Fredun Pharmaceuticals Ltd — Q4 FY26

Fredun Pharmaceuticals Ltd Q4 FY2025-26 Earnings Conference Call https://www.youtube.com/watch?v=nWIMo8agcwA Published: 5 days ago

0:01 1 second Ladies and gentlemen, good day and welcome to Q4 FI26 business conference call of Freeden Pharmaceuticals Limited 0:09 9 seconds hosted by Kiran Advisers Private Limited. 0:14 14 seconds This conference call may contain forward-looking statements about the company which are based on the beliefs, opinions and expectations of the company 0:22 22 seconds as on date of this call. These statements are not the guarantees of future performance and involve risks and uncertainties that are difficult to predict. 0:32 32 seconds As a reminder, all participant lines will be in the listenonly mode and there will be an opportunity for you to ask questions after the presentation 0:39 39 seconds concludes. Should you need assistance during the conference call, please signal an operator by pressing star then 0:47 47 seconds zero on your touchtone phone. Please note that this conference is being recorded. I now hand the conference call over to Miss Saki Pangiara from Pyan 0:56 56 seconds Advisers. Thank you and over to you ma'am. 1:00 1 minute Good morning everyone. Thank you for joining the Q4 FI26 earnings conference call pharmaceuticals limited. We have 1:08 1 minute, 8 seconds today with us Mr. S. Moram, managing director of the company. Before handing over to him to address your question, let me briefly walk you through the 1:16 1 minute, 16 seconds company's performance for the quarter and year ended FY26. During the Q4 FY26 1:22 1 minute, 22 seconds total income stood at 213 K registered a strong growth of 27.27 year on year 1:30 1 minute, 30 seconds compared to 167.41 K in Q4 FI25 IIDA come in at 29.13 K reflecting a 1:40 1 minute, 40 seconds robust growth of 67.05 yearon year with margin improved to 13.67 67 expending by 326 BPS point. 1:51 1 minute, 51 seconds Net profit for the quarter stood at 11.07 crores with a growth of 56.47 yearon year. Net profit margin improved 2:01 2 minutes, 1 second to 5.19% expended by 97 basis point. For FY26 the 2:08 2 minutes, 8 seconds total income reaches 639.12 kores marking a 40.08% 08% yearon-year 2:16 2 minutes, 16 seconds growth. IVID stood at 94.79 crores up by 72.05% 2:22 2 minutes, 22 seconds year on year. IDIA margin improving to 14.83% and expansion of 276 basis point. Net 2:31 2 minutes, 31 seconds profit increased to 33.21 K delivering a strong 59.59 growth year on year. 2:39 2 minutes, 39 seconds Overall the company has demonstrated the strong revenue growth along with the meaningful margin expansion and improved profitability during Q4 and FY26. With 2:48 2 minutes, 48 seconds that brief overview, I would now like to hand over to Mr. Tan Mora Salor. We can now open the floor for Q&A. Thank you. 3:00 3 minutes Thank you very much. We will now begin the question and answer session. Anyone who wishes to ask a question may press star N1 on their touchstone telephone. 3:11 3 minutes, 11 seconds If you wish to remove yourself from the question queue, you may press star N2. 3:17 3 minutes, 17 seconds Participants are requested to use handsets while asking a question. Ladies and gentlemen, please note in order to ensure that the management will be able 3:25 3 minutes, 25 seconds to address questions from all the participants in the conference, kindly limit your questions to one per participant. Should you have a follow-up question, please rejoin the queue. 3:36 3 minutes, 36 seconds Ladies and gentlemen, we will wait for a moment while we question Q assemble. 4:03 4 minutes, 3 seconds The first question is from the line of Kesha Toshiwal from Kakala Capital. Please go ahead. 4:10 4 minutes, 10 seconds Uh congratulations Fredun for excellent set of numbers. Uh the company has been growing at a crazy pace. Now my question 4:18 4 minutes, 18 seconds is with regard to the recent notification which you have given regard to doll cell and harmonics. It it seems to be very exciting pack like how do you 4:26 4 minutes, 26 seconds see these products and what is your plan and like how do you want this products to pan out in our company? 4:34 4 minutes, 34 seconds So excellent. Uh we are we are launching two uh sets uh one is an hormonal line 4:42 4 minutes, 42 seconds and the other is an anti-aging line. Now in the hormonal line the market is quite 4:49 4 minutes, 49 seconds fragmented. Uh there are there are these hormones which are used for medical medicinal purposes and uh there are some 4:58 4 minutes, 58 seconds who abuse it also uh and uh they we are going through the talk the channel. We are we want good hormones in the market. 5:10 5 minutes, 10 seconds There's a huge demand as the uh population is gaining awareness. the population uh requires uh certain 5:18 5 minutes, 18 seconds targeted therapies such as uh you know testosterone replacement therapies uh and and so on and so forth. Even in 5:26 5 minutes, 26 seconds terms of pregnancy, even in terms of estrogen, even in terms for men and 5:32 5 minutes, 32 seconds women both, uh hormones are a a a sector which is not very focused on and uh it 5:40 5 minutes, 40 seconds is very fragmented in terms of its uses because there is uh there are not many 5:47 5 minutes, 47 seconds good hormone uh products available. Many even abuse it. So we have gone through our doctor line. We have created uh a 5:56 5 minutes, 56 seconds list of products. Some of the products that we have created in the hormone line, we will be one of the first or the second in the country to have those 6:04 6 minutes, 4 seconds products. Uh we have created a ground level team. Currently we are focusing in MMRDA region as we generally do as a 6:12 6 minutes, 12 seconds company and then we are focusing on certain metros. 6:16 6 minutes, 16 seconds uh we also will be the first ones to have uh medicated hormone uh products sold online through our website and 6:25 6 minutes, 25 seconds through our doctor channel which is available which will will be the first ones in the country to do so. 6:32 6 minutes, 32 seconds Uh so there we are going to add not only uh these products but also specialized 6:40 6 minutes, 40 seconds uh therapeutical uh products even for uh fitness industries such as specialized 6:47 6 minutes, 47 seconds preworkout specialized uh protein powders because we are already doing an entire protein range uh in our nutrition 6:54 6 minutes, 54 seconds range which is doing phenomenally well under Fron energy. Uh so uh we are going to use we are going to enhance those and 7:02 7 minutes, 2 seconds created create targeted uh uh preworkouts create a targeted therapies 7:07 7 minutes, 7 seconds which are uh going to not only uh help the fitness industry but also will do 7:17 7 minutes, 17 seconds great for doctors as they will have alternative long-term treatments along with their hormonal therapies. So we are 7:26 7 minutes, 26 seconds going to have a range not just of hormones but of other protein supplements also which are targeted in those areas for those people who are on 7:34 7 minutes, 34 seconds hormone therapy. So uh it will be a complete end to end basket for for for people who are on that prescription. 7:45 7 minutes, 45 seconds When it comes to anti-aging uh as you know the number of clinics of anti-aging are growing rapidly. Uh now CDSO has 7:54 7 minutes, 54 seconds lately finally announced that you cannot accept for doctors because first you know anyone was given any therapy 8:02 8 minutes, 2 seconds online. You would see in newspapers that uh weddings have uh these IV bars given 8:09 8 minutes, 9 seconds uh uh for the IV guest and everything and anyone was administrating anything. 8:15 8 minutes, 15 seconds The demand is unbelievably huge but uh it was not very organized. Uh finally the government has uh has has put a very 8:24 8 minutes, 24 seconds good law uh and CDSU has put a good law that only certified doctors can prescribe it. It works to our advantage. 8:32 8 minutes, 32 seconds Uh we are one of the first manufacturers for uh NAD NAD plus we are one of the 8:39 8 minutes, 39 seconds first ones to have exclusive uh uh import rights for the API also uh which 8:46 8 minutes, 46 seconds is right now the talk of the town. So with end to-end supply chain uh and it 8:52 8 minutes, 52 seconds has a relatively decent u uh margins also and we can use our dermacitic 9:00 9 minutes products our uh our specialized uh anti-aging products and there are certain products which we have we are the first ones to have those licenses. 9:10 9 minutes, 10 seconds create a basket and go to the dermat uh go to the doctors, go to the people who 9:17 9 minutes, 17 seconds are uh prescribing these uh clinic uh these uh serums and injections and create a range of it. It is a very high 9:26 9 minutes, 26 seconds margin uh fragmented uh market uh not strong competition uh unorganized market 9:34 9 minutes, 34 seconds and uh frankly speaking a very uh brown field for us to build our brand very quickly and very fast. 9:50 9 minutes, 50 seconds Thank you very much. 9:52 9 minutes, 52 seconds Next question is from the line of winner Cha from BSA. Please go ahead. 9:57 9 minutes, 57 seconds Hello. Good. Good morning sir. Am I audible? 10:01 10 minutes, 1 second Yes. Yes, you're good. Thank you. Good afternoon. 10:04 10 minutes, 4 seconds Yes sir. I just have one quick question sir. So uh can you share some light on growth strategy for your mobility 10:11 10 minutes, 11 seconds division? Um how are you planning to scale this business going forward? 10:16 10 minutes, 16 seconds Yes, mobility uh has been a very positive division for us. We have seen phenomenal growth. Last year we did 10:24 10 minutes, 24 seconds around uh almost 30 cores of mobility products. Mobility has four brands in 10:30 10 minutes, 30 seconds it. Brace on DGN neon and now we are launching this uh by July Mobilitics. 10:39 10 minutes, 39 seconds Uh these products go to the chemist shops and most of these knee braces, leg braces, uh your orthoperating products, 10:48 10 minutes, 48 seconds your digital uh based um uh you know products like uh thermometers, your BP 10:55 10 minutes, 55 seconds machines, your your glucometers, those are all uh products which are sold in the chemist line. We are already doing 11:03 11 minutes, 3 seconds very big distribution uh uh and distributing our products of Freedom GX and our other third party products also 11:12 11 minutes, 12 seconds and our uh our branded products in certain geographies in India. Uh so we use the same distribution channel we 11:21 11 minutes, 21 seconds have used the same uh channel to add on our mobility products. Uh companies like Visco and Tino don't have uh farmer 11:30 11 minutes, 30 seconds along to sell it. we have that gives us an upper hand in the distribution that gives us an upper hand in even logistics 11:38 11 minutes, 38 seconds uh which is a big component when it comes to mobility products uh like wheelchairs and walkers and so on so 11:45 11 minutes, 45 seconds forth. So we have used that to our advantage. uh we do not foresee any problem uh in touching a 100 crores uh 11:54 11 minutes, 54 seconds within a uh two two and a half years from from now calendar two and a half calendar years from now uh and uh 100 12:03 12 minutes, 3 seconds core run rate we are looking at uh easily within the next 5 to 7 years a 250 to 300 core uh enterprise coming out 12:11 12 minutes, 11 seconds of this. It is profitable. It is doing well. It is not burning any of our other resources. We don't burn money to market 12:19 12 minutes, 19 seconds it and we are not an online brand. We are completely offline pure distribution. Uh in Maharashtra every 12:28 12 minutes, 28 seconds single uh space has our uh product. We have also gone inroads in into Goa. We are getting inroads into Chhattisgarh. 12:37 12 minutes, 37 seconds We are getting inroads in in uh into Karnataka next month. uh we are available in many states but uh in the 12:44 12 minutes, 44 seconds states which I've mentioned we have very strong distribution within the next 2 and a half years we should be having the same kind of distribution we have in 12:52 12 minutes, 52 seconds Maharashtra in at least uh 17 to 18 states so that division touchwood has 12:59 12 minutes, 59 seconds done phenomenally well for us uh I feel uh we can create amazing brands out of 13:05 13 minutes, 5 seconds it our mobileics uh brand is a specialized brand which is targeting only physiootherapists and products 13:13 13 minutes, 13 seconds which physiootherapists are using and uh we have created a unique uh models in order to tap that market because they 13:22 13 minutes, 22 seconds are a marginalized community when it comes to uh doctor community uh and they are actually the firstand influencers 13:30 13 minutes, 30 seconds for most of the products. So we have created a list of products uh and we have got phenomenal success. In fact, 13:39 13 minutes, 39 seconds our pre-booking is completely booked with the physiotherapist as we are planning to launch in July. Hopefully, 13:45 13 minutes, 45 seconds that alone uh should go into uh uh 30 to 40 crores in the next two years just the 13:51 13 minutes, 51 seconds mobility part of freedom mobility. So uh we have amazing uh response and and and 13:58 13 minutes, 58 seconds frankly uh it is a no headache business for us and growing at uh almost a 55 to 60% gagger. 14:11 14 minutes, 11 seconds Thank you. 14:13 14 minutes, 13 seconds Next question is from the line of Pesh Va an individual investor. Please go ahead. 14:20 14 minutes, 20 seconds Thank you for the opportunity sir. So I wanted to ask you regarding your pet care business in terms of uh aspiration 14:27 14 minutes, 27 seconds like in terms of product and uh you know uh the range of products that you are going to offer and numbers what do you 14:34 14 minutes, 34 seconds see like uh in next 3 years 5 years how big can the business be I don't want to know the numbers per se I just want to 14:41 14 minutes, 41 seconds know about the products and the services you plan to offer us uh like I've always been saying sir that we are the only 14:50 14 minutes, 50 seconds company to do what we do in the sense means that we are the only company manufacturing alopeathic formulations, neutrauticals, herbals, grooming, 14:57 14 minutes, 57 seconds functional foods and also do diagnostics all under the same roof. So we have a unique uh basket. Our goal uh our 15:06 15 minutes, 6 seconds long-term goal is very crystal clear, succent and simple uh that by 2032 2033 15:14 15 minutes, 14 seconds uh no pet in India can be born or die without using a feroci product or service. So our targeted uh pathway is 15:24 15 minutes, 24 seconds that we create products which are there in [clears throat] all parts of a pet's life from birth to youth to uh their pry 15:35 15 minutes, 35 seconds to their geriatric parts. Uh the biscuits that we are launching, we are we have launched one of the most noble 15:43 15 minutes, 43 seconds varieties including giant biscuits uh which have done phenomenally well. But in addition to that we have 42 variants 15:51 15 minutes, 51 seconds of functional food biscuits that we are uh launching and as as we speak we are launching for all kinds of breeds and 15:58 15 minutes, 58 seconds all kinds of products. That way we'll go inroads into uh the industry even further. Even in grooming we uh in in 16:07 16 minutes, 7 seconds certain markets we have uh displaced the market leaders and uh created because of our products because we come from a 16:16 16 minutes, 16 seconds manufacturing background. We come from a human manufacturing background. We already manufacture the best uh 16:23 16 minutes, 23 seconds dermacitics and cosmetic products in India uh where even the big brands use from us. So uh with the same tech 16:32 16 minutes, 32 seconds background with the same knowledge to manufacture uh pet grooming products we have come out with an amazing range of 16:39 16 minutes, 39 seconds products and they have done phenomenally well when it comes to uh certain products we are in uh as I have said 16:47 16 minutes, 47 seconds last time also we'll be heading in stage uh four trials we have already had it in stage four trials within the next 8 to 16:54 16 minutes, 54 seconds 12 months we'll come out with some uh formulations which will will be the first ones in India uh for pet uh and it 17:03 17 minutes, 3 seconds will it will be a real gamecher for us in the uh in the pet space also our 17:10 17 minutes, 10 seconds online platform Vagger is also uh going to be one of the most uh most uh awaited 17:18 17 minutes, 18 seconds things for us right now uh we have taken our time we have taken 3 4 months longer than necessary but the the final product 17:26 17 minutes, 26 seconds has come out phenomenally Well, we are in the launch phase right now. Hopefully by first week of July or mid June, uh mid June, we are having a soft launch. 17:35 17 minutes, 35 seconds First week of July, we'll be launching. 17:37 17 minutes, 37 seconds Uh it is one of the most inclusive platforms for pet uh ever created. It is not just a e-commerce platform. So when 17:45 17 minutes, 45 seconds uh when people will see that when people see our products when uh when doctors understand because when we when we start 17:54 17 minutes, 54 seconds um our our marketing we do not just go with a product to the doctor. We start our education uh much much much before that we start our educational programs. 18:06 18 minutes, 6 seconds We call uh the the top doctors across the world and and and create symposiums 18:14 18 minutes, 14 seconds where the reason for why we have created a product is is is uh certain to the 18:21 18 minutes, 21 seconds patient uh to the doctors uh like for example our diagnostics doctors were just uh we got a such a 18:29 18 minutes, 29 seconds phenomenal response but at the same time uh many doctors didn't even know what are the real advantages of good 18:36 18 minutes, 36 seconds diagnostics. So after understanding, we also launched India's first bulletin on radiology uh and bad imaging. Once that 18:45 18 minutes, 45 seconds bulletin went to all the doctors, they started calling us uh and they started uh appreciating what we do uh and even 18:55 18 minutes, 55 seconds for exotics what we are doing uh is is is really phenomenal. For example, last last week we did a uh CT scan uh for a 19:05 19 minutes, 5 seconds cobra uh which is very rare uh to have that bandwidth to have that infrastructure and have the doctor 19:12 19 minutes, 12 seconds support uh to diagnize uh uh cobra related CT scans. So we are kind of 19:19 19 minutes, 19 seconds pioneers in what we are doing. uh whenever we have launched a product in the industry, we have ensured that the bar of the industry has been raised uh 19:29 19 minutes, 29 seconds irrespective of our sales and that is our long-term goal anyways. So we are quite uh happy and quite content in and in achieving that. 19:41 19 minutes, 41 seconds Thank you. Next question is from line of Ankip from Manim. Please go ahead. 19:48 19 minutes, 48 seconds Hi Fredon. Uh congratulations on the great set of numbers and uh you know keeping up with that cons consistency as 19:55 19 minutes, 55 seconds always. Um my question is um uh you know uh we all know about the growth capabilities and you know how you all 20:03 20 minutes, 3 seconds have you know performed quarteron quarter but I think because of what is happening in Middle East and the whole 20:10 20 minutes, 10 seconds geopolitical issue uh do you see that the raw material cost as a percentage of your sales has started inching up and 20:17 20 minutes, 17 seconds are you able to pass on to the customers one is that and second is any slowdown you feel which has come in the last two months because of this whole tension And 20:26 20 minutes, 26 seconds uh you know this is a question I have plenty for you. 20:30 20 minutes, 30 seconds Yeah. Uh uh excellent. So I I you know people have always uh I've have said uh 20:39 20 minutes, 39 seconds that uh you know geopolitical you know issues cause problems and you know I always say uh no matter how many 20:48 20 minutes, 48 seconds bombs fall no matter how many uh things people have to take their heart pills. 20:54 20 minutes, 54 seconds So uh the yes of course the prices have increased but therein because we always 21:02 21 minutes, 2 seconds used to keep 3 to four months of stock that initial jolt of that price increase never bothered us. In fact, we were we 21:11 21 minutes, 11 seconds could cater to our clients uh at the same prices because we had considerable 21:18 21 minutes, 18 seconds stock in hand and something which uh was considered as a bane uh on our company 21:26 21 minutes, 26 seconds became our boon and uh we we we that is why our turnover also increased. In fact, our sales increased because of it. 21:35 21 minutes, 35 seconds Uh yes of course uh everyone the price has not increased for freedom pharmaceuticals the price has increased 21:42 21 minutes, 42 seconds for the world. So luckily we had buffer stock and we we could uh and we already 21:49 21 minutes, 49 seconds as I've said before we have orders in hand for six to seven months uh in in hand always this time also we have 21:57 21 minutes, 57 seconds orders upwards of 320 330 crores in hand. uh as a result we also give orders 22:04 22 minutes, 4 seconds up ahead to our suppliers in hand and our orders are kind of booked uh which is a very big plus point when it comes 22:12 22 minutes, 12 seconds to such geopolitical uh changes. So yes it does not affect us few percentage one or 2% uh the buyer absorbs sometimes 22:21 22 minutes, 21 seconds certain products we have to absorb but it has has absolutely no uh difference to our bottom line. In fact it in 22:29 22 minutes, 29 seconds increases our business. It creates a robust line uh uh of communication where 22:36 22 minutes, 36 seconds the buyer is h the buyers are happy the distributors are happy. Many of our products are in our own brand. So uh 22:44 22 minutes, 44 seconds there are decent uh margins if we at all in the future if we have to absorb anything but currently we do not uh it 22:52 22 minutes, 52 seconds has not affected us. Yes the prices have increased. Yes certain products we have to increase our prices all everyone 23:00 23 minutes understands it the oil prices have increased globally. The the foil prices have increased globally. The PVC price plastic prices have increased. Anything 23:08 23 minutes, 8 seconds to do with petroleum has increased globally. uh so uh it's it's it's a phenomena uh that has bothered the whole 23:17 23 minutes, 17 seconds world. It is nothing specific to us. In fact, we have taken advantage of it. Uh 23:24 23 minutes, 24 seconds and uh we have used that advantage to propel faster. That is why we have seen this kind of growth and uh this year 23:31 23 minutes, 31 seconds also I think uh we are on track to overachieve our targets. So hopefully uh what we have targeted in 2029 and uh 23:40 23 minutes, 40 seconds 2030 we will achieve it uh faster than uh than anticipated. 23:48 23 minutes, 48 seconds Thank you. 23:50 23 minutes, 50 seconds Next question is from the line of Mikl Agarwal from Venture X Fund. Please go ahead. 24:06 24 minutes, 6 seconds Yes sir, you're audible. 24:08 24 minutes, 8 seconds Yeah. Uh how much we get from our Christmas 24:16 24 minutes, 16 seconds also in that I'm sorry NL uh I'm sorry. Can you please use uh your handset now? 24:24 24 minutes, 24 seconds Your voice is muffled a little. I can't hear you. Yeah. So am I audible now? Yeah. data. 24:32 24 minutes, 32 seconds Yeah. So can you please uh give the revenue breakup for your vintage and new business for in FI26 and also in that 24:39 24 minutes, 39 seconds which business has contributed uh what percentage in vintage and new age? 24:46 24 minutes, 46 seconds Yes. So our vintage business as I have always said is growing at around 15 to 20% year on year and that will continue 24:55 24 minutes, 55 seconds to grow. So, so uh our exports have grown with about 110 120 crores. Our tolling is somewhere around 24 crores. 25:04 25 minutes, 4 seconds Our uh indirect uh exports our institution sales that add up to about 120 130 odd crores that uh our uh 25:14 25 minutes, 14 seconds domestic uh third party uh branding also uh grows to somewhere around uh 45 to 50 crores. Add around Fagun DC another 25 30 crores. So those are growing rapidly. 25:26 25 minutes, 26 seconds Our new age business such as the pet care business has done phenomenally well. Uh we have done around 42 43 crores of sale in the pet care business. 25:34 25 minutes, 34 seconds Uh in the mobility we have done around 29 to 30 crores. Uh we've done neutraeticals of around 26 crores. We've 25:42 25 minutes, 42 seconds done cosmaceuticals of cosmetics mass market cosmetics around 20 22 crores. 25:47 25 minutes, 47 seconds We've done around 12 crores. So uh we doing uh quite well. The new age businesses are growing at around uh 40 25:55 25 minutes, 55 seconds to 50% kagger because they're coming from a smaller base. Uh the vintage business is also growing because of 26:02 26 minutes, 2 seconds registrations. We have about uh a thousand registrations still in the pipeline uh more than a,000 registrations. So that is also growing 26:11 26 minutes, 11 seconds uh at around 10 to 15% but that's on a cruise control growth. uh our focus is on the new age business where the gross 26:18 26 minutes, 18 seconds margins are also relatively higher uh at around uh 45 to 55%. Some products like 26:26 26 minutes, 26 seconds dermacitics have around 80 to 90% some products have even higher hormones will have somewhere around 50% gross margin. 26:34 26 minutes, 34 seconds So we uh definitely will uh uh keep on growing the new age business also within 26:42 26 minutes, 42 seconds the next few years that will the percentage of the business will come to around 50% each and within the next 2 3 26:49 26 minutes, 49 seconds years post that it will be around 70 to 30%. As I've always said, we are transitioning from a contract 26:58 26 minutes, 58 seconds manufacturer normal pharmaceutical generic or branded generic company like 27:04 27 minutes, 4 seconds Zipla and so on to a more uh consumer related products consumer uh DTC 27:11 27 minutes, 11 seconds products uh and also growing our farmer line simultaneously. So we are not intrinsically a farmer company anymore. 27:20 27 minutes, 20 seconds Uh we are a a mass market consumer product company uh as we speak and we 27:27 27 minutes, 27 seconds are growing and hopefully we'll have the transition uh done within the next 7 to 8 years with retaining our farmer roots 27:36 27 minutes, 36 seconds and growing our farmer roots also at the same time. 27:42 27 minutes, 42 seconds Thank you sir. Next question is from the line of Nishita Shanklesa from Safire Capital. Please go ahead. 27:51 27 minutes, 51 seconds Um yes uh thank you for taking [clears throat] my question. Uh so just wanted to understand uh you mentioned that we'll overachieve our target in 27:59 27 minutes, 59 seconds FI27. If you could uh quantify that target that would be great. What is the growth that we can see? 28:07 28 minutes, 7 seconds Yes. So I I always I I always underpromise. Uh if you have seen my BSC guidances for the last 10 years, we have 28:16 28 minutes, 16 seconds always underpromised and overd delivered. Uh we are not uh a company which uh has uh un unreal unnatural 28:25 28 minutes, 25 seconds targets. Uh we we can consider a growth an overall growth of around 25 to 30% on 28:32 28 minutes, 32 seconds our top line from the last year. uh which will automatically add up and increase from the expectation of what we 28:39 28 minutes, 39 seconds had given guidances 2 years ago. Uh uh we can do better than that but right now 28:46 28 minutes, 46 seconds between 25 to 30% growth on our top line of last year is what we are intending uh to achieve and I think we can easily do 28:55 28 minutes, 55 seconds that. We are on track to do it and uh our numbers as we speak and the run rates as we speak are in line to achieve that. 29:05 29 minutes, 5 seconds Thank you. 29:07 29 minutes, 7 seconds Next question is from the line of Achel Maheshwi from Naridi Investment. Please go ahead. 29:19 29 minutes, 19 seconds Uh Mr. Maheshwi, can you hear me? 29:23 29 minutes, 23 seconds Your line is unmuted. You may please go ahead. Am I audible? 29:30 29 minutes, 30 seconds Yeah, ma'am. You're audible. Yeah. Uh I just wanted to understand sir uh where are we exactly? How are we uh targeting 29:39 29 minutes, 39 seconds our customers for the peg business? Uh like are we listed on online marketplaces and how are we marketing the products? 29:50 29 minutes, 50 seconds Currently most of our products are prescribed products. We had a very novel range of uh marketing. Initially when we 29:59 29 minutes, 59 seconds started creating brand awareness, we did not go online or we did not go to the doctors like most of the companies. What 30:06 30 minutes, 6 seconds we did was very different. We started educational uh programs with our first line of influencers in pet care. We have 30:15 30 minutes, 15 seconds to understand the first line of influencers are not necessarily doctors or online platforms. They are the breeders, they are the groomers, they 30:22 30 minutes, 22 seconds are the dog walkers and they are the dog trainers. So we went to tier 1, tier 2, 30:29 30 minutes, 29 seconds tier three and tier four cities across India and we started training, we started teaching, we started making them 30:38 30 minutes, 38 seconds understand the benefits of certain products, not necessarily our own products but certain molecules and why 30:46 30 minutes, 46 seconds certain things are to be done, certain techniques. That way we created a bond and we created a very robust 30:56 30 minutes, 56 seconds uh relationships with the real first line of influencers. Then we start when we then when we uh got our products in 31:04 31 minutes, 4 seconds they were very easily accepted. You go meet your doctor when your pet is sick, but you meet the breeder for the first 31:12 31 minutes, 12 seconds time when you are a pet parent or you get the pet where you go to your dog walker practically every day, you go to your dog trainer twice a week, you go to 31:21 31 minutes, 21 seconds a dog groomer twice a month. Uh so those guys are better influencers in terms of 31:28 31 minutes, 28 seconds day-to-day uh products uh than your doctors themselves. Then when when when we started doing the education programs, 31:35 31 minutes, 35 seconds the doctors started realizing that hey this is not [clears throat] a normal company who has just started pet care. They are very strong in their science. 31:43 31 minutes, 43 seconds They're very uh good with their team. I can I can I can proudly say we have one of the best uh teams for pet care in the 31:51 31 minutes, 51 seconds country. uh from India's top nutritionist to India's top cat cat expert to uh one of the best research 31:59 31 minutes, 59 seconds scientists to India's first and second vet radiologist all are on our team. So because of that approach we could then 32:07 32 minutes, 7 seconds go to the doctors and they started prescribing. We are not a inorganic growth pet care company where we are 32:17 32 minutes, 17 seconds spending money to sell our products. uh here our products are taught are scientifically grown and that is why we 32:25 32 minutes, 25 seconds have actually got better success than many online companies also and many online platforms plus most of my 32:32 32 minutes, 32 seconds products are prescribed so there is no point of selling it on any uh platform my functional foods yes but we have our 32:40 32 minutes, 40 seconds own in-house websites where we can sell and people know about us and through our distribution channels it sells very well 32:47 32 minutes, 47 seconds so we are quite happy and content with uh our road map for pet care. We want to continue that and in the next few 32:56 32 minutes, 56 seconds decades uh I mean next few years we will we will uh pursue this path uh to get 33:04 33 minutes, 4 seconds further inroads into the root of the pet industry rather than be superfluous and sell online only because we are not a 33:12 33 minutes, 12 seconds pet food company. We are a pet care company. 33:19 33 minutes, 19 seconds Thank you. Next question is from the line of Kesha Nival from Kakula Capital. Please go ahead. 33:27 33 minutes, 27 seconds Yeah. Uh that's my last question. I don't I only wanted to ask you right regarding your awareness with regard to the finance cost, right? Just you're 33:35 33 minutes, 35 seconds aware of the cost of finance you're paying and I guess this is the topmost debt levels of our companies. 33:42 33 minutes, 42 seconds Yes. See uh that as an absolute number is not relevant. The as with tomorrow 33:50 33 minutes, 50 seconds when our turnover is,000 2,000 3,000 crores the absolute number might increase. The ratios are definitely 33:57 33 minutes, 57 seconds improving for for our uh manufacturing company for a company which is launching five. 34:04 34 minutes, 4 seconds Yeah. Just a just a pardon. I I just want to address with regarding to the percentage of cost, right? As our rating 34:12 34 minutes, 12 seconds has increased, our credit rating, our balance sheet has improved, uh the percentage of cost should come down drastically. 34:19 34 minutes, 19 seconds Yes. Yes. That is exactly that is the only concerning part. Just saying just you should be aware that is the only point. 34:25 34 minutes, 25 seconds Yes. Yes. We are very much aware. We are very much aware. We uh who wants to pay more. Yeah. Of course. Of course. 34:34 34 minutes, 34 seconds uh nobody works hard to pay interest. 34:36 34 minutes, 36 seconds People want to make money. Touchwood we are making money. We have been able to service the debt comfortably. At the same time we are aware absolute number 34:45 34 minutes, 45 seconds definitely will increase. We are also looking at the ratios that is also going to improve and uh right now our focus is 34:54 34 minutes, 54 seconds on robust growth. Uh so yes uh there are certain uh uh uh rates which are 35:01 35 minutes, 1 second slightly higher but within the next uh 3 to four years you will see a very different picture when it comes to this 35:10 35 minutes, 10 seconds in terms of your percentage uh of of uh the spends. uh absolute numbers might 35:18 35 minutes, 18 seconds increase, decrease, that changes uh from quarter to quarter but uh definitely we 35:24 35 minutes, 24 seconds are very well aware of the kind of uh interest that we are paying uh and we are very attuned to the fact that we are 35:32 35 minutes, 32 seconds going to improve this even further as we are doing for the last few years. 35:40 35 minutes, 40 seconds Thank you. 35:42 35 minutes, 42 seconds Next question is from the line of Nishita Shanklesia from Safar Capital. Please go ahead. 35:48 35 minutes, 48 seconds Um yes, thank you for the followup question. Uh so our margins have improved quite a lot. So I just wanted to understand what is the uh growth 35:56 35 minutes, 56 seconds driver behind this margin improvement and uh what are the sustainable margins going forward? 36:04 36 minutes, 4 seconds As as I've said that the new age businesses have a higher intrinsic margin. uh the new age businesses are 36:12 36 minutes, 12 seconds growing but at the same time the new age businesses are also adding more demographics. So if you're earning in 36:20 36 minutes, 20 seconds Maharashtra we have to spend in Andhra Pradesh to start launching it. We are a brick and mortar company. So we are not 36:27 36 minutes, 27 seconds into inorganic growth. Therefore we grow at our pace. We earn money and we spend that money. uh our margins have improved 36:36 36 minutes, 36 seconds because since 2016 I have been saying post 50 crores a quarter revenue the economies of scale in the vintage 36:45 36 minutes, 45 seconds business will start hitting in and that is exactly what happened in 2021 2022 that is when our profitability which was 36:54 36 minutes, 54 seconds uh around one or less than 1% started increasing to two three four right now we are at around 6 and a half uh that 37:03 37 minutes, 3 seconds kind of growth will continue uh as the new age businesses have a higher IBITA, they have a higher gross margin uh they 37:11 37 minutes, 11 seconds will balance out. We are looking at uh a continuous growth uh as we have seen for the next uh 8 to nine quarters. Then 37:19 37 minutes, 19 seconds there will be a sudden spike in the profit. Why? Because the demographics uh uh reach of the new age products will 37:27 37 minutes, 27 seconds be kind of satiated. Uh they there would be no further demographics to use. So after about 7 to 8 quarters from now 37:34 37 minutes, 34 seconds there will be a sudden spike in profit even further than what it is growing now and then it will kind of uh ease out and 37:42 37 minutes, 42 seconds uh plateau as profit cannot grow infinitely. So uh within the next few years you're easily looking uh at a 10 37:51 37 minutes, 51 seconds to 12% pat uh kind of company on a uh 2x 3x kind of uh topline uh within the next 38:00 38 minutes few years. So again uh top line and bottom line are very important but as a 38:07 38 minutes, 7 seconds company we are focused on sustainable growth. Uh last 19 years our growth is 38:14 38 minutes, 14 seconds at 32% gaga. Uh there's not a single year of degrowth. In the last 19 years we tend to continue that we tend to uh 38:23 38 minutes, 23 seconds have a sustainable growth in in the future. 38:26 38 minutes, 26 seconds uh pharma uh definitely will have its cycles. Uh we have seen multiple cycles and we have grown in spite of those 38:35 38 minutes, 35 seconds cycles. So uh we are quite confident in what we are claiming. 38:42 38 minutes, 42 seconds Thank you sir. Next question is from the line of Ashish Sony an individual investor. Please go ahead. 38:50 38 minutes, 50 seconds Any thoughts on any new product launches and can give us commentary on vagger.a how it's doing according to your expectations and what's the future plan? 39:00 39 minutes uh new products as I told you this year we are going to focus on our hormone and anti-aging and uh we are going to increase our demographics for our 39:08 39 minutes, 8 seconds existing line of ranges and that is what our targets now of course new molecules will keep on adding within those ranges 39:16 39 minutes, 16 seconds as part of our long-term plan and those uh numbers are quite huge so that will keep on happening uh autonomously 39:26 39 minutes, 26 seconds uh when it comes to wagger uhin in uh it was Vagger AI now it is vagger.in 39:33 39 minutes, 33 seconds because uh we uh want to make it a more inclusive uh uh platform. That platform 39:40 39 minutes, 40 seconds uh has turned out really really well. It is going to launch uh in end of this month and the beginning of July. It has 39:47 39 minutes, 47 seconds taken longer than uh usual as I've said earlier. Uh but it is an amazing platform. It is something which uh uh 39:56 39 minutes, 56 seconds others have not seen till now. It is not enormous e-commerce platform. uh and we are going to use our connects uh in the 40:05 40 minutes, 5 seconds pet industry that we have which other online platforms don't have. We have a ground level presence, we have a field force presence, we have a uh we have a 40:14 40 minutes, 14 seconds manufacturing presence, we have a uh a marketing presence. So having an e-commerce on top of that uh is a 40:23 40 minutes, 23 seconds phenomenal advantage uh for the e-commerce and for our offline distribution as well. So we are going to 40:29 40 minutes, 29 seconds incorporate all our abilities and all our uh USPS uh together. The product final product has turned out really 40:38 40 minutes, 38 seconds really nice. Uh the team is uh phenomenal for handling it. It is one of I would say one of the best teams uh to 40:46 40 minutes, 46 seconds handle uh uh e-commerce platforms like that. And it's just not an e-commerce platform. It would be wrong to just call it e-commerce platform. It's a 40:54 40 minutes, 54 seconds completely holistic uh pet care uh portal uh for for all the needs for a 41:02 41 minutes, 2 seconds pet for a pet parent. So uh uh it will definitely keep on updating itself. It will it is using AI. It is using uh the 41:12 41 minutes, 12 seconds latest AI, it is using the latest uh analytics, it is using the uh latest uh you know uh the the tools which are 41:20 41 minutes, 20 seconds required. So it's come out good. Uh hopefully uh you will be able to see it uh in the next 3540 days uh active and 41:28 41 minutes, 28 seconds live. You can still uh Google it. You will find uh the layouts but it will be live and active within the next 15 to 20 days. 41:41 41 minutes, 41 seconds Thank you. 41:44 41 minutes, 44 seconds Next question is from the line of Dil Chandra and individual investor. Please go ahead. 41:52 41 minutes, 52 seconds Hello, I'm audible. 41:56 41 minutes, 56 seconds Hello, sir. You're audible. 42:00 42 minutes Yeah. For the number just given the uh group. 42:08 42 minutes, 8 seconds I'm sorry. Dil, can you try using your answer mode and just increase your volume please? Yeah. Yeah. Just just hold on. 42:17 42 minutes, 17 seconds Hello. Now I'm audible properly. Yes. 42:20 42 minutes, 20 seconds Yes. Yes. Now, yeah. Congrats for the excellent effects of number F. I just you are given the mean exactly the same guidance of 25 to 30% for this year and next year also. 42:29 42 minutes, 29 seconds So, how much the uh margin growth do you see from here on 25 to 30% growth? The how much the margin can go up? 42:38 42 minutes, 38 seconds The same growth that we have seen last year. Uh 30 to 40% on what we have. uh as I told you the margin growths will 42:47 42 minutes, 47 seconds keep on increasing for the next uh eight quarters in the same lines as what is happening in the last four years. Uh 42:55 42 minutes, 55 seconds then there will be a certain certain spike in the profitability uh even further than that uh because uh the 43:02 43 minutes, 2 seconds demographic reach will be satiated by the new products within the next 2 and a half to three years. Uh then of course there will be uh further growth but profit of course cannot go infinitely. 43:14 43 minutes, 14 seconds uh we are uh in the next few years because we can only target for the next few years. We we are looking after a few years we are looking at around a 10 to 43:23 43 minutes, 23 seconds 12% kind of pat uh coming up uh uh for the company. 43:31 43 minutes, 31 seconds Thank you sir. Ladies and gentlemen, please avoid repeating questions that have already been addressed. We will take a next question from the line of 43:40 43 minutes, 40 seconds Nikl Agarwal from Venture X Fund. Please go ahead. 43:47 43 minutes, 47 seconds Uh so my next my question is how is our manufacturing uh capacity utilization as 43:55 43 minutes, 55 seconds of now? How what product do we manufacture in house and what products to be manufactured? Do we outsource to the 37 different locations? Uh you mentioned in the previous call. 44:06 44 minutes, 6 seconds Yes. Uh now we have around 43 locations. 44:10 44 minutes, 10 seconds uh and we manu for example wheelchairs, knee brace, leg brace, auto brace, uh electronic wheelchairs that we have come 44:18 44 minutes, 18 seconds up with uh braces that we cannot manufacture in our pharma plant. There are certain products like uh liquid 44:25 44 minutes, 25 seconds injections, PFS's, uh dry powder injections, uh beta lectum kind of products we cannot manufacture in in uh 44:33 44 minutes, 33 seconds uh uh uh in in a house. So definitely we have planned we have added more uh uh 44:42 44 minutes, 42 seconds locations in considering our future growth as well. So registration takes time product validations products 44:50 44 minutes, 50 seconds standardization it takes time. So we have not gone now searching for new uh places where we ourselves outsource just 44:57 44 minutes, 57 seconds like how SIPLA does just as how micro does how fizer or abbot or vtha does. Uh 45:05 45 minutes, 5 seconds uh we we we have gone out preemptively uh we have planned out for the next seven to eight years our requirements 45:12 45 minutes, 12 seconds and then we have selected units then we have taken our loan licensing and our uh contracts and then we have started our 45:20 45 minutes, 20 seconds manufacturing. Right now I would say about 80% of our products or more than 80% uh gets manufactured inhouse in-house capacities uh are augmented. 45:31 45 minutes, 31 seconds They are uh expanding even as we speak. 45:34 45 minutes, 34 seconds We are adding another 12 to 13 packing lines uh by end of September. Uh we will 45:41 45 minutes, 41 seconds have uh uh we we are also in u uh going to construct a new wing within the PL 45:49 45 minutes, 49 seconds plant. uh hopefully we will uh disclose it uh again when we do it uh you know on 45:56 45 minutes, 56 seconds our uh BSC guidances and everything uh that will propel us as I have been saying uh we are one of the largest 46:04 46 minutes, 4 seconds manufacturing plants uh even right now within the next uh 2 and a half years we should be uh in the top three top four 46:13 46 minutes, 13 seconds manufacturing plants for capacities at a certain location we have a cluster of four plants at one location and uh we 46:21 46 minutes, 21 seconds are also set up uh we are also setting up uh uh facilities for our functional foods and also uh planning to set up 46:29 46 minutes, 29 seconds facilities for manufacturing a lot of uh ve food products. So a lot of exciting stuff is coming up. Uh in terms of 46:38 46 minutes, 38 seconds manufacturing capabilities capabilities uh we we have one of the highest COPPS for a single plant in the country. Uh we 46:47 46 minutes, 47 seconds are doing well. We we have used time as our greatest ingredient. I always say uh 46:54 46 minutes, 54 seconds it's uh you can spend 4 500 crores and replace our infrastructure. It will take you 15 20 years to come to our 47:02 47 minutes, 2 seconds validation and uh licensing level. So uh that is our asset. We are utilizing it. 47:10 47 minutes, 10 seconds Uh we have created and built it over the last three decades. Uh now is the time to optimize it and use it to our advantage. 47:20 47 minutes, 20 seconds Thank you. Next question is from the line of Dwang Sha from ENT Financial. Please go ahead. 47:29 47 minutes, 29 seconds Hi. Uh sir, am I audible? You're slightly muffled. 47:36 47 minutes, 36 seconds Okay. Uh sir, now the voice would be okay. Yes. Only one question is there from myself. 47:44 47 minutes, 44 seconds First of all, congratulations for the good set of the growth and the numbers. 47:47 47 minutes, 47 seconds Sir, one question uh that is really concerning me that I'm an investor in the company from last two two and a half 47:54 47 minutes, 54 seconds three years. only one thing is working capital requirement like free cash flow is not like joining 48:02 48 minutes, 2 seconds with the numbers adjusting. So can you uh throw some light on that like is is there any plan to like utilize the cash or the working capital effectively? 48:15 48 minutes, 15 seconds Yes. So I have uh if you're tracking if you're investor for the last two and a half years and uh you're tracking the company I'm sure before that uh you 48:24 48 minutes, 24 seconds would have noticed that uh we have constantly improving uh in terms of uh our inventory levels but when I four 48:32 48 minutes, 32 seconds years ago 5 years ago I used to always say I'm I require this inventory level because I'm launching multiple brands at 48:39 48 minutes, 39 seconds the same time and we have 2100 SKUs across 27 therapeutic ranges. So we need that inventory. Uh that time it was very 48:48 48 minutes, 48 seconds difficult for many people to understand why a company requires 200 crores of inventory for a 230 cr topline. Then 48:55 48 minutes, 55 seconds when it was a 350 cr top line we had a 220 cr inventory. When we have 450 cr 49:02 49 minutes, 2 seconds topline we are a 220 cr. Now at around uh 700 crores we still have only 270 crores and our cash flows have 49:09 49 minutes, 9 seconds constantly improved. In fact, our cash flows which uh were were strained uh about two years ago because of our uh it 49:19 49 minutes, 19 seconds was a planned decision. It was not unplanned. It was not situation. It was planned. Uh now the cash flows have 49:26 49 minutes, 26 seconds improved. Uh we have positive cash flows even from our operations as we speak. Uh working capital is not a worry for us 49:34 49 minutes, 34 seconds right now. Uh we have improved our numbers. uh debt to equity is8. 49:41 49 minutes, 41 seconds Uh we have we have done uh quite well in terms of uh addressing our issues. The new age uh products that are coming in 49:49 49 minutes, 49 seconds are up bringing in profits of course and in any growth phase in any any any companies phase uh and uh if you're 49:57 49 minutes, 57 seconds growing uh step by step uh organically working capitals will be stretched time 50:03 50 minutes, 3 seconds and again. uh we we have seen multiple cycles. We are existing for almost 40 50:11 50 minutes, 11 seconds four decades 40 years. So we know how to operate uh with uh lower uh working 50:18 50 minutes, 18 seconds capital uh requirements versus what we are doing. However, we have done well. 50:23 50 minutes, 23 seconds We are now positive. Hopefully, it is going to continue to do that because the trajectory of the growth ensures that we 50:31 50 minutes, 31 seconds will have positive cash flows. Working capital requirements will always be there. We will we will we might require more debt. We might require more working 50:40 50 minutes, 40 seconds capital as we are growing. We are growing faster than anticipated. Of course, we are going to require are we improving? Yes. Are our profits 50:47 50 minutes, 47 seconds improving? Yes. Uh are we are we are we reaching more demographics? Yes. As long as our products are doing sustainably 50:55 50 minutes, 55 seconds well, as long as we have been able to repay our debts, as long as we able to service the interest, as long as we are 51:01 51 minutes, 1 second uh now in positive cash flow that uh we were after a long time of uh investments, uh we doing we doing quite 51:10 51 minutes, 10 seconds well. So I completely understand your concern but uh we have mitigated those concerns. Uh we have addressed upon it 51:17 51 minutes, 17 seconds and uh the numbers are speaking for itself. 51:22 51 minutes, 22 seconds Thank you ladies and gentlemen. We will take that as the last question for today. I would now like to hand over the call to Miss Saki Benjara for closing comments. Over to you ma'am. 51:34 51 minutes, 34 seconds Thank you everyone for joining the conference call pharmaceuticals limited. 51:38 51 minutes, 38 seconds If you have any further queries you can write to us at research at the redkinadvisor.com. 51:43 51 minutes, 43 seconds Thank you freed for your time. Once again thank you everyone for joining the conference call. Good day. 51:52 51 minutes, 52 seconds Thank you on behalf of Kirin Advisers Private Limited. That concludes this conference. Thank you all for joining us today and you may now disconnect your lines.