Blue Jet Healthcare Limited ($BLUEJET)

Good afternoon, and a warm welcome, everyone, to Q4 and FY '26 Earnings Call of Blue Jet Healthcare Limited. Please note, the investor presentation and the financial results are available on the company's website and the stock exchanges. Also, anything said on this call which reflects our future outlook or which could be constituted as a forward-looking statement must be revised in conjunction with the risks that the company faces. The conference call is being recorded, and the transcript along with the audio of the same will be made available on the website of the company as well as on the exchange. Please also note that the audio of the conference call is the copyright material of Blue Jet Healthcare Limited and cannot be copied, rebroadcasted or attributed in the press or media without specific and written consent of the company. From the management, we have with us Mr. Shiven Arora, Managing Director; Mr. V.K. Singh, Chief Operating Officer; Mr. Ganesh Karuppannan, Chief Financial Officer; Mr. Sanjay Sinha, Deputy Chief Financial Officer. I would now like to hand the call over to the management of Blue Jet Healthcare Limited for opening remarks. Thank you.

Good afternoon, everyone, and thank you for joining us today. FY '26 has been an important year for Blue Jet Healthcare, a year where we continue to invest in building in the foundation of our next phase of growth across manufacturing, R&D and customer engagement. Over the last few quarters, we have remained focused on strengthening our position across our complex chemistry platforms while simultaneously expanding our operational capabilities and future growth infrastructure. From a business perspective, FY '26 reflected a mixed operating environment across segments. While the PI/API business was impacted by customer side inventory normalization, the Contrast Media segment continued to demonstrate strong momentum and partially offset the impact. Importantly, despite near-term volatility, in parts of PI segment, we continue to invest behind future growth platforms, customer engagement and capacity readiness. Encouragingly, as we enter FY '27, we are seeing improved visibility across several parts of the business, supported by healthy customer engagement in CM segment and confirmed order visibility across select PI programs. One of the key milestones during the year has been the commencement of our Vizag greenfield expansion project. With the groundbreaking ceremony completed and the project activities now underway, the project represents a significant long-term growth platform for the company and is being developed in a phased manner to support future opportunities across APIs and intermediates. We believe the scale, infrastructure readiness and strategic location of Vizag will further strengthen Blue Jet's positioning as a reliable global partner in complex chemistry platforms. Over the last few quarters, we have also continued to strengthen our development pipeline and R&D capabilities which we believe will support the company's next phase of growth over the medium term. While FY '27 will continue to be an investment intensive year for the company, we believe underlying momentum across our core businesses remains encouraging. As validation activities convert into commercial supplies and new capabilities progressively ramp up, we expect our investments across manufacturing, R&D and pipeline development to support the company's next phase of growth. Just to summarize, FY '26 has been a year of strategic execution and platform building for Blue Jet Healthcare. As we move into FY '27, we believe that the company is gradually transitioning from an investment and preparation phase into a broader commercialization and growth cycle, supported by expanding capacities, improving visibility and multiple emerging growth opportunities. Thank you once again for your continued support and confidence in Blue Jet Healthcare. I now invite Mr. V.K. Singh to share further operational and business updates, followed by the financial review from our CFO, Mr. Ganesh.

Thank you, Shiven, and good evening, everyone. While FY '26 was relatively flat from a revenue standpoint, we believe that this has been a foundational year for preparing Blue Jet and catapulting it into the next phase of growth. For a credible and differentiated CDMO, two elements are critical: manufacturing capacity and strong R&D capabilities. During the year, we made significant progress on both fronts. At Mahad Unit 3 site, we are progressing well on the backward integration project for the key raw material within our contrast media portfolio. This project is strategically important as it strengthens supply chain reliability, improve integration and enhances resilience against global disruptions. At the same time, we have commenced development activities at our Vizag greenfield site spread across approximately 100 acres. Vizag will form an important part of the Blue Jet's long-term growth road map. In Phase 1, we plan to develop dedicated manufacturing blocks across contrast media intermediates, high-intensity sweeteners and pharma intermediates. The total CapEx that we envisage for Vizag project is approximately INR 1,000 crores over a period of approximately 3 years. The investments being undertaken across the 3 sites remain closely aligned with customer engagement, future product opportunities and long-term business visibility. On the R&D and CDMO platform strengthening front, alongside our manufacturing expansion, we are also strengthening on R&D and development capabilities. Our upcoming R&D Center in Hyderabad with a planned investment of about INR 40 crores will focus on newer chemistry platforms including peptide-related intermediates, GLP-1 linked opportunities, biocatalysts and, of course, a faster turnaround of CDMO development programs. This expansion is aimed at increasing our participation in innovator-led programs, including opportunities emerging from both the large pharma and the smaller biotechs. Encouragingly, the PI segment, which had witnessed inventory buildup over the last previous quarters, has now started normalizing and shipment trends and improving order visibility are evident. Over the last 1 year, with regard to product portfolio and pipeline, we have significantly strengthened our product and development pipeline across multiple chemistry platforms. In the contrast media segment, we expect 3 to 4 new product launches during the current year, further expanding our participation across advanced intermediates within this space. Within the PI and CDMO segment, we have been tracking approximately 23 active RFPs, primarily across chronic therapeutic areas, including intermediates linked to GLP-1 programs and peptide building blocks. Encouragingly, we believe that 2 of these opportunities are expected to move into the commercialization phase during the current year. In addition, we are evaluating 2 high conviction commercial stage opportunities, which may potentially evolve into strategic lateral entries, for which dedicated capacity is being factored into our long-term planning at Vizag. In the high-intensity sweeteners segment, one high-volume product is currently under validation and we expect continues to be shipped over the coming quarters. With regard to sustainability and operational excellence, the focus in the company is high. Today, close to 70% of our energy consumption is supported through renewables, and the company was awarded the CII National Award for Excellence in Energy Management. With this, I pass over to my colleague, Ganesh, for the financial review.

Good evening. I will now share financial performance for FY '26. Revenues. Q4, we reported a revenue of INR 235 crores, an increase of 22% on a quarter-over-quarter basis and a decline of 31% year-over-year basis. Our reported revenue from operations in FY '26 of INR 947 crores is a decline of 8% compared to FY '25. We will analyze revenues by product category. Contrast Media. Q4, we reported a revenue of INR 193 crores, an increase of 55% on a quarter-over-quarter basis and an increase of 91% year-over-year basis. Our reported revenue from operations in FY '26 full year of INR 495 crores is an increase of 23% compared to FY '25. Despite higher goods in transit, our flagship product has increased volumes compared to FY '25. Annual forecast from the customer has a mid-single-digit growth for FY '27. Our intermediate for NCEE molecule commercialized in FY '25 saw strong offtake in FY '26. Based on the customer's forecast, we expect this performance to continue in the near term. Based on the current forecast, we expect this category will continue to have a positive momentum in FY '27. Moving on to PI/API category. Q4, our reported revenue of INR 2.4 crores against a revenue of INR 40 crores in Q3 and against a revenue of INR 196 crores in Q4 FY 2025. Our reported revenue from operations in this category for FY '26 full year of INR 298 crores is a decline of 35% compared to FY '25. The decline in FY '26 is predominantly attributable to intermediate for a cardiovascular drug due to destocking by the customer. Our participation in the supply network in FY '27 of this innovator customer will enable us to normalize the growth and grow over the peak sale we had achieved in FY '25. Artificial sweeteners. Q4, we reported a revenue of INR 37 crores, which is an increase of 43% quarter-on-quarter basis and a decline of 24% on year-over-year basis. Our reported revenue from operations in FY '26 of INR 131 crores is a decline of 2% compared to FY '25. This category faced pricing pressure from imports and we will remain opportunistic. Gross margin. Our reported Q4 gross margin is 56% compared to 52% in Q3 and 55% in Q4 '25. For the full year FY '26, our reported gross margin is at 54% compared to 55% in FY '25. In FY '26, rupee depreciation improved realization of exports and negated raw material price increase, which happened in the last month of the financial year due to Iran war. The discussions are encouraging with select customers on pricing and pass-through based on current geopolitical situation. Moving on to operating expense. With renewable energy source, the company has sustained electricity cost in FY '26. Freight cost post March '26 have increased. While the impact is not felt in FY '26, logistics costs in FY '27 will have to be evaluated. With Hyderabad R&D going live in H2 '27, we expect investment in product development to increase this current financial year. EBITDA. Reported EBITDA for FY '26 is 31% against 37% for FY '25. FY '26 EBITDA has been muted by lower volumes in PI/API category. Moving on to other income. Reported other income for FY '26 is at INR 69 crores compared to INR 46 crores for FY '25. This increase was due to an exchange gain of INR 36 crores recognized this year. In addition, an income of INR 5 crores on account of insurance claim has been recognized. Note, the entire loss on account of the fire incident was booked as an expense in the year of incident. Profit after tax. Reported profit after tax continue to be healthy at 26% for FY '26 against 30% in FY '25. Moving on to CapEx. The total CWIP as on March '26 stood at INR 301 crores. This predominantly includes capital work in progress at Mahad and investments what we have made in Vizag in terms of land acquisition. Mahad facility is in the final stages of completion and is expected to start commencement of production in H2 FY '27. We propose to spend approximately INR 400 crores in FY '27 towards Vizag greenfield, completion of Mahad and other additions in Ambernath. Moving on to cash in bank. We ended FY '26 with liquid financial assets of INR 400 crores as against INR 306 crores in FY '25. As on year-end, we are a debt-free company. Cash flow from operating activities stood at INR 334 crores. ROCE and continues to remain strong in FY '26. With this summary, I open the floor for Q&A.

[Operator Instructions] The first question is from the line of Sanjesh from ICICI Securities.

I've got two, all of them from the observation...

I'm sorry to interrupt, Sanjesh. Can you use your handset mode, please?

I'm on handset mode. Can you hear me?

Yes, right now.

Okay. A couple of observations from the opening remarks. First, on the existing product. We said that in the PI section, we are expecting to cross the previous peak of FY '25 with the destocking behind. Now what's giving us this confidence? And have we got a confirmed order for it? How are we looking at PI section? And is this all led by the same product or you're also affecting PI to have more products to come in, which V.K. mentioned in his opening remark, in peptides and 2 lateral product which we are looking to enter? And number two, on the contrast media, what is driving the strong growth? Does this also include the shipment of [indiscernible], which we were anticipating? My initial questions.

Sanjesh, I think great set of questions. On the PI part, Sanjesh, we are gaining confidence because whatever inventory had been built up, so that inventory, the destocking has happened. So if you recall, last time we said that the orders were already in our hand but the supply was deferred. So that was one part. Subsequent to the supply realignment, we have some more orders with us. So we are quite confident that in the PI segment, we are getting to a very good set of numbers in the coming year. And we also believe that there'll be some new products which will get launched. But then to gain traction and to get some critical scale, those products will take time because they are completely new products. So we are not factoring much from that side. But then there will be new product launches on the PI side and there will be new product launches on the contrast media side, both. So I think as far as the product portfolio and pipeline is concerned, I think over the last 6 quarters, the work that has been happening, very intensive work has been happening, and we are getting to a stage when that will all start stratifying.

And just to add on to that on the contrast media side, Thematically, we believe there are some select partnerships that we have on key molecules this translating into deeper partnerships. So we feel their optic requirements also increasing, and that's a combination of the existing molecules plus the launch of new molecules in FY '26.

Then this quarter growth was all led by the existing customer investing product or a 90% growth? I know that we did mention about supply starting NCEE, whatever the other product, the [indiscernible], has that started? Or this is all coming from the 2 products?

As far as this quarter is concerned, I think that excludes the sale. But in FY '26, there was some contribution by the select molecule you spoke about.

Got it. And you talked about the lateral entry and V.K. can also mention that we are looking to put up a dedicated block in the Vizag for 2 lateral product. Where are we in the process? When we are talking about dedicated, that means really large in size. Can you give more detail or an understanding? I know we can't reveal the product but therapeutic area, how large the opportunity could be, some of those details will be helpful.

So Sanjesh, I think all that we can say right now is that we have very high conviction on those lateral entries, and that's the reason that we are mentioning specifically only 2. And they will take a while to fructify, then as and when they happen, there will be significant opportunities. And that's the reason that we are looking at deploying dedicated capacity at Vizag for that. But then as you know, that Vizag is completely greenfield. And we envisage 24 to 30 months for that capacity to get online. But then what's more critical is that our portfolio is growing, and we are tracking some very large opportunities in that portfolio. So our portfolio is going on the NCEE side. Our portfolio is growing in the lateral entry side. And the lateral entry, clearly, the commercialization -- I mean, the peaking will happen faster. But then we'd have to wait for Vizag to come up.

Got it. And what about the peptides Where are we there in peptides? You mentioned in your opening remarks some of the opportunities in GLP-1, et cetera. Where are we there in the process?

We are with a couple of these GLP innovators, but not for the end peptide but for the building blocks, for the intermediates of the peptides.

But have you started lab supplies, pilot supplies?

Yes. We have started lab supplies to some innovators and we have also started some lab supplies to some very large subtype CDMOs.

[Operator Instructions] We will take our next question from the line of Pritesh Chedda from Lucky Investments.

Sir, your commercial contrast media was not clear. One, this growth that we see in the quarter 4, so was contrast media products started being a part of it or the new products that you were supposed to supply, is it? And what were your exit comments for FY '27? So should we look at the quarter 4 number? Or was it somewhat different that we had to look at the '27 growth? The comments were not clear, if you could reiterate them please.

See, if you look at Q4, majority of the turnover is from the existing customer, existing product. When you look at FY '27, whatever we have marketed, we have got, the forecast is quite encouraging. And we should be in a position to -- with a couple of new launches we are expecting, we do expect 1 or 2 validations and 1 commercial launch, which should actually like ensure that we will actually get into a sort of double-digit growth. That's what we are expecting.

And the validation is the contrast media product validation or some other product?

It will be a combination of both gadolinium and iodinated.

Okay. And the commercial launch is -- okay, the validation is for those 2. And then there is a completely new commercial launch.

Yes, yes.

Okay. And what explains this 22% growth? Because in the past con call that you've mentioned, the market growth is not so significant on the existing product. So is it something on the market share that we need to understand or any other comment that you have?

Generally, like in contrast media, the volumes are forecast. We get it couple of quarters ahead. What you need really like appreciate is the customer offtake. It is generally not uniform across all months. So based on customer need, there are variations within the year. But generally, like if you look at 1 month period, normally, the customers meet their commitment. Whatever they had actually like agreed to pick up, they take it on. So in this particular CDMO activity, one should not look at unclear quarterly. I think as long as we get that annual number right, I think that would be a better way to forecast.

But sir, you never guided for the growth in the beginning of the year.

No, we actually talk about what the annual numbers are. Like we talk about how we can look at the forecast because these things are all not [ informed. ] Like it is a forecast. So based on that, we actually like to talk about what could be the likely trend in a particular category.

Okay. Just last one is contract media backward integration. Where are we like this year in contrast media?

Yes, The plant will go onstream this year, and we will start consuming the quantities that we produce, but we plan a slow ramp-up. So the full impact maybe will come after a year.

And iodinated contrast media, the revenues will flow this year or there is just validation?

We try to be a bit more general in terms of the overall guidance for the segment. I think as far as the offtake requirements for this particular specific molecules are a bit confidential at this point in time. But I think things look encouraging so far.

Next question is from the line of [ Samir ] from Kotak Institutional Equities.

So my first question is, V.K. sir, during the opening remarks, he spoke about 2 commercial opportunities in the PI and API segment. Could you just elaborate on these 2 opportunities, like what kind of products these are and what kind of an opportunity are you talking about?

So I guess you're speaking about the 2 lateral entries that we spoke in the narrative, right?

Yes, yes.

Yes. So there, as I said in my answer to a question earlier, that the best that we could disclose for the time being is what we have said. But being lateral entries, the peak volumes will come much faster because it's not an NCEE. But then let's just wait and see how they pan out. We will not be able to disclose much about the therapeutic category or anything because then it becomes very obvious. And we have very strict NDAs at this point of time.

In terms of peak potential, can we expect it in FY '28?

See, Vizag will take -- so while some quantities may go from our existing capacity, the main volumes will start going from Vizag, and Vizag, we envisage anything between 24 to 30 months for the blocks to come up and go onstream.

Okay, sir. Secondly, on the contrast media part. So this INR 190 crores top line compared to the INR 125 crores in the previous quarter, how much of this incremental INR 65 crores is due to the revenue booking goods which was shipped in the previous quarter and how much was actually due to the demand in this quarter? Could you quantify that, please?

Now actually, the goods in transit has normalized. There is no significant variance.

So this entire INR 190 crores, does this belong to the fourth quarter order book?

Yes.

I have just one last question. My third question is what kind of a margin outlook are you expecting for the next fiscal given the geopolitical scenario and the pressures on logistics and trade costs? So can you elaborate on that?

Actually, the cost structures are evolving. We need to actually watch how the Q1 cost structures pan out. We will be in a better position to talk about it during the Q1 results.

But do you expect any margin expansion because we are also guiding for some incremental sales from that cardiovascular intermediate, which is an innovative product?

You know the impact of crude oil price, which has actually impacted most of the chemicals logistics cost, and there is also going to be a domino effect, okay? Today, whatever we saw in the month of March '26 was very limited. The impact was not fully seen for many of these companies. So you ought to give us a quarter time. So Q1 could actually give you a good representation of how the cost structures have evolved and how the margins are. Today, it will be too early to talk about the impact.

Next question is from the line of [ Sajal Kapoor ].

I've only got two questions. First is are we at a stage where Blue Jet is deliberately optimizing more for future strategic positioning and embedded customer relevance rather than near-term operating efficiency?

If you look at our leading financial metrics and indicators, I think they are one of the best in the industry. So I don't see why you should be asking that we are not optimizing for the near term. But as a CDMO, we always say that the gestation is 3 to 4 years. So any CDMO will have to have the type of time horizon and plan for the future. And that is exactly what Blue Jet is doing, and that's the reason that we said that while FY '26 might have been flattish, the year was foundational because we are sowing the seeds for doubling our capacity and doubling our chemistry platforms in R&D. So we are very clearly planning or bracing up for a bright future because we see tailwinds for the country, and we see a lot of opportunities for us as a company.

That's helpful, V.K. And second, with Mahad backward integration block expected to go live this fiscal, should we think of initial impact more through gross margin improvement and supply chain control with the top line benefits perhaps becoming visible only after customer validations and the scale up? Or how do you see that?

I think you are spot on. When we started the project, the primary objective was to gain strategic independence. And while the volatility that we were seeing in the pricing of the product because of very sketchy and choppy energy prices and, as you know, that we were importing from Europe as well as China. And that was the primary reason for the vertical integration, that we should be able to insulate ourselves from such choppiness. But then when we made the 2 products that are a part of the vertical integration, then we realized that there is a market for these products as well. But then that is supplementary and that will be just an add-on. We are not talking of any numbers as far as those products are concerned for vertical integration. But it's clear that when we will make them, and we will make them at a scale at which we plan to, there will be incremental top line opportunities as well where we will sell to third parties and not just consume.

Next question is from the line of Ritika from Values.

I have one question. Sir, one of your customers have seen warning letter for the sole formation plant, which is for [indiscernible] as well as [indiscernible]. Wanted to understand if we are seeing any kind of risk from this warning letter that we've received, Optimer, and we are going ahead what our plan of action or is there any communication if this escalates to [indiscernible]. Anything on that, if you can help us a understand?

See, Ritika, we know only as much is there in the public domain. And even if we would have more information, let us say, just in case we did, it's a very sensitive matter and we will not be able to talk about these things on this earnings call. But then as you have yourself very rightly said that they yet do not have an import alert, so which means that the commercial impact should not be there. It's in the time that there's an import alert.

I think it's also not reflecting in our production schedules or their offtake requirements, not a particular customer, but in general, in this particular vertical.

Sorry. So just now currently, there is no supply disruption to this. Is that what you mean? Going ahead, obviously, you do not know. But up until now, we've not seen any supply disruption from this?

From my side, I think it's business as usual in this particular segment. And we don't foresee any disruption in the coming quarters also.

Next question is from the line of Shashank Krishnakumar from Emkay Global.

I think in one of your earlier responses, we mentioned double-digit growth in contrast media in FY '27. So does that imply it will potentially exceed our FY '23 peak in terms of revenue in FY '27? And a related question is,whether this trial order from a Japanese customer, which you mentioned in the presentation, whether that will also contribute. And also wanted to check which product are we referring to for the new customers, is this iodinated APA? Or is it some new product? Just wanted to check that.

I think our endeavor to meet this double-digit growth, I think, is backed by certain visibility by our customers. Now it's more about execution. So I think we'll be more comfortable limiting this indication as of now.

Got it. Any comment on this new product which you are shipping to a Japanese customer, which one is...

It is a trial quantity. But I think the clinical indications are extremely encouraging from a future growth perspective.

Perfect. And just the second one on the artificial sweeteners, which we have been referring to. So will we see any meaningful commercial volumes in FY '27? Or will it largely come onstream once the Vizag facility gets commercialized?

I think it would be the most significant milestone if we are able to deliver this key validation. I think our objective would be to meet our quality targets, efficiencies and yields from this particular milestone. Once this is completed, we'd be more happy to share the future updates around it.

Next question is from the line of [ Mehta ] from Unifi Capital.

A single question on the contrast media business. if I look at our commentary a year ago, 2 years ago, we were speaking about having a step jump in contrast media business. So I'd like to understand, do you see FY '27 as step jump year in terms of growth? Or it will be a steady growth? If you can elaborate on that, please.

I think when we look at step jump, I think it's most important to understand how the company is looking at new launches and from our perspective, our double-digit growth at the back of certain launches. And I think it's quite encouraging to start with.

Next question is from the line of [ Dhiraj Kumar Reddy ].

Am I audible?

Yes, you are audible.

I have a couple of questions. The first one is, I know that you made [indiscernible] intermediates. I just wanted to understand, from your sense, how many competitors are there across the globe and typically, even if someone wants to supply, what is the typical timeline for these intermediates? And typically, how many players end up actually getting the supplies right?

Are you referring to contrast media?

No. See, the critical thing to understand is that the molecule is still under patent. So there will not be any great number of suppliers or people who are selling the product in the market. Once the patent expires, then of course, the market will get inundated by suppliers. So at the moment, it's protected.

Got it. Sir, my question is basically what stops like another South player who is actually doing an API into getting into the intermediate? What gives us the competitive edge in actually supplying this intermediate?

Competitive edge. Firstly, this is a very advanced intermediate. And anybody, everybody cannot supply because of the complexities and because of the regulatory pathway, right? And what gives us a competitive edge are the chemistry and the fact that we have a dedicated plant which is highly automated and the fact that the unit operations, we are extremely good. So that gives us a competitive edge. And of course, to add to that, scale.

Got it, sir. Sir, my next question is, basically, I know we will be entering the peptides, which will be the next phase of growth probably in Vizag. Sir, I just wanted to again understand like how much time has the company or organization invested into this particular category? What is the sort of capability building you are currently going through? And if possible, even in terms of R&D, how many scientists are being allocated? And how do you see this entire vertical probably? If not, say, like 3 years, maybe 5 years out, how do you see which kind of categories are you focusing on? What is the kind of the peptides you are currently working on?

Peptides have been on the market for decades now. But then because of certain new indications for which peptides are getting qualified, the market has grown exponentially. At Blue Jet, if you see our trajectory, we are a company which has always focused, grown and built ourselves on building blocks. On the peptide side also, our starting point is doing the building blocks for the peptides or doing the peptide fragments. There could be pentamers or decamers or whatever, but peptide fragments, which will get joined to make the peptide. As we advance and we get clientele and we get experience in doing the peptide type blocks, doing the final peptide will be the natural corollary. But that will come after some time. And at Vizag, we do plan to create the capacity that can be deployed for peptide manufacturing production.

Understood. Sir, in the initial peptide phase will be margin accretive? Or do you think they will have slightly lower margin? Because again, these are very starting intermediates.

The margins will be very good, in line or better than what we have. But then you must understand that as compared to the other segments, there could be faster, higher price erosion in this segment. In contrast media and the patented CDMO segment, we don't have that type of price erosion, which perhaps we may see in the peptide segment.

Next question is from the line of Ravi Purohit from Securities Investment Management.

Just two things. And if you look at contrast media production -- I'm sorry, revenues for the current year is INR 190 crores. Is it fair to assume that's like peak capacity for our contrast media division? Like if I refer to earlier calls, I mean, typically, I think we have mentioned about INR 600 crores to INR 800 crores kind of range for our peak capacity. So if you could just kind of help us understand whether that is the case here as well. And second was on the pharma intermediate. I think we had mentioned that we are talking of growing above the levels of FY '25. So FY '25, I think our revenues were some INR 260-odd crores. So have you already started shipping to the customer as in from -- or it's still in orders that are in hand and shipping will kind of happen during the year?

I think as far as contrast media is concerned, we are far away from the peak utilization levels because of the ongoing works from the company side in terms of capacity creation, debottlenecking across products. And you also see a large capacity being built in Unit 3. I think all the capacity creation is in sync with the customer needs from a 5- to 10-year perspective, I think we are very well positioned as far as contrast media is concerned. In terms of pharma intermediates, I think the outlook as a segment is very encouraging. And we just have to execute our plans well despite what we are seeing geopolitically in terms of the raw material prices and everything. I think as a segment or as a vertical as a whole, it's quite resilient. We've been able to, in some cases, pass on -- have a pass-through mechanism on the pricing and the margin security standpoint. So both from a top line and a margin sustainability standpoint, I think we should be well positioned in the PI vertical.

Okay. And in contrast media, how is the pricing arrangement like? I mean, so is this INR 192 crores revenue in this current quarter, does it also reflect some sort of higher prices? Or is it normal prices? There is entirely volume growth. And if price escalations do happen because contrast media is a very large -- sorry, long period contracts that we have from our customers, right, our largest customers. So if you could just help us explain how this pricing works on the contrast media side.

I think without going into the specifics, but I think in the past few quarters, we've seen a volume growth. I think that should answer quite a few aspects around this vertical.

And the optimism for the current year FY '27 also is on higher volume growth this year as well, right?

Partially due to some volume growth but also due to the new launches that we are expecting.

Next question is from the hand of [ Sachin ] from Global Country.

Am I audible?

Yes, you are.

I had a question regarding the demand trends. So how is the inventory destocking trend shaping up from the global innovator? And what is the overall demand outlook for your key molecules going forward?

I think the end market in all our 3 verticals, they are growing. And I would say all 3 of them are sunrise segments. And if you are talking of the CDMO PI vertical, then one of the key molecules is showing a fantastic growth at the final formulation level. So I guess Blue Jet, in all the 3 segments with our key customers being as a primary and main supplier and a supplier with scale, I think we are very well poised to capture the upside that we will have in these opportunities.

Next question is from the line of [ Ashwin Patel ] from Telligence Limited.

Already answered my question. Thank you.

Next question is from the line of [ Keshav Bagri ] from Family Office.

About the pharma intermediary in API segment...

I'm sorry to interrupt, Keshav. Can you repeat your question, please?

Am I audible?

Yes. Right now we can hear you. Please proceed.

I just had one question. I joined the call a little late. So please excuse me if my question is repetitive in nature. I just wanted to check on the pharma intermediaries and the outlook for this segment for the coming fiscal year.

Keshav, we don't really give guidances. But then all that we will say is that whatever destocking had to happen has happened, and the plant has been now running to optimum capacity and the shipments have started rolling out. And you will soon see that in the data.

So the worst is behind for this particular segment, sir?

Absolutely. That's a good summary.

Next question is from the line of [ Saket Saurabh ] from Sage Capital.

Am I audible?

Yes.

So sir, the question was pertaining to one of the private equities acquiring our innovator company. In the past, there have been cases that while a change of hands of stand-alone companies is a normal phenomena, but those change of hands sometimes also leads to supplier consolidation or vendor consolidation. So any thoughts that you have had or any interaction that we've had with the private equity folks are the new owners as to -- regarding this continuity of supply? Or any thoughts that you may have on this front?

I think given the product, where it is in the life cycle, it's patent protected. So typically, any change has a regulatory pathway. I think from our standpoint, we feel that the end molecule is growing. So there is definitely some merits from a medium to long-term perspective. So we are in the right game. And it's quite encouraging to know that it's acquired by a stronger partner. So from our standpoint, business as usual. There are certain positive growth levers around it as well.

Okay, sir. That's encouraging. Sir, coming to the later opportunity that you talked about. So is it safe to assume these are more like lifestyle and life cycle management products that are on the verge of going off patent? Is that a fair way to describe those lateral opportunities? Or do you say recently commercialized, are yet to hit their peak market?

These are CDMO opportunities, which has some sensitivities around CDA. But I think from an execute perspective, we feel that it's worthwhile investing in capacity buildup.

But yes, they are all in mature phase.

Okay. Got it. No, that was what I was guessing. Now specifically to the peptides one. Now you talked about GLPs, so these are weight loss opportunities or more like metabolic disorders? And also in some of the cases specifically semaglutide, we have seen a fair amount of price erosion given the increasing competition that is getting into that space. So any thoughts on is that a risk in our opportunity as well, the price erosion thing? And are they pointing to weight loss or the non-weight loss areas which is still an emerging space, sir?

I think they are in both categories. As far as the price erosion part is concerned. I mean, it's too premature for us to comment. We have just about started sending some small validation quantities. So this, let's wait and watch. Let's see.

And is it safe to assume this is non-semaglutide.

We wouldn't comment.

Next question is from the line of Shah Sha from Alternate Asset Managers.

Am I audible?

Yes, you are audible.

I just have one question pertaining to the fundraise. Are we looking to raise funds in particular to the Vizag investment? Or any sort of plans?

We are actually like -- I think the situation is dynamic right now. I think we'll be able to update you in the coming quarter. But I think from a company standpoint, given the liquidity it has, I think we are rather accelerating our CapEx plan. So we are well positioned as a company.

Thank you. Ladies and gentlemen, that was the last question for today. I now hand the conference back to the management for closing comments.

Yes. We thank all the participants, and we will see you in Q1 call. Thank you.

Thank you very much. On behalf of Blue Jet Healthcare Limited, that concludes this conference. Thank you for joining us today, and you may now disconnect your lines.