Emcure Pharmaceuticals Limited (EMCURE.BO) Q1 FY2026 Earnings Call Transcript & Summary

Ladies and gentlemen, good day, and welcome to Emcure Pharmaceuticals Limited Q1 FY '26 Earnings Conference Call. [Operator Instructions] Please note that this conference is being recorded. Today, we have on call Mr. Satish Mehta, CEO; Mr. Samit Mehta, Executive Director; Mr. Vikas Thapar, President Corporate Development, Strategy and Finance; Mr. Tajuddin Shaikh, CFO; Mr. Piyush Nahar, EVP, Corporate Development and Strategy. I now hand over to Mr. Piyush Nahar. Thank you, and over to you, sir.

Thank you, Ash. Good afternoon, everyone. Earlier today, we released our financials for the first quarter of fiscal 2026 along with the press release. These are also posted on our website. We hope you all had a chance to review it. I'd like to bring to everyone's notice that this call is being recorded, and the recording and transcripts will be available on our website. Before we begin, I want to remind everyone about the safe harbor related to today's investor call. Today's discussion may include forward-looking statements, which must be viewed in conjunction with the risks that our business faces that could cause our future results, performance or achievements to differ significantly from what is expressed or implied by such forward-looking statements. At the end of the call, if any of your queries remain unanswered, please feel free to connect us. Now I'll now request Mr. Satish Meta, our CEO, to provide the opening remarks.

Thank you, Piyush, and good afternoon to all of you. It's a pleasure to speak to you again post our first quarter results of FY '26. I am pleased to share the positive results of your company to start off the fiscal year ahead. We had a strong start to the fiscal year with all businesses, all verticals showing excellent growth. Overall, our revenue grew by 15.7% year-on-year, while EBITDA grew by 20%. Our profit after tax PAT grew by 41%, and we reported our highest quarterly profits of INR 215 crores, a repeat INR 215 crores. Let me now provide key business updates for the quarter, which ended. Our domestic business grew faster than the industry in the quarter under the reference. We saw strong growth in all our key therapies as it gynic, cardiac, anti-infective and vitamins. As I told you in the last call, our new initiatives that we have taken in Derma and consumer wellness are seeing a positive trend and strong traction. We expect Derma as well as consumer wellness to become our key growth drivers in times to come. We continue to take steps to strengthen and synergize. We continue to take steps to strengthen and synergize our domestic business. We expanded our partnership with Sanofi for the diabetes segment. You are aware that is part of the public domain. We'll now be marketing and distributing Sanofi's oral diabetic portfolio, with key brands, merit and [indiscernible] . These 2 brands one will be promoting from first of August. As you know, 15 months back, we also had the cardiovascular portfolio, and we have done a reasonably good job. Now with this cardiovascular portfolio known as metabolics, I'm pleased to tell my shareholders whether that your company is emerging as a strong player in the field of cardio [indiscernible] diabetes segment. We were strong in cardio with Marin and [indiscernible] has every reason to believe that we will also emerge as a player to return with in metabolic Digital segment as well. I am pleased to inform that we are strengthening our team with some significant additions. I'm happy to welcome Mr. R.S. Vasan into the Emcure family as President in the business. He brings with him rich experience in managing India formulation business for the last 40 years, we're still with various multinational and Indian company. And as far as this last 15 years sir, you were still only Sun Pharma. We remain confident that we'll continue to grow above industry during the year is the steps that we are initiating, and I'm pretty confident about our journey in the domestic business. With a bit some briefing about the domestic business, let me now move to the International segment. Our International business grew strongly by 20% with all the verticals, all the geographies seeing a pretty good traction. Our Canada business around Michel, I spoke to in previous quarters, continues to show strong growth led by market share gains and new launches. Our Rest of the world, we call it as emerging markets is also seeing a strong traction in both ARV and non-ARV segments. This is led by new product approvals in our target countries. I told you that we have a reasonably strong presence in ERV, but at the same time, the strategy is to a stronger non-ARV segments, and this is driven by unique products so that we are also selling in the emerging markets. I'm happy to inform that grew and double-digit growth, and we have a healthy pipeline going forward. As mentioned in my last call, Emcurehas embarked on a journey of growth and improved margins through innovation, partnership and newer geographical reach. This is the first year of 5-year vision to take Emcure into the next orbit. I repeat, this is the first year of our 5-year vision to take Emcure into the next orbit. During this period, our focus will remain on building strong foundation through investments in new technologies, processes and above all, people to deliver highly profitable and above average growth. I'll repeat our focus will remain through investment in new technologies processes and people to deliver highly profitable and above average market growth. Let me repeat once again that Emcure remains an India focused company with huge opportunity to tap the unmet medical needs of over 1.4 billion AUMs. We are very, very committed to the domestic market. All I can say is that we at Emcure are very excited are absolutely excited in this phase as we see a huge opportunity unfold ahead of us. We remain focused on building a company that creates everlasting value for all its stakeholders. We remain focused on building a company that creates everlasting value for all the stakeholders. I'm very satisfied with what we have achieved so far and even more excited and even more excited about what lies ahead of us. I will end my opening remarks by saying, [indiscernible] this space as more and more exciting opportunities unfold, helping make your company one of the most admired companies within the pharmaceutical industry, watch out for this particular space. as together with new people, your companies will emerge as one of the most advanced company within the pharmaceutical industry. Let me touch base on another topic of interest before I conclude. We all keep on talking about tariffs and what's happening with the Trump administration. Unfortunate, but true that 50% tariff has been launched with exports from India. And you never know what is going to happen about the pharma industry [indiscernible] President tumors about it. But I want to highlight that your company is predominantly insulated from U.S. market with our exposure to U.S. being less than 3%. Let me remain that as far as more is concerned, your company is predominantly integrated from the U.S. market with our exposure to U.S. being less than 3%. With these remarks, I will now pass on the call to my CFO, Tajuddin Shaikh, to share the financial details of last quarter before we open up the floor for your questions and answers. As to your pleasure in talking to you, and thanks for making it convenient to attend the call which means a lot to me personally and obviously to the company, your continued interest in Inc. Thank you very much.

Good afternoon, everyone. Thank you for joining us today. Before we move to the q&a, I'll take you through some of the key financial highlights for the first quarter. Revenue from operations for the quarter grew by 15.7% year-over-year. to INR 2,101 crores, up from INR 1,815 crores in Q1 FY '25. The domestic business grew by 9.4% year-over-year to INR 995 crores driven by strong performance across all key therapies. International markets maintained solid momentum, growing 22% year-over-year to INR 1,106 crores. Emerging markets grew impressively by 42% year-over-year to INR 360 crores with strong contributions from both ERV and non-ARV portfolio. Canada reported a 16.4% growth to INR 342 crores. Europe saw robust growth of 12.8% year-over-year, reaching INR 403 crores. Gross margins for the quarter stood at 61.8% versus 57.8% in 4Q and 62.4% in 1Q of '25. The change was driven largely by product and business mix. EBITDA, excluding other income, grew 20.1% year-over-year to INR 404 crores. EBITDA margins stood at 19.2% versus 18.5% in Q1 '24 and 18.4% in Q4 '25, supported by strong operating leverage and productivity gains. Depreciation and amortization was flattish quarter-over-quarter at INR 99 crores. Interest cost was INR 27 crores, reflecting lower borrowings. The effective tax rate stood at 26%. Profit after tax came in at INR 215 crores, showing strong growth of 41% year-over-year. With that, I will now open the floor for questions.

[Operator Instructions] The first question is from the line of Mr. Amey from JM Financial.

Hello am I audible?

Mr. Amey are you on the line? Mr. Amey can you come again?

Yes. Am I live?

Yes, sir. Please go ahead.

Yes. congrats on good numbers. So I had done it late. So in case I'm repeating the question just -- so basically, the 9% growth, which we have delivered this year in India, -- is it fair to assume that this base is on the normal base as well, if you can give us the breakup in terms of the volume and price for this 9% growth for the quarter?

Sure. Yes, this is on a normalized basis. So there's nothing that. I think in terms of the price volume, volume would have been about 4% price about 4% and about a couple of percent of to new launches that we have.

So is it fair to say that from the negative trajectory of volumes in post COVID for 2 years than last year around 2% volume growth, what we have seen. Now we are moving towards like 4% to 5% kind of a volume growth for the full year?

Yes. That is what we are targeting.

Sure. And going ahead, because there will be diabetes sales additions happening, right, from the Sanofi. So how should we look at the number for the full year? Is it possible to quantify how much of the sales coming in from the Sanofi Diabetes portfolio?

Sanofi would roughly be about INR 200 crores portfolio annualized that we'll have. So we'll get about 9 months of that in the year. We started from August, yes.

I mean 7 months, 8 months we'll be getting in the current year. And on an annualized basis, it is INR 200 crores.

Got it. And in terms of MR addition, has there been any mirror diabetes or we will be working with same cardiometabolic MR?

Yes. So we've already had 3 divisions in the cardio diabetes state. So we're not adding new MR. This will get fit in the current one.

Sure. And the last question I have on the FCM performance, if you can elaborate for this quarter how the performance will be especially now the competition has been largely settled in...

So I think there, on the prescription side now, we're actually seeing revival on growth. So this quarter, the -- or FCM grew in double digits for us. So that is doing well for us. I think there we're seeing where I think it's still a bit more challenging is on the institution side, where pricing -- some of the competition is still there at lower pricing. But I think on the promoted side, we are seeing traction and revival.

And just to add this, this is Satish Mehta, I mean, the promotion, we are essentially focusing on quality and certain parameters where we are better than the competitors -- because as you know, this particular product incur brought in the company for the first time. So we are having a lot of data and the scientific promotion is also helping us. And I think we are getting the traction going forward. And as [indiscernible] slightly said, in prescription market, we are doing well. But when it comes to the question of institutions, the challenges remain.

Got and just last question, like how much would be the mix in terms of prescription and institutional for us for that particular product franchise?

FCM asking or for the overall?

For FCM franchise, how much would be the...

I think now a majority will be prescription-driven now. Okay. Sure, sure. So that should start reflecting in our performance in the subscription.

The next question is from the line of Mr. Alankar from Kotak Institutional Equities.

You had spoken about further launches in FY '26 in the women's segment in the previous quarter. Can you take us through the progress on that front?

So yes, at, we have launched 2 areas. One is since we talked about it and second is on the Benefit. Both of them have been launched in last quarter. I think as we have talked about last time, these are new concepts we are trying to establish in the market. So early days, but we are seeing good traction out there. But I think it's for them to become material will take time because we are still establishing these concepts out in the market.

Understood. And also, if you can comment to you, the performance of the IM portfolio in this quarter?

On the have the numbers of the portfolio [indiscernible] yes. So Guidance has done valuable for us, which includes largely iron I think there, we are doing much ahead of the industry. So even if you look at IQVIA, the IPR reflection is about 13-odd-percent growth in the Ganasegment. And so all of our parts continues to grow in double digits. FCM has already talked about on the prescription side, we are again now in double-digit growth. So that end segment is now back on growth move for us.

Understood. Just one question there before I get into the international business. So on FCM, a clarification, if I take into account both the prescription business as well as the institutional business, was there any drag at all if I look at the reported domestic growth in this quarter?

It would still be about 1% drag. So ex of that would have been about 3.5%.

Okay. So adjusted for FCM, the growth is about 10.5% in India? Okay. Got it. Then on the international bet, was there any meaningful benefit of the amputation we launched in Europe in this quarter? Or we expect the ramp-up to be more gradual towards the course of the year?

Yes, this is Samit. In U.K., yes, we have started actively supplying. However, in Europe, as we had told you over the last call, we got the approval under the -- and each country typically takes anywhere between 3 to 5 months for its own national approval we start which we expect to start from the end of this quarter. So I think the ramp-up in the second half of the year will be much higher than what we will see in H1.

Understood. That's helpful. And a quick one on ARV and non-ARV. Now Satish sir mentioned about good growth in both ERV and non-Rand RW, what was the ARB contribution in this quarter?

ARV would have been roughly about half of it.

Sorry, you mentioned 50%?

50%, yes.

And final question from my side, any update on the filing of semaglutide in Canada?

Yes. In a in Canada this month, we will be executing our filing batches. So I think we continue to be on track to file towards the end of this fiscal year.

Got it. And in India, I'm assuming we are on track to be amongst the first way of launches, as you had mentioned earlier.

Yes. That continues to be our effort.

[Operator Instructions] The next question is from the line of Mr. Gagan Thareja from ASK Investment Managers Limited. Please go ahead. Could you speak a little bit louder, please?

All right. So the first question is on -- is it possible to give some flavor on how the Sanofi cardiac portfolio is doing for you or 1Q of this year compared to last year.

So the Sanofi portfolio, I think it's broadly similar to what we have reported for the overall domestic growth it's been going in line with that. I think the -- our target for Sanofi has been to grow that in line with the IP. And I think that's what we have been there in 1Q.

And on the additional diabetic portfolio that you acquired from Sanofi, is it possible to understand the rationale -- are these drugs not generally not seeing a slower sort of growth given that we've had a new generation of of drugs coming in for diabetes or these still constitute the first line of treatment and therefore, will you expect them to grow healthily.

Gagan this is Satish Mehta. [indiscernible] continues to be first kind of treatment and products like glycomate and others, they continue to have traction. If you recollect in the call so that I had probably a year back at that time, I was trying to communicate to my equity holders that we would like to be strong in, say, skin care, dermatology, we would like to be strong in metabolics. As far as Skincare is concerned, we took a big step by getting somebody like super starting in cities and getting traction. And as far as metabolic is concerned, this is a book are which will connect me to all the major consulting physicians and diabetologists with the help of that I feel that there will be rebound effect on other products and will do well. As you know, our brand builder leptin is doing quite well. That's one of the top 3 brands post. So with Amiril coming to the fold, our position in the diabetics segment, metabolic will significantly strengthen and that will also help us when we go for Semanta and when we get the OE -- so this is plan of overall strategic thinking because with Mr will get a good connect with the doctors and obviously, the same doctors are my potential prescribers to version look at as well.

Okay. And was the sales force also transferred to [indiscernible] from Sanofi for these?

No, that is explained some time back. We already have 3 divisions in cardio divide. So -- this is going to be one of the divisions.

All right. And is it possible to understand the contribution? I mean I understand it's early days, but it's still possible to understand how the Derma and consumer awareness divisions are ramping up? Any flavor would be helpful here?

Currently, we are in the investment mode. I mean, we just started a few months back. And even put model in pharma, the gestation period is 18, 24 months, -- but at the same time, the we are getting prescriptions and in the unique preparations, we are launching in the Derma segment and also whatever Namita is doing in earth that is obviously very well see but this is a patient game. It's not going to happen in a day. It has taken me 30 years ago to get the company to this level or by foretime to the year

I think -- just to add. I think what we had guided last time is that overall, we think that these 2 new initiatives should drive about 1% or 2% additional growth in our overall domestic business. So I think we're on track for delivering that for the year.

Thanks, Vic. Very helpful.

And one more, sir, on the asparaginase and the MD product, any further updates on when you believe you can come into the market with these?

Sure. So for the Ras person is, we have already submitted our dossier to CGI, and we're waiting to hear from them in terms of when they construe the SEC and when it will be reviewed. So fingers crossed there. And on the wet end, we are also very positive in the sense that we should be completing our clinical trial by the end of September. So whatever time it takes after that to compile it dossier and submit it to the CDC. So very hopeful that at least one, if not both, should get approval in this financial year.

A final one from my side, sir, you could give us the latest gross debt position for the company?

Latest gross it is around INR 700 crores.

The next question is from the line of Mr. Bharat Shah from ASK Investment Managers Limited.

Yes. Satish, it was good to hear the 5-year journey that you outlined, which will be marked by not just new partnerships but new innovation, driving new products and geographies and is underpinned by investment in people processes and technology. So that's [indiscernible] to hear that we feel that on a sustained basis, the growth will come in, so which this quarter is marked retort. Just to put a little bit of skepticism on that, if you pardon me, but ultimately, in the pharmaceutical business, sustained and predictable growth will come only from a refresh portfolio of products. The well-aligned therapeutic areas. And all of that is to be driven by new products developed through the sustained research effort. But a large part of our portfolio, my impression more [indiscernible] . And therefore, how do we aspire to remain on a continuous growth journey? Or what are the steps being taken so that we address these game on Internet behind half the business and...

Can I [indiscernible] a step back and tell you, in 1995, when I began my journey at everyone this way at me, from entering into the market and my friends from multinational as well to the extent of saying [indiscernible] . Our market is very fragmented, very, very competitive and you are one of last -- now when I'm talking to you in 2025, the reason why we have done well is because of science, innovation and technology. And I take pride in telling everyone that as far as my company is concerned, it is in the forefront in launching new products and we're giving new products to the industry. To give you a few examples, I gave more 11 products in the field of [indiscernible] -- similar, esmolol, et cetera, like they have been doing exceedingly well. We gave [indiscernible] for the first time. We gave very carboxymaltose about which Amestesometime back Percarbonates. Similarly, we have given 7 biosimilars and now Samit just told you some time back, we were talking about expense, we are talking about bevacizumab. So to that extent, as soon as gene of the company is concerned, it is driven by science and technology, and we are doing a lot of work in R&D to that extent, I'm very confident that going forward, my company will be in a position to bring new products because [indiscernible] you are absolutely spot on. the competition is very intense as far as new 2 products are concerned. To that extent for any company to survive and make headway, it has to focus on science and technology, and that's one area where we are committed, and we are taking a lot of steps in that direction. Would you like to add something Microloan?

I think when we spoke about the 5-year vision internally for each of the years, we have already identified which is the product launch for which a lot of the work has already been done, whether it is filing batches or submissions. So we have very crystal-clear clarity on each of these 5 years, the one big blockbuster products. So for example, like we did mention liposomal amphotericin B similarly across the years, building on the liposomal platform. There are a few other products there's, of course, GLP-1s and within that, some incremental innovation that we're doing. And of course, towards the end towards year 4, year 5, there will obviously be what we've spoken about earlier and which we've honestly started at for the whole space of ADC. Vic, would you like to add something it?

I think it's covered.

So basically, what we are seeing is it is not merely a reason good to say kind of a statement, but it is -- in other words, it's not just good in dish, but there is a decent mathematics behind it.

Absolutely. There is absolutely a clear vision and game plan as far as the lowest therapeutic segment is concerned. So the strategy will be clear. R&D will drive. One, the second thing, we like to work with multinationals. We are demonstrated by working with Sanofi, we've got a big portfolio, something similar will happen. That is number two. And third part of the strategy, we'll be working at a global level to get some products like Samit mentioned about AEC or maybe something in Phase I pick them up and see whether we can develop for the domestic market. So there is absolute clarity at the senior level about the way the new products we will launch in Asia and every therapeutic segment would have been.

No, that is very happening to know. A related question, you mentioned Satish way that this 5-year journey will be marked rate above average growth rate. And could you be a little more specific as to what is meant by that? Will it be double-digit very healthy double-digit, what kind of growth did you have in mind? And also on the margin, make a comment, from 20% of that we are now wait. Do you think our margins also what kind of trajectory would hold out?

So I will break it in 2 parts. As far as the growth part is concerned, I will answer margin part which will answer. As far as growth is concerned, I would like to have 2% more than the industry growth, whether we are talking about India or other markets, okay? Other markets are also very, very competitive, Europe and Canada. So that will be the aspiration. If you grow by more happiness. But at least now as well, the basic objective will be to grow by 2% more than the industry growth in various markets. And regarding margin, we have been talking that there is a journey towards the desired results, I will ask him to opine on that, Rick?

Yes. So what we have guided, if you can hear me, is that from the roughly margins that we've guided to for this year, we should continue the journey of increasing our margin profile by about 300, 400 basis points over this 4-, 5-year journey, which will be driven by obviously both productivity gains in terms of our India business as well as improving our gross margin profile with the business and product mix that we will be working on in the pipeline, and overall operational effectiveness in terms of just the scale economies we will get as we continue to scale different verticals within our business.

Which means about 20% operating margins now over the 5-year period, it should be somewhere in the end of 23%, 24%.

That continues to be the goal and aspiration that we'll be working towards.

And one last thing. When do we think the INR 700 crore debt on the books is likely to become CEO?

If I can just add there, and guided on the debt was that barring any M&A that should be approaching close to 0 even by the end of the current fiscal year. Having said that, 2 of our recent announcements, 1 was with the acquisition product portfolio for Max, which is going to be paid for in various milestones as well as our recent announcement of acquiring the minority stake from Zuventis. I think these 2 initiatives will obviously add to our gross debt position which will probably push out our debt going to -- approaching 0 by at least 1, 1.5 years going forward. Having said that, both of these initiatives, we think, are going to be very accretive and I think it's money well spent over the -- that we have announced.

We very much value your support and thanks to all for participating. And kindly feel free to reach out to any time. We are available 24/7. We value your support Macao -- all of the -- thank you.

[Operator Instructions] The next question is from the line of Mr. Tushar Manudhane from Motilal Oswal Financial Services. Please go ahead, sir.

Thanks for the opportunity. Joined which leads, I'm not sure if you already addressed. But just wanted to understand on the gross margin front quarter-over-quarter, where it's a business composition in terms of geography has not changed much, but we've seen good improvement in the gross margin. If you could just elaborate on that first?

So the gross margin, I think what we indicated last time, right, it's largely driven or by the product mix in the international market. So I think you have to look at more at an annual level. For an annual level, I think what you indicated is we expect this year to be about 50 basis points higher than what we ended last year. So -- but between quarters, you will have variations depending on the product mix that you have of our businesses.

And therapy-wise as far as the India market is concerned, of course, there's secondary data available. But if you could throw some light in terms of these therapies, we have sort of performed better than the industry and where we have dragged?

So I think Cardiac and gynax have done much better. Cardiac also has been more in line I think. So those 2 have the others, I think we have more or less in line the industry which has -- what has driven a bit more as I talked about is some of the new launches and all have come up.

And as far as the emerging market is concerned, where we have seen on a year-on-year basis, sharp increase in the revenue, but how to think about it on an annualized basis for next 2, 3 years?

I think for this year, what we had indicated is that for the emerging markets, we expect to grow in high teens to 20% around that.

And again, what we happen to emerging markets when we are talking about, say, ARV and non-ARV, ARV is a function of winning the tender, so there is an element of uncertainty -- so it's very difficult to predict now what happens though the company is in a good position. And as far as on ARV is concerned, that is also a function of getting registration in various countries. And if you get the registrations for some [indiscernible] products that we market, and that gives there will be uptick. So I think one can ask you rightly said, when we talk about the base business. So as I mentioned some time back, normal growth was 2%, that will be the aspiration. But suppose if we get to some of the products registered for which the number of fights are pending, there will be obviously be an upside.

And as far as, let's say, operational cost, is it going to have some meaningful increase, let's say, FY '26 FY '27, or is it more to do with like inflation being the increase?

I think it's largely inflation base and the business growth driven.

Sir, as far as our business growth is more than the inflation, then effectively, it should help get much superior EBITDA margins as we go along rate?

Yes, that is the intention. That's what it was indicated. Yes. So I meant to ask effectively that should reflect in itself, where FY '25 at least the EBITDA margin or Q1, it was similar to the fourth quarter or first quarter. So I'm just trying to ask that when do we see that improvement in the margins?

I think what we had guided last time was that even on operating cost side, we should see about 100 basis point improvement vis-a-vis last year on account of both of these areas, a better productivity with the Indian field force as well as some of the scaling of the business and better utilization of our manufacturing facilities. So overall, as the business continues to grow healthy double digits and inflation where it is. That's where we feel bullish that we'll continue to get roughly that 100 basis points of expansion that we had indicated.

The next question is from the line of Mr. Alankar from Kotak Institutional Equities.

Samit, you mentioned about working on an incremental innovation in GLP-1. Can you please elaborate on that? Sure. So in terms of some of the approved GLPs, we are looking at some tweaking in terms of improving the compliance through different dosage systems and the incremental innovation within the formulation space.

Okay. And I mean, currently, our filing both in India as well as markets like Canada would be through the synthesis route, right? Cement Yes, that is going off patent in 2026. The fegmentation route, the semisynthetic is going off in 2028. So we'll be fully synthetic right now. Fair enough. The other question was on the Juventas acquisition. Now due to this acquisition, will there be any change from an operational standpoint in the acute business?

Yes. Okay. Fair enough. And the final question is more of a clarification on what Vik just mentioned. I think in the previous call, we had spoken about 150 basis point EBITDA margin expansion for FY '26. So is it 100 basis points or 150 basis points guidance for FY Yes.

So I was specifically alluding to the OpEx portion of it as 100 basis points, you should just mention that we also anticipate 50 basis points expansion in our gross margins based on the product and business mix.

The next question is from the line of Mr. Gagan Thareja from ASK Investment Managers Limited.

The first one is on the RV, I believe there's going to be a retendering cycle this year, later this year. Any idea you can give us in terms of whether funding agencies from a budgeting standpoint are going to be constrained or that is not a constraint whatsoever. And secondly, [indiscernible] category now has been post the Phase III trials, even WH strongly recommends for prophylactic benefits to take up in a category? How do you see this evolving over a period of time, do you see [indiscernible] becoming the first line of treatment perhaps in the next 2, 3 years?

First question, you take [indiscernible] will take -- and I will also chime in.

Yes. on the tendering, I think as of now, we haven't heard anything that there have any constraints on happening. I think most of the tenders are continuing as normal. So we haven't seen that impact.

And in terms of Lenacapavir, absolutely not entirely certain how long the duration will be for that becomes the treatment of choice because different countries and different agencies have to change their adoption protocol. But definitely in the medium term, it should be one of the dominant therapies as far as the ARV space goes.

Gatan, one more thing I would like to tell you, if you see the latest issue of economist, they are extensively covering and or constraints, I would like to flag off one as far as the Piping is concerned to restore, but at the same time against $3.5 billion that they have been giving it has been reduced to [indiscernible] , if I remember correctly. The second thing that has been happening in the Americas and in the most generous in terms of contributing to global fund, there also the funding has been reduced. So I think what really happens after couple of years as in we [indiscernible] the market. I think the product over can question the security on this particular article also says the Venator is going to be a game changer. But the funding of global funding, [indiscernible] funding, then all the governments, which will be interested in buying that will also play a very important role because unlike what is happening right now, like TLD, it is not going to be that cheap. I believe. Samir, can I say that? TLD is not -- it's going to be a game changer, but at the same time, there will always be a cost attached to it. So when we will wait and watch how it plays out. But it's technological breakthrough. Let's accept that. It's a big thing.

And is it possible to give some idea of the EU business growth ex of the bank's numbers, which I believe would have been there in the contribution for the first quarter?

[indiscernible] was quite small. It has been about $1 million to $2 million in the quarter. I think Max will ramp up over the quarters.

And any possible to give any idea of how you see the scale up in liposomal amphotericin and Tenecteplase, over the next, let's say, 2 to 3 years what sort of scale? Is it possible here? And also in the other 2 products, which are under trials for you? Any possible [indiscernible]

Sure. So in terms of lysosomal ambition, like I mentioned, we have approvals in a lot of the major markets, but there are still a few big markets where our product is likely to get approved in the near future. the kind of capacity we have created and the bets we have taken on this product are pretty significant because there are 2 different facilities with large lyophilization capacities that we have installed and are ready to churn out product. So I don't see any constraints coming in, in terms of capacity. And I think the full effect of all the approvals and the MAX volumes will probably materialize in the next 12 months across different geographies, probably in Europe and U.K. and U.S. will be more near term in the next 4 to 6 months. But some of the other big emerging markets where the full potential will probably take 12 months.

Now the second question that you asked was regarding Connected and other...

Yes. I'll come to that as well. So on connected players as well, not only are we seeing new registrations slow in for the original indication of MI, which is your margin in faction. But surprisingly, there's a lot of interest and uptake also happening, which is doctor driven from those countries for the indication of stroke. There are countries which have started picking up small volumes on a name patient basis they are seeing excellent results, and they are now pushing towards getting full registration, which will then have a log-fold increase in terms of the kind of uptake that happens. So [indiscernible] play is going to be, again, in the next 18 to 24 months, a very dominant product for us. And in terms of the other 2 in the pipeline as far as clinical channel, I'm assuming you're referring to Regina there as well. The trials have been done, keeping in mind a dossier that can be submitted across all the emerging markets. So for example, for a personal, the reference product is the EU approved product. And hence, once that approval comes through, we should also be able to file across a lot of different countries where there is a severe unmet need. So overall, across these 4 products, we see the next 18 to 24 months having a significant ramp-up.

Sure. That's great. A final one from my side, sir, Canada, is it -- is the 1Q growth sustainable for the full year?

Yes. So in Canada, I think the growth is sustainable. We had basically been guiding to sort of a mid-teens growth rate for the Canadian operation as a whole. And we're very happy with the Mantra acquisition, which continues to track even ahead of our own expectations at the time of doing the deal and some of the synergies, even at a product level being rolled out across Canada as a result of that continue to play out. So we are very bullish on continuing that momentum for Canada.

The next question is from the line of Paresh an individual investor. Yes, Mr. [indiscernible] go with the question please. The next question is from Lana Partha from Investment Managers Limited. Please go ahead.

Satish [indiscernible] more than a question. I just wanted to -- it was a site of a comment. When you were referring to the RV portfolio, internationally and the contribution from America to the program, which is supported. And you referred to the general city, which has declined. But I just wanted to say, American General City at [indiscernible] of terms. I thought I'll just put that a little bit of a view on that. And then to a question -- the -- based on the 5-year region plan that we have done, in terms of capital expenditure on assets, I suppose, more or days we are in place. In other words, it's unlikely that we will be incurring material capital expenditure in buying, putting more assets manufacturing assets. Is that understanding right?

I can take that question. So what we had been guiding to is that -- we expect annualized sort of CapEx spending in the range of about INR 350 crores a year. If you look at that, roughly about INR 150 crores of that goes towards more repair and maintenance CapEx and about INR 200-odd crores is in earmarked for. Some top-up investments for capacity enhancements or product-specific type CapEx requirements that we have. So barring anything else. I think that's the range that you're going to see on the CapEx front. Of course, we will continue to evaluate and be aggressive in terms of any M&A or strategic alliance or in-licensing deals, which may have some capital allocation there, our focus areas are obviously going to be India first and foremost and some of the emerging markets to the extent that we have an opportunity to get some product both on portfolios in places like Europe, like we have recently done or Canada, we'll continue to evaluate as well. But by and large, you're right that most of the infrastructure required to cater to our 4-, 5-year growth plan is already well in place.

The next question is from the line of Bhavesh an individual investor.

Am I audible now?

Yes, sir, you are.

Congratulations on a good set of numbers. My question is with respect to the cash and cash equivalent as on June 30, 2025. So I just wanted the number?

Yes, INR 200 crores.

Including the investment?

Yes.

So why there is no other income in this quarter then?

There's a very small amount of other income. The amount of cash is at the end of the quarter. throughout the quarter, you don't have cash used to reduce debt.

Okay And one more thing, sir, I'm a user of your MPs Aqua oat moisturizing cream. And just wanted to provide an honest review about it. So it's a really good formulation and the cream does the job quite well. So I just wanted to appreciate it. And will be a consumer and also a long-term shareholder of the company.

Bhavesh, you are going to get line extension and absolutely super packing top of the line matching the global standards in the next 2 or 3 months. And we share one thing in common. I'm also a big time fan of Aqua coat and I also Aqua utilize the product. extension, which is quite exciting. And I like it. If somebody likes my product, it makes me feel happy my hemoglobin they will go to the man.

So I'm using it for the last almost couple of years. So one derma, so she was the HOD of KEM hospital. So she recommended me that go for out, it will reduce your sensitivity of the skin. So it has been a helpful cream for me. And it's the plus point of the cream is a fragrance free. So a lot of screens in the market have fragrance and alcohol. So that doesn't seem... I mean many times what really happens, so I've seen that on some fragrance, so it goes for itching also. That also happens. I have one package at home like whenever it gets over, I bought another one. So thank you for you and all the best for the future quarters.

Thank you as that was the last question for the , I would now hand the conference over to Mr. Piyush Nahar for closing comments. Over to you, sir.

Thank you all for joining today's investor call. If any of your queries will remain unanswered, please feel free to get in touch with us. Thank you.

This is Satish Mehta. You're squeeze-back means of opto. We feel very enlighting by the inputs given and we are committed to improve committed to take whatever suggestions coming from you very, very seriously. And we will go to for your company with more water than ever before because you give us lot of motivation. Thank you very much.

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