And I think all the upsides of our investments that we've made or the paraffos that we've made that we could possibly monetize are over and above that. So, I think that is not included in that. Because those are all very uncertain, so I think that will only change. We're just driven by the certain outcomes we are giving guidance on. But any one times or exclusivity or any upsides from the investments, that will only change. And if you stop to judge, and I'll be very honest with you, as much as you like to give guidance for the future years, I think you can have more clarity only when you're closer to the year. We can only make a positive judgment of that. It will go to a particular map. I prefer to talk about it closer to the end of the financial year. At this time, I think I'll have more clarity and it will be easier for me to judge. Okay. Thank you.
Operator
The next question is from Rajat Srivastala.
Yes, sir. Yeah, it's good.
Yeah, hi, Rajiv. Rajiv, just one question. In the cash flow statement, I can see that there is some 300 crore CAPEX already done in the first half, which looks quite high if I compare it to last year. Can you tell us where is this CAPEX going and if you could just share the CAPEX guidance for full year?
I think we're talking about 400 acres for the KPEX every year. So I think most of the KPEX is going at, we are upgrading at Chennai and make good our facilities, our API facilities. Our API new blocks we've built, so that has taken away about most of the cash. And we're also upgrading our formulation facilities. We added a new oncology line in Narajan Sajid site, just coming to market. We just started production now. And also we're setting up a cartridge line to make some glutathione internally. So that CapEx is also ongoing. That line will get ready next financial year. And general basic maintenance traffic. So, our run date is around 400 a year. I think typically we spend about 350 to 400. This year we spend a little more and a half year. But yeah, that's mostly how we do things here. Sure. Thanks. Thank you.
Operator
Thank you. The next question is from Amani Hasan.
Yes, I am. Please go ahead.
Sir, my question is regarding our associate appointed a new CEO. What are the strategies? Can you tell us?
Say that again. I don't understand. Can you repeat that question?
Our associate, Ed Koch, appointed new CEO.
Oh, yes, of course, of course. Yes, yes. What about him?
So, what is the upcoming strategy I want to know?
He's Mr. Gulani, so he has been appointed recently. He comes from very good experience in innovative pharma. I think he was with Pfizer, I think it was his last job before he joined us. So he's a good person and I think he has a lot of experience in prescription business, which has been the weakness of Adcock. So I think after Lee came in, I think we've seen a lot of uptick and also other colleagues who have been recruited recently. I think we've seen an uptick in the prescription business. So I think that's the strength that they have. So we are happy with how things are going.
Yes. And my second question, I had read a news regarding Adcoc shutting down its plans because of non-profit product.
They have laid off some people recently in one of the lines. I think because and that one time charge is already reflected in Adcoc's earnings. Yes. Yes, this one particular factory has happened. Yes, that's correct.
Yes, and my last question is how big we take acquisition? How is big?
Right now our position is that we own 49% of our ad-com. And I think that's our position in the city.
And what is cash in our book?
consider the right issue inflows, we are around 2250, 2250 points. Net cash. Net cash.
Net cash. And how big is transaction which we acquire?
New application. You mean ad costs 30% or future acquisition?
No, no, no. Upcoming, upcoming acquisition.
We don't know. I mean, we're shopping for different transactions. So, we expect to use some portion of this cash to do this transaction.
Okay, okay. Thank you. Thank you.
Operator
Please raise your hand from the participant tab on the screen to ask the question. The next question is from Shubhash Gupta.
Good afternoon. Can you throw some light on the commercialization of NRC 2694? Any timeline to it? As well as potential?
As of now, no, Subhash. I think we're still trying to redo the strategy. So we've done some phase one data. So I think now we're trying to see what the right strategy is in terms of what our phase two strategy should be. At this time, I have nothing to look at.
And my second question is, with respect to the performance in this quarter, if we look at the performance, excluding the associates, there has been substantial improvement in profit before tax. It has almost doubled over the previous quarter. Is this sustainable?
I think so much our business has cycles and it has. You know, different territories do well at different times, and there's also an element of one-time orders that you get 10 days that you get. So when we give a guidance, I give it for the whole group. I don't give it for one particular entity. Like sometimes India does well. Sometimes, you know, Canada does well. Sometimes Brazil does well. Sometimes USA does well. So generally when we give a guidance, we don't, you know, try to capture, you know.
And my final question is with respect to acquisitions. Are we thinking of concluding any acquisitions in the current financial year, whether in India or abroad?
We're trying so much. We're trying one transaction. We're running it, I think, quite seriously. Hopefully, we'll have to close it. But again, we're all subject to, you know, all the regulatory and all the agreements getting asked. But we are against, we're actually trying to do one more transaction.
This will be the last call. Thank you.
Operator
Thank you. The last question is from the Gujay Pakal.
Yeah, sorry for coming back in the queue, but I just wanted some clarity that you just mentioned about the activity thing. So prior to the rights, did we have any bankers or bankers set up for doing an M&A transaction or are we doing it after the rights closure or like how is that timeline going?
We are always making a transaction thing, because there's no, like, nothing is linked with rights. Rights is a parallel process, and then the engagement for transactions is a parallel process. So I think we, I mean, we've spent, if you look at it, in the last two years. Different transactions, which for the last four or five years we've taken through Niamh Cup, we've spent nearly 3,000,000 in person acquisitions. This has helped us set up a front-end in the US. We are able to build a reasonable front-end in South Africa. So obviously, South Africa being the biggest chunk of that money. So I think this is always an ongoing process. We look at multiple transactions, but in the end, you only consummate one or two.
So just the thought of the acquisition, why not purchase the entire stake of IDPOP, like we have 51 pending debt? That seems like a...
I would love to think, but at this time, only 49% was at offer, so that's why we are here. But hopefully, I mean, if the major shareholder chooses to do it, then we'll come. At this time, it's not at play, but certainly, I think if they are interested, we are also At this time, only 49% is at play, so what's going to be what's. I think the asset was so valuable that at 49 also was very meaningful. That's where we took it.
Sure. So, we have the first right of refusal right there.
At this side, I'll end the call. Again, thank you very much. Thanks for your questions.
Operator
Thank you. Passing the call to Mr. Rajiv Manan for the closing remarks.
Thank you, everyone, for joining today. If there is any question unanswered, please reach out to the investigation team. Thank you.
Operator
Thank you very much to NatCo's management team. Ladies and gentlemen, on behalf of NatCo Private Limited, that concludes today's conference. Thank you for joining us, and you may now disconnect your lines and exit the webinar. Thank you.
