Hester Biosciences Limited (HESTERBIO.NS) Earnings Call Transcript & Summary

Ladies and gentlemen, good day, and welcome to the Hester Biosciences Q1 FY '22 Earnings Conference Call, hosted by ICICI Securities. [Operator Instructions] Please note that this conference is being recorded. I now hand the conference over to Mr. Vinay Bafna from ICICI Securities. Thank you, and over to you, sir. Mr. Bafna, we are not able to hear you.

Hello. Can you hear me now?

Yes, sir, please go ahead.

Yes. Thank you, Lizan. Good afternoon, everyone, and welcome to the Hester Biosciences earnings call for the quarter. I would like to thank Hester for giving ICICI the opportunity to host the call for this quarter. From the top management of the company, we have today with us Mr. Rajiv Gandhi, CEO and MD; and Mr. Priya Gandhi, Deputy Director of Business Operations; and Nikhil Jhanwar, CFO of the company. Over to you, Rajiv, sir.

Good afternoon, everybody. As always, it's our pleasure talking to all of you on this quarterly call that we have after our results. The press notes have already been released. So I'm sure you would have gone through the press note and quite a few details have already been mentioned in it. So we would be ready with your questions to answer them. But just to talk briefly about the operations of the company. Q1 as compared to the earlier Q1 definitely was good. By far, it was good. Our top line went up by around 50% because the Q1 was highly impacted of the last year as compared to the -- sorry, the last year as compared to this Q1, of course, all because of COVID. And our profitability has marginally gone up more than what the sales have gone up. So it is in line with all our efforts in ensuring and assuring that our profitability remains. These results have been possible because our team over here has been continuously managing and trying to ensure that the sales don't go down, trying to look between the vaccine and the health products. And within the vaccine as well as within the health products, looking at what species, et cetera, and try to put in an absolute trust in all the areas as far as marketing is concerned. Domestic, while the domestic sales went up by 61%, the exports, actually, there was a degrowth of 8%. The reason for this is that in exports, point number one, we had many restrictions in terms of supplying -- our ability to supply the products to the countries. The air -- I mean, all our vaccines are shipped by air. And many countries still even today, are not really able to get the vaccines or supplies on to them by air. And that definitely has been an issue with us also. And secondly, there had been certain disease prevalences in India in terms of mainly on the poultry side, et cetera, which also helped us in a way. I would -- help us is the wrong word, which propelled our business towards selling more poultry vaccines in Q1. So these were the few reasons. And when it comes to domestic demand versus international demand, while our plants in Nepal as well as in Tanzania, would -- the Nepal plant is ready, Tanzania plant, we hope to inaugurate in the month of October. I mean, a lot of pressure from us would anyway be transferred over there. And at this point, where within India, we would not -- we did not want to get into a situation that at the cost of Indian business. We try to maintain international business, supplying over here was our bigger priority. So that much as far as the sales is concerned. In terms of product mix, our thrust it has been on the health care side. Of course, whatever the thrust be, but sometimes because of disease or sometimes because of some peculiar situation, there may be a little bit of a redesigning of the product mix within the quarter itself. So all these things are a regular feature, a little bit movement going up or going down in terms of the gross margin actually do not really -- we don't see that as a concern at all because these things are part of the whole business cycle, et cetera. But overall, we are surely trying to ensure that our bottom line is maintained. And not only maintained, we would want to still further improve it than what it is at this point of time. And we are all working towards that. I mean, specific questions on this would be answered once I finish my talk. Talking on the human COVID-19 vaccine initiative. Hester has gotten into a licensing agreement with Bharat Biotech for manufacturing the drug substance for their vaccine, Covaxin. This project has now -- is under construction. It's a greenfield project. We are at the moment and in the construction phase. We will be constructing a BSL-3 facility towards this and hopefully in the first quarter -- in the last quarter of this financial year, we should be able to see some tangible results out of supplies going out of this -- for this project. So these are of -- that's an update on the COVID vaccine. Talking about our subsidiaries. Texas Lifesciences continues in terms of growth. On the top line, we have registered growth as usual because as Hester grows, Texas Lifesciences automatically directly grows because all our health products are produced at Texas Lifesciences, which we buy from there, and we do the marketing. In -- for Hester Nepal, it's been a tough quarter, again, though sales have marginally gone up as compared to Q1 FY '21. But the COVID impact still continues. The country is still not having regular flights for supplies to many of the countries. Secondly, FAO tenders have not been upcoming at this point of time. So that has also been one reason why which we have not been able to come up to a strong level as far as Hester Nepal is concerned. Something that I would like to mention on this call, not mentioned in the press note, that OIE, which is the apex animal health body, which monitors the animal health all across the world had floated a tender for the PPR vaccines to create a vaccine bank of PPR vaccine. So there have been 2 suppliers shortlisted for the full bank creation for PPR vaccine, and one of the companies is Hester. The progress of that will be seen from September, October, as already mentioned by them. So we look forward to remain engaged internationally for PPR. If tenders are slow, this creation of this vaccine bank in itself is a very big boost, and it should give us a reasonable huge turnover. I would not want to commit any quantities at this point of time. As and when they are officially announced and declared, I would want to talk on it at that time. Hester Tanzania, our trading entity. We continue to try to grow the business as far as Hester Tanzania is concerned. And we are very confident that besides this, we have also embarked on 1 or 2 other trading initiatives in Tanzania, and this is going to take -- we foresee to take a very big jump as far as trading activities in Tanzania is concerned. It's -- of course, one, is that our own vaccines will start from October from Hester Africa. By that time, many things would be opened up from Nepal to be supplied over there. So I think we foresee that before the -- in the next 4 to 5 months, our trading activity would take a very big jump in Tanzania and in the African continent. So these are -- and talking about the manufacturing project, as I told you, we would want to have the opening sometime in the month of October. We are working towards the opening plan. And hopefully, it should be a matter of pride for -- on the day of the opening because it would be the biggest animal vaccine plant in the continent of Africa. And as and when the dates and all get announced, I'm sure we would make press releases, public notices and all of you would be notified on that. So that completes my brief on Hester on its functioning as well as on its subsidiaries. And as I said, the press note has been reasonably elaborate. And with this, I now open the house for taking on questions. Over to all of you.

[Operator Instructions] The first question is from the line of Ketan Gandhi from Gandhi Securities.

Yes. Sir, in your press release, you have stated that, in point number 3 of other developments of international market. How is that the expansion of markets. Can you please share some details on that and its impact on next 2 years?

Yes. If -- in the past also, I have made a mention of this, but I would not mind making a mention again. Health products and vaccines, these are 2 different categories. Any company that you see worldwide, their business from health products is always larger than what their business is of vaccines. At Hester, it is the other way around. In vaccines, we are far more around 2 to 3x bigger as compared to the health products. So we are -- we foresee -- as now we have also put in the focus, not that there is a reduction on the vaccine front. But as we are also pushing this, we foresee a reasonable big jump as far as health product is concerned, and that is what exactly I have meant in point number 3. We have already quite a few products. We have also launched a few herbal products. And we are constantly adding more and more products to become more aggressive on the health product side as well.

Okay. And sir, what could be the impact in the next 5 to 10 years?

The impact of this business should become bigger than what it is for vaccine within 3 years' time and then take it further. I would not be able to give you a quantification of 5 to 10 years at what would it be. But there are companies, which have huge turnover. For example, even in India, if you look at Virbac, if you look at Zydus Animal Health, who just sold their division some time ago, all of them have turnover of over INR 400 crores, INR 500 crores. So it's just for you to get an idea, not for me, I would not be able to give you any specific figures on them.

Sure. Sir, my other question is, what could be the sales contribution in FY '23 from Tanzania? And what kind of sales we require to break even.

In Hester Africa, that's our manufacturing entity over there. At full production, we have shown that we should be selling around USD 25 million to USD 30 million over there. We believe that if we are able to generate a sale of approximately USD 4 million to USD 5 million, we should be breaking even.

Okay. Sir, can you please share your individual CapEx plan in India, both for poultry and large animal vaccine? And largely CapEx for non-vaccine project?

We have a few expansion plans. We are in the process of defining them. And I think as and when our plans are absolutely ready, if we would be obligated to discuss that and inform that and make that in public information. But yes, we are looking at expansion plans because we have reached to near 200% capacity as far as vaccine is concerned. Our health product is also growing at a very fast pace. So there are some plans that we have and we would be sort of real. I mean, making the full plan in the next 1 to 2 months' time, we would be more or less ready with our expansion plan, which would be notified.

Sure. Sir, global manufacturing capacity, including Tanzania can achieve what kind of peak sales? And when do you expect to achieve it?

Now you see in vaccine, it is very difficult to give what is the total capacity because in poultry, we have 1,000 doses, in cattle ruminants, we have 25, 50 and 100 doses. So there is a difference between a -- 10x difference in the number of doses in a while as far as other animals is concerned as against poultry. So in -- over here, our total capacity is now gone over approximately around 6 billion, around 6 billion. It has gone in Tanzania that capacity should be approximately 1.5 billion. That is because it is small ruminants. If we make poultry vaccines here that capacity would go to up to 3 billion to 4 billion, and we are looking at a total capacity of approximately about 8 billion to 9 billion doses of all types of animal vaccine.

So in terms of amount, sir, can you specify?

It is very difficult for us to really define that. A poultry vaccine of 1,000 dose while costs around INR 50, INR 60. And some doses are priced at around INR 2. And as I said from INR 0.04 to the most expensive vaccine could be INR 8, INR 9. So that is the range that we are dealing in as far as vaccines are concerned.

All right. Sir, one housekeeping question. What is the current gross debt and gross cash at consolidated level?

I will just request Nikhil, our CFO, to answer that rather than me take this question.

Yes, the gross debt, the consol level is INR 95 crores as on date.

And gross cash?

The gross cash, let's see, yes, it's almost at INR 21 crores.

All right. And sir, my last question is, when do you expect to become profitable in Nepal on a sustainable basis?

We were profitable. It could even happen this year. We are just waiting. All that we need is a few orders, that's all. We are confident that this year, in itself, we should be profitable.

And on a sustainable basis, right?

Hello -- then, sorry. Sorry?

On a sustainable basis.

On a -- I think it is a sustainable model site from day 1. It's just that COVID delays that FAO has created this situation. Otherwise, it's an absolute -- it's not just sustainable, it's a profitable model that we have embarked on to. Be rest assured what you are seeing today and what you will be seeing after 2 years will be a difference of 180 degrees. I mean, without a doubt, I can tell you this.

Okay. Sir, I have some more questions, I'll get back in the queue.

[Operator Instructions] The next question is from the line of Anirudh Shetty from Solidarity Investment Managers. Anirudh, your line is on soft mode.

Maybe on mute or something.

Am I audible in now?

Yes.

Sorry about that. I have 2 questions. Sir, you spoke about the poultry vaccine opportunity in Africa. So can you just -- for what I understood is your Africa business is more for large annual. Can you just throw some light on how big the poultry vaccine opportunity could be? And what is our proposition over there? And also the CapEx that we've been incurring, does that -- can that be used for this poultry vaccine as well?

The African market overall is an untapped market. It is like a chicken or the egg situation over there. But having said that, it's not that it is a shot in the dark made by us. There have been -- it's a well-planned plant that -- a well-planned project that we have embarked on to over there. The African market for large animals as well as poultry, both -- I mean, both the markets are huge. Poultry is now getting consolidated in a few countries, and it is shifting from backyard to the main poultry. And the large animals continue to be scattered the way they are scattered in India. And to give you an exact -- I'm not right now having all these figures, which on the whole African continent, et cetera. But we are all covered to produce whatever type of vaccine we might want to produce over there in Africa. So I mean, and we have already made the capital expenditure over there.

Okay. Okay. And my second question is more on the -- how do I think about margins because -- sir, my second question was more on how do I think about margins, your EBITDA margin? Because as you mentioned, globally, health is a larger share of mix usually. So how would -- between our segments on a steady-state basis, would help have a similar EBITDA margin profile? Or would that be lower to our vicine business?

Okay. Let me answer that question in a minute. See, the whole issue -- just a minute. Yes, so EBITDA margins, you are talking about the comparison between vaccines and health products, okay? Now while vaccines definitely could have a better gross margin. But the number of cycles for the health product where the gestation time is less, the manufacturing time is less, the investment is less. So all that gives more cycles in a year than vaccine. So considering the -- if you go on to the cost of material and all those other where our expenses would be more -- so we would be able to recover that. And at an EBITDA level and at a profit before tax level, I think with the bigger turnover of health products, we would still be in a better situation than what we are today.

Scope for margin expansion...

Sorry, scope for?

There is scope for margin expansion from our current levels even as health business grow faster as a percentage of mix at some.

Yes. Our bottom line at the EBITDA level could definitely improve positively upwards.

Okay. And have we made the necessary investments in building the distribution, in our sales employees to scale up our health business? Or that is something that we will have to go through over the next 1, 2 years?

You are talking about Africa or India?

India. India.

Yes. So I think, just a minute, what is the -- Yes, see, we are anyway distributing our own products all over the country at this point of time. So we are very well entrenched as far as distribution is concerned. Talking about number of people, 3 years ago, we were 60-70, today, we are around 150 -- between 150 to 200 people. So this is -- we are growing, taking in more people as well as expanding the business. So it's an ongoing activity. It's nothing that we are doing new. I don't know. Does that answer your question? I was not able to understand your question actually.

No, no. You clarified it that as sales employee base has expanded quite significantly, right? From 60 to 200. So yes. No, that clarifies that.

The next question is from the line of Manish Jain from GormalOne.

Rajiv, when one reads your press statement it sounds very, very bullish that effectively, you are expanding your number of products that you are launching the number of market segments that you are addressing, both in India and African market. And of course, you have increased entry into Africa itself. So what in your view are the key challenges that you foresee in the next 1, 3 and 5 years for you to achieve your true potential?

Very reasonable, good question, but a little bit on the philosophy side. 1, 3 and 5 challenges -- what we would -- 1 challenge in Africa is that we need to create the demand and we need to start selling. But on the flip side, the prices today are between 3 to 10x per dose and what they are anywhere else in the world. So partly that offsets that. But in the long run, it is our endeavor to penetrate the full African market, get Africa business at a normal international level. Therefore, we have big business and our vaccines are reached all across the continent, and we get the credit and the valuation because of being the first company to have changed -- becoming a game changer in the continent of Africa. So I think even if you look at it, the challenges in the first 3 years, they would be the same challenges in terms of Africa. In terms of India, we do not see any challenges as such. It's just that we need to grow the business more somehow the other vaccines, health products, add more products, make the team bigger. I mean, we have reached a point wherein it's just that we have to look and work hard towards getting ourselves higher and higher from this point where we are. I mean, there aren't any such hurdles that I see. It's all internal. We have to work hard to make this big.

Got it. And in terms of team size, how many people do you plan to increase both in India and outside India, especially in Africa?

In India, we are -- we should be approximately 250 people by the end of -- in, I think, in how much time? In 1.5 years? Will be -- sorry, we will be -- my information was wrong. We should be 450 to 500 by next year itself in terms of marketing. And if you're talking about Africa, we are yet making the plans and we are trying to have people. In fact, we have hired a few people, and we have already put them in place. That plan is still -- it is being made and because of it, I mean, being a new territory, being out of where we are in India, it takes a little while -- it'll take a little while before we actually structure the whole thing. We are looking at tying up, acquiring some distribution companies in a few countries. So all these sort of things, we are just looking at options, which I have mentioned to you for the last 2, 3 years, either some distribution companies, manufacturing. Unfortunately, we have not been able to lay our hands on it. But this is what we are looking. And the African model would be, at this point, let's take it that it would be a dynamic fluid model. As we move, we will structure -- sorry, structure ourselves.

The next question is from the line of Manish Gandhi from KPML Private Limited.

I just have one -- hello?

Yes, I can hear you clearly. Tell me.

Yes. Rajiv, I just have 1 question. So due to COVID what has happened that the importance of vaccine wold over has gone up. The understanding of vaccine and the importance in the life of vaccine has gone up tremendously high. So my question is regarding, do you see any changes in the field when you're dealing with farmers, they also -- say to convince them or to give vaccine to animals. Do you feel that it is changing the behavior also or in the medium term, do you feel it is a great help to you to convince them?

You see the media has flashed so much on vaccines that every person illiterate, literate, everybody knows vaccines, tighter, antibody, antigen. So all these things definitely help in one way. But then on the flip side, on the lighter node, this -- there is so much of information on the net that actually, sometimes it even disoriented people. But anyway, having said that, poultry is organized and most of the poultry farms are very aware in any case as far as usage of vaccination is concerned. The incidence of COVID would have maximum helped us 2%, 3%, definitely nothing more than that. In large animals, we feel that we should take a reasonable big leap because of this knowledge in terms of how important a vaccine is and what can happen if a vaccine is not given. It's not what a vaccine can do, what can happen if a vaccine is not given. Now people are more or less very aware about these things. And therefore, the importance of vaccines has definitely gone up in their mind and this perception is now going to become a reality in the next coming few years.

Right. So that was exactly. And especially large animals, the INR 60,000 to INR 70,000 a cow or a Buffalo. So for them, it is very important for to have vaccinated.

Yes, yes, it is very important.

Right. And one more thing. As we are expanding large animal vaccines, number of vaccines and even trying to expand our market in large animals. So is it that poultry vaccines are at very low price and the large animals are at higher prices. So eventually, after 5 years -- per vaccine should change?

No, no, there is nothing of that sort. The population -- poultry population is more than 1 billion. So what happens is that all this, you can't take it as a price-related business model. I mean, if you take in human vaccines, there are some vaccines which are available for a few thousand rupees, while some vaccines are even given free. So likewise, in poultry, cattle, I think that comparison should not really be made. A disease is a disease against which a vaccine is to be made. We are able to maintain our profitability, whether it is a poultry vaccine or a cattle vaccine or a sheep goat or a swine vaccine. And we shall continue to manufacture the range. There could be a variation in the number of doses between x species and y species. But besides that, I don't think so. There should be any impact of that.

[Operator Instructions] The next question is from the line of Mitesh Shah from ICICI Securities.

Sir, have you impacted the COVID second wave because our poultry has sequentially decline? Or is it just a volatility of quarterly numbers.

No, I think all this is just a little bit here and there. There is a -- COVID second wave has nothing much to do as far as poultry or large animal business is concerned.

And my second question is regarding your export. I think freight is already on a rooftop. So can you expect the impact of your export business in near term -- And the same with the margin as well because of the higher effect.

No, no. Your first line, I did not hear you clearly.

So basically, export, you said that, that was in fact because of the few countries have stopped. So currently, the freight charges are quite high and is almost on the rooftop. So can we expect term, the export business will be impact because of this -- TMBT margin as well.

No, no. I think all this will continue. Freight costs cannot be deciding factor. To tell you in poultry, the cost of vaccine to the total cost that they -- in their budget is around 1% or 1.5%, okay? Let's presume freight has become 2x. That 1.5% can become 2.5%, 3%, double that. But I mean, even with that, there is no impact in buffalo, cattle, sheep. In fact, the budgetary impact is even less than what it is in poultry. So all these things should not. It is just that people should get their awareness and they should vaccinate. This freight charges going up and all is -- I don't -- in any case, Africa vaccines are sold between 3x to 5x than what it is sold over here. So all these things are of no relevance.

The next question is from the line of Alisha from Envision Capital.

So with respect to what the earlier participant was asking with respect to our export sales or revenue, this is the second quarter in a row that we've seen a decrease. And if the reason is not higher air freight, like you mentioned, that is not the deciding factor. Then what is the reason for this degrowth 2 quarters in a row?

As mentioned in the call earlier, there has been a degrowth, yes, which is there. But there has been an excessive demand in the Indian market. And there are some countries where it is even difficult to reach the vaccines over there. It's not that the vaccines are not being bought just because of freight or anything of that is high. It's not just because of that. On the other side, if the Indian demand is there, our first preference is to ensure that we cater to the Indian demand and which we have registered a growth totally of 61% on a quarter-to-quarter comparison. So it's just that we have made sure that Indian demand does not go at all unheeded by us. This is our in-house market, et cetera. While exports, we will soon have Nepal, Africa, everything up and running. Now whether -- once Tanzania is ready, supplies would be made from Tanzania to the African content where, again, the freight would go down than what it is from India. From Nepal, yes. We will be exporting from there. But it is something, which people are already buying. So it's basically just that, to answer your question, is that the Indian market has been very good. There have been some disease incidences. We have diverted everything over here. Demand have come. It is not that the demand is less internationally, but we have diverted it to the Indian market. But in days to come, all these things will be restored. We will have 3 entities producing. So it would not happen that something needed there. But because we have demand here, we are consuming it here. We will have Nepal, we will have Tanzania. In fact, in Tanzania, we are under the process of registering all poultry vaccines also from Nepal. So if India, we are in short, we will supply from Tanzania. So we are just trying to make sure -- we also feel that there should not have been a dip in the exports, and we should have pushed and we should have achieved. I do admit to that. But as that has not happened, we are trying to reorient ourselves that such a thing is not done and that we are able to cut the cake and have it to between the Indian and the international market.

Understood. So it's more capacity constrained and deciding Indian market to prioritize.

Yes. Absolutely. And partly, the actual vaccines are being air freighted over there. Nothing to do with the price.

Understood. Understood. So my second question is, I believe in the previous call, you had mentioned that we're looking at identifying some partners for Hester Tanzania. Is there any update on the same?

There is no update, man. Our hunt still continues. I'm sure we would be able to get onto certain tie-ups, et cetera. We are looking at 1 or 2 aggressive things. Probably as soon as we are able to get something, find something, it would be notified to all our shareholders.

Understood. And sir, also with respect to our Bharat Biotech -- agreement with Bharat Biotech for the drug substance manufacturing. Is there a delay in this project? Was it expected to come on stream solar because I believe in your commentary, you mentioned that we're expecting supplies to start by Q4, hopefully. So is there a delay in that project?

No, there is no delay from the last time line that we have been talking with Bharat Biotech, people, et cetera. And Q4 -- by the end of Q4, we are surely expecting. So I think -- no, no, we are on track at this point of time.

Okay. And just one last question with respect to your earlier con call, you mentioned that for FY '22, you're looking at going at about 25% to 30%. Does that still stand?

It stands.

And this is excluding the Bharat Biotech cost.

I mean Bharat Biotech is one of its kind opportunity that we got all our forecasts are without that factor.

Understood. And just...

You can take it as approximately 20% to 25% -- between 20% and 30%. 20% -- yes, you can say around that for sure.

Got it. And just one last question, if I may squeeze, please. Your gross margins from FY '20 have been falling in FY '20, I believe for full year to 67% to 62% last year. In this quarter, we are at 59%. What is the reason for this consistent decline in gross margins?

Gross margin decline has been made up at our EBITDA level. And the whole thing is that on a month-to-month, quarter-to-quarter, there are always changes in the product mix that is being sold. As I just discussed, partly sometimes what happens is that you are -- we are selling few -- we are selling more health products. We are selling certain vaccines, which might have been giving us a little lesser margin, et cetera. So I would say, ma'am, if you look at the bottom line, you would actually be convinced that irrespective of what happens where, the bottom line definitely is more or less being protected or we are even trying to improve on that. The vaccines have a bigger cycle, health products have a smaller cycle, while if GPs are low on the health product, but having more cycles, the ultimate profitability goes up because the average cost per employee goes down because of more cycles of the health product.

The next question is from the line of Ayush Mittal from Mittal Analytics Private Limited.

Reference, sir?

Yes. Yes.

First of all, congratulations on a good shorthorn given the challenging times picture there in last quarter. In last couple of calls, we have been saying that you are very confident about the growth. And this growth, you are more confident on the Indian side also apart from the expansion in Africa and Nepal that we are doing. So in the Indian context, what are you seeing driving this big growth for you where you were also looking to do some acquisition or build more facility or expansion. Can you share something more as to what is happening and what are you trying to capture? How are you trying to capture that?

Yes. We feel that the business in India is growing and it will further grow. And talking about Hester specifically, we have got a big potential to grow in geometric progression as far as health products is concerned, as well as certain large animal vaccines, government is going to be taking up immunization programs, et cetera. So -- and notwithstanding the awareness that people are already getting as far as vaccines is concerned. So we are -- just a minute. So these are the reasons we feel that the market will definitely grow in India. And it will keep on growing. And the health segment -- health products segment is going to grow in definitely geometric progression. So that is going to help us in building the top line to a very great extent.

And this health segments on back of more new products that we are doing? Or the business just based on trying to increase your reach and presence across India?

Reach and product and species, everything.

Can you give some examples as to what kind of products are we introducing on this side?

We have introduced -- we have curative products, which are antibiotics, therapeutic products. We have growth promoters, we have herbal products for growth promotion and specifically against addressing some diseases. We have disinfectants, we have sanitizers. I mean we have the full reach.

Okay. And what kind of investments are we making to make this happen? The growth part in India?

I think in terms of investment increasing the manpower, getting more products produced and becoming more and more determined in trying to grow this business.

Okay. So this is not capital intensive?

No, it is not going to be much capital intensive. I think determination is something, which is needed, which is most expensive, which we are probably having.

And sir, you were also talking about some acquisition or something in the Indian market?

We have been talking, but we need to get whether India, whether Africa, we have been talking, but it has to match us. It has to match our philosophy, our budget, there are so many things. But having said that, we are anyway organically growing our business at 20%, 25%. So I think while that effort still continues. We are, in any case, putting in the efforts at our own end in trying to grow the business.

So one final question. Did Africa commercialization -- when will it start? And when will we start -- okay.

The next question is from the line of Ketan Gandhi from Gandhi Securities.

Sir, can you please share the recombinant vaccine you were developing for India and global market?

We are working on certain poultry recombinant vaccine work is ongoing. At this point of time, I do not have any update on that. Work is ongoing and when it gets, we will inform you. So I mean that's all. I don't have anything much to say on that. Neither is it that my not addressing it means that projects are not ongoing. Projects are ongoing.

Thank you. Ladies and gentlemen, that's the last question. I now hand the conference over to Mr. Vinay Bafna for his closing comments.

Thank you, Leanne. Thank you for participating, everyone. I will give the call to Rajiv, sir for just closing comments before we end the call.

So thank you. Thank you to everybody for being patient and asking me questions. I hope I have been able to answer most of your questions. There would have been certain questions where I would have not had the answer with me at this point of time from the paper that I have on my table. Certain information I might not be able to give for whatever our own internal and regulatory reasons. So please pardon me for that. But otherwise, it's been always nice interacting and talking to all of you and hope to remain in touch and hear you all again in the next con call. And thank you from my side and from our team.

Thank you. Ladies and gentlemen, on behalf of ICICI Securities, that concludes this conference call. We thank you for joining us, and you may now disconnect your lines. Thank you.