Yes. I've joined a bit late so apologies if I'm repeating the question. The first question is with respect to the quarterly results or H1 results, however you wish us to look at, and bringing in the context of past there is volatility in the business. Any comments? Is that the nature of volatility changing and it would be much less volatile? And how much of the Q4 results is kind of one-off, lumpy, et cetera, et cetera? So that's first question that I have?
Questions across 9 calls
Chirag Shah
White Pine Investment Management
Neuland Laboratories Limited
I have two clarifications and one question. Sir, first is on the gross margin side, you alluded to the fact that gross margins for next year can be in the ted pressure. So can you just indicate how should we look at it? Why I'm asking is because if you look at over the last 5 years from F Y20 till now, we have been a constant uptrend and reaching up to 63%, which is a great achievement. So over the next 5 years, how should 1 look at gross margin trajectory?
And second clarification was on the product pipeline, the slide that you share every quarter. So See, I wanted to ask that question. My bigger word is on the commercial projects that you have, it is stagnating at around 9 account. Why am I saying this if you look at H1, our commercial revenue is more than 93%. So if you can just elaborate on that, either the commercial pipeline number has to go up or the value of each pipeline has to see a significant jump for next 2 years, so how should we look at that?
Thank you for this opportunity. Two questions. First is a slightly different question from this quarterly stuff. So I wanted to understand what is required for a higher conversion for us from Phase-3 to commercial especially in Big Pharma because it appears that we have not been able to participate on the commercial side with Big Pharma in a way in which we would like. So what is required or what changes you are making to be a part of the supply chain when it becomes a commercial product?
Is capacity in advance a constraint for you? Because even when you work with biotech and when they are taken by Big Pharma, is capacity, upfront being available is a constraint. And how should we look at it?
Onesource Specialty Pharma Limited
Yes, thanks for the opportunity. Sir, two, three questions and bit of clarification also. So, first, for this GLP, on the innovator side, if you would like to specifically call out, I know the Polish entity has got some innovator customers and even Biologics, we have some innovator customers. But for the GLP, this facility, so are we choosing not to be a part of innovator? And if not, then what would it require to be a part of the innovator supply chain?
That is helpful. And last question or clarification on the merger. If you could just refresh us, what could be the range of dilution, if at all, because of this merger? The two entities that are getting merged?
Yes. Thanks for this opportunity. I got two questions. Question one is on the potential M&A that you are again embarking on. So is it more of the same or it brings the additional capabilities either in terms of technology or in terms of customer? I know you would have -- you have already indicated earlier, but a brief rewind would be helpful. How does it add up to in terms of value to OneSource? Question one. And I'll ask the second question after that.
Okay. The second question was, we have been focusing on generics. Any thought on being part of innovator or what are the challenges over there? And would this Polish acquisition help you to be part of the innovator supply chain? Especially what after the Catalent deal which has happened, you are in a sweet spot in that sense.
Cohance Lifesciences Limited
Yes, thanks for the opportunity. Sticking back to the guidance, that is my first question. What kind of confidence do you have in H2 and '27 guidance? Because it appears from the tone that there is more downside risk to the guidance that you are indicating. So, given what has happened in the recent past, you are in better position to take an assessment. Why I am asking this question? Because if I look at last three - four transcripts, your granular commentary always looks to be very good in terms of molecules, in terms of where we are in the cycle with the Phase 2, Phase 3, etcetera. But the near -term guidance seems to be missing by far. I do not think that this would have been your expectation in any which ways. So, if you can just summarize it and help us understand the confidence that we have in your guidance, that is the first question.
Secondly, based on the information that we have today or that you have today as a Board, can we assume F27 would see around the 20%-25% kind of growth, that kind of visibility you have? I understand a lot of things can change. But there is a reasonable confidence, but for the unforeseen events, it is possible given the way the spillovers you have been indicating. So, can we assume say 70%, 80%, 85% kind of confidence that it is possible to achieve 20%-25% kind of growth next year?
Laurus Labs Limited
Sir, first question is on Q4 of current financial year. So last quarter, you indicated H2 margins could be around 25%, so that our annualized margins would be 20%. Now, we have done around 20% in Q3. So do you still hold to your H2 guidance of 25%? And if not, has there been any delay in Q3 revenue which leads to lower margin? That's my first question.
Okay. And sir, second is, for next year, that's '26, given the efforts you're putting on CDMO over the last 2, 3 years, can we expect '26 could be the year of the breakthrough phase and we can cross or reach INR2,500 crores of revenue on a full year basis
Sir, first question is on Q4 of current financial year. So last quarter, you indicated H2 margins could be around 25%, so that our annualized margins would be 20%. Now, we have done around 20% in Q3. So do you still hold to your H2 guidance of 25%? And if not, has there been any delay in Q3 revenue which leads to lower margin? That's my first question.
Okay. And sir, second is, for next year, that's '26, given the efforts you're putting on CDMO over the last 2, 3 years, can we expect '26 could be the year of the breakthrough phase and we can cross or reach INR2,500 crores of revenue on a full year basis
Ramkrishna Forgings Limited
Good that the disclosures have really improved from the Company and you are upfront on that. I really appreciate that. Sir, 2, 3 questions. One, how should one look at the new margins and ROCE, ROE guidance? You had indicated that you will act on this based on the findings and conclusion of the same. So , have you formed a thought , or you want to wait for the final forensic report to share your sustainable return on capital and margin guidance that you used to share earlier? So that's question number one.
Okay. Sir, why I was asking is because there will be a permanent resetting of your gross margins, right, because of the accounting , not accounting lapses, but whatever errors which have happened. So that's why I was asking the question that there will be a permanent rebasing of your margins, and it will have its impact on ROCE.