This is Kunal here from CLSA. Thanks for outlining the product pipeline for the next five years. That's quite articulate. Just to back that up, like, how do you look at say, revenue growth going forward in FY26 and possibly beyond that? If you can articulate for both India as well as US business. And on the margin side, I don't know, with the share of com plex generics increasing by FY30, at the same time, you spoke a lot about the cost efficiency levers that you have. How should we look at on the margin side, margins play out over the next in FY26 and beyond that as well?

The buoyancy and the top line would contribute tremendously because as Nilesh, Vinita were talking about, the pipeline is very strong. Given that mojo, we would of course expect that to contribute. And there's, of course, tremendous focus on cost itself. So as a combination of that, you would expect margins to certainly go up. This year, for example, we have Tolvaptan. And there's a host of other products that we've lined up for next several quarters. So, the margins would continuously go up. And we speak about the adjacencies, they would evolve in terms of growth and critical mass itself and start contributing profits. And if that were to be brought in, you would certainly expect the margins to creep up. This year, of course, we think it will go up by at least about percentage point as in the past. And then, it will increase in terms of the way the pipeline evolves.

My second question is on, one of the growth levers that you spoke about was, focus on the novel drugs. With the MFN policy now, how should we look at that strategy going ahead? The second part is on the tariff side. We do have two facilities in the US, and you also in your opening remarks alluded towards, if there were enough incentives, you would look at setting up more facilities. What kind of flexibility first of all, the 2 facilities offer us in terms of like managing supply chain on some of our key products and if you can talk a little bit about, how are we looking at setting up any new facilities if possible?

I think the MFN would definitely impact the brand side of the business much more than the generic and the focus under IRA has been on the highest value drugs. So, it is really the highest value drugs that will likely get impacted. I think that at the end of the day the value of the brand has an impact on the opportunity for generic. So, obviously we track it very carefully. We don’t see a direct impact on our brand products which are relatively speaking small in the scheme of things. I also think that the MFN order would be challenged like it was in the last time Trump was in the office. I think you are going to see litigation; I think you are going to see Big Pharma fight it pretty hard . If they are going to make the tens of billions of dollars of commitment to manufacturing in the US, to reshoring in the US they would not accept price pegging to ex-US markets. So, I think that there is a lot you know that’s going to unfold over the next co uple of months here. So, I am not very concerned about MFN at this time. As far as tariffs go and our flexibility what we are willing to do in the US , my first hope is that the bilateral trade negotiation is successful. We heard the US administration talk about the fact that India is willing to reduce tariffs on pharmaceuticals, steel, and automobiles to zero, hopefully that is somewhere in the negotiation and means reciprocally also the tariffs into the US should be at the same level. Having said that given the flexibility that we have with Coral Springs as well as Somerset, if there is a need to manufacture essential drugs in the US , we will explore it. We are actively exploring that with the National Security Council as part of the White House right now. The government has identified 9 drugs that they believe that are essential and we go into the dialogue back and forth with them to determine how we can build the partnership between India and the US to give them the confidence that they will have reliability of supply. Our own investments in Coral Springs , we are investing into the E llipta Line, we are investing into the Respimat Line - that was already under way even before this administration. So, we are continuing to invest in the respiratory franchise. And if there are incentives offered, grants offered to set up more manufacturing, do more development in the US, we certainly be open to it. We are in active dialogue right now on that front.

Hi, Krishnendu from Quantum. The House of Representatives of US is trying to cut the cost of Medicaid by USD 880 billion dollars to fund the gap in tax. So, just wondering how could it affect the Indian hemisphere if it does get through?

I think a big part of CMS spending is on branded drugs, so I think the first impact you would see is on branded drugs. And that’s what they are trying to do with this MFN clause, to negotiate pricing on brand drugs at a level similar to Europe. I don’t expect it to get to generic drugs very quickly because , generic drugs are already a pretty low spend. We have emphasized to the government as part of the Section 232 investigation in the commerce department that there's a lot of inefficiency in the supply chain. When you look at the generic side of the industry there is only a small percentage of the value that comes to the manufacturer, there's a big part that goes into the GPOs and PBMs and that’s where they need to focus to be able to gain efficiency. I think that is also, resonating with them. They are looking at the numbers and can see that how skewed the value chain is. So, we think that the PBMs are going to be challenged quite a bit. We have already started seeing some of that, a few of the states have already started dis - intermediating PBMs. I think that you are going to see potentially more negotiation with Big Pharma on brands. Again, to be seen how that syncs up with the reshoring goal that the administration has. And I see limited impact on generics.

On the India piece, how do you see insulin acquisition of the Lily drug playing up with Semaglutide when it goes off-patent in India? Comments on that, how do you think you are going to play that?

We have Rajeev here we can ask him to answer that.

So as far as the Lily acquisition is concerned our objective was to acquire Huminsulin® so we can penetrate into Tier-2 Tier-3 markets also and we can capture that market of insulin there. Now, Novo going out as far as insulin market is concerned particularly cartridges, we expect that we will be able to garner that market share also which will be vacated by them. At present our Huminsulin® market share is 18%. We expect with this space becoming available we will be able to garner another 6 -7% market share as far as Huminsulin® is concerned. So, that’s absolutely our strategic move as far as acquiring Huminsulin®. Semaglutide going off -patent as Vinita also mentioned in March 2026, we are developing in-house also Semaglutide and we have partnered with other partners also so we are very much ready once it goes LOE. And we expect that this market is going to go up because once the prices come down the usage is going to go up.

So, you don’t see cannibalization happening if Semaglutide comes in?

No, Semaglutide apart from diabetes because there is separate market for GLP-1s, there is a separate market for insulin , and particularly in obesity insulin has no role. So GLP-1s are going to be the one which are going to play a major role in obesity.

Last one on Mirabegron where do we stand, what is our stand on that right now?

We continue to sell the product - no change. And we have the trial in February, and believe that we have plenty of defences that, you know we have a good chance to fight at that point in time. So, we will find out in February.

And the Albuterol market share right now for us?

It’s close to 18-20%.

Hi, this is Damayanti from HSBC. Vinita, earlier on TV interview you mentioned USD 250 million US sales is the new run rate for you. But just want to understand you continue to sell Mirabegron and then Tolvaptan has come. Then why it should not be much higher?

So hopefully it is higher. We think that you know we are going to see pressure on Albuterol, we have already started seeing it. We think Tolvaptan will be a great contributor in the first half of this fiscal year. But second half we certainly expect other competitors to come in and while our first mover advantage will be there because it is a specialty drug, it is a REMS product we will expect to give up share. So, we expect some products to go down and products like Tolvaptan and continued growth in Spiriva® would offset some of the decline in other products and helps us hopefully grow over USD 250 million a quarter.

Does it look that your first half will be much bigger than the second half?

So, for the company it looks like both first half second half would be great. For the US, first half certainly has a lot more of Tolvaptan than the second half does. But in the second half we have injectables coming in, in particular the three I mentioned , Glucagon, Liraglutide and Risperidone all come into the tail end of the first half so really have a strong contribution in the second half. We certainly have the US more front loaded in the year.

Second question is on injectable launches which you just mentioned. So, in terms of your application what is the current visib ility? A re you confident about timely launches?

So we think that majority of these products we have heard recently about Glucagon, we have heard recently about Victoza®. It is between July and August that we should get approval. We haven’t heard any different on Risperidone, in the next couple of months we s hould get that approved as well.

This is Surya from Phillip Capital . My first question is about the CDMO initiatives. Could you share what is your plan there and how do you position the CDMO/CRDMO business while you are having es tablished generic business here?

I think the CDMO market is very mature in the fact that people would pick companies for the ir reputation, for their manufacturing capabilities, their compliance record and the like. I think the fact that we are a large generic company as well I don’t see that as a challenge at least in none of the conversations that we have had so far. This started with a fact that we were overinvested in API and we had additional capacity which was available as well. But I think you know with some of the China rhetoric, with some of the alternatives that people have been seeking as well I think it has become a large opportunity. It is also an opportunity that we can do at scale. I think there is multiple reasons why we are excited and we need to build . Once we have got numbers we will present those numbers but I don’t see anything coming as a challenge at this point of time. We have to build capability though. I think our key goal was commercial capability and project management. It is just operates at a very different level versus a generic company in that. So, our goal has been to build that and the team that we have built is all from the CRDMO space. So, optimistic but I think we will put our heads down, work for two years and then talk about good numbers.

Any sense of the timeline of the progress of this?

It is fully functional , I mean it is a separate entity altogether, they have a separate office, they don’t even sit in the Lupin offices, so they are fully functional already. The entire business is about building a funnel, so we want to build that funnel with good number for this year as well. I think the revenues it will be nothing meaningful at this point of time, I think in the next two years it will get to a meaningful number.

Second question is about the margin for the quarter that you mentioned, Ramesh sir, that after adjustments it is something like 26% kind of a margin profile for the core business for the quarter. And there are adjacencies also which are currently having ne gative impact to the overall FY25 margin. So, two things - what would have surprised this 26% kind of core EBITDA margin for the quarter. And is it Mirabegron only driving that, you can clarify that. Secondly, the impact of the adjacencies if you can quantify that for FY25?

In terms of adjacencies, this is essentially the digital business, the diagnostics, API CDMO, the bio business, all of these are still evolving. So, if we were to knock out that impact it will be about 3.5 to 3.7 percentage points. And in terms of the first part of the question, we lost out in terms of PLI - not lost out it was actually capping out because there is a limit to what we can claim for any year. So, previous quarter was higher by about INR 50 crores. This quarter that’s the impact it is about 1% lower because of that and the higher impact in terms of R&D I will specify that again, the R&D spends are lot higher. If we knock out that impact, then potentially that 23.2% would have been 26%.

Just one last question, there is % more than 20% CAGR growth on the R&D spend over the last 3 to 4 years that we have seen. And obviously there are some results that we are witnessing now on the market. Going ahead what would be your plan in terms of the spend quantum, in terms of percentage or in terms of growth?

Our R&D spend would go up next year . I expect at least about 10 % to 15% growth out there. Principally because of the kind of products that we are working on. There is a slant towards more complex stuff. That will bring in a lot of more expenditure as well. If we take count actually close to about 70%- 72% of our spends today is really on complex stuff. This includes biosimilars, the inhalation portfolio, the complex injectables, the 505(b)(2)s, all of this, and in some parts the specialty as well. So, that calls for a lot of expenses. Therefore, the ab solute numbers are set to go up. And as a percentage of sales also so it is about 8% right now. So, I believe that will be upward of 8.5% next year.

Just one last clarification, ma’am, from your side. Any competition for Spiriva® one should think about?

There are one or two filers that have filed already. But just given how long it took for us to get approval - it took 5 years for us to get approval. Now the FDA would have gained a lot through the interaction back and forth. I think for the next 12 months we should still be the sole generic in the market place.

Just to clarify again on R&D , when I talk about EBITDA margin increase next year it is after taking into account this increase in R&D expenditure

Good evening, Kunal Randeria from Axis Capital. Vinita, should we expect Spiriva® Respimat® launch in FY27?

No, it actually was one of the FY29 DPI products.

Secondly, just a bit more on R&D where Ramesh did give some colour. Since majority of your incremental growth is coming from inhalers, how much of that is being spent on inhalers?

We don’t state platform wise details. But we are just saying bundling all of this expenditure relating to complex together as a percentage it is close to about 70%.

Sure, and just one more if I can.

I think inhalers is partly 30%.

Yeah, I would say roughly about that.

30%, right. I don’t quite understand your biosimilar strategy so when I look at your pipeline. Most of your products are coming maybe 4 or 5 years after the first entrant. So, I don’t know, is it more opportunistic because the regulatory barriers seem to be lower now. Just a thought process behind it?

It has been quite an evolution. The strategy has been evolving on the biosimilars front just given the market evolution. When you look at the changes that have taken place in the US. It is really creating opportunity for older products as well for us. For example, Pegfilgrastim it’s a very old product, multiple players in the marketplace. But as we have had conversations over the last year with the customer base the fact that we will come in with a new ASP that’s attractive for providers makes it a very attractive opportunity. So, we really see value in bringing Pegfilgrastim to market. Whether we do it ourselves or we do it with a partner is a question mark.. We have both options available to us. So, when you look at the other products, if you start looking at the first product that we had invested in was Etanercept - Enbrel®, and the idea with Enbrel® was global, we wanted to get into the US market, European market, everywhere we can and there's a submarine pattern that appeared in the US that held the product back until 2029. But we launched in Europe through Viatris, now Biocon, as well as other parts of the world through other partners. In the US we have the ability to bring the product into the market ourselves in s fiscal year 30. It will be a material opportunity for us because we likely will still be one of four in the marketplace. So, for us so far it has been a learning on the biosimilars front . We have tried to mitigate the risks through partnerships, partnerships on the development cost, partnerships on commercialization. In the last 12 months with the changes in the US we really see an opportunity of going direct into the market with biosimilars . Particularly for products like Pegfilgrastim certainly there is an opportunity. But also for the Ophthalmic products - the two products that we have on the Ophthalmic front , Ranibizumab and Aflibercept. we have the relationships with Ophthalmic distributors right now. AmerisourceBergen which is now Cencora is 70% of the ophthalmic market, they visit 70% of the ophthalmic clinics. So, we have the relationships in place to be able to enter that market if we get approval in time and can launch the product. Having said that going forward now given the barriers are reducing it becomes like a complex generic play for us. So, the focus is on products where the number of competitors are limited or where we can be one of few in the market place.

But Vinita, you know with competition also increasing in future the price erosion will be much sharper. We have seen it in the last couple of years that it has behaved almost like oral solids where the prices have been very sharp and now it can get even sharper. The cost I don’t know if that cost justifies you know launching this?

Well, so the cost has come down in development, the cost is going down on market access with these private labels. If you have a private label avenue, like Cordavis, the CVS private label or one of the other private labels where you are not creating the co mmercial infrastructure, we already have the capabilities on the development and manufacturing front, why would we not leverage it to get products where we are in the first wave or products where we are one of the few in the market place.

This is Neha from Bank of America, thanks for taking my question. Ramesh, if I was to think about margins after FY26, obviously FY 26 we have Tolvaptan helping us and then you have the injectables. As we think about after that , Vinita mentioned Spiriva® sees competition, Tolvaptan FTF goes away. Is the margin expansion entirely dependent on the adjacencies turning around given we would continue to invest in R&D?

Yeah, I do see turning around would of course be a very important part of the whole thing. At some point of time we would also perhaps look at allowing them to spin on their axis by getting a private equity player or a strategic end to kind of allow them t o grow also. Clearly, their evolution and their growth and their profitability is also important. But it is not going to be the most critical factor from our perspective, it is going to be really the core , really contributing in terms of the buoyancy on the top line and other initiatives that we have taken on.

Vinita, on your foray into specialty. One, what are the therapy areas that we are looking at this time, is it different from what we were looking at previously which was women’s health. Second, you know from a P&L as well as balance sheet investment when d oes the P&L investment kick in, how much are we thinking we want to invest, given the pipeline that you have. And from balance sheet what's the number that you are looking at committing for M&A or asset acquisition for specialty?

So, on the areas of focus, they are very much Respiratory and CNS. In respiratory given that we have Xopenex®, we have a position in respiratory already. We can bring synergies through our development lifecycle management within our internal capabilities. So, respiratory definitely is a big focus, building on what we have. And CNS neurology - with NaMuscla®, we are now doing the study to bring the product to US as well, that’s multiple times the opportunity of the current product. If we can g et other neurology products, they will be synergistic with the infrastructure that we have in Europe as well as what we will build in the US. Those are still the two focus areas. Opportunistically we look at other areas as well based on the assets that come to market. Our focus is very much on accretive assets; on a limited basis we are looking at pipeline assets. On the pipeline front we obviously want de -risked pipelines , so late-stage programs and will want to look at creative structures around it to be able to mitigate the risk on our P&L. In terms of capital allocation maybe I will let Ramesh talk about it. I mean the overall allocation is the focus is specialty and India region.

We have drawn very good guardrails in terms of our overall capital allocation policy. In terms of for example the overall debt that we will take on the balance sheet will be around the 2:1 ratio in terms of Debt to EBITDA . If we are talking about EBITDA close to about INR 5,000 - 5,500 crores and you are talking about potentially the debt we can raise is about INR 10,000 - 11,000 crores. We are also kind of prioritizing in terms of where we will be putting our money in and from our perspective it is going to be in India and of course specialty. Though we would of course like to address white spaces in distribution program across say geographies like Europe. And we have also said that when it comes to adjacencies, we would restrict our overall involvement to what we envisaged at the time of drawing up the investment program for various adjacenc ies. Beyond that we would actually involve private equity houses or a potentially strategic of the like. So, we also said in terms of financial returns we would be expecting return of about 20% and in terms of a payback period between 4 to 6 years depending upon the project. So, some of these guardrails are already operational. And going forward we would make sure that most of the projects qualify under this.

Nilesh, last one for you. For the India business you know you talked about double digit growth for next year. Given Empagliflozin, just went generic we have that impact, we had a large tender number in the base. Despite of that we would be able to grow double digit, would that be a fair conclusion, and what would be driving that growth. Is it new product launches? You mentioned about 400-500 MR additions, are there new divisions that you are launching, just some colour there?

I think we are really coming into our own in some of these therapy areas. We have had all of the disruptions on the cardiovascular side. So, that’s all played out and the like. So, now we are seeing that 30% ahead of market growth. We see diabetes obviously with this happening, but we will still see good volume growth and I think we will still grow at a double digit in diabetes as we ll. Respiratory has been slow in the last couple of years. We have launched a new task force for nebulization, we have expanded our Uday Division which is focused on extra urban as well. That will lead t o growth again as well. So, sum of it all I think we are going to grow at double digit and not just for the next year. I think the intent is to grow at 20-30% ahead of the market, I believe the market will grow at 6 -7% or 8% as the case maybe. On top of that if you grow at 20-30% ahead you will be at that double digit. I think the sum of this all, trade generics we have launched into a separate subsidiary, that entity is expected to grow at a strong number. OTC is expected to grow at a very strong double-digit number as well. Summation of all of this adds up to a good double-digit number.

So, while we collate some of the audiences while we put up a queue here, there are a couple of questions from the people who have joined online. One question is the US government has expressed a desire to reduce dependencies on PBMs and increase the transparency of drug pricing. And the question which is asked is does this lead to better predictability of drug pricing and is it a positive measure from a generic pricing perspective going ahead?

The scrutiny on PBMs?

The actual question is the dependency on PBM s the government in the US would like to reduce and does that mean that the pricing environment for generics in the US improves further actually going ahead?

I think the PBMs take a big part of the value so certainly improves the opportunity for generic drugs. Also is a big opportunity for the government to save drug spend. So, it is a combination. I mean we certainly think that it will reduce drug spend overall , because right now it is going into the pockets of folks that don’t pass it on to patients, nor pay us either. And potentially can help us with generic pricing.

And a couple of questions on Mirabegron, I think we did answer some parts of it. One question is are we continuing to sell Mirabegron till the litigation dates in Feb and added question on the ‘780 patent are we fighting against infringement or invalidity? Add on question to that is if you win ag ainst infringement do we have a pathway till 2030 when the patent actually expires?

Well, we hope. But so the first question was, do we continue to sell? Yes, we continue to sell. And two, in terms of our defences it is going to be both, non- infringement as well as invalidity. And then if we have the opportunity to prevail on infringement only, we might have a long-term opportunity. So, we will see.

A couple of questions have come , actually Rajeev did answer but again this concern that with the launch of the generic GLP -1s in India there could be some cannibalization on the diabetes side especially on insulin. I know Rajeev did mention that they are two very different categories. But is there anything else that we have in terms of talking about the fact that our diabetes portfolio, we have visibility and confidence that it will continue to grow even with the GLP-1s coming in?

I mean the market is going to open up, right. It is going to take time to shape therapy itself. So, it is a near term opportunity to grow on the GLP-1 side itself. That doesn’t take away the fact that there is a lot of diabetes in India, a lot of untreated diabetes in India. It is not like everybody is going to jump onto GLP- 1 product to change where the therapy is headed. Obviously with the genericisation price point comes down, access becomes much more available to people to access GLP-1 products itself. But I think we are talking many years out , certainly our MTP is talking about the double -digit growth on the diabetes side as well. And to add to that I think Rajeev talked about the insulin, I think the insulin opportunity, I think we can emerge as a very large insulin player as Lupin and specially if we can bring access to tier 2 - tier 3 towns I think the opportunity is a very large opportunity in itself.

Just quickly Canada USD 45 million sales, we are launching Semaglutide in India, we are not there in Canada are we?

No, we don’t have the product as of yet. The team is actively looking at an opportunity of in-licensing but we have an internal product which will come later into Canada.

On the European part Nanomi acquisition , and the French injectable acquisition, we have Risperdal coming from N anomi so how does it complement. Could you show light on the acquisition how does it help us, or whether it doesn't help us at all. Just trying to understand that landscape. I am just trying to understand is there any benefit from both combined acquisitions because I think we got Risperdal Consta® injectable from Nanomi as far as I remember. Does it help us?

I think they are independent in any case. I mean Nanomi is more a platform that we bought for long acting injectables. It is a very unique platform. Risperdal Consta® of course will be the validation of the platform, it will be the first product that we bring to market through the platform. But what we are doing with that platform is really exploring innovative opportunities, 505(b)(2) opportunities. We have put peptides on that platform. We are working on biologics on that platform to see how far we can extend the use of the platform . But to us the biggest opportunity with Nanomi is really the ability to innovate and build a novel pipeline. The Medisol acquisition and injectable business acquisition in France. We didn’t have a presence in France until we bought Medisol. So it gives us a presence in France. And on top of the portfolio we have there we are looking at all of the injectables that we have in India including Risperdal Consta® but we are looking at the broader portfolio of injectables to bring into France.

Last question, all the DPI / MDI are coming from Indore. Just a clarification? Future filings?

Future filings will be a combination of India as well as Coral Springs.

You spoke about pricing pressure in Albuterol. Can you elaborate?

Another question to Ramesh. Ramesh, you showed the chart on capex of INR 700 or INR 600 crores kind of run rate for last several years. But your cash flow statement shows a capex of INR 1600 crores in FY25 and INR 900 crores in FY24 What is the difference for that number?

The Cashflow shown here reflects just the Capex po rtion and the one in the Balance sheet also includes acquisitions.

So, these are acquisitions of ANDAs or intangibles other than that?

It could have been intangibles. We bought into companies like Medisol, Vinita just mentioned that, so, all of those acquisitions that came in. The Cash flow is after taking into account all of that.

I was talking about the capex number, the INR 700 crores numbers which you had showcased for last couple of years on an average versus the cash flow statement where there is the capex number over there, the gap is very wide is what I am saying.?

No, I showed only one figure which is the capital expenditure on an annual basis for 4-5 years really. And that I think average is about INR 500 to INR 700 crores. A larger chunk was for really maintenance capex and there's been some expansion in some part s especially when it comes to biosimilars, injectables and the likes.

This is Kunal from Macquarie. The first question is on Tolvaptan. I think our understanding was that this is going to be a long tail product for us. Has there been any change in that view that we had on this product?

No, we always said that in the 6-month exclusivity we will gain a lot more than the period where we have additional competition. But given the launch efforts and what we have learnt in the last couple of months, the specialty distributors and that market works a little bit differently. They really like to establish longer term relationships. So, for REMS product we expected in any case the tail to be longer and now with the relationships that we have established with the specialty distributors we feel even stronger that we should be able to maintain a high share in the time when others get in.

Second question on the overall impact on our P&L, let’s say from next 3 to 5- year perspective because we are looking at a lot of shift towards complex generics and specialty. Margins wherever they are right now or ROC E whatever it is right now where do you see that panning out over next 3 to 5 years because it also seems that there are a lot of investments, R&D may be inching up for that future pipeline. So, how should we think beyond FY26 just looking at this shift in the business mix that we have put out today?

So, the team has worked hard really to improve margins year after year, and that’s a consistent effort going forward. As we look at the situation right now based on the pipeline that we bring to market, certainly R&D spend on complex generic is up but also the new product launches of complex generics are up. And increasing over the next 5 years. So, we should be able to afford the investment and still grow our margins.

I think we will take a last question, it is online. It says on Semaglutide we have highlighted that we are partner ed as well as we have our own version. The question is what was the reason to have both and is it to compress the timeline or is there something else?

We have a play in the oral solid the tablet as well as injectables. The tablet we have internal, injectable we have partnered.

Thank you, I think if we have no further questions we would like to end. Thank you so much, we really appreciate your time, effort, it has been a busy day for you. We end this session and looking forward to seeing you and connecting with you again going ahead as well. Thank you.