Blue Jet Healthcare Ltd — Q3 FY26

Blue Jet Healthcare Ltd Q3 FY2025-26 Earnings Conference Call https://www.youtube.com/watch?v=o12D-ttCQXY Published: 3 months ago

0:01 1 second Ladies and gentlemen, good day and welcome to Blue Jet Healthcare Limited Q3 FI26 earnings conference call. As a 0:09 9 seconds reminder, all participant lines will be in the listenon only mode and there will be an opportunity for you to ask questions after the presentation 0:17 17 seconds concludes. Should you need assistance during this conference call, please signal an operator by pressing star then 0:24 24 seconds zero on your Touchstone phone. Please note that this conference is being recorded. Precautionary remarks. I now hand the conference over to Mr. Adid 0:33 33 seconds Badikar from Ansen Young. Thank you and over to you sir. 0:40 40 seconds Thank you Bumi. Good evening and a warm welcome everyone to QCM9 and FIR26 earnings call of healthcare limit. 0:47 47 seconds Please note the investor presentation and the financial results are available on the company website and the stock list. Also, anything said on this call 0:56 56 seconds which reflects our outlook for the future or which could be confused as a forward-looking statement must be reviewed in conjunction with the risk that the company faces. 1:06 1 minute, 6 seconds The conference call is being recorded and the transcript along with the audio of the same will be made available on the website of the company as well as on 1:13 1 minute, 13 seconds the exchanges. Please also note that the audio of the conference call is the copyright material of US healthcare limited and cannot be copied, 1:21 1 minute, 21 seconds rebroadcasted or attributed in press or media without a specific and written consent of the company. From the management we have with us today Mr. 1:31 1 minute, 31 seconds Shiv Naruda managing director, Mr. VJ Singh, chief operating officer, Mr. 1:36 1 minute, 36 seconds Ganesh Kurupan, chief financial officer and Mr. Sanjay Sina deputy chief financial officer. Now I request Mr. S 1:43 1 minute, 43 seconds Aurora, managing director of Blue Jacket Healthcare Limited to provide you with the update for the quarter and 9 months end 31st December 2025. Thank you and over to you sir. 1:55 1 minute, 55 seconds Thank you Az. Good evening everyone and 1:58 1 minute, 58 seconds [clears throat] 1:58 1 minute, 58 seconds uh thank you for joining us today. Let me begin with a few business and strategic updates before we hand over 2:05 2 minutes, 5 seconds the discussion to our COOSAC green feed project. We are pleased to 2:12 2 minutes, 12 seconds announce that the groundbreaking ceremony for our Visac project is scheduled for this month. This green field site represents a pivotal growth 2:21 2 minutes, 21 seconds platform for BlueJet Healthcare. In phase one, we will be setting up a dedicated capacity for API and 2:29 2 minutes, 29 seconds intermediates focused on new products aligned with customer requirements. 2:36 2 minutes, 36 seconds This project was approved by a board with a total investment plan of thousand crores over the next 3 to four years. 2:43 2 minutes, 43 seconds The initial capacities under development are aligned with customer demand and long-term business visibility. 2:54 2 minutes, 54 seconds We believe the scale, infrastructure and the geographic advantage of WISAC will strengthen positioning as a reliable global partner in complex chemistries. 3:10 3 minutes, 10 seconds Hyderabad R&D expansion. We have successfully secured lease space for R&D activities in Hyderabad. 3:18 3 minutes, 18 seconds Development work is expected to commence from Q3 FY27, further strengthening our innovation pipeline and technical capabilities. 3:30 3 minutes, 30 seconds Artificial sweetener pipeline as a part of a focus on specialty ingredients. We are initiating few exhibit batches of the new artificial sweetener in FI27. 3:43 3 minutes, 43 seconds This will complement our existing high-intensity sweetener portfolio and address a growing segment of global demand. 3:55 3 minutes, 55 seconds Terms of capeex update of unit 3. 3:59 3 minutes, 59 seconds Our expansion project is nearing completion. The block is designed for key intermediates in contrast media. 4:10 4 minutes, 10 seconds The facility incorporates robust safety, environmental and automation systems and is expected to be ready for qualification in Q127. 4:20 4 minutes, 20 seconds It will play a key role in debotting our supply chain and supporting the future growth. 4:28 4 minutes, 28 seconds On this note, I would pass it on to my colleague Mr. Vik. 4:34 4 minutes, 34 seconds Thank you Shane and uh good evening everyone. Let me take this opportunity to expand on our operational progress, capex execution and CDMO pipeline 4:43 4 minutes, 43 seconds momentum at our Mahad unit 3 site. The core block for backward integration into contrast media intermediates is nearing 4:50 4 minutes, 50 seconds completion. This facility has been designed for one key site chain in our contrast media portfolio. A step that 4:58 4 minutes, 58 seconds not only improves cost competitiveness but also provides strategic independence from raw material volatility. 5:05 5 minutes, 5 seconds We have embedded a very high level of automation into this facility alongside strong safety and environmental design. 5:14 5 minutes, 14 seconds The site is on track for validations in quarter 1 of FI27 and we have incurred a cumulative capex of uh approximately 146 5:22 5 minutes, 22 seconds crores to date. This plant exemplifies our approach to securing supply chains and defending leadership in complex high 5:30 5 minutes, 30 seconds barrier segments like iodonated contrast media. 5:36 5 minutes, 36 seconds on the R&D and CDMO platform expansion that Shane u touched very briefly. Over the last 18 months, we have doubled our 5:44 5 minutes, 44 seconds R&D infrastructure and talent pool. As a part of our next phase, we are investing about 40 crores to build a new R&D 5:51 5 minutes, 51 seconds center at Hyderabad focused on emerging technologies including intermediates for GLP1s and some other chronic therapies, 5:58 5 minutes, 58 seconds peptide chemistry, biocatalysis and a faster turnound of CDMO tailored uh late phase RFPs. 6:07 6 minutes, 7 seconds This expansion is designed to support a growing CDMO pipeline particularly high conviction phase three and commercial stage opportunities. Currently we are 6:16 6 minutes, 16 seconds tracking around 20 active RFPs. Of these six are high conviction phase 3 programs including a couple of GLP1 candidates and one contrast media in C. 6:29 6 minutes, 29 seconds Two are commercial products that may evolve into strategic lateral entries with dedicated capacity planning. 6:36 6 minutes, 36 seconds We are also ramping up customer engagement, including on boarding a senior resource in Europe. 6:44 6 minutes, 44 seconds On sustainability and operational excellence, we continue to embed sustainability into our operations. 70% of our power consumption is now met 6:52 6 minutes, 52 seconds through wind and solar. Our team strive for atom efficiency in synthetic chemistry and sustainable process design. 7:00 7 minutes We have been recently recognized by the CI and have been awarded the national award for excellence in energy management. 7:08 7 minutes, 8 seconds On the operation side, we have built a dedicated process excellence department supported by strong additions in uh engineering quality and supply chain. 7:19 7 minutes, 19 seconds As a company, we believe in building scale and you see the same happening at Visak Mahad and our R&D platforms. We 7:27 7 minutes, 27 seconds remain sharply focused on reliability, responsiveness and readiness to support our customers across the life cycle from clinical intermediates to long-term commercial supplies. 7:38 7 minutes, 38 seconds With this brief, I hand it over to Ganesh for the financial review. 8:00 8 minutes Ganesh. Hello. 8:07 8 minutes, 7 seconds Ganesh. 8:11 8 minutes, 11 seconds He's there on the line. Um, but he's not speaking. 8:17 8 minutes, 17 seconds Can you just tell him just in case he's on mute? 8:20 8 minutes, 20 seconds Kisha, please unmute your line and go ahead. 8:27 8 minutes, 27 seconds Give me a moment. I'll just disconnect his line and reconnect him. 8:36 8 minutes, 36 seconds I'll I'll request Sanjay to take it. Yes. Uh good evening everyone. 8:43 8 minutes, 43 seconds So I'll take you first on a year on year uh performance. So revenue from operations 8:52 8 minutes, 52 seconds has increased. Revenue from was at 3 3184 million last year and this year it 8:58 8 minutes, 58 seconds was 1924 million and it has 9:05 9 minutes, 5 seconds sorry revenue from a decreased by 40% and AITA decreased by 62% and PD decreased by 39%. 9:17 9 minutes, 17 seconds Coming to Q1 Q performance uh the revenue has operations has increased by uh 16% 9:27 9 minutes, 27 seconds decreased by 15% and PD decreased by 23%. The increase in revenue is mainly towards u increase in contrast media and 9:36 9 minutes, 36 seconds where the dispatches were much more higher last quarter and got recognized this year. uptake of our flexib 9:44 9 minutes, 44 seconds uh was very stable and and and we continue to do uh to be major out major supplier 9:52 9 minutes, 52 seconds gross margin for Q3 was at 52% slightly lower than our normal trend mainly due to change in product mix and one time 10:01 10 minutes, 1 second write off of in inventory stands at 20% for the quarter lower mainly due to operating leverage of 10:08 10 minutes, 8 seconds lower sales volume one Impact of labor code implementation and of course engagement of certain foreign consultants. 10:27 10 minutes, 27 seconds Hello. Hi. 10:37 10 minutes, 37 seconds So, I'm taking over. Is it okay? Yeah. Okay. Okay. Yeah. 10:42 10 minutes, 42 seconds So 9 months to 9 months year on year uh the revenue from operations increased by 3%. And and decreased by 6% and PD 10:52 10 minutes, 52 seconds decreased by 6%. The increase in revenue from operations was due to increase in sale of PI this year. Gross margin was at 53%. 11:01 11 minutes, 1 second Compared to 50 purposes last year this is mainly due to product mix. 11:06 11 minutes, 6 seconds company reported robos other income in 9 9 months period with uh 45 million uh revenue. 11:20 11 minutes, 20 seconds On this note, we can uh open the floor. 11:25 11 minutes, 25 seconds Thank you very much. We will now begin the question and answer session. Anyone who wishes to ask a question may press 11:32 11 minutes, 32 seconds star and one on their touchstone telephone. If you wish to remove yourself from the question queue, you may press star and two. Participants are 11:41 11 minutes, 41 seconds requested to use handsets while asking a question. Ladies and gentlemen, we'll wait for a moment while the question queue assembles. 11:57 11 minutes, 57 seconds Our first question comes from the line of Amland Das from JP Morgan. Please go ahead. 12:05 12 minutes, 5 seconds Yeah. Hi sir. So first question is regarding the D talking impact that you have highlighted in your uh opening remarks. So so my question is when do 12:14 12 minutes, 14 seconds you see this Dalking impact uh going away and and and how do you see this um year ending um especially on the fourth 12:23 12 minutes, 23 seconds quarter? So so do you expect uh to do you expect grow to recover on your F25 base in the next year or how should you 12:30 12 minutes, 30 seconds think about the uh quarters ahead regarding this? 12:38 12 minutes, 38 seconds Hi, thank you for the question. Um uh see uh yeah there is clearly some channel inventory for which there is 12:45 12 minutes, 45 seconds some detocking happening and uh um 12:53 12 minutes, 53 seconds but at the same time you know there's a a supply chain realignment that is also happening and the reason for some 13:01 13 minutes, 1 second subdued orders uh can be contributed to both of these. Now 13:07 13 minutes, 7 seconds I would we we our assessment is that it might take a couple of quarters for this to get completely realigned. But if you 13:15 13 minutes, 15 seconds would see that um over the past 9 months also we have done significant volumes as 13:23 13 minutes, 23 seconds far as our API uh vertical is concerned. 13:28 13 minutes, 28 seconds To further corroborate the potential and the optimism that we have for this molecule, you need to understand how the end molecule is fairing. 13:38 13 minutes, 38 seconds quarter on quarter it is still showing uh good medium month on month I would say it's it's still showing uh good uh 13:46 13 minutes, 46 seconds mid-second digit growth mid mid level twodigit growth and uh new markets are also opening up 13:54 13 minutes, 54 seconds like a very big market that's Japan is opening up and there are lot of markets in uh the emerging geographies that are 14:01 14 minutes, 1 second opening up and uh the launch in Canada still is going to you know awaiting traction so we foresee see that uh I 14:10 14 minutes, 10 seconds mean we we are still very bullish on this product. We don't see any uh concern or issue. 14:20 14 minutes, 20 seconds All right sir. Thank you for the answer. 14:22 14 minutes, 22 seconds Uh my next question is regarding the contrast media uh segment. So I just wanted to understand over the say past 14:29 14 minutes, 29 seconds couple of years how many launches have you done in this segment and how has it contributed to your revenue so far and and and which and and any uh product 14:38 14 minutes, 38 seconds that you would like to call out which which has been a meaningful contributor to you um and uh and how is your market share in this product uh fed so far? 14:51 14 minutes, 51 seconds In contrast media there were uh two needle movers for us. One is an advanced intermediate for the existing product that we make which is currently under 15:00 15 minutes validation wherein we have the capacity ready for the next 5 years. 15:05 15 minutes, 5 seconds And uh the second molecule is the NC intermediate which has done well for us in the past uh 12 months. As you recall 15:12 15 minutes, 12 seconds in uh December 24 we had commenced a new line for this NC intermediate. 15:19 15 minutes, 19 seconds So I think keeping these two together um we have capacities on stream one is getting validated one is already scaled 15:28 15 minutes, 28 seconds up and the growth outlook in these two molecules is extremely encouraging. So these are the two major launches and the 15:35 15 minutes, 35 seconds third one uh which is more of a backward integration play and we spoke about a line uh which is under validation in unit 3. 15:44 15 minutes, 44 seconds Um this also could be a significant uh strategic um um needle mover for us both on the bottom line and also from the top line. 15:56 15 minutes, 56 seconds So and um how is the market share far in this product? So u so can you assume this market share to be sustainable or 16:04 16 minutes, 4 seconds or have they gone down recently in your key products? Uh so how should you think about it? 16:11 16 minutes, 11 seconds These are very sticky relations and uh in most of these cases these are backed by multi-year supply agreements. So we 16:17 16 minutes, 17 seconds feel that u uh depending on the order flow it's just about execution and u in 16:24 16 minutes, 24 seconds terms of the development of these molecules we've done uh considerable work. So we're very confident about the qualities and uh the order flow to go through very soon. 16:36 16 minutes, 36 seconds Thank you sir. So uh just if I could squeeze in one more uh so in the I just wanted to understand the in your PI API pipeline uh how should you think about 16:45 16 minutes, 45 seconds it uh in the in the say next couple of years. So how many molecules do you have in say the late stage or phase three assets uh in your PIP pipeline right now? 16:56 16 minutes, 56 seconds So the latest stage assets are about six and u um I think they'll start kicking 17:04 17 minutes, 4 seconds in about 2 years from now. 17:11 17 minutes, 11 seconds All right sir. Thank you. Those are my questions. 17:16 17 minutes, 16 seconds Thank you ladies and gentlemen. In order to ensure that management is able to address questions from all the participants in the conference, please 17:24 17 minutes, 24 seconds limit your questions to two per participant. If you have more questions, please rejoin the queue. Our next question is from the line of Sanjay 17:33 17 minutes, 33 seconds Chain from ICICI Securities. Please go ahead. 17:37 17 minutes, 37 seconds Yeah, thanks uh thanks for taking my question. I got few of them. Uh first on the margin uh in the presentation you mentioned that the product mix and the 17:46 17 minutes, 46 seconds inventory write off has hurt the gross profit margin. Uh I I think with increasing uh contribution from contrast 17:55 17 minutes, 55 seconds media the mix has only improved. Uh and uh can you give us more color on the inventory right down what and which 18:03 18 minutes, 3 seconds product and how much did it hurt because the gross profit volatility has really been all over the places and need to have a little more grip over that that 18:12 18 minutes, 12 seconds would be really helpful. That's number one. Uh number two, you did mention on the realignment of the uh supply chain 18:20 18 minutes, 20 seconds for the bamboo acid. Uh where are we in that realignment? Uh because one of a pure in India uh has also add up a lot 18:29 18 minutes, 29 seconds of capacity. So in this realignment uh how do we look our contract? We were at 120 metric earlier. Will it positively 18:36 18 minutes, 36 seconds benefit us? Will it negatively benefit us? and this dtoing phenomena when should it get over and we should start looking at volumes coming back. So these are initial two questions. Thank you. 18:47 18 minutes, 47 seconds So we'll take the question on the gross margin. If you see gross margin on a YTD 18:53 18 minutes, 53 seconds basis is around 53% compared to 54% 55% last financial year last. So it's only a 19:01 19 minutes, 1 second difference of 2% out of which 1% impact is roughly on some certain inventory writeups which are old stock which was 19:08 19 minutes, 8 seconds sitting in our um inventory. So it was a training exercise 1% impact is there and balance 1% is basically a swing off because of product mix. 19:20 19 minutes, 20 seconds No I thought product mix has improved that 1% should have been positive. So what we are talking is much bigger impact. 19:28 19 minutes, 28 seconds Just to give you some more idea in in in contrast media we have two approved vendors right um and um in the past 19:35 19 minutes, 35 seconds quarter we had uh sort of increased the uptake from the European supplier and that could have had a marginal impact on the main product of contrast media but 19:44 19 minutes, 44 seconds at the end of the day uh both uh contrast media and uh the pharma intermediate vertical is um is is highly 19:51 19 minutes, 51 seconds uh profitable with u you know gross margins over 50%. and in some cases uh about 55%. 20:00 20 minutes And on the on the stocking deto specific guidance, but um I think with the 20:07 20 minutes, 7 seconds molecule gaining new entries in new markets uh and the growth outlook definitely is 20:14 20 minutes, 14 seconds very encouraging. The capacities are on warm standby and we are already discussing encouraging volumes with our target customers for FI27 and beyond. 20:26 20 minutes, 26 seconds Should we expect the volumes in the Yeah, please go ahead. 20:31 20 minutes, 31 seconds Uh Dan here uh sorry if there was some issue moderator had muted my phone. Uh maybe 20:39 20 minutes, 39 seconds I'll just uh explain a little bit more on the gross margin. uh remember last quarter we actually talked about uh uh 20:49 20 minutes, 49 seconds change in uh finished goods and vip where uh goods in transit was pretty 20:56 20 minutes, 56 seconds higher. I was actually talking about uh overheads getting inventorized. So to that extent your gross margin in that particular quarter went up to 65%. 21:07 21 minutes, 7 seconds because we had a very huge goods in transit uh which didn't reach the customer destination 21:15 21 minutes, 15 seconds uh as of the end of the quarter. Now that whatever overheads which gets inventoized actually gets released into 21:23 21 minutes, 23 seconds this quarter when you actually like book the revenue. Uh that's how the accounting works. So to that extent uh 21:31 21 minutes, 31 seconds uh you would actually see a slightly uh a dip in the gross margin. uh the way Sanjay put it if you look at 21:40 21 minutes, 40 seconds cumulatively for n quarter uh whatever number we were actually like committing 21:46 21 minutes, 46 seconds we are in that similar range uh 52 53% of gross margin and 21:54 21 minutes, 54 seconds if you look at products like saccharine there is a little bit of uh price erosion so that would have actually 22:01 22 minutes, 1 second contributed marginally to reduction in the gross margin No, that's very helpful Ganesh. I think 22:09 22 minutes, 9 seconds that's that's clear. Uh on the realignment on the benotic value chain, can you can you help us understand uh 22:16 22 minutes, 16 seconds what exactly is happening and uh how is it going to benefit us? So Sanjay I think u it's uh it's a little premature 22:25 22 minutes, 25 seconds on our part to comment on it but uh all that I can say is that uh it'll work in 22:31 22 minutes, 31 seconds our favor and it is not that uh uh supplies from blue jet are not going and 22:38 22 minutes, 38 seconds somebody else is supplying or the end molecule is not doing well. So it's neither the case. So I think uh it's 22:47 22 minutes, 47 seconds it's uh just about uh some realignment and uh chant stocking. 22:55 22 minutes, 55 seconds Yeah. And uh you must also understand that uh these are advanced uh uh 23:02 23 minutes, 2 seconds intermediates. So uh any change uh will require some uh will have a regulatory pathway. 23:10 23 minutes, 10 seconds So uh and we were the primary suppliers in the past and we believe that we will continue to be the primary suppliers. 23:20 23 minutes, 20 seconds That's clear. On the on the growth in FI27, uh FI26 has been quite subdued on the 23:27 23 minutes, 27 seconds growth side. Um what gives us a confidence that FI27 should be better than FI 26 in terms of revenue growth 23:35 23 minutes, 35 seconds and on the operating leverage helping to regain the margins. 23:42 23 minutes, 42 seconds Okay. I'll I'll answer this question um by giving you some perspective about the capacity utilizations and uh the two 23:50 23 minutes, 50 seconds major lines that we had created one for the cardiovascular molecule and the other one was for the NC intermediate on 23:57 23 minutes, 57 seconds on contrast media um both of them would be positively contributing for FI27 24:05 24 minutes, 5 seconds with which is backed by some customer orders and you've seen in the past year we've been able to scale up this both the molecules well So there's one thing 24:13 24 minutes, 13 seconds that you add capacities but at the same time successfully scaling up with right efficiencies. I think there's a proven track record. 24:21 24 minutes, 21 seconds The third incremental aspect would be the backward integration play uh for the contrast media intermediates in unit 3. 24:32 24 minutes, 32 seconds While the topline growth will happen after certain customer audits, 24:38 24 minutes, 38 seconds validations but as soon as the line is commenced, we ourselves are a customer for this critical raw material and uh we 24:47 24 minutes, 47 seconds will gradually this will gradually impact the bottom line in the next coming years and some marginal line growth. 24:56 24 minutes, 56 seconds Um so these u three molecules we discussed [clears throat] and the fourth one is the iodonated contrast medium which uh the validation took longer than 25:05 25 minutes, 5 seconds expected but uh the forecasts are very encouraging. 25:10 25 minutes, 10 seconds Um and um this keeps us very positive in terms of the FI27 outlook 25:17 25 minutes, 17 seconds and from the API uh PI basket uh we are not looking at any new product to come in FI27. 25:24 25 minutes, 24 seconds We are we are but I think uh we will be giving a positive update in the next quarter for that 25:32 25 minutes, 32 seconds something uh really encouraging cooking but um I think we would be in the position to share that um uh in the next quarter 25:40 25 minutes, 40 seconds that's clear uh thanks thanks for answering all those questions and uh bishop for the coming quarters thank you thank you Sanjay thank you 25:48 25 minutes, 48 seconds thank you sir thank you very much thank you our next question comes from the line of shams Sat from MSA Capital Partners, please go ahead. 25:59 25 minutes, 59 seconds Hello sir, good evening. Um, I just wanted to understand firstly on the visa land that you mentioned that we've taken 26:06 26 minutes, 6 seconds position. Um, keeping that in mind what will our capeex deployment schedule look like for 26:13 26 minutes, 13 seconds the next FY27 uh given the current uh volatility that volatility that we have with Parma intermediates. How will you be facing this capeex? 26:24 26 minutes, 24 seconds So I think as per the board approval we've we've committed a capeex of thousand crores over the next 3 to four years and uh specific targets for FI27 26:34 26 minutes, 34 seconds we'll give you in in the next quarter but having said that the capeex that we are doing uh in visac is is is for 26:42 26 minutes, 42 seconds specific projects which have uh customer demand. This is not capacity creation in anticipation of a particular order. Uh 26:51 26 minutes, 51 seconds these are products candidates that have been discussed for many years with our end customers and uh uh this has no 26:58 26 minutes, 58 seconds correlation to the specific product in in pharma intermediate we spoke about. 27:06 27 minutes, 6 seconds All right. Understood. Uh so the next question that I have is uh regarding contrast media. uh in the presentation 27:13 27 minutes, 13 seconds uh you have mentioned that the top four players hold 75% of the share. So uh will our strategy be looking like 27:21 27 minutes, 21 seconds gaining more wallet share now with those players? 27:26 27 minutes, 26 seconds Yes. Yes. Those three three four needle movers that we spoke about in terms of the portfolio will will definitely contribute to the increase in uh the 27:35 27 minutes, 35 seconds wallet share because again our our target is to be a small partner to these uh to these large innovators and be a part of their growth story. 27:44 27 minutes, 44 seconds All right sir understood sir and regarding again in the presentation on page six we had uh uh we had a line 27:51 27 minutes, 51 seconds mentioning that was impacted by engagement of a foreign consultant. I just wanted to understand the nature of this engagement. Is it one off or recurring? 28:03 28 minutes, 3 seconds This would be a recurring expense. This would be a recurring expense and uh it's it's more strategic in nature and um we 28:12 28 minutes, 12 seconds can these are all European European based uh consultant will be helping the company 28:19 28 minutes, 19 seconds in strategizing transforming. So they'll add a lot of value. 28:28 28 minutes, 28 seconds Okay sir. Thank you sir. My last question that I have is uh regarding uh Aida margins. Um we have been we've been 28:36 28 minutes, 36 seconds seeing negative operating leverage. So just wanted to understand what kind of revenue threshold do we think we should expect to uh get back to the uh 30 plus margin mark. 28:50 28 minutes, 50 seconds No, that's a combination of uh product gross margin 28:56 28 minutes, 56 seconds and we we cannot be uh unfortunately we cannot guide on those numbers now. 29:06 29 minutes, 6 seconds All right sir, that's all from me. Thank you so much and all the best to you. Thank you. 29:12 29 minutes, 12 seconds Thank you ladies and gentlemen. Please limit your questions to two per participant so that management is able to address questions from all the participants. 29:23 29 minutes, 23 seconds Our next question is from the line of Nikopadhya from SIMPL. Please go ahead. 29:29 29 minutes, 29 seconds Yeah. Hi. Uh good evening. I hope I'm audible. Yeah. 29:34 29 minutes, 34 seconds Yeah. Uh my question was on this API PI product. See uh last quarter when we had 29:41 29 minutes, 41 seconds the the discussion during the same call uh you had mentioned that we are bound by the uh the order and we see 29:51 29 minutes, 51 seconds visibility on the amount of offices. I understand the innovator is uh renegotiating the orders and all but 29:58 29 minutes, 58 seconds when the renegotiation happens where a new supplier comes in. Uh how does the 30:04 30 minutes, 4 seconds business uh like break up happen between the two suppliers because as you said we are we would be part of the filing of 30:13 30 minutes, 13 seconds the innovator and all. So is it like do you do you see a risk that uh from what 30:20 30 minutes, 20 seconds we have done historically there could be some or substantial drop or is it like a minimum commitment that this will be 30:29 30 minutes, 29 seconds maintained and incremental will go like just some sense because uh we don't know how these things happen. So just some sense how the contracts get renegotiated. 30:39 30 minutes, 39 seconds Oh, I think uh very very fair point and I think I would want to give more clarity on this aspect because it's it's a it's a considerable part of u the overall revenues at this point in time. 30:50 30 minutes, 50 seconds Um see any any new supplier entering has a reg regulatory pathway. That's number 30:57 30 minutes, 57 seconds one. Number two, we spoken about the end molecule growing and um you know entering new markets. So 31:06 31 minutes, 6 seconds this is if you read about the molecule the the indicators are very positive and if at all there was there had to be a 31:15 31 minutes, 15 seconds need to be cautioned at this point in time uh from an FI27 perspective uh it would be our duty to highlight it but we 31:24 31 minutes, 24 seconds don't see those indicators at this point in time so um we are still positive around this molecule and uh we just have 31:32 31 minutes, 32 seconds to be a bit patient around No, I appreciate that fact. that what I'm trying to understand is that if you 31:41 31 minutes, 41 seconds look at 27 FI 27 the the volumes or the amount of business which the innovator 31:50 31 minutes, 50 seconds would be taking from you are these uh firm orders which are signed or is it like it it will be more closer to 31:59 31 minutes, 59 seconds starting of like financial layer 200 would be fine just sense on are we signed or that okay much we'll be 32:08 32 minutes, 8 seconds getting of just to get some confidence that is all. 32:13 32 minutes, 13 seconds No, no. So there are there are binding forecasts and uh there are confirmed purchase orders but at this point in time it's very difficult to give 32:21 32 minutes, 21 seconds specifics around that and hence um u there is no need to be worried about the outlook for 27. 32:30 32 minutes, 30 seconds Okay. And secondly, if we uh we understand if we look at the incremental pipeline from here, there are two of two 32:38 32 minutes, 38 seconds uh contrast media products and one more API PI product which you mentioned. Uh 32:46 32 minutes, 46 seconds by the time 27 ends or we get into 28, would you see that the business would 32:54 32 minutes, 54 seconds diversify it to a lot? the business would become more diversified versus what we have today or would you say this 33:03 33 minutes, 3 seconds concentration to few molecules will still remain very high? 33:10 33 minutes, 10 seconds A bit of both. Bit of both because the the the new launches that we spoke about in contrast media I think uh 33:20 33 minutes, 20 seconds um they are large molecules at the end of the day. So when we set up capacities we look at an incremental growth year on year for the next five years wherein we 33:28 33 minutes, 28 seconds are ready for that uh uh requirement and uh with the new launches and pharma intermediates yes there there would be some lumpiness because that's the nature 33:37 33 minutes, 37 seconds of CDMO so you should have a 2 three year outlook um but yes the the idea and the endeavor 33:44 33 minutes, 44 seconds is to definitely uh add more u molecules and uh that is one of the reasons uh the 33:51 33 minutes, 51 seconds visak Apex um has been announced and um we are looking at it very positively. 33:59 33 minutes, 59 seconds But you know if you would see the numbers two years back and now you would see that both product and client concentrations have significantly 34:06 34 minutes, 6 seconds improved. So I would imagine that we are on the right track and um it should uh stay the same. I mean it should improve further. 34:17 34 minutes, 17 seconds Okay sir. I'll come back. Thank you. 34:23 34 minutes, 23 seconds Our next question comes from the line of Anish Burman from Varia. Please go ahead. 34:30 34 minutes, 30 seconds Uh, hi, good evening. Thanks for taking my question. Um, I had a question on this new u PCSK9 integrator. I don't 34:38 34 minutes, 38 seconds know whether this was answered or not but uh my question is about this new Amsterdam product called OKetra PIP and 34:45 34 minutes, 45 seconds how do you think it will uh when it gets launched let's say two years end how does it compete with vampidic acid given 34:52 34 minutes, 52 seconds the fact that the u like the results and the trials have been pretty encouraging for this product 34:59 34 minutes, 59 seconds you know any of course the molecule is very important and uh it has strong USPS around it is very difficult to make such 35:08 35 minutes, 8 seconds predictions as to how it will fare because what matters is the phase 4 data. Phase 4 means that post-launch marketing surveillance data that's also 35:16 35 minutes, 16 seconds very critical. There is a pathway for getting to uh the uh prescriptions on 35:24 35 minutes, 24 seconds the physician table. Uh by that I mean that uh you need uh endorsement from certain you know cardiologists and you 35:33 35 minutes, 33 seconds need phase 4 and you need outcome trials. So while even if this is a great opportunity, it'll take a while for it 35:40 35 minutes, 40 seconds to gain traction and uh uh regardless of that I think you know it's a new molecule so you have to 35:48 35 minutes, 48 seconds wait and watch just in case there are any adverse reactions or whatever. So I think um as far as our opportunity is 35:55 35 minutes, 55 seconds concerned we are in a very very uh safe zone. That's what we believe and that's what the indications that we have. 36:03 36 minutes, 3 seconds Beyond this, I don't think um I'm capable to comment. 36:09 36 minutes, 9 seconds Okay. Thanks. No, that helps. Uh there's one question regarding uh the contrast media. I mean, I know that second quarter was marred by some transit 36:18 36 minutes, 18 seconds issues, but if you look at the 9 month revenue and compare it, the growth is flat. So, uh when do we expect like a 36:25 36 minutes, 25 seconds material double-digit growth here if if that is possible? 36:34 36 minutes, 34 seconds terms of providing an outlook would be would be difficult but I think when I um when I was trying to say that there are we'll scale up around three molecules 36:43 36 minutes, 43 seconds and molecules are are are of large volume high value products 36:50 36 minutes, 50 seconds um so okay no yeah yeah you talked about uh this one 37:00 37 minutes the NC product. Can you also talk a little bit about the donenated app product? I mean what could be the 37:07 37 minutes, 7 seconds realizations here and uh what are the target volumes here and timelines? I mean when when can we see commercial launch for this product? 37:18 37 minutes, 18 seconds So in FY27 you will see the commercial launch and uh the ramp up will happen uh from Q1 itself uh is our understanding. 37:31 37 minutes, 31 seconds uh value per kg it would be uh it would be higher 60 uh than uh than our main 37:39 37 minutes, 39 seconds module because it's a forward integration plane okay and uh what kind of volumes can we 37:47 37 minutes, 47 seconds get from here let's say in the second year in FI28 that is difficult to comment right now okay no I'll get back Thank you. Thanks. 38:00 38 minutes Thank you. Our next question comes from the line of Sujit Lora from ICICI Lombard. Please go ahead. 38:10 38 minutes, 10 seconds Hi sir. Uh this is just uh one thing on on the farm while the other questions are being answered. uh so on numbers 38:19 38 minutes, 19 seconds while I understand that the contracts are fluid and we don't have quarterly numbers and it's very difficult to guide on that but just a small number here 38:27 38 minutes, 27 seconds that last quarter we last quarter same year we did a farmer intermediate revenue of about 145 146 odd cr which is 38:36 38 minutes, 36 seconds roughly about 40 odd cr in this quarter right uh so what is the quarterly number one should work at for for fi 27 or one 38:43 38 minutes, 43 seconds what is the annual number one should look at is 145 cr right number or is is that exaggerated or is 40 cr a very 38:51 38 minutes, 51 seconds underestimated number? It should it be somewhere in between? What is what is the right number one should look at in terms of normaly of uh of uh the supply chain and and inventory if that happens. 39:04 39 minutes, 4 seconds See uh one is that we normally don't like to give a guidance like this. The second is that um it all depends as to 39:12 39 minutes, 12 seconds how the uh you know orders they pan out. I think uh just wait for a quarter 39:19 39 minutes, 19 seconds and uh then the run rate that you will see from that run rate you can extrapolate. 39:25 39 minutes, 25 seconds Okay. Okay. Okay. Okay. So it's a quarter is what you are saying more will take for the things to normalize is what your your understanding is. 39:34 39 minutes, 34 seconds I think that's a fair assessment to make. Mhm. Um yeah. 39:39 39 minutes, 39 seconds Okay. Okay. Okay. Got it. Got it. That that that's it for my thanks. 39:46 39 minutes, 46 seconds Thank you. Our next question comes from the line of Ankush Mahajan from Sanctum Wealth. Please go ahead. 39:55 39 minutes, 55 seconds So thanks for the opportunity. I'll just try to understand sir that uh if the end product is giving a growth of mid double 40:03 40 minutes, 3 seconds digit growth uh that is showing strong prescription on the on their side also new markets are also growing uh expected 40:12 40 minutes, 12 seconds to grow in the Japan. So just try to understand the nature of this supply chain how this stocking and etoing 40:20 40 minutes, 20 seconds happening actually. So we throw some more light actually because an end product is doing very well growth is there then they stock it at the earlier 40:29 40 minutes, 29 seconds level then we can we say before 2 three quarters they stocks uh the raw material 40:36 40 minutes, 36 seconds earlier at 2 3/4 the launch and something like that. 40:41 40 minutes, 41 seconds See we supply the advanced intermediate and this gets converted to the API and which get gets converted to the formulation. So from the point of supply 40:49 40 minutes, 49 seconds to the point of purchase there is about 9 to 10 months and when the molecule is new then you lag of three quarters. 41:01 41 minutes, 1 second Yeah. you know it's so difficult to give uh some sort of a number I mean if you are trying to create a model but then broadly is yes that's that's a type of 41:10 41 minutes, 10 seconds uh guidance that you can work with but still there is a constant uh they 41:18 41 minutes, 18 seconds are whatever the number they are releasing the growth is there yeah growth is there and that's why we have been saying that there's channel 41:25 41 minutes, 25 seconds inventory um and there's some detocking happening and you will see the numbers revive very soon. Just be bit patient. 41:35 41 minutes, 35 seconds I think there from from a stocking scenario to um uh limited product. I think uh we are at 41:43 41 minutes, 43 seconds the end of the transition from the last two quarters. We can say that uh there is this talking. So 41:53 41 minutes, 53 seconds maybe not from one month not not from the last two quarters but yes last quarter we did but uh maybe you know we could take it offline if you 42:02 42 minutes, 2 seconds have more concerns and queries on this uh you can explain more about the end molecule and there are some u reports 42:11 42 minutes, 11 seconds available online about the end molecule in terms of how it's entering new markets and uh that could be a good indicator for absorption. 42:18 42 minutes, 18 seconds Thank you sir. Thank you very much. Thank you. 42:25 42 minutes, 25 seconds Our next question comes from the line of Shashang Krishna Kumar from MK Global Financial Services. Please go ahead. 42:33 42 minutes, 33 seconds Yeah. Hi, thanks for taking my question. 42:35 42 minutes, 35 seconds Uh so my first one was on the uh six late stage assets. I think last call we did indicate that we have seen some RFPs 42:43 42 minutes, 43 seconds for one phase three and uh two commercialized products. Uh so uh anything incremental in terms of updates 42:51 42 minutes, 51 seconds that uh you might have to share whether we can see some of these getting converted in terms into orders say sometime next year FI28 anything that you would any update there. 43:03 43 minutes, 3 seconds Uh just wait for some more time. I think they are moving very fast and in the right direction. Uh we last time we 43:11 43 minutes, 11 seconds spoke about two lateral entries. Uh very advanced conversations are on on both of them. 43:18 43 minutes, 18 seconds um and and um uh to some extent the capacities that I envisaged at VISAC 43:25 43 minutes, 25 seconds will be also catering to these opportunities. So just give us a little more time and we'll make uh uh some announcements 43:34 43 minutes, 34 seconds soon but all that I can say is that they are moving in the right direction both the opportunities that we spoke about. 43:42 43 minutes, 42 seconds Got it. Thank you. That's helpful. The second one on uh the new sweetener that we're looking to commercialize now uh can we sort of expect it to start 43:51 43 minutes, 51 seconds contributing meaningfully from 27 or uh will this largely be contingent on the wisak capacity coming in and then we'll 44:00 44 minutes probably start seeing uh this contributing to the sweetener revenue how should we think about it 44:06 44 minutes, 6 seconds I think um between uh FI 27 and 28 there are certain milestones that we are working towards I think In terms of the 44:15 44 minutes, 15 seconds target capacity that we are targeting is about u 10% or $1 billion. 44:21 44 minutes, 21 seconds So for a large molecule uh there has to be some work at piloting uh in terms of proving ourselves to the 44:30 44 minutes, 30 seconds target customers. So I think uh in terms of the development we are very confident 44:37 44 minutes, 37 seconds uh in terms of the pilot quantities in FI27 this will give us some very valid um uh indicators in terms of continuous 44:47 44 minutes, 47 seconds engineering um in the backward integration in Mahad is is is a very continuous plant that's 44:53 44 minutes, 53 seconds why the capeex is uh optimized and uh that would be the endeavor for this large sweetener as 45:02 45 minutes, 2 seconds What did uh thanks that's it from my Thank you. 45:09 45 minutes, 9 seconds A reminder to all the participants. If you wish to ask question, you may press star and one at this time. 45:16 45 minutes, 16 seconds Our next question comes from the line of Vinea from the corporate daily. Please go ahead. 45:24 45 minutes, 24 seconds Yeah, good evening sir. Uh I hope I'm audible. Uh my question is the manage yeah the the management management has 45:31 45 minutes, 31 seconds attributed uh that the recent revenue decline is due to the customer restocking. However, during the high 45:38 45 minutes, 38 seconds growth period of H2 FY25 to Q1 FI26 we observed a nearly 100% 45:45 45 minutes, 45 seconds spike in trade receivables rising from 177 CR to 350 CR. Could you please explain this period of significant 45:54 45 minutes, 54 seconds credit letter sales and why it was immediately followed by two consecutive quarters of a sharp slump sharp revenue slump? 46:05 46 minutes, 5 seconds I didn't get your question. Can you repeat that please? 46:08 46 minutes, 8 seconds We observed three good quarters H2 FI25 and Q1 FI26. three good quarters with a 46:15 46 minutes, 15 seconds spike of 100% trade receivables from 177 CR to 350 CR and after that OFS happens 46:23 46 minutes, 23 seconds and there are two slump quarters back to back wherein customer detocking 46:31 46 minutes, 31 seconds is happening and so the previous three quarters sales were led by credit. So can you please explain this? 46:41 46 minutes, 41 seconds See u um this is normal when a new product is getting launched. I mean if you track 46:49 46 minutes, 49 seconds any new launches then uh filling up the channel uh is very critical because 46:57 46 minutes, 57 seconds um you know getting the product to the patient and ensuring that any prescription that is written gets filled 47:04 47 minutes, 4 seconds up. This is something you you know which is very normal in the in the pharmaceutical world. So um I mean 47:12 47 minutes, 12 seconds usually that's how it happens. So I don't see any actually I'm not able to get your concern. So I think uh if you see in the numbers also my friend I 47:20 47 minutes, 20 seconds think in in in 2024 the pat was about 47:27 47 minutes, 27 seconds 160 crores around 160 crores in 25 it became 300 crores. So after listing we've been able to double the profits. 47:36 47 minutes, 36 seconds So the end endeavor of us is to definitely grow the company and uh going forward also the target uh 47:44 47 minutes, 44 seconds launches that we are looking at I think the outlook should remain positive. Okay. 47:51 47 minutes, 51 seconds Thank you for your question. Can we expect the next quarter to be better normalize? 47:59 47 minutes, 59 seconds Again, you know, as we said, we don't really give a guidance, but uh uh but u like we already mentioned uh it may take 48:08 48 minutes, 8 seconds a quarter or two for this particular opportunity to get back to normal. In fact, be better than the past. 48:15 48 minutes, 15 seconds Thank you. Thank you. Thank you. Thank you. 48:20 48 minutes, 20 seconds Participants who wish to ask a question may press star and one at this time. Our next question comes from the line of 48:28 48 minutes, 28 seconds Alankar Garud from Kotak Institutional Equities. Please go ahead. 48:33 48 minutes, 33 seconds Hi, good evening everyone. Sly adjust for the 5060 crores of goods in transit which you had called out in the second 48:41 48 minutes, 41 seconds quarter. The contrast media sales have actually declined on a sequential basis. 48:46 48 minutes, 46 seconds Uh and we also would have had the ramp up of the gadalinium based NC and possibly some validation supplies of the iodinated product. So in this context 48:55 48 minutes, 55 seconds just trying to reconcile the the low contrast media sales was there any pricing pressure or any specific volume impact which you would like to call out? 49:08 49 minutes, 8 seconds No, there are no first of all there are no volume or pricing pressure as such and as you rightly said uh there was a 49:15 49 minutes, 15 seconds huge what do you call sales cut up last year so last quarter and but it was followed by I mean the cut off 49:24 49 minutes, 24 seconds essentially means dispatches happened so those dispatches now got recognized 49:31 49 minutes, 31 seconds we we spoke about it last quarter also Just 49:39 49 minutes, 39 seconds Alanka uh just to clarify uh the closing cutff for this quarter is 49:47 49 minutes, 47 seconds also similar to uh opening cut off. So you didn't see the impact but actually our dispatches 49:55 49 minutes, 55 seconds uh if you actually see from a production point uh we have a pretty strong production of contrast media this 50:03 50 minutes, 3 seconds quarter and the cut off for December is also similar to the opening cutff. So uh 50:12 50 minutes, 12 seconds that is a pretty positive news as far as uh contrast media is concerned and we should be recognizing that in Q4. 50:22 50 minutes, 22 seconds Okay, if I understood this correctly sir, uh the goods and transit were higher in the second quarter. Was that the issue in the third quarter as well 50:30 50 minutes, 30 seconds and you expect it to be better in the fourth quarter? Uh it is a similar number. 50:38 50 minutes, 38 seconds Uh so the uh maybe if I go back to Q2, the opening of the quarter, we didn't have uh too much of goods and transit. 50:47 50 minutes, 47 seconds it was actually more in the closing. So that's why you had a significant impact in Q2. But in Q3 both opening and 50:55 50 minutes, 55 seconds closing are more or less similar. So the the business is as usual there is a very steady state of dispatches. 51:03 51 minutes, 3 seconds So like uh it is not that there is a one-off in Q2 which is not there in Q3. I think that assessment is not correct. 51:12 51 minutes, 12 seconds uh you would actually see whatever cut off we have in Q3 getting recognized in Q4. 51:20 51 minutes, 20 seconds Okay. Uh sorry to persist on this just trying to understand the the numbers. If you look at 81 crores of Pontas media 51:27 51 minutes, 27 seconds sales in the second quarter you had said about 51 crores of goods in transit and we reported 124 crores in this quarter. 51:36 51 minutes, 36 seconds uh uh so I mean if I add that say 51 crores to 81 crores um the number is 51:43 51 minutes, 43 seconds actually higher than uh the 124 crores that we have reported and I mean we are expecting at least some ramp up after 51:51 51 minutes, 51 seconds the commercialization of the gadalinium based MC and possibly some validation supplies of the iodinated product as well. So just trying to reconcile these numbers sir. 52:03 52 minutes, 3 seconds Uh see as far as the gadolinium uh category the sale is constant. Uh 52:13 52 minutes, 13 seconds there is uh it is almost reaching some sort of a steady state. Uh although the product is not comparable to the 52:22 52 minutes, 22 seconds adinated product. uh when you look at uh uh the key product uh our production and 52:31 52 minutes, 31 seconds dispatches were uh higher in Q3. action. 52:37 52 minutes, 37 seconds The amount we recognized is even with considering the opening cut 52:44 52 minutes, 44 seconds off is bit on the lower side actually because we still have that goods and 52:49 52 minutes, 49 seconds transit as for December end which is actually slightly more than what we have as opening. 52:59 52 minutes, 59 seconds Okay. The point I can explain offline uh in terms of uh the frequencation. 53:08 53 minutes, 8 seconds Okay. Got it. Okay. So basically you're saying the gadalinium based NC was flat sequentially and you you mentioned about flattening out. I mean are we expecting 53:16 53 minutes, 16 seconds any any growth here in FI27 or uh this is I would say a steady state. It's a 53:24 53 minutes, 24 seconds steady state and whatever purchase order uh we have received uh the numbers are 53:32 53 minutes, 32 seconds reasonably uh stable and sustainable. Got it. 53:38 53 minutes, 38 seconds I think instead of a quarterly maybe you will have to look at from a yearly perspective. Uh from a yearly perspective these numbers would be more 53:46 53 minutes, 46 seconds sustainable. I think just to give you an additional data point on this NCE molecule, I think uh I was just reading some reports, it's it's growing by uh 53:55 53 minutes, 55 seconds high teens. So that's definitely encouraging from the future capacity utilization standpoint. 54:04 54 minutes, 4 seconds Okay. So eventually there could be some growth. Uh okay, fair enough. Uh the uh the other question was uh VK you you 54:12 54 minutes, 12 seconds said uh Bluejet will continue to be the primary supplier for the PI API molecule. Uh what is giving us that 54:20 54 minutes, 20 seconds confidence? You mentioned about being in discussions and there being some binding forecast some purchase orders. Uh but 54:27 54 minutes, 27 seconds this point about being the primary supplier especially given the realignment in the supply chain which you alluded to earlier. uh just trying 54:35 54 minutes, 35 seconds to understand this and if you could provide us some comfort as to what is giving us that confidence. 54:43 54 minutes, 43 seconds Uh one is the sheer momentum. Two is the quality. 54:50 54 minutes, 50 seconds I cannot elaborate more. Momentum of what sir? 54:55 54 minutes, 55 seconds Uh we have been supplying we have supplied large quantities in the past. I mean you can uh see the data uh huge 55:05 55 minutes, 5 seconds quantities have been supplied by us in the past and um uh so that's the momentum that I'm talking about and two 55:13 55 minutes, 13 seconds I think our quality is extremely consistent because uh we are giving it from a very 55:21 55 minutes, 21 seconds high-tech automated and dedicated facility. 55:27 55 minutes, 27 seconds Okay. Okay. Uh understood sir. Uh that's it and uh that's it from my side. Thank you. Thanks. 55:35 55 minutes, 35 seconds Thank you. 55:37 55 minutes, 37 seconds Next we have a follow-up question from Shasham Krishna Kumar from MK Global Financial Services. Please go ahead. 55:45 55 minutes, 45 seconds Hi uh thanks for the followup. uh just wanted to check so uh from a normalized uh grass gross margin standpoint should 55:52 55 minutes, 52 seconds we take this quarter's figures as the normalized margin or is it likely to be closer to the 9 month figure how should 56:00 56 minutes we uh think about it I said it should be between 50 to 55% 56:07 56 minutes, 7 seconds depending on the product mix okay okay got it and uh just a last one on 56:15 56 minutes, 15 seconds the uh visac facility what is the incremental P&L impact that we should uh try and build in uh say for 56:23 56 minutes, 23 seconds uh uh FY27 um because um obviously this will get fully commercialized after a point but u what is the incremental PNL 56:31 56 minutes, 31 seconds hit in the near term which we should sort of expect 56:41 56 minutes, 41 seconds mostly most of the expenses would be capitalized and we need to just the uh the portion of expenses that cannot be 56:49 56 minutes, 49 seconds capitalized because it's going to be a green field and uh uh I don't expect any significant P&L impact. 56:59 56 minutes, 59 seconds Thank you. That's excellent. Thank you. 57:06 57 minutes, 6 seconds Our next question comes from the line of Andy from Rave Ventures. Please go ahead. 57:13 57 minutes, 13 seconds Uh hi, good evening. Thank you for taking my question. There's one question. So given the recent moderation in operating cash flow and the announced 57:22 57 minutes, 22 seconds KEX program uh could you elaborate on how management is thinking about funding this investment? Is it like specifically how do you expect to balance say 57:31 57 minutes, 31 seconds internal approval versus existing cash and investments and like say potential for external finance etc. 57:38 57 minutes, 38 seconds Uh if yes then uh what could be the guard rails around leverage or dilution as we execute on this capex? Thank you. 57:47 57 minutes, 47 seconds Good question. Ganesh can you take it up please? 57:50 57 minutes, 50 seconds Uh right so we have 410 cr cash as of December. Okay. Uh we will continue to 57:57 57 minutes, 57 seconds uh use internal approval for the initial phase of uh capex. Okay. Uh we have both 58:04 58 minutes, 4 seconds opportunities open. uh we could actually tap the debt market uh or we could also like uh use the capital market. Anyhow, 58:13 58 minutes, 13 seconds we have certain headroom to be uh uh offloaded to meet the minimum promoter stake of 75%. 58:25 58 minutes, 25 seconds So we have all options and as we get into long-term contracts with the 58:32 58 minutes, 32 seconds customer we are also evaluating co-investment options. 58:36 58 minutes, 36 seconds Uh so for us uh uh being a debtfree company we have all options available. 58:46 58 minutes, 46 seconds Amazing. Thank you so much. 58:51 58 minutes, 51 seconds Thank you ladies and gentlemen. We take that as the last question for today. I would now like to hand the conference over to 58:58 58 minutes, 58 seconds management for closing comments. Over to you sir. 59:03 59 minutes, 3 seconds Uh we thank you all all the participants and uh we will meet you in the next quarter. Thank you. 59:11 59 minutes, 11 seconds Thank you on behalf of Blue Jet Healthcare Limited. That concludes this conference. Thank you for joining us and 59:18 59 minutes, 18 seconds you may now disconnect your