Ajanta Pharma Limited (NSE: AJANTPHARM) Q4 2026 Earnings Call dated May. 05, 2026
Corporate Participants:
Yogesh Agrawal — Managing Director
Rajesh Agrawal — Joint Managing Director
Arvind Agrawal — Chief Financial Officer
Analysts:
Sidharth Negandhi — Analyst
Avnish Burman — Analyst
Tushar Manudhane — Analyst
Abdulkader Puranwala — Analyst
Bino Pathiparampil — Analyst
Rohan — Analyst
Udhayaprakash — Analyst
Unidentified Participant
Ankit Shah — Analyst
Yogesh Soni — Analyst
Aditya Chheda — Analyst
Niharika Agarwal — Analyst
Presentation:
Operator
Ladies and gentlemen, good day and welcome to Ajanta Pharma Q4 FY 2026 Earnings Conference Call. As a reminder, all participant lines will be in the listen only mode and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal an operator by pressing STAR and then zero on your touch tone phone. Please note that this conference is being recorded.
I now hand the conference over to Mr. Yogesh Agarwal, Managing Director of Agenda Pharma Ltd. Thank you. And over to you sir.
Yogesh Agrawal — Managing Director
Thank you. Good afternoon everyone and welcome to Agenda Pharma’s Learning Call. With me I have Mr. Rajesh Agrawal, our Joint Managing Director, Mr. Arvind Agrawal, our CFO Mr. Rajiv Agrawal for VP Finance and Invest Regulations. I hope all of you have received the financial results by now. I will take you with our overall business performance first. It is a pleasure to share that. Agenda has achieved several important milestones in FY 2026 with revenue surpassing 5000 crores and net profit crossing 1000 crores.
This marks a significant step forward in our growth journey. The year reflects strong, well rounded performance across all areas of business, reinforcing the strength of our strategy and execution. Our revenue from operations grew by 21% while margins grew by 18% reflecting strong operating performance. Alongside continued investments to support future growth. All our businesses are progressing in line with our plan, giving us confidence in sustaining this growth momentum in the coming periods. This strength is also evident in our returns.
As of March 2026, return on capital employed stood at 43% and return on net worth at 25%, underscoring our position among the best performing companies in the industry. Now moving on to the business details, let me take you through our key business verticals, starting with the branded generic business in Asia and Africa which contributed 38% to total revenue. We continue to invest consistently in people, portfolio expansion and market development to support sustainable long term growth. Let’s move to Asia.
During the quarter, the Asia branded generic business recorded sales of 274 crores compared to 303 crore in the same period, reflecting a decline of 10%. For the full year, sales stood at 1176 crore versus 1191 crore last year, a marginal decline of 1%. While we had expected a recovery in Q4, geopolitical developments in the Middle east led to significant supply chain disruptions impacting dispatches during the quarter. For the full year, the performance remained below our internal expectations, largely due to Logistic challenges.
We remain confident that the business will regain its growth momentum in coming quarters. During the year, we launched 15 new products primarily in chronic therapies, further strengthening the quality and sustainability of Asia business. Let’s move to Africa. During the quarter, the Africa branded Jamie business delivered strong performance with sales of 182 crore compared to 133 crore last year registering a growth of 37%. For the full year, sales stood at 861 crore versus 750 crore from last year reflecting a growth of 15%.
During the quarter, we introduced one new product taking the total launches for the year to eight, supporting continued expansion in the region. Overall, our branded generic business continues to progress in line with our guidance and we remain confident of delivering healthy performance in the coming quarters. Let us move to another two verticals with our international business. US Generics. As indicated, the US Generic business delivered an excellent performance during the quarter. Sales stood at 505 crore compared to rupees 325 crore in the same period reflecting a strong growth of 56%.
For the full year, sales reached rupees 155. 1,557 crores versus rupees 10, 47 crore last year registering a robust growth of 49%. This performance was driven by eight new launches over the past 15 months supported by consistent execution and strong customer relationship. On the back of this momentum, the contribution of the US generic business to total revenue increased 99% during the financial year. We continue to be preferred partner for distributors and customers, anchored in reliable supply, strong quality standards and disciplined execution.
We now move to Africa institution. During the quarter, the Africa institutional business reported sales of rupees 49 crore compared to rupees 28 crores last year delivering a growth of 71%. For the full year, sales stood at rupees 160 crore versus rupees 147 crore reflecting a growth of 9%. The institution business contributed around 30% to the company’s total revenue during the financial year. At the start of the year, we had anticipated a softer performance. However, improved order flow in the second half supported a steady performance for the full year.
Now I invite Mr. Rajesh Agrawal, our joint Managing director. Thank you. And over to you.
Rajesh Agrawal — Joint Managing Director
Thank you. Good afternoon to all of you. I will take you through the performance of our India business. We have concluded both the fourth quarter and the financial year on a strong note. I am glad to inform you that Ajanta is now among the top 25 companies in the Indian pharmaceutical market as Per IQVR MAT March 2026 Our ranking has improved to rank 24th against ranked 26th last year. During the year the India business contributed 30% to the company’s total revenue supported by the launch of 26 new products including five first time launches in the country.
During the just concluded financial year our revenue reached at 1,654 crores versus rupees 1452 crores in the previous year registering a healthy growth of 14%. In the fourth quarter our sales stood at rupees 404 crore compared to rupees 369 crore in the same same quarter last year reflecting a growth of 9%. Our India business includes revenue from Trade Generics segment which contributed rupees 49 crores in Q4 for both years. For the full year Trade Generics recorded sales of rupees 188 crore compared to rupees 179 crores last year.
Let me now take you through Ajanta’s performance as per IQVMC March 2026 we continue to outperform the IPM by a healthy margin with Ajanta delivering growth of 13% compared to the IPM growth of 10%. We also continue to lead in volume growth and new product introductions relative to the market. This momentum is visible across most of our key therapeutic segments where our growth consistently exceeds the segment growth. Now the data variance in IQVR for our cardiac portfolio continues for this quarter and we are hopeful to get this resolved over time.
We remain confident of sustaining our growth trajectory in the coming quarters. In the covered market we rank among the top five companies in the IPM and feature within the top 10 across all our core therapeutic segments. Cardiology contributed 36% to the India branded sales followed by Ophthalmology at 31% and Dermatology at 23% with the remaining 10% coming from the pain segment. Our new therapy in Gynecology is progressing well and is expected to contribute meaningfully to our future growth. During the year we added around 300 medical representatives across our therapeutic areas taking our total field force to approximately 3,750m hours.
The newly onboarded teams are being integrated with a clear focus on productivity and effective field execution. With this I invite Mr. Arvind Agarwal, our CFO to take you through the financial performance of the company. Thank you and over to you Arvindj. Thank you and good afternoon to all. Before I begin, I would like to mention that during this call we may make certain forward looking statements. These statements are based on management’s current expectations and are subject to risks and uncertainties that may cause actual results to differ materially.
The Company does not undertake any obligation to update these statements publicly. I will now take you through the consolidated financial performance on a year on year basis. Coming to Revenue Total Revenue for the fourth quarter stood at 1,422 crore compared to 1170 crore last year reflecting a healthy growth of 21%. For the full year. Revenue reached 5453 crore versus 4648 crore last year, a robust growth of 17%. Our diversified business model continues to support consistent growth even as certain market experience temporary variations which are part of normal business cycle.
Coming to the Gross margins Gross margins stood at 79% for the quarter and 78% for the full year. We expect gross margins to remain around 77% with a variation of plus or minus 1% in the coming year. Personal cost for the quarter stood at rupees 341 crores compared to rupees 280 crore last year reflecting an increase of 22% for the full year. Personal cost stood at 1,291 crore versus 1090 crore last year, an increase of 18%. This increase was partially contributed by the addition of medical representatives across our branded genic businesses.
Also during the year the Government of India new Labor Code became applicable and based on our assessment, an additional provision of Rupees nine crore has been net towards related liabilities coming to other expenses. Other expenses for the quarter stood at Rs. 443 crore compared to Rs. 310 crore last year reflecting an increase of 43%. This includes a mark to market head loss of 42 crore. Excluding this the increase was 29% for the full year. Other expenses stood at 1 rupees 1,583 crore versus rupees 1,228 crore last year, an increase of 13%.
This includes a mark to market hedge loss of Excluding this The increase was 21%. The hedge loss was on account of depreciation of the INR against the US Dollar and Euro during the year. The increase in expenses reflects our continued selling investment in products, brands and people across the branded generic portfolio. We expect other expenses to remain broadly aligned with current trends coming to the R and D. R and D spend included within personal and other expenses remained at 5% of total revenue and is expected to continue at similar levels.
RND expenditure for the quarter stood at rupees 70 crores compared to rupees 63 crores last year while for the full year IT stood at 252 crore versus 224 crores last year. EBITDA for the quarter stood at Rs. 333 crore compared to Rs. 297 crore last year. Reflecting for the full year EBITDA stood at 1,395 crore versus 1260 crore last year registering a growth of 11%. EBITDA margin stood at 23% for the quarter and 26% for the full year excluding the impact of mark to market foreign exchange movements, EBITDA margins remain aligned with our guidance of around 27% for the full year.
The mark to market forex loss recorded under other expenses stood at 103 crores while forex gain under other income stood at rupees 97 crore. We remain confident of maintaining EBITDA margin of 27% with a variation of plus or minus 1% in the coming year as well while making further investment in developing our market. Profit after tax for the quarter stood at Rs. 267 crores compared to 225 crore last year reflecting a growth of 18% for the full year. Pads stood at Rs. 1,056 crore versus 920 crores last year reflecting a growth of 15%.
PAT margin remained steady at 19% for both the quarters and the full year. Coming to the tax rate, the effective tax rate for the year stood at 23%. It is expected to increase in the coming year as one of our manufacturing facilities transition out of the exemption period. Capital expenditure for the full year stood at rupees 330 crores in line with our guidance as we embark upon new CAPEX cycle to meet our continued growth requirements, we expect CAPEX to increase to around 400 crore in the FY2037 which includes 150 crore of maintenance and balance for new capacity expansion.
Working capital trade receivables stood at 125 days compared to 94 days last year reflecting the shift from factoring to working capital loans enabling better interest efficiency. This remains neutral to the P and L supported by corresponding investment income. Inventory levels improved to 63 days from 72 days last year reflecting continued focus on enhancing working capital efficiency.
With this we now open the floor for question and answer. Thank you.
Questions and Answers:
Operator
Thank you very much. We will now begin with the question and answer session. Anyone who wishes to ask a question may press STAR and then one on their touchstone phone. If you wish to remove yourself from the question queue you may press star and then two participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles again. To register for a question, please press star and then one. Your first question comes from the line of Siddharth Nigandi from cwc. Please go ahead.
Sidharth Negandhi
Hi, thanks for the opportunity and congrats on a good set of numbers. Just wanted questions. One, if you could share your PCPM in the domestic business. Second, if you could give some color in terms of how are you looking at the generic semiglutide opportunity? Primarily from what I understand you’re looking at this outside India. And. And what’s the update on that? Yeah, that’s the two questions.
Rajesh Agrawal
So the second part, generics. You are referring to the generics in the domestic market. The trade generics.
Sidharth Negandhi
Generic cyanoglutide in. Outside. Outside of India is what.
Rajesh Agrawal
Okay, I will hand it over to.
Yogesh Agrawal
Yeah. Outside of India. We are going to start our filing this quarter and normally the approval takes somewhere between one and a half years to two years. So as and when we keep getting approvals in various markets, we will keep launching. So yeah, I think it is work in progress. We’ll see. I’ll profiling happens and what approvals we get and we’ll keep launching them.
Sidharth Negandhi
Got it. And I’m assuming India is not as much of a focus market for semaglutide or is that not the case?
Yogesh Agrawal
India is also a focused market for us and we are also in the race for sure. It’s too early to comment on how it will pan out, but we are definitely one of the contenders. And on the productivity, the PCPM for the last full year has worked out to 3.7 lakhs per man per month. But keep in mind that this is also after the addition of 300 more representatives that we have made in the current year and maybe couple of 300, maybe two to 300 more last year which are yet to come to this level. So we have been keeping on incrementally adding to our field strength. So therefore it may seem what it looks like right now.
Sidharth Negandhi
Got it. That’s helpful. If you could just give me a sense of given that given the significant additions to the field force or the mature field force, what’s the average ECPM and how much is that higher by maybe that gives a sense of how that’s.
Arvind Agrawal
I think four to four and a half lakh rupees is the steady state PCPM we are looking for.
Sidharth Negandhi
Got it. Thank you.
Rajesh Agrawal
Okay, thank You.
Operator
Thank you. Your next question comes from the line of Avnish Barmal from. Please go ahead.
Avnish Burman
Hi, good evening. Thanks for taking my question. Sir. Just your comments on the impact on the business because of the ongoing Middle east conflict. And you can, I mean it would be great if you can divide it into how you are managing the cost in your domestic business versus the international business.
Yogesh Agrawal
I think that your question how are we managing what?
Avnish Burman
The increase in cost that you would have experienced because of the Middle east conflict. The increasing cost of either raw material or utilities.
Yogesh Agrawal
Yeah, so the freights have increased both air and sea across geography. It is not only restricted to the Middle east supplies, but the rates have increased in general for the air and sea. Since last quarter was only one quarter, we saw the impact. We will come to know for the next full year how the cost will sit because it’s still an evolving landscape where how long this war continues and whether it will better and after that what will be the cooling off. So I think that is yet to be seen. And we are seeing the increase in the RNBM cost also.
But since last quarter we had inventory with us, we did not see the impact of the same in that quarter and maybe coming quarter also it may not be as impacted because there were some inventories and some old orders given. But I think if the war continues, I think going forward, a quarter after, probably we should start seeing some increase in the cost of the goods also RMPM cost and the freight cost.
Avnish Burman
Okay, so the freight and insurance cost increase that you are witnessing right now, are you able to pass it on to your customers or are you partly absorbing it in your pnl?
Yogesh Agrawal
It is absorbed by us in rpni.
Avnish Burman
Okay, and this last question, let’s say the, I mean the conflict lasts for longer than your inventory. Then in that case the RMP and cost that is increasing will that also will be borne by the marketing company like yourself or is it like passed on through the entire supply chain like the CMO partners and the customers? How does it happen?
Yogesh Agrawal
No, it is observed by us only. It is observed by the manufacturing companies.
Avnish Burman
Okay, great. That was my question. Thank you so much.
Operator
Thank you. The next question comes from the line of Tushar Manudane from Motilal Oswal. Please go ahead.
Tushar Manudhane
Thanks for the opportunity. So firstly on the EBITDA margin guidance with FY26 we have ended with 27.7% EBITDA market. Maybe Q4 is relatively weaker quarter. Additionally just trying to understand why the EBITDA margin guidance is lower at 27% that’s my first question. Given that we have decent growth across the geography.
Rajesh Agrawal
Yeah, that is sure the growth will definitely be there. But however, as you know we are investing. All that investment is going on. So that investment also is something which is charged to pay. We are also proposing to increase the filing across the market so that also will increase the R and D cost little bit. So all these things will definitely impact leap profitability. So we are currently looking at all these aspects and then giving you the guidance of 2020.
Tushar Manudhane
So how many Mrs. You intend to add in India for FY27
Rajesh Agrawal
I think about. There is some disturbance on the line. Not able to hear
Operator
That is. I’m so sorry to interrupt. This is the moderator Tushar sir, if you can tell me what the line when the management is answering the question because there’s a lot of background noise coming from the line.
Tushar Manudhane
Sure.
Yogesh Agrawal
Yes. So we are looking at an addition of 250 to 300. This is a very broad ballpark Working of course it will keep unfolding every quarter. This is to optimize the coverage as we go along.
Tushar Manudhane
This is for India market, for Asia Africa market. Also do we intend to add. Mr.
Rajesh Agrawal
Yes, we are intending to add. Mr. And Africa also again 5 to 6% so you can imagine about 130, 150 per people will be added there as well. And now this is sorry coming back to India market. Mr. This would be largely spread out across the therapies or this is more for specific therapy as far as Fymar Edition is concerned
Yogesh Agrawal
Across all therapies, all teams.
Tushar Manudhane
And just lastly how much would have been the inventory days for US Market?
Yogesh Agrawal
We don’t give out such a breakup of the inventories market wise
Tushar Manudhane
So broadly not specific but in general how much inventory we carry for us.
Yogesh Agrawal
Oh that that way normally we carry about three months in.
Tushar Manudhane
Okay. So effectively which is where we are concerned that Q1 presumably can be still okay in terms of execution but this Middle east issue might given that we are already sitting in May so you know what kind of sort of visibility we have as far as QQ or maybe like the second quarter onwards, availability of material both in terms of raw material as well as availability of finished goods for US Market or for other geographies. Share your thoughts.
Yogesh Agrawal
So guidance which we have given is considering all those factors, considering what are the prevailing rates of RMP and if they will continue going forward, the freight rate, what are prevalent currently they are going forward. So those are factored in into the guidance which we have given of 27% EBITDA. So any change positive or negative in that will have the corresponding impact on the, on the diagram.
Tushar Manudhane
And just on the revenue growth. How maybe I missed the guidance on the revenue growth.
Yogesh Agrawal
No, overall for the company we are looking at the guidance of CFODIA figure.
Tushar Manudhane
16 to 18%. Right?
Rajesh Agrawal
Yeah, really looking at.
Tushar Manudhane
Got it. Thank you. Thank you.
Operator
Thank you. The next question comes from the line of Abdul Kader Puranwala from ICICI Securities. Please go ahead.
Abdulkader Puranwala
Yeah. Hi sir. Thank you for the opportunity. So my first question is pertaining to your India business. So this quarter as compared to, you know the first nine months we have seen some bit of a slowdown in the India business where the growth has been nine and a half percent. So if you could you know us understand any market leading factors or we expect to bounce back from this current growth level in the coming quarters ahead.
Yogesh Agrawal
If you look at the annualized performance we have call it 14% growth which is significantly higher than the IPM growth rate as well as the covered market and the subsecrated segment growth rates. This 1/4 has been an aggression due to unexplicable kind of reasons. However, if I correlate that with the SMSRC prescription data as well as the IMS secondary data, they are all very positive. So when they will all fall in line, I don’t see this to be concern.
Abdulkader Puranwala
Understood sir. And secondly on the Asia business where I heard your commentary that the performance was not expected in line with our expectation. So any sense on, you know what is the kind of channel inventory into the system and you know by say the first half or second half, you know we should back be back to delivering at least some sort of growth into this business.
Yogesh Agrawal
Yeah. So we have seen that the logistics have been now streamlined in a way. When I say streamline, that is the earlier the inventory stocks which were on the high field, they got stuck, they got localized at various places where they were in the transit and they were not moving. But at least now the logic system sorted out just the timeline has increased the total transit time because it has to be routed from multiple ports and somewhere it has to be then called on the surface. So you see that the slowly the logistics started kind of coming in place.
Just the standard time has increased with this we have not seen any demand challenge. The demand has not been impacted. It was more of a supply chain concern or issue with that supply chain now getting streamlined. In fact we are looking back in the next year. Our guidance for the Asia is in the high double digits. So we should be able to deliver a good performance.
Abdulkader Puranwala
Got it, sir. And so just one final one if I may so on your US business. So you know, again a very still quarter on that front. But you know, if we can guide us something on how the trajectory going ahead would be and you know, how confident are we on achieving this? Over 500 crores of revenue. What we have seen in this quarter and you know, going into FY27,
Yogesh Agrawal
No, this whole year has been exceptionally strong on back of various things which we have been giving the commentary in the earlier earning calls of number of products we launched in last 15 months, increasing market share of products. And also this quarter is also elevated because we have one seasonal product which is and typically we see the demand for that or sales for that happens in this quarter. It’s somewhere slightly in December, but most of it happens in this quarter starting January. So generally the quarter is slightly elevated.
And this quarter also got slightly more elevated because of another factor which I just explained. So I think going forward for the next year we are looking at a mid single digit growth for the US business considering that for the full year we have delivered an extremely robust growth of 49% on back of that. So the base is very high on back of that we are projecting to be a mid single digit growth for the year.
Abdulkader Puranwala
Got it, sir. Thank you. All the best.
Yogesh Agrawal
Yeah, thank you.
Operator
Thank you. The next question comes from the line of Dino Patiba Rampur from Elara Capital. Go ahead.
Bino Pathiparampil
Hi, good afternoon. A couple of questions. One, how is the shipments to Middle east happening? Is it happening normally or is it.
Yogesh Agrawal
I just answered that a minute back. But I repeat earlier when the conflict started, the shipment got stranded at whichever place they were. But now they got rerouted and barring the air shipments when the things are the conflicts is on. But otherwise we see that the sea shipments have kind of resumed and it’s taking longer to reach because they have to be rerouted from different ports somewhere it has to be hauled through the surface. So overall the supply chain is the supplies of the launches have settled. It is just taking longer and cost has gone up significantly.
Bino Pathiparampil
Got it. Second, your revenue guidance of high teen does it take into account the high BD depreciation in INR.
Rajesh Agrawal
Was not audible. Including account was take into account the depreciation in inr.
Yogesh Agrawal
Yeah, yeah. So it is considered on the current exchange rate. Whatever.
Bino Pathiparampil
Okay. And if I heard correctly, the raw material cost increases that are currently there that has been built into your EBITDA margin guidance of 27%. So. Okay, got it. Okay. Thank you.
Yogesh Agrawal
Cost of RMPM as well as the space both are in place in the guidance which we have given increased cost in the.
Bino Pathiparampil
Thank you. I’ll jump back to you.
Operator
Thank you. The next question comes from the line of Rohan from Envision Capital. Please go ahead.
Rohan
Hello. Thank you for the opportunity. So sir, this question was in regards to the US FDA inspection that happened in our Python plant. Just wanted to understand, you know what is the kind of impact this can have in our plants going forward and for the supply that we are doing today. Thank you.
Yogesh Agrawal
No, so the 483 as we have informed on the stock exchange we have got the five observations followed by compatibility and observations means there is some what FDA wants, there are some procedural or some other kind of things which we have to comply making to the FDA requirement. So we are moving forward to submit our response to the FTA as per the specified timeline. And yes, that is the thing on the 483.
Rohan
So just wanted to understand, you know, will this impact any of our filings that we planned to launch or any of our existing products? I mean just wanted to understand on that side.
Yogesh Agrawal
No, no. The impact is what impact can be seen only if there is any elevated concerns. So there are no impact on the filings also. We continue business as normal.
Rohan
Okay. Okay. Thank you.
Operator
Thank you. The next question comes from the line of Odeya Prakash from Value Research. Please go ahead. So we are not able to hear you. Line is very bad.
Udhayaprakash
Yeah, hello. Am I audible?
Operator
This is much better sir. Yes, please go.
Udhayaprakash
Yeah, so I just have a couple of questions from my side. First one being we have been pretty consistent in terms of new product launches in the recent years. So If we could give a rough breakup on let’s say over the last two years, what is the revenue generated by these new product launch.
Rajesh Agrawal
Okay, that figure we don’t have it at hand at this moment. I would email it to the investor relations team and we’ll come back to you. However, what I can share with you is last 12 months the breakup. So our new product contribution will within that is 4.7% out of 13% as against the industry which stands at 2.8% out of 10%. So our new product contribution is significantly higher compared to the industry new product contribution.
Udhayaprakash
Just to know the overall growth prospection as a thing are we highly dependent on consistent new product launches? I get the new products have to be launched but we go behind or due to some kind of issue we are not able to follow up on the target that we set for new product Launches, will that have, Will that have a material impact on revenue or, you know, existing products or older products will continue to grow at the same pace as they did when they were launched.
Yogesh Agrawal
Yeah, so interesting question. They’re totally disconnected from one another. Our base volume growth is also much higher, 30% higher than the industry volume growth. Right. So which means my legacy brands, my larger brands such as Metexcel, Cnaud, CrossFit range, Purple combinations and all of those are growing at a very healthy pace. So while I deliver exceptionally well on the new products, I’m also able to build better than the industry in terms of the existing and the older brands. So they are not interlinked as such in best of my experience.
Udhayaprakash
And for the last question, I just want to get a picture of the promoter. If we look at the number over the last 20 years rise a bit and I get that, you know these let’s have to avail one facility and everything. But since we generate adequate cash flow, we do not require much of a loan because what is the thought process for personal reason or is it purely for company loan facility? I just want to get a brief or overall picture on why shares have been flexed and why has it been increasing over the last 10 years.
Rajesh Agrawal
Yeah, I’ll tell you, as far as agenda Pharma promoters are concerned, there are four brothers who are owning these shares. Out of that two brothers, Mr. Rajesh and Yogi Shagrawal, both of them are in the helm of Ajanta Pharma and there are two other brothers who are developing their own businesses. So for their new businesses they are increasing the share and borrowing for that. There is nothing to do with agenda pharma borrowing at all.
Udhayaprakash
Okay,
Rajesh Agrawal
Yeah, sorry.
Arvind Agrawal
Yeah, they don’t have any pledge at all. So there is zero pledge from their side. It is only the other two brothers who are developing their new businesses. So they are playing to borrow the money.
Udhayaprakash
Okay, if I could just create one last question. You had given a very strong guidance for HR business for the next year. I just want to know what is the basis for the guidance in the sense that are you expecting growth in any particular geography or is it any therapeutically or any new product launches that you are anticipating? I just want to get overall to. Guys, I know that we cannot go into specifics, but still.
Rajesh Agrawal
Yeah, I think it is basically on the back of the low performance last year because Asia has grown -1% in the last year. So naturally that lower performance was basically again because of the logistic issues which are there in Middle East. So I hope we should be able to really recover that and should be able to grow.
Udhayaprakash
Okay, thank you. That’s it.
Operator
Thank you. Before we take the next question, a reminder to everyone, you may press star and one to ask a question. The next follow up question comes from Tushar Manudane from Motila Loswal. Please go ahead.
Arvind Agrawal
Yes sir.
Tushar Manudhane
Am I audible?
Operator
Yes you are.
Tushar Manudhane
So just on the guidance again where US probably would slow down in FY27, India doing better than IBM but IPM itself probably would grow at 8 to 10%. So effectively Asia Africa would be the strong growth driver. So in Africa also what is it that you know if you can just. We’ve already grown at 15% in branded generic for full year. So what kind of, you know factor will drive much higher growth in Africa market? So that, that’s my first question.
Yogesh Agrawal
Africa also, we are looking at a high double digit growth. Africa also should be able to perform well.
Tushar Manudhane
Okay. And this is in a way SEMG will actually for contribute in any of these geographies. Probably fi28 almost.
Yogesh Agrawal
No, no, there is no commercial type which is factoring in this. This is from our existing business addition of people which we have done over last two years. Addition of people, not that many, let’s say 125 which will be done here. So I think, okay, let’s discount that. That may not contribute so much but all the new people products which we have launched over last year or two years that is going to contribute to this growth.
Tushar Manudhane
And as far as CapEx is concerned it’s at the existing side, the growth CapEx,
Yogesh Agrawal
Can you take that?
Rajesh Agrawal
Yes, this will be on the existing site because we have the extra land available in the equation site. So CapEx will be there.
Yogesh Agrawal
So we’re looking at about 150 crores of routine CapEx maintenance. CapEx, 10 to 50 crores of CapEx for the capacity additions and expansion.
Tushar Manudhane
Got it. And just lastly how much effective tax rate for FY27?
Arvind Agrawal
We are expecting about 26 to 26.5%.
Tushar Manudhane
All right sir, thank you.
Operator
Thank you. The next question comes from the line of VAMSI from Askim. Please go ahead.
Unidentified Participant
Hi sir, thanks for the opportunity and congratulations on a good set of numbers. So we have guided for a mid single digit growth in the US formulations business. So are there firstly any launches that you are scheduling for the next year or is it going to be that the existing base business itself is going to kind of continue at that rate? That is my first question.
Yogesh Agrawal
There are launches which are planned. There are about four to five launches which will be planned. But they are all going to go towards the second half of the year. So there will be some growth coming in from there also. But it is most part first half will be existing products.
Unidentified Participant
Understood sir. Also coming back to the semagluited opportunity. So while the filings are happening currently as we speak, how do you envisage the launches to happen? And you know, at what point could it reach a material scale? Maybe anywhere between 100 to 150 crores, kind of a top line contribution.
Yogesh Agrawal
I think it’ll be two years by the time product will get commercialized in various markets. I think the three year from third year from today is when we should start seeing the revenues and probably fourth year would be the where we will have launched and we would have probably increased our penetration in the market and got some market share. I think three to four years is the time when we should start seeing these kind of meaningful impact in the future, some profit.
Unidentified Participant
Understood sir. Thank you. And all the best.
Yogesh Agrawal
Thank you.
Operator
Thank you. The next follow up question comes from the line of Siddharth Negandi from cwc. Please go ahead.
Sidharth Negandhi
Thanks for the opportunity. Just wanted to understand. You mentioned high double digit growth for Africa, right? Low double digits for Asia, middle mid single digits for us and assuming the same level for as FY26 per Africa institutions, India growth works out to be high double digits upwards of 20% even if I take the lower end of your high single digit guidance which is 16% growth for the overall business. So if you could just help us get some understanding of broadly what’s the range at which you’re looking to grow the India business. And considering the India business has higher margins as you mentioned earlier, you know, despite that, what’s the reason for margins coming in around 27%? Yeah, that’s my question.
Rajesh Agrawal
First of all, I think Asia you are seeing low double digit. Actually it is high double digit again. So that’s what we mentioned and for India we are talking about new middle growth.
Sidharth Negandhi
Got it, thank you. Yeah. And then on the margins.
Rajesh Agrawal
Yeah, on the margins. I think we never said India is higher or other markets are lower. Actually the margins are quite well spread and the entire branded generic business is almost at the same level. The only thing which is happening is that we are investing in the market simultaneously for the future growth. So product registration, people, additions, etc. Is continuously going on. So that is why. And also we have factored in some amount of increase in the freight cost and the material price cost due to the war situation for at least about two to three months. So all that has been factored in and on that basis we have given you the margin guidance.
Sidharth Negandhi
Got it. Thank you.
Operator
Thank you. The next question comes from the line of forum Parekh from POB Capital. Please go ahead.
Unidentified Participant
Yeah, thank you for the opportunity. My first question is on the receivable date we see significant jump in FY26. So what is the reason for the spike and and how should we look at it? I mean is 125 days the normal base that we should consider or can it come lower?
Arvind Agrawal
So I think this is mainly because of the higher sales at US. As you are aware the US outstandings are little longer and US very, very high this year with 50% increase. So that is the contribution which has come in and I think at this point of time I think we can consider this as a new normal now.
Unidentified Participant
Okay, thank you for that. And my second question is on your strategic priorities that you have mentioned in the presentation where one of the priorities is focus on digitalization. So just wanted to understand here, are we talking on the AI front? And if. Yes. So just wanted to understand how does adoption of AI actually impact our PNL and basically on the RND side does it increase our RND expense or it lowers our R D expense? If you can just throw some light there.
Yogesh Agrawal
No, we have on the AI initiative and we are progressing well. We have formed a team in Alaska Bama and we’ve identified the areas. So yes, it is one of the priorities for us. But we’ve been on this journey for a while, not particularly AR in got AR journey started let’s say about last three months or so, six months or so. But we’ve been on a journey of digitalization in all our verticals whether it’s sales and marketing in India, marketing in overseas markets, whether it is our facilities. So we have a heavy digitalization which gives us a lot of rich data.
And now our plan is to integrate that, take that data and apply a layer of AI on that and see how we benefit from all this data to make quicker decisions, sound decisions. So that is going to be the next focus for the current year for how we want to use the data and how we can impact how we can make use of that for the benefit and building more efficiency. But I don’t think on the R and D side there is any significant impact that will be there because of something like this, at least not in the near term.
Unidentified Participant
Sure, thank you for that. Yeah, those were my two questions. Yeah, thank you.
Operator
Thank you. The next question comes from the line of Ankit Shah from cramc. Please go ahead.
Ankit Shah
Hello. Am I audible?
Yogesh Agrawal
Yes, please.
Operator
Yes.
Ankit Shah
Hi, thanks for the opportunity. My question pertains to the US Market. Are you seeing any stability in the pricing environment or any restocking demand because of the logistics disturbances in that market? Any comment on that?
Yogesh Agrawal
No, I think logistics to us is not impacted. Its costs have gone up. There is no supply chain disruption, any issue. So the market in US Continues normal. So whatever the earlier factors of price erosion and things like that, they continue, which is the normal one, no impact on the U.S.
Ankit Shah
Got It. That’s it for me. Thank you.
Operator
Thank you. The next question comes from the line of Yogesh Soni from High Tong Securities. Please go ahead.
Yogesh Soni
Yeah, good evening sir, and thanks for the opportunity. One question, just wanted clarity clarification on that our U.S. Business margins have improved and whether they have reached neither to a corporate level margins,
Yogesh Agrawal
We don’t give out the vertical wise margins. I think. I’m sorry, I’ll not be able to share those branding in details.
Yogesh Soni
Okay, one more question. If you could just help me understand how much of the chronic share in the combined Asia and Africa branded generics market because for the past few quarters we have been focusing on growing our chronic therapy areas in these markets. So if you could help me with the numbers.
Yogesh Agrawal
I think combined figures, we may not have that right now.
Yogesh Soni
If you could broadly help me understand, I mean how is the revenue split between chronic and acute in these two markets combined?
Rajesh Agrawal
Broadly, I think we can take some markets are growing with 80%, some markets are with 30%. But overall if you take, I think it will be 50% at this point of time. Going forward.
Yogesh Soni
Understood. And sir, on the India business, it’s been now one and a half years since we have entered into Gyneco and so if you could help us understand how the performance has been increased to new therapy areas and how are we planning to grow these two therapies over the next two years?
Yogesh Agrawal
I have a short reference in the opening comment. Also on the gynecology, the progress has been very encouraging. We have been received very well in the segment itself by the key opinion leaders in that sense. So we are progressing very well in gynecology better than what we were expecting internally. I see that to be contributing meaningfully in the coming two to three years. So that is as far as Gynec is concerned. We will also strengthen within gynecology by way of adding more. Mr. In the coming year nephrology as we Said was a smaller task force.
If you recollect when we entered the segment, it’s a much more difficult segment to have a crack at. It will take some time and we were prepared for that. But there are some positive signs. But it will take longer than what it is taking in the gynecology segment.
Yogesh Soni
Thank you, sir. Thank you for your answers.
Operator
Thank you. The next question comes from the line of Aditya Chera from Incred Asset Management. Please go ahead.
Aditya Chheda
Hi, good evening. Can you please break your India growth into price, volume and new product.
Yogesh Agrawal
13.1% against IPM of 10%. And our growth breakup is as follows. 3.6% from the volume price growth has contributed 4.8% and new product launches have contributed 4.7% to the total growth.
Rajesh Agrawal
Okay.
Operator
Thank you. The next question comes from the line of Meharika Agarwal from Incredible. Please go ahead.
Niharika Agarwal
Good evening, sir. Thank you for taking my question. So given your increasing exposure to US Generics and Africa Institutional, both of which are tender driven and competitive markets, how are you managing price erosion risk at the portfolio level?
Yogesh Agrawal
Can you come again with your question?
Niharika Agarwal
Given your increasing exposure to tender driven and competitive markets I.e. US generics and Africa Institutional, how are you managing the price erosion just at the portfolio level? Because the both of them are, you know, highly competitive markets.
Yogesh Agrawal
Yeah, no, we always build in the price erosion every year the guidance we came out. So the current, the forward looking guidance for the next year also for each of these businesses we have given is considering those price erosions calculations as well.
Niharika Agarwal
All right, thank you. That is all from my side.
Operator
Thank you. As there are no further questions I would now like to hand the conference over to Mr. Yogesh Agarwal for closing comments.
Yogesh Agrawal
Okay, thank you everyone. Thank you for joining this. If there are any questions which got left, which got left unanswered, please reach out to our investor relations. Thank you for joining.
Rajesh Agrawal
Thank you everyone.
Operator
Thank you members of the management, on behalf of Ajanta Pharma. That concludes this conference. Thank you for joining us. And you may now disconnect your