Anupam Rasayan India Ltd (ANURAS.NS) Earnings Call Transcript & Summary

Ladies and gentlemen, good day, and welcome to the Anupam Rasayan India Limited U.S. Acquisition Update Conference Call. [Operator Instructions] Please note that this conference is being recorded. I now hand the conference over to Mr. Anshuman Gupta. Thank you, and over to you, sir.

Thank you very much, Sagar. Good evening, everyone. I'm Anshuman Gupta from Investec. I cover pharma, healthcare and chemicals here. We welcome you all for this update call on the U.S. acquisition done by Anupam Rasayan last week. First of all, I would like to congratulate the entire team at Anupam for the acquisition of Jayhawk Fine Chemicals, which is truly a strategic milestone in their journey, and this does strengthen their global specialty footprint. From the management side, we have with us today, Mr. Anand Desai, MD; Mr. Gopal Agrawal, the CEO; Mr. Vishal Thakkar, Deputy CFO; and Mr. Ravish Chaudhary, Senior Manager. We hope everybody has received the acquisition presentation release earlier. And with this, I would like to hand over the call to Mr. Anand for his opening comments and just spell out the strategic rationale and anything further he wants to add. Post that, we will obviously open the call for Q&A. I have some of my own questions, which I will start with once Mr. Anand finishes with the opening comments, and then we can move on to the questions by the audience. Over to you, sir.

Thank you, Anshuman bhai. Good evening, everyone, and thank you for joining us today. We are pleased to announce a significant strategic milestone for Anupam Rasayan India Limited. On 9 December 2025, we signed a definitive agreement to acquire 100% equity in Jayhawk Fine Chemicals, a U.S.-based specialty chemicals company from the CABB Group. Jayhawk was founded decades ago and is headquartered in Kansas, U.S.A. It's a highly specialized manufacturer with strong capabilities in custom manufacturing, high-purity processing and complex chemical synthesis, serving long-standing global customers across multiple high-value applications. This acquisition is fully aligned with our long-term strategy of building a global integrated specialty and CDMO platform with strong customer relationships, differentiated chemistries and multi-geographic execution capability. First, Jayhawk gives Anupam a direct onshore manufacturing presence in the United States, significantly enhancing our credibility and engagement with multinational customers who increasingly value geographic diversification and supply chain resilience. Second, the acquisition strengthens our platform depth across the value chain. Over the last few years, our investment in Tanfac has enabled backward integration and secured critical fluorination raw materials such as HF and KF. Jayhawk complements this by positioning us closer to the end applications with manufacturing of critical advanced intermediates and N-1 molecules for high-performance materials and life science customers. The acquired portfolio adds high-value dianhydrides and polyimide intermediates, positioning Anupam Rasayan as a strong integrated player in this rapidly growing segment. This move expands our access to fast-growing innovation-led end markets such as semiconductors, automotive, EV, aviation and electronics. Third, the transaction enhances our chemistry capability and customer platform. Tanfac's segment chemistry, Jayhawk brings additional process capabilities and a strong global customer base, allowing us to scale faster and deepen customer relationships. Importantly, we are exceptionally well positioned to capitalize on emerging geopolitical tailwinds, particularly those driven by regulatory changes like the recently approved U.S. Biosecure Act. By acquiring a U.S.-based CDMO platform, we now offer global pharma companies an essential alternative for derisking the supply chains away from restricted geographies. This acquisition establishes a strategically valuable platform for us to expand the presence in the U.S. and build a global CDMO network, especially for advanced intermediates and API and AI intermediates within the life science sector. We aspire to leverage Jayhawk's global customer base for cross-sell potential and deepen our existing customer relationships. Ultimately, this acquisition is about creating a diversified multi-geography growth engine powered by specialty and high-purity chemistries and establishing a U.S. innovation and CDMO hub. Lastly, this acquisition is fully aligned with our philosophy of disciplined capital allocation. The transaction is funded through a balanced mix of quasi-equity, debt and internal accruals, ensuring balance sheet strength while providing Anupam full strategic and operational control. With Jayhawk's established revenue base being relatively less cyclical, higher-value segments, we expect the acquisition to be EPS accretive from day 1. On a pro forma basis, the combined entity would have revenues of approximately $243 million and an EBITDA of approximately $61 million. With that, I will now hand over to Gopal bhai to walk you through the operational strength and transaction details.

Thank you, Anand bhai. I will briefly cover Jayhawk's operational strength and how we see value creation post integration. Jayhawk reported approximately $78 million revenue in CY '24 with EBITDA margins of around 19%. About 65% of the revenue comes from performance materials with the balance from life and life science related molecules. This mix provides stability and strong growth visibility. The U.S. facility is large, multi-solution site spanning nearly 3 million square meters, comprising 2 manufacturing units and a pilot plant. The presence of pilot scale infrastructure is critical for development, scale up and commercialization of new CDMO projects. From a capability standpoint of view, Jayhawk adds complex chemistries such as Suzuki coupling, Azo chemistry, Grignard reactions, and specialized high-temperature oxidation. These are highly complementary to Anupam's existing strength in halogenation, oxidation and nitration. On implementation, the plan revolves around creating a powerful dual-site production model. This synergy combined with Jayhawk's high-purity technology and advanced operation with Anupam's cost-efficient backward integrated manufacturing base in India offers our global customers the flexibility of localized U.S. production and a highly integrated supply chain. The enterprise value of the acquisition is approximately $134 million, implying an EV to EBITDA multiple of around 9x CY '24 earnings. Total purchase consideration is approximately $150 million, including cash on Jayhawk's balance sheet, which is roughly around $16 million. The funding structure involves Anupam Rasayan investing $40 million through a combination of internal accruals and debt. And the balance, which is roughly $110 million, is being invested by a leading global investment management firm in form of Class B nonvoting shares, which will enable Anupam Rasayan to consolidate Jayhawk fully. Finally, we recognize that quality and experience of the team is fundamental to any CDMO business. We look forward to working with Jayhawk's existing management and team, whose technical strength and long-standing customer relationship aligns well with the integration model we followed even at Tanfac. With this, I will hand it over to Anshuman to take this forward.

Sure, sir. Thanks for a good brief starting point on the acquisition. And I think what I will do is that I have some set of questions that I need to ask. And then obviously, we will open the lines for Q&A as well. But anybody if they have a question, they can actually join the Q&A straight away. But sir, my first question is, while you did mention a little bit about the strategic rationale, I mean, if you have to like put it in 4 or 5 points, and detail it out, what are the key strategic rationale for the acquisition, so I mean, I would love to hear that.

Anshuman, happy to take that. I mean, we had covered this in our presentation as well as in the initial remarks. But if I have to talk about 4 or 5, one of the biggest one is basically it helps us strengthen our presence in U.S. This acquisition marks Anupam's entry into onshore manufacturing in the United States, which perfectly aligns with our global expand strategy to be a global CDMO player for our customers. Jayhawk has established operations and customer base both, which provides Anupam immediate access to the key end markets, leading multinational customers, significantly enhancing our global reach and engagement. So that's one. The second point is, it helps us expand our performance materials portfolio, especially into high-value dianhydrides and polyimide intermediates. These products have critical application, as you would know, across semiconductor, aviation, electricals. This will help us, Anupam and Jayhawk put together more as an integrated player, in this fast-growing performance materials segment. The third benefit which I can talk about is the forward integration. So as you would know, when we did the acquisition of Tanfac, it was clearly an idea to secure raw material sourcing, and this was more of a backward integration and particularly in the fluorination chemistry. Now with Jayhawk, basically what we are trying to do is that go forward, which is go closer to our customer, and idea would be to manufacture more of our key N-1 molecules for our customers. So this whole combination, I would say, of Tanfac, Jayhawk and Anupam would allow us to kind of provide integrated, what we call, supply chain solutions to our customers, and this will help us enhance our, what we call, relationship with the customer. And we would more kind of act as a one stop kind of a solution for some of the critical needs of our customers. The fourth one would be kind of also combining somewhere the cost efficiency and technology, what we call, superiority of Jayhawk. So basically, the synergy between Jayhawk and Anupam, I would say Anupam would more probably act as a cost-efficient backward integrated manufacturing base, and Jayhawk obviously would be more on the technology advancement. And net-net, our idea would be to basically provide a localized solution to our customers in U.S. Lastly, again, along with Jayhawk, we also get a pretty experienced team and R&D kind of, let's say, capabilities. Idea would be to combine the 2 and look at, I would say, kind of offering innovative solutions to our customers. So I would say these are the 5, 6 synergies, which I can kind of think of to begin with. Of course, as and when we more and more kind of integrate our operations, there will be a lot more which will come our way.

Sure, Gopal. Sir, I think one of the statements in the opening remarks was about China Plus One, right? It's a buzzword, and across the globe, there is this thought about China Plus One, right? So if you can throw some light, from this acquisition perspective, how do you think this China Plus One factor will actually play out in your favor because of that?

So Anshuman, I mean, as a company, we have always focused on our own strength. I don't think so we have kind of designed our thought process or strategy which is going to be based more on China Plus One kind of stuff. Our idea is to basically do and strategize basis whatever strength we have. And as I said, given the overall, I would say, kind of a combination of Tanfac at the back end and Anupam more at the intermediate and Jayhawk now on the front-end side, our strategy would be to basically more look at our own strength, which we can offer to the customer, and then thereby kind of offering more of an integrated supply chain solution to our customers and being of a value which would be long-lasting than trying to focus our strength on certain geographies or otherwise. But yes, Anand bhai or Vishal, if you wish to add anything?

Anshuman sir, this is the operator. Should I open the floor for questions? Or you have any further questions?

No, no. I'm going to ask further questions. I think Gopal was asking Mr. Anand or Vishal if they want to add something to the answer. That's why I stopped. So we have questions. We can always open the Q&A queue, if you want, but I have a few questions which I want to still ask the management. Is that okay?

Sure.

Yes. Sir, again, on the acquisition structure and the debt to be taken by Anupam, what does it really cost the company? And to add to that, I mean, how would Anupam be able to consolidate the full financials of Jayhawk?

I will have Vishal bhai answer that. Vishal bhai?

Yes. So Anshuman, I think first thing is that Anupam is going to set up a wholly-owned subsidiary, which will eventually acquire Monitchem Kansas S.à r.l., which effectively holds 100% of Jayhawk Fine Chemicals, which is the entity which we are talking about, which is the operating entity, and Monitchem Kansas S.à r.l. is a holding company which is having an effective 100% holding. So that is the first from a holding structure point of view. In this, Anupam is looking at -- will invest around about $40-odd million, both from a combination of debt and internal accruals, so which will act as an equity investment of Anupam in its wholly-owned subsidiary equity or a shareholder loan structure of Anupam, so which is where we will be holding 100% of the Anupam -- Anupam will hold 100% of the Monitchem Kansas S.à r.l., which effectively holds 100% of Jayhawk Fine Chemicals. Now the balance amount of approximately $110 million is going to be invested in the form of a Class B share by one of the large global investment management firm, which has AUM of over $100 [ billion ] through an investment vehicle. Unfortunately, today, I'm not in a position to share the name because we are under confidentiality as of now. And as we consummate this transaction, we'll be able to share the name and more details on that as well. So basically, that will translate to total $150 million, which shall be paid as a consideration to the selling shareholders for the company and the transaction. Now coming to the question that -- okay, let me first take it, how does it look like? So it will be Class B shares. So it will effectively act as a noncontrolling interest for Anupam in the Anupam's balance sheet to that extent. Today, we intend that eventually, we have right to buy them out at any given point in time. So that is a pure quasi-equity that we see it. From our perspective, I see it more as a bridge to a larger equity round to settle this amount that is there. Now coming to the consolidation, because it is a noncontrolling interest and I have 100% share of the equity of the company of our common shares, based on the auditor's opinion, we will be able to fully consolidate this company's EBITDA and P&L without having any dilution to that extent. Also -- yes, so that is what it is.

Sure, perfect. No, no. Also, I mean, in terms of just drilling down into what Jayhawk's business capabilities are, and what, according to you, it brings as a unique value proposition, and also the core chemistry that it has? And subsequently, if you can also answer that because you have evaluated Jayhawk quite well, and currently, it does about 19% EBITDA margin, so what's your sort of growth outlook? And I'm not necessarily looking for numbers, but just broadly, if you can add that. So one is on the capabilities and value proposition, and then you talk about the overall growth potential and margin profile of Jayhawk.

Gopal bhai, would you like to take that?

Yes. So I think Anshuman, as we kind of spoke, from a business perspective, this is a complete kind of a synergy which is there between Anupam and Jayhawk. So just to give you some sense, which we have spoken in the presentation as well, currently for Anupam, the performance materials is roughly around 10%, 12% of our overall revenue, while in case of Jayhawk, it's almost 65%. So maybe if I was to kind of fast forward, on a consol basis, the way the overall Jayhawk plus Anupam integration will look like, would be around 40%, 45% would be agrochem, 35% would be performance materials, and another 20% would be a mix of personal care and pharma for us. So basis this, we kind of get, I would say, a portfolio which would be pretty, I would say, kind of comprehensive, and we'll be able to kind of offer needs of our customers across all these segments. So one is, from a segment perspective, we'll be able to kind of offer them product across, let's say, agro, performance materials, and pharma and, let's say, personal care. Similarly, in terms of performance materials, where you would appreciate that the application is more in the high-end segment like aviation, electricals and semicon. These are some of the segments which are growing at a very, very fast pace globally, which would allow us basically, again, offer a more like an integrated supply chain solution to our customers. And coupled with, let's say, a bit of a cost-efficient model of Anupam, which we kind of spoke about initially in our commentary, and advanced capability as far as the chemistries are concerned of Jayhawk, we do believe, I think we offer a model to our customers where the customer would be able to more partner with us in their supply chain kind of this thing. See, our idea and philosophy has never been to be a competitive supplier to a customer, because maybe today you are competitive, somebody else tomorrow could become competitive. Our idea is to more offer an integrated supply chain solution and partner with our customers from a long-term perspective. So our belief is that with the segment expansion as well as, I would say, now the geography as well, because another thing which Jayhawk brings to us is that almost 70% of their business is U.S., while for us, U.S. was, I would say, fairly low. We had some more business in Europe as well as in Japan. So I would say this whole combination has a capability to help us expand margin going forward. We may not be able to give you specific in terms of what kind of, let's say, growth one is looking at, whether it is sales or EBITDA margin, but we do believe that one should be able to kind of go closer to the kind of margin, I would say, and growth Anupam has been enjoying even in the combined operations.

I am Tanya from Investec, from Anshuman's team. Just one question. How is Anupam planning to do the integration of this acquisition considering this is a relatively larger acquisition compared to Tanfac?

So Tanya, I think it's a good question. And the only thing at least we can say is that we have had experience of integrating Tanfac. As you would know, we acquired Tanfac 3.5 years back. And I mean just for everyone's kind of a benefit, I'm happy to kind of just share what we've been able to achieve in the last 3.5 years. We have been able to double the capacity at Tanfac. Revenue has grown 3x. We have been able to increase, I would say, margin or EBITDA margin by anywhere between 50% to 75%. And if market cap is any indication, the market cap has gone up almost 7x from the time we have done acquisition. So all one is trying to say that, yes, we have now what we call experience of Tanfac. Of course, one can argue this is domestic and this is international. But I would say, business remains the same. Thought process remains same. Idea and strategy remains the same. So we feel fairly confident that we'll be able to kind of do this integration also pretty well. Like in Tanfac, we also have a global kind of a firm, consulting firm, who has been assisting us more as a PMO to ensure that we get the whole process and system integration right. So we will have similar kind of, let's say, agencies also helping us out. But yes, I would say as far as Jayhawk is concerned, the team there is pretty independent. As you would have seen in our presentation, while the ownership at the top has changed at Jayhawk, we have a pretty capable team or, I would say, a pretty capable as well as full team which is there, who will be able to kind of run operations pretty independently. And our idea would be, I would say, more to act as a catalyst wherever there is a need to look at expanding, let's say, the product offering and otherwise to our customers. So as far as this whole, what we call, acquisition is concerned, we are fairly confident that we should be able to kind of manage this pretty well, having done Tanfac successfully.

Sure. That's great, sir. And what are the growth plans for Jayhawk, including the anticipated CapEx and new product initiatives?

As I was telling you, Tanya, what we would be doing is that we do have, let's say, certain kind of, what we call, thought process in our mind. To begin with, we will primarily more focus on scaling the existing product of Jayhawk. And then we will look at kind of selectively taking some capacity expansion. Idea would be to more sit with the Jayhawk management, talk about what we can bring on the table, what do they have, and then look at selecting some of the kind of molecules across segment, where we can go together and probably offer something which, as I said, is more of integrated solutions to our customer. As far as the markets are concerned, as I said, in the segment, whether it is aviation, semicon, electricals, EV, for example, I mean, the addressable market is billions and billions of dollars. So I think as far as the demand is concerned, there is no end to it. What we would be doing is that work with the team to see what are our strengths. And this is that look at selective capacity expansion is what we do. If I more talk about the current, let's say, asset base, there, I would say, exists a decent amount of headroom, which will support our near-term growth. So yes, we will look at additional investment on a more of a case-to-case basis as we progress further.

[Operator Instructions].

So I have a couple of questions before the queue sets up. So I think one of the key here is from a customer standpoint that both Anupam and Jayhawk have customers. So what are you -- I mean, from the response from the customer side, what are you currently seeing? What's happening? How are both Anupam and Jayhawk customers actually reacting to this transaction?

So I mean, the way to look at it is that there are a few customers which are common between, let's say, Anupam and Jayhawk, which are currently being served by Anupam as well as by Jayhawk as well. And then there are definitely a decent amount of new set of customers that Jayhawk brings on the table. What we are happy to share is that when we announced this transaction, we have had, I would say, a decent bit of a positive, what we call, inquiries by a lot of existing customers of Jayhawk as well as of Anupam, wherein they said that, yes, we kind of saw this news, we are very happy having you kind of done this forward integration. And we do believe that this combined business definitely provides a greater supply chain stability and flexibility. And hence, I would say the customers are pretty, I would say, kind of excited. And we are kind of, let's say, engaging with some of them one by one. Of course, we will do more of those once the closing happens, which probably would be maybe another, whatever, 4 to 6 weeks away. But yes, to begin with, I think the customers are pretty excited. They are very keen to kind of look at this integrated offering from us. So yes, idea would be to kind of, let's say, bring the best of the both worlds, both, I would say, from Anupam and Jayhawk combined. But yes, net-net, we are seeing enough and more of them kind of approaching us as we speak, wherein they are having kind of a discussion or wanting to have discussion with us or with our sales team, and I'm sure similar would be the case with Jayhawk as well.

Sure, sir. And sir, I think specifically, I wanted to focus on the manufacturing side of this transaction. And if you can elaborate, right, from a manufacturing strategy perspective, what this combined entity will do from a manufacturing perspective?

Let me kind of answer this in 2 ways. One piece which I kind of covered, which is more of a, kind of, let's say, integrated solution, which is a combination of Tanfac, Anupam, and Jayhawk. Two is that the current site has roughly 3 million square meters in size. And what the existing, let's say, manufacturing setup occupies is hardly around, I would say, 15% to 20%. So there is another 80% of land which is available clearly for us to kind of expand going forward. So as I said, we will look at initially to expand the existing, what we call, product offering to our customers and then selectively look at some of the CapEx for which the land is available. So idea would be to kind of look at some of this manufacturing -- or rather building some of the manufacturing assets in Jayhawk. This is our offering or ask by the customer, where we are able to kind of take benefit of integrated, I would say, solution, which would combine Tanfac offering, Anupam and Jayhawk put together, especially on the fluorination side of it.

We'll take the next question coming from the line of Meet Vora from Emkay Global.

Sir, just if I were to put the growth plans of Jayhawk under context, with a revenue of around $78 million and EBITDA of around $15 million, should a 20%, 25% growth on top line and EBITDA would be a fair number to work with? And an extension to that, also on margin front, Anupam stand-alone entity is having a margin of around 25%, whereas Jayhawk is having a margin of around 19%. So would it dilute some margin on a consol level? Or do we expect Jayhawk's margin to rebound to, say, 24%, 25%?

So I think as I said in our commentary, we definitely are looking to kind of a more integrated offering. And given the integrated offering and the synergies which we have, we do believe that the combined Anupam and Jayhawk should basically be able to achieve the growth which we have been kind of envisaging for Anupam in the past and similarly, the margin as well. As far as in terms of timing or otherwise, we'll not be able to kind of guide specifically. But yes, Vishal bhai, if you wish to add anything there?

So Meet, I think what Anand bhai also indicated in the call and what even Gopal bhai has said, I think the way I would see it is that there is a strong growth opportunity coming for this company on a stand-alone basis itself. And we believe that along with that, if we add the synergies that Gopal bhai has said and the opportunities that we can combinedly target, I guess, the number that you are speaking on an EBITDA basis, yes, that should be there over the 3- to 4-year period. So 2 parts to it. The growth of EBITDA should be around about what numbers you had highlighted. And to my mind, with the kind of a scale, growth, and the synergies that we see, I believe that effective margin dilution would not be there going forward over the next 2 to 3 years' time period. Let's just get you more specific numbers as we try and close this transaction and have a better visibility on the business plan, along with Jayhawk's management's view as well more integrated in this position. Today, it is only coming from our vantage and our initial understanding.

Sure, sir. Just one question I had on the existing stand-alone business. So how are we seeing the existing business across agro and polymer segments? I think we had commissioned a few large AIs last year, which were seeing decent traction at least in the last few quarters. Are we seeing any revised interest in those from the customer end? Or in general, how is the base business looking like?

So again, I would say agro is kind of performing well. The volumes are kind of coming back for sure. And we do believe that it should start kind of contributing significantly. I mean we did lose out, let's say, in FY '24 and '25, but we do expect agro to kind of come back. As far as the kind of the particular AI you're talking about, I think we are getting a decent amount of forecast from our customers and we, in fact, expect a significant increase as far as the revenue is concerned from that in FY '27, both in terms of volume as well as in terms of improved pricing. So yes, I would say, net-net, we are definitely seeing agro business reviving pretty well. And particularly this molecule is kind of doing very well for us.

Okay. And do we expect to put any further CapEx for this molecule? Or do you think that the existing capacity will be enough to suffice that requirement of the customer?

Currently, we don't incur anything at this stage for sure.

[Operator Instructions].

This is Tanya from Investec. So sir, how do you envision allocating your products and processes between India and U.S. sites to optimize your cost and customer proximity?

Tanya, I think as we said in our commentary, currently, we are very clear. Whatever is being done in U.S. would continue to be done there. We will only look to kind of enhance the product offering or scaling some of that in U.S. What we would do is that from a more of a backward integration perspective, if there are certain solutions which we can offer from Anupam or from Tanfac or combined is what we would look to kind of do and thereby, as I said, more act as a catalyst to overall, I would say, Jayhawk's capability and look at then kind of increasing our offering to the customer, both I would say, existing customers of Jayhawk and even some of the customers, which, as I said, once they heard the news, they do believe that there are certain products that they would like to kind of offer given the combined entity. So we will evaluate each of this, I would say, sitting with the management of Jayhawk, go through it case by case and then kind of look at it. But yes, in the short run, our idea is very clear that we'll kind of continue things as is. And then kind of from a midterm and a long-term perspective, look at kind of integrating more like a dual-site model wherein, kind of, we at Anupam India become more of a cost-efficient partner to Jayhawk. And Jayhawk basically would be more someone who will be close to the customer and then look at kind of combining the strength of the 2 and offer solutions to our customer.

Understood, sir. And are these polymer molecules sticky, high-value molecules with multiyear lock-ins? Or are these mostly annual supply agreements?

So there are kind of long-term contracts which are there with the existing customers and all of those would continue. Our idea would be, as I said, again, to look at kind of augmenting some of this going forward. But yes, there are, what we call, long-term contracts which are there currently, which are existing with the customer, and they would continue. Of course, as I said, the idea would be to meet those customers and understand what more can be done with them while the existing product continues as it is.

All right. And just a last question. What is the expected gearing post acquisition, considering Anupam already has INR 730 crores of net debt as of second quarter?

Vishal bhai?

Yes. So as I said, at max, we are looking at around about $40 million of investment. So to that extent, you may want to count it in the net debt, because either we'll use some of our cash or we'll use the debt that has been made available by a large bank, which is our existing lender also. So I think you can take it $40 million on it.

The next follow-up question comes from the line of Meet Vora from Emkay Global.

Sir, I just had one follow-up. In your initial remarks, you mentioned that we are planning to serve the semiconductor and performance materials industry put together. What was this thought? Is it coming from the Jayhawk acquisition? Or is it from Anupam stand-alone? And how do we view these sectors going forward?

So Meet, I think from our strategy perspective, our idea was always to kind of target some of these high-end segments. Some of it, we have been kind of, let's say, supplying this directly or indirectly to some of our customers. But yes, from a future perspective, now that we have Jayhawk, who has capability on some of these high-purity chemistries, which have application, as I said, in some of these segments, which are going to grow, I would say, significantly, idea would be to kind of combine the 2, which is both Anupam and Jayhawk, and then look at kind of penetrating, I would say, our kind of entry -- I wouldn't say entry, but yes, rather strengthening our positioning with the customer. So please appreciate, some of the sectors, as you would know, semicon, aviation and others, for kind of, I would say, a player to even get into, the process could be anywhere between 5 to 7 years. I mean, if everything goes your way, for your ability to kind of get the approval from the customer and kind of be part of their supply chain. With Jayhawk kind of combining with Anupam, all we are saying is that our journey as far as some of the segments is concerned, it's advanced by 5 to 7 years, if not more. So yes, the way I would look at it, or I would expect you guys to look at it is, the combined entity now has advanced, let's say, Anupam's overall what you call strategy as far as the performance materials is concerned by anywhere between 5 to 7 years, where we already have a decent bit of our customers who are approved by Jayhawk, who have been, let's say, with Jayhawk for decades together. So from that perspective, I think we will be, I would say, probably a decent, what you call, combined force in performance materials globally.

Okay. So would we be creating a separate segment for performance materials like what we have for agro, pharma and polymers today, say, 2, 3 years or out?

No. So I mean, I said from our perspective, it's more of the offering to the customer. I didn't understand when you say a separate segment. I mean, of course, what one would do is that whatever, let's say, products in terms of intermediate or otherwise, which we can supply to Jayhawk from here, we will do that. Obviously, we would have some further, what we call, processing done by Jayhawk here depending upon the customer need. And then I said, more look at supplying the integrated solution to our customers. So I didn't really understand when you say a separate segment is what? Because from our perspective, it would be more like a combined Anupam and Jayhawk, which would be offering solutions across these segments.

Yes, yes, understood. So it was more from end application point of view. Understood, sir.

Our next question comes from the line of Rohit Nagraj from 360 ONE Capital.

Congrats on the acquisition. Sir, first question is in terms of customer overlap between Anupam and Jayhawk. And an allied question to that in terms of the product concentration risk on Jayhawk, are there any challenges on these 2 fronts? And in terms of customer concentration, again, is there heavy customer concentration for Jayhawk? And if it is there, how are we going to tackle it incrementally?

As we said in our initial commentary, Rohit, that there are a few kind of common customers. But would that kind of lead to concentrated, let's say, what we call, this thing as far as the combined Anupam and Jayhawk is concerned? The answer to that is no. Because as I said, there are only very few kind of common customers. Jayhawk has, I would say, kind of a decent set of customers, which they have built over decades with them. And if you look at their overall revenue, we don't feel that there is kind of, let's say, concentration of a single customer or product, which should be cause of a concern or should be worrying any of us for that matter. So I would say neither as an individual, let's say, Jayhawk, nor as a combined Anupam and Jayhawk, we see any kind of, let's say, tilt or risk of consumer concentration, let's say, of any single customer or a single product is concerned. I think I would rather only say that with both entities coming together, I would say, with the overall sales kind of going up or rather the revenue going up, some of this, I would say, concentration can only reduce in the overall scheme of things.

Sure. Got it. That's helpful. And second question is in terms of the promoters of Jayhawk monetizing. So what could be the potential reasons that they want to monetize given that the business is likely in growth phase as the performance materials segment is improving, plus the margins seem to be at relatively higher levels. And if you can just throw some light in terms of what could be the working capital cycle or ROCEs that Jayhawk was making over the last couple of years, that will be helpful.

I will have Vishal bhai answer that, and maybe I'll then add if there's something more which I feel like. Vishal bhai?

So Rohit, first thing is that this is effectively owned -- so Jayhawk is owned by CABB and CABB is eventually owned by Permira, a large private equity fund. It's an $80 billion private equity fund, as you know. So basically, their objective was that they had practically invested for a long time now in CABB, and it's over 7 years that they've held this asset. And it is time for them to exit, and they have been trying to do that for the last year or more. So it is more to do with the end of life or a life of their investment that they are looking at this divestment. So that is one part of it. And second, on the working capital side, as per our understanding, the numbers will be in the range of 90 days odd net working capital would be -- 90 to 100 days net working capital would be.

And the ROCE profile in the last maybe couple of years?

It would be double digit, but higher teens -- sorry, mid-teens to high teens, yes, mid-teens, I would say.

The only thing I'll add to what Vishal bhai said is that, yes, I mean, given a choice, they might have wanted to hold it, but as Vishal bhai rightly said, any private equity has to kind of look at exiting some of the assets in 5 to 7 years' time. And from their perspective, it was more of that which drew the decision than anything else.

[Operator Instructions] We have our next question coming from the line of Mahendra Parmar, an investor.

[Foreign Language].

Vishal bhai?

[Foreign Language].

[Foreign Language].

[Foreign Language].

As there are no further questions from the participants, I now hand the conference over to the management for closing comments.

Okay. So this is Vishal. First of all, thank you very much, everybody, for joining on a busy Monday. In summary, the acquisition of Jayhawk Fine Chemicals LLC is a transformative step for us. It strengthens our U.S. presence, significantly diversifies our revenue across end markets, across geographies and across customers as well. And it helps us integrate into a very high-growth end market like U.S., and we look forward to realizing the synergies that we have discussed today, and we'll be in touch as we look for the closing of this transaction in January later. Thank you, everyone.

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