Hello, sir. Thank you. Thank you for the opportunity and congratulations on Canada approvals for Semaglutide. I have two, three questions. Sir first question is, my understanding is that Brazil had 28% duty if local manufacturing requirements are not met. So how are we going to deal with it? How are we going to work around it? And is it a hindrance for big growth in Brazil? That is question number one. And then question number two, sir, our US deal with Natco plus Mylan, I think it had profit-sharing arrangements as per the press release. Is it fair to assume that similar arrangements might be there with other customers in major regulated markets? So let's start with these two?

Hey, Rupesh. Thank you for your questions. On Brazil, I can just tell you that that is applicable only when there is local manufacturing available. As we speak right now, there is no manufacturing which is available in Brazil. And also having said that as a CDMO, all our terms with our customers are ex-works. So really, any impact of whether it's a tariff or otherwise will actually be to the customers to really be taking over, if that clarifies. And to your second question around profit share is what we have shared in public domain is what we have shared. And that as CDMO, we neither do we talk about which customers we have or the terms which are with them. And I hope you'll appreciate confidentiality is the biggest part of our deal with our customers.

Okay. And the other question, Neeraj ji in drug device combination business, we are I think the service provider. So there is we just provide the filling service. So with that context, I mean, can you please explain why our inventories have moved from INR158 crores in March '25 to INR440 crores in March '26? I mean, that number for non-Semaglutide business seems kind of large?

Rupesh, I want to clarify that while our inventories have gone up, as you would know we are service providers, you rightly said. But you should know that these inventories are part of our entire production process. So these purchases are fully funded by our customers and fungible. So precisely that is the inventory that we are carrying. There is really no risk that we carry on our inventories that we are carrying.

It is paid for by the customers already, just for you to know, because our benefit to our customers, Rupesh, is the fact that we are able to combine, pool in the demand from various customers and able to get better terms for customers for all the inventory which is fungible among them.

So Anurag, this inventory change then will not flow through P&L. Is that fair? It will the inventory up and down will be adjusted against customer advances. Is that a fair way to look at it?

You're right. That's correct.

Okay. Thank you. I have few more I will come back in the queue.

Yes, thank you for the opportunity. Sir, I have one question. If I look at H2 results and balance sheet, there is significant amount of investments both in P&L as well as balance sheet without commensurate revenue. Be it staff cost, be it other expenses like inventory example. So what kind of revenue will this investment support? If you can just share some thoughts, it would be helpful. And secondly, the non-CDMO business or the injectable plus capsule business, what kind of EBITDA margins that we do? Because it is difficult to analyze it right now?

Hey, Chirag. So as I mentioned earlier to Rupesh, I think what you're seeing is an increased elevated level of working capital. These are as expected and as planned. These essentially are preparation for our significantly large launches. These inventories are fully funded and paid for by our customers and pretty much will go off the balance sheet. The impact on the P&L is practically negligible. It's only the conversion charges for the service fee that we get which will flow into the financials. So not a matter of concern from that standpoint. What we are also doing from a balance sheet standpoint is there is capacity build- out, and that's the increase that you may be seeing in the capex side. So those are the two.

But I was more – I was more referring to the staff cost for the wage expenses and the other expenses. Despite drop in revenue, we have seen an increase in both line items and that could be because of the cost that we are bearing on expectations of potential revenue. So what I'm trying to understand is to what kind of revenue scale this staff cost and other expenses can support and beyond that there will be further investments that will be required?

So I think this is, Chirag, just that this is the investment which is being put in the entire expansion of capacity, whether it was earlier the capex which we said, but this opex is basically to support that expansion. And that is what we have said. It is for supporting our guidance of $400 million revenue. Out of which the DDC part where the increase is happening is very significant. And that's where it -- we have already said the second line is already here and second line is undergoing qualification right now. So there is opex associated with it and that's when it comes online from next quarter onwards. And similarly, the third line which will be coming online later in the year. So I think that's what you see. And the revenue guidance we've already given which is going to be coming out of this expansion.

Thank you. Next question is from the line of Nitin Agarwal from DAM Capital. Please go ahead.

Hi, thanks for taking the question. On the capacity, if you could probably just remind us on the timelines for the capacity expansion in DDC and by when do you see incremental capacity available? And if you can also give some sense on by when do you see reasonable utilization of these capacities in your plans?

Yes, Nitin. So if you see our -- as I mentioned, the current line is currently completely busy on doing the CSAs, the commercial manufacturing for both Canadian partners as well as our multiple Indian partners. The new line which is currently undergoing qualification, it was installed earlier in the year and is now undergoing qualification. That line will be available from next quarter onwards. And that's what will, A, it'll ease pressure on the existing line and as and when customers keep moving, because that is also the line which has the capability of going to a significantly larger batch size of 500 liter, which actually is in the interest of our customers and us to be able to churn even higher output from that line. And once the third line, because you know that we are going to be adding two lines, two additional lines this year and as the year will be ending, we'll be having the second new line. So by end of the year, we will have three lines installed. And you will see, as we have said, the sequential improvement in both revenue and EBITDA quarter-on-quarter, that sequential improvement actually is built on basis of these new capacities being available. Because as I mentioned in my note, we have a very clear visibility on a very robust demand from all the markets which are either already where the approvals are there or the approvals are going to be coming. And with this capacity expansion, that demand will keep getting serviced and that you will see shown in our sequential quarter-on-quarter improvement. And you also know that there is another additional line which will be coming next year, but I'm not even factoring that. I'm just staying put with three lines which will be ready and which will be visible by end of FY27.

And what will be the capacity available? We had a 40 million in the first line, and how many cartridge capacity will be there by the end of the year available with us?

Yes, so Nitin, I think last time if you remember we explained that our capacity, the way to look at the capacity is in the number of sterile days which are available as a sterile injectable company. And that is roughly we look at roughly about 225 odd days of sterile manufacturing available to us. And in this, it is then a function of batch sizes. Now, if we do a 200 liter batch size, we can do roughly 60,000 odd pens per day. And if we were to take the batch size to 500 liter, that number immediately goes up by 2.5x as you can imagine. So from the same line, the output can vary quite significantly and increase quite significantly depending upon the batch sizes. So the customers who will move to the batch sizes will be able to get a much higher output from us. And the same will be applicable to all the three lines. So you can imagine that with 225 sterile days for us in on one line and you multiply by three gives you the 675 odd days which will be available to us once all the three lines are up and running making commercial. And that's the best way to look at our capacity. And also at the same time, I would also tell you that what we are really good at and what our customers are really valuing us for is all the capacity which I am telling you is not only for filling, it is end-to-end including assembly. So we are telling our—offering our customers the full finished packed product.

And secondly on the biologics CDMO business, I think there is.

Sorry, is it better?

Yes.

You're saying on the biologics business, we probably made a lot of progress on the funnel. But with what we see in the business now in terms of the pipeline the way it's building out, when do you see this business beginning to contribute to a meaningful proportion of our console EBITDA for the business by what time does that begin to happen?

So Nitin, biologics is a really very exciting business for us. As you see, there are so many global tailwinds which are supporting, including the recent changes in the guidelines by FDA as well as Europeans, which have opened the biosimilar business dramatically, expanded the size of the biologics business, the biosimilar business globally. And obviously, the access and the attractiveness of CDMOs like us because of the comparative cost which we offer, because of the agility and time to market which we offer, has made us really, really attractive. So while the tailwinds and the funnel is very strong, what happens in biologics is it's a fairly long gestation in terms of closing the agreement. So while the funnel is really strong, we see agreements getting signed and you will see that happening over the next full FY27 and FY28. For you -- you will already see a meaningful contribution coming in FY27 and FY28, but the real kicker is once the commercial manufacturing starts for biologics, which is I would say still beyond the current time horizon which we are looking at FY28. We see the commercial manufacturing happening '29 onwards. However, the contribution from biologics will already be meaningful in FY28.

And just one last one, Arun, if you could probably answer that. We're talking about FY28 guidance which we've been holding on for the last couple of years. Now, if you look at OneSource as a business qualitatively, how should one think about the business beyond the FY'28? If you can give us some qualitative feel on how should we visualize the business scaling up beyond that?

I would request Arun to answer. It's a good question. Thank you.

Hi, Nitin. On your question, basically there are several modalities. There's a lot of conversation and noise around the DDCs, which of course is an important segue to our $400 million. But we have several modalities including our soft gels, injectables, and the biologics, which is the nascent build-out as Neeraj said that'll take a little time before we've got a lot of contracts signed up early stages and a lot of RFPs issued, but material conversion will take at least another 2, 3 years. And we already see the need to expand capacities in that area. But we believe that the soft gel in our $400 million target, we've alluded to the fact that our soft gels and injectables business are trending closer to the $100 million mark. We see a lot more growth opportunities there. We're expanding more capacities. Neeraj alluded to the enhancements of capacities in our injectable space. We have a fourth line coming in unit two, which is a dedicated injectable capability with several features including an SPD with high viscosity pre-filled syringes. So there are several legs beyond the $100 million which we are investing heavily now and we brought in a lot of new capabilities in our R&D and market access. So we are very confident those businesses will grow quite smartly in the next many years and should give us much more leg up on the beyond 400 goals. Of course, the Steriscience assets would have added to the whole story, but that's for another day. But having said that, the $400 million organically will also have some inorganic elements, not necessarily the Steriscience assets, and clearly they would also -- that's a pivot that we'll continue to look as we create beachheads internationally.

Thank you. Nitin, I'll request to come back for a follow-up question. Next question is from the line of Kunal Lakhan from CLSA. Please go ahead.

Yes, hi. Thanks for taking the question. A little more elementary question. With respect to semaglutide, do we have like a minimum commitment on volumes from our clients, say either on a quarterly or an annual basis, irrespective of whether the clients are able to sell their inventory in their respective markets or not?

Yes, so I can tell you that right now the biggest challenge actually for the customers is access to capacity. And for them to secure this access, customers have done capacity reservation with us. And that capacity reservation includes blocking capacity and submitting to pick up that capacity both by paying upfront fee as well as take-or-pay kind of contract. So right now, as I said, we are only looking at how we can service this demand than worrying about whether they will sell or not.

Sure, I get that. And once these markets like Brazil and other markets open up, right, going into say FY '28 or '29, right, would these terms be different or you see similar terms in terms of access to supply, access to capacity still remaining a priority with these clients?

See, again it depends how the demand develops. But I can tell you considering right now the way we have seen India pick up, we are seeing even the brand in other markets where the expansion which is happening continues to go beyond what was anticipated. And the demand- supply gap will continue to be there at least for next 2 years. So -- while I cannot forecast the future, but I can tell you certainly over a next 2 year period, there will be a challenge more -- I mean, demand will be robust and the gap will be more from supply than the demand.

Understood, sir. Very helpful. Thank you so much.

Hi, sir. Firstly, on the Semaglutide Canada opportunity, when do you expect approvals for your other clients in the Canadian market? Do you expect them to come in by the end of FY27 or maybe sometime earlier or beyond FY27?

So, honestly, that's a question which we are not directly involved in managing the regulatory strategy or discussing with the regulatory agencies. But I think as we have all seen in public domain that there would be more approvals which will be coming in over the next few quarters. So now when exactly these are going to be there, it's very difficult to anticipate. But you saw Health Canada talking about that there are more approvals which are currently in the pipeline.

Got it, sir. And secondly, sir, you have given some information on few ROW markets in your presentation. So can you give some more thoughts on how big could the market be in Brazil and few LatAm and select ROW markets that you have mentioned in your presentation?

So Brazil today, if you look at IQVIA, Brazil is the largest market outside of North America for Semaglutide, right? So it's a very -- it's a large country, significant population, and a country which is very focused on weight reduction. So it is going to be a very significant market. And if you see there are other markets which are fairly large, whether it is Turkey, whether it's Saudi Arabia, because this is a factor of population size. And you look at these markets, Turkey with 80 million people, Saudi Arabia again large populations. So these will be interesting. But also you need to see that many of these markets today, whether it is Southeast Asia, whether it is Latin America, the brand has not been available. It has been a very, very constrained supply because brand has focused only on US and Europe and the developed markets. So these markets will really grow much. So there are no clear numbers available simply because the brand has done a very, very poor job of even supplying these. The clear example was India, which is the second largest diabetic population in the world, and the brand got launched months back and not years back as it should have been. And you see the growth. So I think that's how we will have to wait and see, but there is a very significant market out there in each of these emerging markets. And also we have customers in all these -- we have a very strong customer base which will be covering all these markets which are opening.

Got it, sir. And sir, lastly, while you have given your FY28 guidance, but now as few of your customers have already got Semaglutide approval in few markets, do you want to give some color on full year FY27 numbers? Maybe some inclination?

Yes, so I think we as we said, we will stay right now with FY28 guidance while we continue to progress with the commercial launches, expanding capacities this year. So this year, right now, we are reiterating FY28.

Thank you very much. Next question is from the line of Dr. Kartick Bane from Bajaj Life. Please go ahead. Dr. Bane, can I request you to unmute your line and proceed with your question?

Take the next question.

Due to no response, we move on to the next participant. Next question is from the line of Ritika from Valuequest Investment Advisors. Please go ahead.

Yes, hi, sir. Thank you for taking my question. First question is on Brazil market. As per ANVISA's website, we see only handful of applicants which are currently under review, though there would be 17 applicants. So could you help us understand of these top filers, what would be our partnership number? Though we've said we have five partners, but out of these top applicants, where would our partnership share be?

So Ritika, again as I said, this is not information which is in public domain. What ANVISA has not given -- it doesn't give details on which ones are currently under evaluation, what are the names, who are. So I can only tell you that our customers are a fairly, variable bunch. We have some of our global generic company partners who have filed in Brazil. We've got Brazilian companies who have filed in Brazil. We've got regional strong leaders who have filed. So it's very, very difficult to really understand where they are. But as and when the approvals will start coming, our customers should certainly be in that first wave.

Sure. Second question is on Saudi Arabia as a market. Three months back, we had given out the notification of approval of the drug in Saudi Arabia, Semaglutide. Why would there have been delay in launches? Could you help us understand that?

No, so here it's not a delay because the fact is that while Saudi Arabia there was no patent, you're aware that there was a patent in India, right? So that's the -- that was a constraining factor and not the Saudi patent. Now that all that is freedom to operate is there, so as we have said, Saudi launch is imminent.

Sure. Last question is on customer advances. What would this number be currently on our books versus INR250 crores last quarter?

Ritika, the number would likely be at almost the similar levels. There's not significant change on that number.

Sure, thank you so much.

Thank you. Next question is from the line of Aman Vij from Astute Investment Management. Please go ahead.

Good afternoon, sir. First question is on the biologics part. You explained how FY27 and FY28 could be good growth years for the business. I just wanted to understand what is the number in terms of revenue and say EBITDA loss for FY26 and when do we expect the breakeven in this biologics business?

So, I think we have mentioned that earlier. The stage of evolution we are in right now, we don't really break it down in that granularity business-wise because the modalities our customers take are all together. So -- and as you know, right, as I've mentioned that CDMO, our biggest asset is actually confidentiality of our customers. So we don't really break down business-wise revenue or any other financial.

If you can answer which year can we expect the business to breakeven and start contributing in terms of profitability also?

As I said, whether what would be the profitability, whether it is breaking even already or not, I will not get into that. But as I mentioned that the -- it's a business which is going to be expanding year-on-year and will already contribute meaningfully to our FY28 numbers and beyond. In fact, that is the business which has got very long runway for us beyond FY28 because the commercial manufacturing is going to be starting beyond FY28 and that is a very, very meaningful growth on these numbers. I mean, just to let you know, it's a very strong EBITDA business.

Sure, sir. On soft gelatine part, in my understanding, the new capacities are already online. So could you talk about say capacity utilization and when can we see -- start seeing good growth and higher capacity utilization in that business?

Yes, so this is, as you know, that last year we have expanded the capacity. And since then, we have onboarded new customers. We continue to onboard. In fact, thanks to all the challenges in having capacity available for our European customers and who are really coming to us. So that soft gelatine capacity, we are actually seeing an increase. And as we have said by most likely by end of this year or if not next year, we would have no real capacity available beyond. And that's why if you also know that we have a limited period agreement, transition agreement with Strides, and we would be expanding into our own site. And that's the time where the next set of expansion on the capacity will happen. So by within the current period, we look at this capacity to be fully utilized.

Sure, sir. Final question on Sema side. You explained how the based on batch size, whether it is 200 KL or 500 KL, the capacity becomes 2.5x. So in your...

Yes, just to clarify, it's not KL, it's liters. It's only, it's 200 liter and 500.

Yes, yes. 200 liter and 500 liter. So, in your understanding, when do you expect, say, this to happen for the, at least the first original line?

Yes, so our original line, the current line, we can't go beyond 200. That's why the new lines which we have done, see, it's again, the existing line predates all the exuberance and excitement around GLPs and where the market was. So that line can do maximum 200. It's the new line -- all the new lines which we are doing which can go even up to between 750 to 1,000 liters is what where we are going to be changing.

And for the first new line, when do you expect this to happen?

So it's a process. You know, customers already working on it. We'll keep updating you, but it's not a long-term plan. It's going to be happening sooner than we anticipated.

Thanks for answering the question.

Thank you. Next question is from the line of Dr. Kartick Bane from Bajaj Life. Please go ahead.

Hello, can you hear me now, this time?

Yes, yes. Please go ahead.

Okay, thank you. Yes, thanks for the opportunity. So I would like to know more about the oral Semaglutide opportunity and how would that impact our business?

So I think, it's a good product. And we are very clear that there are patients who just cannot take injections because they have a needle phobia. And for them, oral tablets are an absolute relief. Having said that, orals have a challenge of [inaudible] they still don't match the efficacy of injectables. Orals also require a daily dosing, what we call a very high pill burden. And obviously, with the daily dose, the side effect challenges also increase. So with all in mind, while they are a very good solution for people who really need and can do with a lower weight loss, and the expectation.

Can you just mute your line please?

Yes. I am sorry.

Yes, so we don’t expect the orals to be taking about anywhere between 25% to maybe a third of the total market. So the market will overwhelmingly stay as injectable. Simply look at the pipeline of products, the other GLP products which are coming, which are overwhelmingly injectable.

Okay, thank you. And my second question is that you mentioned Canadian partner. Would you like to clarify if the Canadian partner is Indian company or outside India company?

See, I think we have said, right? that it’s one company is in public domain, which is Dr. Reddy's. So and the second partner is also in very clear we have put in public domain. Our partner is Orbicular, and Orbicular has a partner in one of the largest Canadian companies. So I think it's -- there are only two companies who are approved, so you can, I'm sure, figure out which ones are those.

Okay, thank you very much. Thanks a lot.

Yes, thank you very much for taking time and asking such insightful questions. Really appreciate the interest, and we look forward to speaking to all of you next quarter. Thank you very much.

Thank you very much. On behalf of OneSource Specialty Pharma Limited, that concludes this conference. Thank you for joining us, and you may now disconnect your lines. Thank you.