Aarti Pharmalabs Ltd (NSE: AARTIPHARM) Q1 2026 Earnings Call dated Aug. 13, 2025
Corporate Participants:
Unidentified Speaker
Rashesh Chandrakant Gogri — Executive Vice Chairman of the Board, Managing Director
Analysts:
Unidentified Participant
Shrikant Akolkar — Analyst
Rahul Jain — Analyst
Aejas Lakhani — Analyst
Ankit Gupta — Analyst
Vivek Gautam — Analyst
Shubham Agarwal — Analyst
Ankit Gupta — Analyst
Neha Kharodia — Analyst
Yash Lahoti — Analyst
Kumar Saurabh — Analyst
Presentation:
operator
Ladies and gentlemen, good day and welcome to RG Pharma Labs Q1FY26 earnings conference call hosted by Nuama Wealth Management Ltd. As a reminder, all participant lines will be in the lesson only mode and there will be an opportunity to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal an operator by pressing the Star then zero on your touchstone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Srikanth Akolkar from Rama Wealth Management Ltd. Thank you and over to you sir.
Shrikant Akolkar — Analyst
Thank you and good day everyone. On behalf of Nuama Wealth Management, we. Welcome you all to Q1FY26 earning conference call of RT Pharma Labs Ltd. From. The management side we have with us. Mr. Rashesh Goghri, Chairman, Mrs. Hital Gogri. Gala Vice Chairperson and Managing Director and. Mr. Piyush Lakhani, Chief Financial Officer. I’ll now hand over the conference call to Mr. Rashesh Pogdhry for his opening remarks.
Rashesh Chandrakant Gogri — Executive Vice Chairman of the Board, Managing Director
Thank you and over to you Sir. Good evening everyone and welcome to Atifarma Labs Earning call for the first quarter of the financial year 2026. I appreciate you taking the time to join us today as I walk you through the performance of Q1FY26 and share key business developments. Let me start with an overview of our standalone financial for Q1FY26 the top line in Q1FY26 was 375 crore which was rupees 394 crores. A year back the EBITDA was 95 crores as compared to 84 crores in the corresponding period of the previous year.
This is an increase of 14% YoY. The profit after tax in the Q1FY26 was 51 crores as compared to rupees 47 crores a year back which was a increase of 9% YoY basis. Even though the revenue has been slightly dipped in this quarter, year on year the EBITDA and the PAT have grown reasonably well. I remain confident that the underlying fundamentals and the long term drivers of the business are intact. Now I will talk about the consolidated financials. For Q1FY26 the top line was 386 crores against Rupees 555 crores in Q1FY25. The reported consolidated top line of Q1FY26 is not actually comparable to that of Q1FY25 because this does not include the proportionate share of the Ganesh Polycam turnover following the amendment in the subscriptions and shareholders agreement, GPL Garnish Polykan is a joint venture from Q1FY26 onwards.
Accordingly in the consolidated financials a single line of share of profit is added following the equity method of consolidation. So basically the Consolidated turnover for Q1 FY26 onwards will not include GPL garnish policies contribution and hence will look optically lower year on year. However the EBITDA and the PAT will PAT will continue to include GPLS share and will be comparable year on year. The EBITDA was rupees 95 crore as compared to rupees 97 crores in Q1FY25 the profit after tax for the quarter was rupees 50 crore as compared to rupees 56 crore a year back.
Additionally, for the revenue of ATI USA Incorporation the Q1FY26 has significantly come down and this was communicated in past quarter calls. This is due to limited business activities in the subsidiary which were earlier carried out for the RT Industries Limited Distribution business which has shifted to the RT industry subsidiary in the us. Now let me present the business highlights. RT Pharma Labs continues to operate in three key verticals Xanthine Derivatives, API and Internet and CDMO CMO services. The Xanthine derivative segment contributed to 50% of our turnover in Q1 the volume split was 65% beverages customers and 35% for others.
In terms of geographical split the export sales was 57% and rest of 43% was local sales. The API and intermediate business stood 41% of the turnover and the sub segment wise the breakup is 49% regulated market, 43% in row market 8 percentage in non regulated market which aligns with our long term focus towards regulated market. We are continuously working towards development of new molecules with patent expiry in next three to five years and the number of US DMFs have gone up from 53 gone up to 53 from 50 in last quarter and the CEP they’ve gone up to 35 from 31 in last quarter.
Also the number of commercial APIs now stand at 60. The third segment CDMO CMO has contributed to 10% of the revenue in this quarter. We are presently working with 21 customers and the number of active projects are now 60 of which 33 are in commercial stages and 27 are in different stages of development both at the customer end. Based on the current order book we are on track to achieve our target of FY26 CDMO sales. It is important to mention that one of our sites which supports Nthene derivatives business was under extended planned annual shutdown and upgradation in this quarter.
This is partially the reason for declining our standalone top line. For the last couple of months there have been a lot of geopolitical turmoil and globally there has been a business uncertainty due to US tariffs. However, the current tariff rule do not impact our pharma products and even xanthine derivatives like caffeine are under the exempt list and I see minimum impact on our sales. Lastly, I will share the progress updates on the ongoing CAPEX. Our brownfield expansion for increasing xanthine derivative from 5,000 metric tons per annum to 9,000 metric tons per annum is progressing as per our plan.
The commissioning will be done in a phased manner across H2 FY26. The greenfield project at Atali A Gujarat is in final stages of completion. The mechanical completion of the phase one has been done. The commercial production will commence towards the end of Q2 FY26. However, it will take us until the end of FY26 to ramp up and operate the plant at an optimal utilization. In conclusion, I remain confident in our strong fundamental strategic initiatives and dedicated team driving RT Pharma Labs forward. Our strategy remains firmly intact and we are focused on navigating any near term challenges with agility and discipline.
We are well positioned to achieve our targets for the year and continue delivering the sustainable growth and our values to all our stakeholders. The moderator may now open the forum for Q and A session. Thank you.
Questions and Answers:
operator
Thank you very much sir. We will now begin the question and answer session. Anyone who wishes to ask a question may press Star and one on their touchstone telephone. If you wish to remove yourself from the question queue, you may press Star and two participants are requested to use handset while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question comes from Rahul Jain with Credence Wealth. Please go ahead.
Rahul Jain
Thanks for the opportunity. Am I audible?
Rashesh Chandrakant Gogri
Yeah, yeah.
Rahul Jain
Given the top line degrowth sir, and also the scenario we have delivered some good set of numbers. So just to understand sir, you mentioned about two things on the impact of sales and also one is the Ganesh polychem numbers which are not including the sales. So what amount of. Because in standalone sales I think the plan shutdown has impacted the sales. So what is the impact in terms of sales with regards to this plan shutdown? The planned shutdown sales impact would be around 15 to 20 crore rupees.
Rahul Jain
Okay, okay. And sir, when I look at this intermediate sales that has come down on a year on year basis from about 170 to 150 currently. And in fact in the previous quarters we were averaging around 200 crores for last two quarters prior to this June quarter or in fact even the earlier quarter we were around 190 crores. So this quarter is down to around 155 crores. So do we read anything into this? No.
Rashesh Chandrakant Gogri
If you see in this quarter we have had higher inventory because you know, the shipments were little impacted towards the end of the quarter due to unavailability of shipping space. And I think that would have some impact of some amount of sales. But overall API business we have been able to have good, you know, pace whereas in intermediate business it shares the asset with the CDM or cmo. So there we are progressing more with the CDMO projects in the current quarter. So the intermediate sales is little bit on the lower side. Purposefully. Sure. With regards to the margins, our margins are gross margins are at the highest level for this quarter around 57% which fell around 51% the previous quarter. And even the year on year on year basic is up from 48%. So typically now how do we look at the gross margins going ahead? And if you could understand that there is some impact on Ganesh polychain side, what could be the. And this. I’m talking about standalone, sir, I’m not talking on the console base.
Unidentified Speaker
Yeah, I think in terms of margin, of course, you know this year was a higher margin because you know this inventory had an impact. And overall the products that we have sold were more into regulated market and beverages and export market. So that has yielded us better pricing than the lower price market. So on these ending segments overall I think it is a product mix that we have played and which has yielded in better margins.
Rashesh Chandrakant Gogri
Hi, there is one addition to this also. You know earlier there has been some disclosure change in the financial that we have published earlier. Some of the consumables that we were we normally consume in the plant were getting clubbed in the cost of materials. So now because these are consumables like filter cloths and valves and those engineering items as we say, so these from this quarter onwards and including the previous earlier quarters also we have now shown it as under other expenses. So there has been. So now the cost of material consumed consists of only our raw material, packing material and fuel.
So these consumables, engineering consumables that we are saying are now clubbed under other expenses.
Rahul Jain
Okay, last question. So with regards to the guidance, we have maintained guidance both on CDMO growth and also on the EBITDA growth. Given the current quarter has been almost flattish on EBITDA on console basis. And if we need to maintain this 12 to 15% guidance then the next 3/4 the kind of growth in EBITDA will be around 15 to 20% if we want to meet our guidance of 12 to 15. So and given the expenses of new plant coming in Atali and also Xanthine and probably they’re not contributing much to the revenue, what gives us this confidence that we will achieve this EBITDA growth?
Rashesh Chandrakant Gogri
Yeah, see basically the EBITDA guidance that we had given was on the standalone basis. So this time anyway we have a standalone basis EBITDA increase of almost 14%. Yoyo. And looking at overall, you know the quarters are going to be, you know, not linear in the performance of EBITDA or top line because of the nature of business. The CDMO CMO turnover may get top line and bottom line may get consolidated in particular quarter which may result into a bump. So I think overall we have to look at you know, few quarters and then see how overall growth trajectory is to really consider because there will be certain quarters where due to multiple stages of processing that we are doing, you know, we may end up doing more earlier stages processing and the invoicing may happen in the later quarters which may impact the top line and the bottom line growth.
Rahul Jain
Thank you sir, wish you all the best. Thanks a lot.
operator
The next question comes from Aijas Lakhani from Unifi amc. Please go ahead.
Aejas Lakhani
Yes sir. Just a clarification on the Xanthine sir, you mentioned that 15 to 20 crores was on account of plant shutdown. So just wanted to understand that X of that. Has there been any impact of pricing, volume, seasonality if you can expand? No, there have been no impact on any of these things. Basically as we have disclosed the product sales mix that we have done, we have done more sales to export as well as the beverages market in the current quarter and that has resulted in better performance in this current quarter. Understood. And sir, just could you also call out in the API business, you know we understand the quarterly volatility and you mentioned that there was a shipping space impact and you know you had higher inventory.
How do you expect the full year ramp up to be for this segment? Yeah, in the API business also we are looking at reasonable growth I think going forward. So it will be EBITDA growth will be at least more than 10%. Okay. Okay. And you know I mean we understand that there’s a shift on the gross margin front but like to like if one were to compare it to the previous quarter in the old format where were gross margins today.
Rashesh Chandrakant Gogri
For the standalone. So the impact of this change in the cost of material consumed has been given for the earlier quarters also. So now it is like to like if you compare what we have published. On the presentation. Okay. And sir, in Ganesh podcast, when do we expect to break even? When will it start contributing to the bottom line? And what are the key challenges today we are facing in Ganesh Polychem? Last year we had a good ebitda of around 60 crores. And and this year you know we took a shutdown plant shutdown to modify and do some modification at our plant. So post that I think we have restarted our plant in July and I think the current quarter we will reach to normalcy of volume and demand. Okay. And finally sir, CDMO has started off to a good start and we thought that this is more of a you know, second half story.
So could you comment a little bit on what’s driving cdmo? As mentioned in my opening remarks, you know we have already, I have already told that you know we have order book of you know the guidance that we have issued 35 to 40, 40% growth. So we are quite confident about you know, achieving the same. Understood, thanks.
operator
The next question comes from Ankit Gupta with Bamboo Capital. Please go ahead.
Ankit Gupta
Thanks for the opportunity sir. You know you highlighted about the reason for you know, declining revenue on the part. But on the API front, sir, you know last year we had seen a very good growth because of the expansions we had done prior to last year. So we had seen almost a growth of around 42%. And I think there was some like this. We had still, we still had some room on the capacity available for growth in the API segment. So you know, given how the first quarter has panned out, you know do you think we can still grow at least 10, 15% on the base of almost 770 crore of API in FY25 for this year, financial year 26?
Rashesh Chandrakant Gogri
Yeah, yeah. See what has happened is that last year, last quarter we pushed a lot of sales so we, we could achieve very higher sales on the in the last year, last quarter. Whereas in this quarter we were constrained by shipping space availability and also you know that resulted in an inventory stock in increase in particularly API. And of course you know basis on every year first quarter normally the API sales are higher because as A start of the year. You know, customers may like to cover some volume. So I think there’s some seasonality also.
Ankit Gupta
Yeah. Okay, so at least compare like FY20.
Rashesh Chandrakant Gogri
Yeah. As I mentioned, we will be able to grow this business.
Ankit Gupta
Okay, okay. On the renting part, you know, we have a new capacities coming in, you know, additional capacity of 4,000 ton coming in, let’s say in the second half. So for this segment we have had very good volume growth for the past two, three years. But you know, because of the fall in realizations, the overall revenue has actually, you know, remain in the range of around 780, 800 crores. So how do you see this, you know, Xanthine segment panning out for us over the next two years? 26 and 27. 27, we’ll have the full year benefit of the expansion coming in.
So do you think, you know, the additional capacity we can utilize at least 70, 80% next year. And for this year, how do you see growth for this segment?
Rashesh Chandrakant Gogri
Yeah, yeah. Overall I think two years down the line we are looking at thousand plus top line for this segment. And I think we are quite confident with the increased capacity we will be able to achieve the 2, 3 years into 3 years time. Good optimized capacity utilization.
Ankit Gupta
So at least FY27. Yeah, yeah. Ma’, am, you were saying something?
Rashesh Chandrakant Gogri
No, no, that’s it. Yeah. So at least FY27 we should be able to read thousand crore of revenue from genting. No, in 27 or 28 in one of the years. Of course it depends on the raw material prices, final price and all that. So we have given three years, you know, we will have the capacity utilization of 80 to 90% with 50% of sales going to beverages and regulated customers. So that’s what is the target. So ultimately out of 9,000 we may optimally utilize 7 and a half to 8,000. Out of which 50% will go to the beverages and export customers.
Ankit Gupta
Okay. And that will be a better margin plus more, you know, regular sales kind of business for us.
Rashesh Chandrakant Gogri
Yeah, the products are different. So the product for beverages is a different product and the product for API pharma requirement is different.
Ankit Gupta
Any, any comments on the pricing? How the same thing prices are currently. Have we seen the prices bottoming out and has there been any increase pricing for the for the entire products?
Rashesh Chandrakant Gogri
No, I think prices are stable on spot market also. Yeah, we are seeing stable pricing. We have not seen any further drop of pricing. And overall I think raw material costs have also come down. So overall that is what has resulted in the pricing pressure in past but now I think everything is stable.
Ankit Gupta
And last question was on the CDMO segment you know we are expecting to you know get around 35, 40% kind of growth for this year given how the pipeline is shaping out. So can you talk about how do you see given how the pipeline is currently and you know we have seen significant increase in our molecules both on under development as well as commercial stage as well as we have added new new customers also over the past two years a significant jump in that. So 27, 28 do we see you know this segment continuing to grow at at least you know, 30, 40 or even higher growth rates with new capacities that are atali coming in you know later half of this year.
Rashesh Chandrakant Gogri
As I have mentioned in past, in three, four years we want all segments to grow up to 100 million or thousand crore, you know, whichever reaches faster, you know. So that’s what the target is. So it depends on a year and how the approvals come and you know how our customers are doing. We have seeded the project so we have 60 projects which are ongoing and how the approvals are coming and how commercially the products are faring in the marketplace and how fast we are able to get approvals as additional source in the current commercial product for the regular requirement.
So all these factors are in hand of our customers. We are doing hard work in terms of supplies and development work but ultimately you know we will get there because all these products are currently in the patent phase. So you know customer has fair bit of idea of how the growth is and how it is going.
Ankit Gupta
Let’s say in FY29 we can expect at least 800,000 crore of revenues from CDMO segment.
Rashesh Chandrakant Gogri
That’s the target, you know.
Ankit Gupta
Okay, thank you Nishwal. Thank you.
operator
Thank you. The next question is from the line of Daniel Desai from Turtle Capital. Please go ahead.
Unidentified Participant
Hi, good afternoon everyone. So my first question is, you know you have mentioned that by Q2 our Tali project mechanical completion will be over and by Q4 the commercial revenue will start. So will two quarter time be sufficient to do validation and everything? And you know even if I assume effect on some 1.3, 1.4 times essentially we are looking at 500 odd crore kind of a revenue from the phase one. So from start to reaching that kind of a number what is the timeline that we are amplifying?
Rashesh Chandrakant Gogri
Yeah, basically you know whatever we are going to do there is going to be earlier st production as well as the products which will shift from our current manufacturing Site to this side. So with where we are having additional orders. So all these together will be able to fill up the plant slowly. And overall I think we expect plant to get utilized. So we have earlier mentioned that every second year after years, you know, we’ll put up additional blocks. So with this optimally getting occupied, we will put up newer facility and of course the top line in ebitda, you know, top line, we, we are basically not tracking top line to that extent.
We will ensure EBITDA growth due to this addition of this manufacturing facility.
Unidentified Participant
Okay, so, so when we say that we will move some of the existing products or production from existing site to new site, so does it mean that the revenue generated from new site will not be incremental in nature? That is how we should look at it.
Rashesh Chandrakant Gogri
Now overall, you know, we have multiple sites which ultimately feed into the CDMO business as well as the intermediate business. And I think you will see a increase in both top line. So anyway, as we have projected growth in CDMO CMO this year and next year also going forward, we expect growth to happen. So that will be driven by the additional capacities that we have put up in Natalie that will help us achieve those growth targets.
Unidentified Participant
Okay. And the, you know, our aspiration to reach, you know, let’s say thousand crore number in a given timeline. So to reach that number, you know, do we see the visibility based on current commercial and in pipeline products to reach that number or you think that we need to get many more projects to actually get to that number?
Rashesh Chandrakant Gogri
It depends on how our customers are doing and when they are getting the approval. I think anything can happen. So, so we are doing currently hard work of getting more customers, more projects and every year we will add those. And I think combination of both will work towards achieving growth in future.
Unidentified Participant
Okay, okay. And lastly, if you can talk more in terms of, you know, what are the white spaces in terms of our capability on the PDMO side which either we on our own or from, from the slight feedback from the customers that we are trying to develop or work upon, which can, you know, help us in the longer term? If you elaborate on two, three such areas where we are spending money and effort, you know, on the PDM side.
Rashesh Chandrakant Gogri
As mentioned in the presentation, you know, we have given the broad capabilities that we have. So we have now also as a part of our CDMO program, we are also doing continuous manufacturing which we have added, which we can offer for CDMO also. So all these are newer offerings that we have added. We can also do cryogenic reactions and hydrogenation we can do high, high pep. So basically anti cancer kind of finished products also. So all these capabilities have enhanced our profile and offering for the innovators.
Unidentified Participant
Okay. Anything new that you think is going to be more relevant that you more futuristic but you are spending time and effort on.
Rashesh Chandrakant Gogri
I think as in past, I think world is moving towards peptide biologics and I think we will like to attempt that in future going forward.
Unidentified Participant
Okay, thank you. That’s it for my slide.
operator
Thank you. Before we take the next question, we would like to remind participants that you may press star and one to ask a question. The next question is from the line of Mother from Fidelity. Please go ahead.
Unidentified Participant
Hi, good evening. Thank you so much for your time. So first question on the xanthine business. Just wanted to clarify. You said that you know our capacity will be going from 5,000 tons to 9,000 tons. So we’re adding roughly 80% capacity. And even on the 5,000 ton hundred which we are at, you know, we are tracking about 700, 720 crore top line. So if the capacity here is going up BY let’s say 80% while the peak revenue is the only thousand crores, like it can be higher, right? Like and especially since we are targeting some better priced contracts as well in like regulated markets or you know, maybe with pharma or beverages like you mentioned.
So just wanted to understand like if on a fully utilized 9,000 ton block, what could be the peak revenue potential like ballpark on current pricing maybe?
Rashesh Chandrakant Gogri
Yeah, mother. So we have guided, see currently our revenue from export and beverages is 65 and 57%. And in going forward we have guided that revenue from these beverages can go up to 50 plus. So of course currently you know we are on a higher side of that. But that will normalize with the additional capacity. Still it will grow from current base. So that has one impact and depending on how fast we are able to secure more pharma customers, it depends on that. And that will define the top line because the spot price and the pharma prices of course there is a difference differential also.
So if we are able to capture reasonable market of say 10 to 15% of total demand in the pharma, then you know, of course we can expect higher top line. But if we have to offload the product in spot, then you know, it can be little bit on the lower side. So it all depends on how the approvals are coming through. Luckily you know xanthine and caffeine is in the an extra 2 of the list. So we are not impacted by the tariffs, which is a good thing that we have.
Unidentified Participant
Okay, so could you just clarify what is the pecking order for prices? Like is it beverages is the best price then pharma and then spot like that or is it pharma beverages in this pot?
Rashesh Chandrakant Gogri
I think pharma has best price and then I think beverages and then spot is the always Spot used to be higher but now spot is lower. Spot is spot.
Unidentified Participant
Yeah, right, right. Okay.
Rashesh Chandrakant Gogri
But you know it’s a market where of course the approvals also matter and the distribution network that we have now established over a period of time that also helps us push the product and there are certain geographies where we can enjoy some better pricing also.
Unidentified Participant
Okay, so just to clarify, you’re saying that in the current mix that we plan to sell into pharma beverages, spot, the total 9,000 ton capacity we expect thousand crores of top line. That’s the way to think. Or it could be a bit higher or lower, like thousand plus.
Rashesh Chandrakant Gogri
Thousand plus. So it can be anything. Yeah.
Unidentified Participant
Okay. Okay, got it. Okay then the second question just wanted to check was on the CDMO business, did I hear that you’re saying that by FY28 or 29, this current 200 crores there is potential to be 8002000 crores. Is that right? Did I get that?
Rashesh Chandrakant Gogri
Yeah. Three, four years.
Unidentified Participant
And so like in this is it from the existing commercial, the 33 molecules we expect like very good scale up or is it the pipeline which makes us more sort of, you know, bullish on the segment? Like if you could whatever color you can share on the growth drivers that will be helpful. Thank you.
Rashesh Chandrakant Gogri
I think it’s going to be effect of both and I think we have more promising under development pipeline also. Okay, yeah. And that’s why you know, it depends on how the growth happens in the approvals once the customers get the approval. So there are variety of factors, you know, depending on the competing therapy and how they are effectively able to capture the market share.
Unidentified Participant
And so this the of the 27 projects in development, how many would be in phase three or you know, late stages of development? Could you give some sense here?
Rashesh Chandrakant Gogri
So we do more phase two, phase three work. So I think phase one will be very limited. So yeah, more phase two, phase three only. So otherwise you would have seen much higher number of projects that we would have done. But you know we, we are marketing ourselves as a manufacturing specialist which does good manufacturing optimization and cost optimization, route of synthesis selection and having large capacity to match the requirement of, you know, the measure Requirement of customers needs in case a product hits jackpot, you know, so all those things are giving us a good customer base.
Unidentified Participant
So just last question like you know, in case, if you’re able to you know get to this mix of let’s say thousand crore plus top line and Xanthine, you know CDMO reaching let’s say 800 to 1000 crores and API growing at a reasonable pace. How does the margin profile of the company move like from current 25%. My sense would be that the margins should improve. Is that the right way to think or you think margins could be stable if this business mix plays out the way we are thinking?
Rashesh Chandrakant Gogri
Yeah. Percentage margin, I think EBITDA should grow reasonably. I think top line is all dependent on the foreign exchange and raw metal prices and all that. So top line. And see ultimately we try to tag per kg margin. We try to maintain in most of the products. That’s how it works. So a lot of factors are there. So I think margin should be from the current level it can go plus or minus 2, 3%.
Unidentified Participant
Okay. But CDMO is probably the highest margin segment.
Rashesh Chandrakant Gogri
Yes, yes. Yeah.
Unidentified Participant
Okay. Okay. Okay. Thank you.
operator
The next question comes from Vivek Gautam with GS Investment. Please go ahead.
Vivek Gautam
Yeah, sorry sir, I joined the conference late so if you can just. If it is repetitive then please excuse me. How much is the exposure we have to the US and what could be the tariff impact for our company and pharma sector in particular? Yeah, currently our US sales would be around 8, 10% but I think we don’t have any tariff impact. Currently only 8 to 10%. And how come no tariff impact? Basically the pharma is exempted by the U.S. government. Yeah. So any risk of it being a temporary sort of a thing and, and CDMO is also sort of covered under that only sir, I think CDMO work more.
Of course we have US based customers also but largely US Europe. It’s multi geographical. So there also I think our US concentration is not very high. Okay sir. And what about our CAPEX plan, Sir? And so H2 will be much better with respect to high margin CDMO business.
Rashesh Chandrakant Gogri
Yes. Yeah, yeah, yes. So I think the Capex plan as we have mentioned that in the second half of this year you know we will have the Atali new site operationalized and also in the second half of this year you know we will have the caffeine capacity addition also will happen. So I think next year of course you know we’ll have much higher capacities to produce more products of Course this year also in the second half also we may have partial impact of this. Okay sir, and few words about your xium and API business. Pizza basically Xentium we are facing competition from China and much more and API comparatively less or because China is strong in both those segments.
The APIs that we are doing are more complex APIs and they are only targeted towards the regulated market. So with that I think the China overall presence in those products is little limited. Whereas in Xanthine of course China has large capacities and you know they compete. But our value proposition to our customers that we are the only backward integrated independent of China source from India who can offer them Xanthine products at a reasonable price. So with that we are able to get market share. Any plan for us to reduce the exposure to US market due to the overhanging risk for by Trump and so we are we looking at other geographies to diversify our so we don’t have.
Unidentified Speaker
Any major exposure in USA to 10% is very reasonable and that too you know Pharma being exempt on the list. I don’t think we are largely present in Europe and all the other geographical locations.
Vivek Gautam
So. Okay, thank you madam.
Rashesh Chandrakant Gogri
Thank you.
operator
Thank you. The next question comes from Shubham Agarwal with Verman Capital. Please go ahead.
Shubham Agarwal
Hi sir, thanks for the opportunity. Can you give us some quantitative context over the segment level margins across the three segments? And sir, where do you see the company level margin shaping up in the medium and long term as the CDMO revenues expand? Thank you.
Rashesh Chandrakant Gogri
I think we are not giving the segmental margins but as I mentioned in past the margin profile in CDMO CMO is the highest followed by Xanthine and then API they are closely neck and neck. Whereas overall I think we have guided for the EBITDA growth then I think we are maintaining the current guidance.
Shubham Agarwal
Okay, thank you.
operator
The next question comes from Ankit Gupta from Bamboo Capital. Please go ahead.
Ankit Gupta
Yeah, thanks for the opportunity. In the past, you know we have spoken about some of our molecules reaching to a scale of you know, 20 to 30 million dollars for us in the CDMO segment. So you know, given we have 33 commercial molecules as of as of June 3 as of first quarter. So you think, you know some of these molecules over the next two, three years themselves have a potential of reaching this scale of you know, let’s say 20 to 30 million dollars or some of the underdevelopment projects or molecule projects have those potential.
So if you can talk about that.
Rashesh Chandrakant Gogri
It will be a mix of both. So and I Think we shouldn’t pin only to because it’s ultimately the final molecule that requires multiple products. So we may supply all the chemistry also to the innovator. So combine being all the chemistry, a single product final, you know, we may be able to reach in some product that kind of number. And it is a mix of both some of the commercial molecules also that we have currently have those potential over the next two, three years. Yes.
Ankit Gupta
Okay. In this 33 commercialized molecules, you know, will there be some molecules where, where we’ll be the largest supplier and will our market share in those molecules will be let’s say 40, 50% and there’ll be some other CDMO companies who will be the second scale supplier. We are mostly the second or the third source suppliers on the CDMO sector.
Rashesh Chandrakant Gogri
Yeah, I think more later is true because I think a lot of products have shifted from China to US and that’s where still the validations are happening. And once we become full fledged supplier, each innovator has also multiple partners to manufacture these products and they have multiple partners from China. So the market share starts from 20, 25% and then it can go up to 50%. So like a lot of these molecules are still under validation and the scale up will happen. So every year the campaign may not come. It depends on the size of product. So suppose certain products may be a regular product. Certain products may be a campaign product for the API manager manufacturer of innovators.
Ankit Gupta
You know, the segment has largely been, you know, second half heavy. You know, as to every year we have seen significant scale up in our CDMO revenue. So is that expected to continue? Is that lumpiness expected to continue or with, you know, more molecules?
Rashesh Chandrakant Gogri
Yeah, yeah, it will continue. The it will have, I think more sales will come in later quarters.
Ankit Gupta
Okay, okay. It will continue after Atali starts operations and contributes significantly, let’s say from FY27 28 onwards as well.
Rashesh Chandrakant Gogri
I think Atali overall we can guide for the business. You know, Atali is a capacity. So basically we are increasing from 1100 k to 1500 k. So which where we are going to to manufacture what will be dependent on overall supply chain planning that is being done and how the approvals are achieved. So if any product has 5, 7 stages, we may shift 3, 4 stages at Atali and do final stages where if customer is not giving us the approval to shift whereas the new projects will directly go to Atali. But of course you know we will have multi site flexibility.
So that is a good thing. Which, so it will also have risk Mitigation overall.
Ankit Gupta
Okay. Okay, thank you.
operator
The next question comes from Dr. Neha Kharodia with abacus. Please go ahead.
Neha Kharodia
Yeah. Hi, good evening everyone. Thanks for the opportunity. And my question was on the API and intermediate piece. So just wanted to understand. So you mentioned in the initial remarks that in this business segment it was more of a conscious decision about the intermediate business that we had more focus on the CDMO site. So probably the decline which is seen is because of the intermediate business coming down. But just wanted to understand why was that as in were we facing any capacity constraints?
Rashesh Chandrakant Gogri
Yeah, so we, we are, that is the reason why you know we are going to start the atali side so that you know we can have our intermediates also validated and the intermediates which required for captive consumption can be validated faster so that we can free up our older capacity to start, you know, catering to the customer along with the CDMO earlier stages which process mentioned earlier.
Neha Kharodia
Okay so on, on that just to understand it more qualitatively. So if we talk about the capacity being free on that and so in, in our Q4 combined revenue of let’s say the API intermediate and CDMO business was about 350 crore and this quarter it is, it is significantly low. So I did not understand the that part. Like how exactly is it or was it. Yeah, yeah, yeah.
Rashesh Chandrakant Gogri
So as we, I think Russell mentioned earlier that for our CDMO businesses we have lot of stages to be manufactured so we start little early so that you know, six, seven stages, the early stages are on, were under production and that is still continuing in current quarter also and Most likely in H2 you will see the bump of you know, sales going in.
Neha Kharodia
The bump in the CDMO segment?
Rashesh Chandrakant Gogri
Yeah, overall. Yeah.
Neha Kharodia
Okay.
Rashesh Chandrakant Gogri
And, and, and so is it fair to assume that going forward, let’s say Q2 onwards in API and intermediate business the growth will again catch up or will it again be let’s say more of filter towards SG to in terms of the API segment. So I think year on year there will be growth in the both the segments API intermediate as well as the CDMO cmo. CDMO CMO specifically we have anyway guided the growth and I think we are quite positive with the new capacity coming in. I think there will be growth in the API segment as well. API intermediate segment as well.
Neha Kharodia
Understood sir. So if one assumes let’s say mid teen kind of work, will that be a fair assumption still in, in let’s say FY20 or maybe on a FY26, 27 KGAR basis in the API intermediate segment.
Rashesh Chandrakant Gogri
So basically top line see what happens is that as I earlier also mentioned on earlier conference calls is that you know we have regulated market customers, we have rest of the world customers and non regulated customers. So if we don’t get the capacities available then we cut the non regulated market. But we still cater to high margin regulated market as well as the row customers. So basically practically you have to see the EBITDA growth overall which really makes the difference in the API segment as well as these engine segment also I can cut the spot sales.
So ultimately so if the capacity goes down by 10% still the profit may not go down by the same amount. The profit may go down by only few percentage points and vice versa is also true because you know we are anyway capturing all the high margin market. So even if I have much higher capacity, the growth may not come significantly higher because we are anyway capturing the all the important profitable market and then we go after the non reg market.
Neha Kharodia
And so in terms of capacity utilization for the quarter, can we give some color on that? Like how was the capacity utilization for intermediate and CDMO capacity?
Rashesh Chandrakant Gogri
Yeah, we were 80% plus utilization. 80, 85. So which is optimally utilized because we are doing so many products at a time. So you are fully occupied? Yeah, yeah.
operator
The next question comes from Yash Lahoti with SOIC Research. Please go ahead.
Yash Lahoti
Hello. Yeah, yeah, good evening. So my question was related to the CDMO part where we are guiding like 30 to 40% kind of crude. So first of all will the margin this year expand on the console level? And also like what is our vision for the CDMO segment for like next three, four years? Can it be 30 to 40% of the overall business for the company?
Rashesh Chandrakant Gogri
Yeah, I think we have guided 30 to 40% growth this year on the CDMO CMO. And I think overall we aspire to do the numbers that I mentioned earlier in the call where we want to reach in three, four years.
So I think overall it depends on how the overall market plays out and how we are able to ramp up the other products. So it can go anywhere between 25% to 33% of field. The question was related to the solar plant that is coming. So what kind of cost savings can be there from that? Yeah, I did mention earlier that annually it will have 25 to 30 crore cost saving for the current plant that we have operationalized. And then of course you know we have one more plant which is coming up which is going to be the plant with the power purchase agreement that we will have with the joint venture so that will also have more savings.
Last question is related to like the base business, how we are seeing the growth PC in the base business we are almost like near to the full utilization level and also like the new newer capacities that are coming up into even side and API side are later into the year. So I think second half is not far. Yes. So I think second half we will have the capacities and that will allow us to grow further. And we are also adding one additional debottlenecking of API line also and then we have. So there are a lot of I think debottle making exercise which keep on happening in the existing sites also.
So I think overall we will have additional capacities which will get freed up in the second half of this year or maybe towards last quarter which will allow us to grow this year and of course next year as well.
Yash Lahoti
Thank you. Thank you for the opportunity.
operator
Thank you. The next question is from the line of Kumar Saurabh with Scientific Investing. Please go ahead.
Kumar Saurabh
Hello sir, My question is regarding the two capex which will be coming live in the next 6 to 12 months. So usually whenever a new capex comes live some of the expenses are front loaded and then once we reach maybe 40, 50, 60% capacity then the operating leverage play happens. So coming to these two businesses where we are coming with CapEx, how does it look like? Do you feel it will impact some margin for one year and then we have operating leverage or do you feel there should not be enough margin impact given the, you know, existing business should take care of that?
Rashesh Chandrakant Gogri
Yeah, I think the two capexes are of different types.
So one of the capex is Greenfield capex where I think whatever you said is true. Whereas the second capex is brownfield and in brownfield I think the cost will not go up as much so we will have advantage with the higher capacity costs also remaining low. Whereas in the Greenfield you know we have, we will have more opex which will have to be covered over a period of time with the utilization. So I think we are going to have mix of both. So the Zen will be more brown filled and the Atali project is going to be more green filled of nature.
And there also we have done almost 200, 150 to 200 crore of Infraspan so which is for future. So currently we have just started with block one which mechanical closure we have done so with that still you know, with the other blocks coming in, you know we have capacity to do 10 blocks. So that also once we have more and more block it will more go in the brownfield capacity, brownfield expansion. So I think we have to bite the bullet once, you know, so that’s what we’ll do in Natalie. Got it, got it. And second question is on if you can give some visibility in terms of the granularity of revenue business, how granular it is.
I know there could be restrictions in terms for competitive reasons but if you can give some color to it that how granular these businesses are. So in API business you know we have in next two, three years we have good patent expiries which are coming in and with the products that you can see our website and the expiries, you know we will have good potential if our partners are able to gain the market share. So it’s all depending on their partner’s ability to gain the market share and how competitively we are able to support partner in manufacturing the products that they desire.
So but we have good pipeline I think in that anti cancer and some of the general products have promising sales. I think I see lot of billion dollar plus products in our pipeline which are going to expire. Multi billion dollar products which are going to expire. So we expect if we are able to get 10 to 20% market share in these few of these products, you know we will be able to get a good growth in API segments. I think intermediate segment also same true. Basically where we have seated with multiple vertically integrated players, you know we end up supplying intermediates to multiple five to seven customers in each product.
And even if one or two of them are successfully able to get their products launched in US and Europe, you know we can get good volumes and I think even the validation quantities and all that also can be meaningful. So there again the game is how competitive you are remaining in total. And that’s where the constant efforts to remain cost effective create capacities for meeting the customers demand and all that is important. So that’s why we have proactively invested in Natalie to have that possibility of growth either now or in future. Do you see any of these API intermediate products having more than 20%, I mean high double digit revenue share of their segment? Yeah, that’s what our overall aspiration is that any product that we do should be at least 10% plus of market share of the global.
Sir, I’m not asking for market share in the API intermediate our revenue mix. Are there products which are contributing in high Double digit like 20% of overall API end intermediate revenue or 30% of API intermediate revenue? Do we have such products just to gaze how granular our you know, we have more than 140 products that we offer as in API intermediates. Of course some of them are very big. So few products have 5, 6 million dollar sales also. And of course you know, we have captive sales internally consumption also. So with that I think overall these products are larger products but not very heavily dependent on any few products.
So it’s a mixed basket of many products that we do. That’s all I had. Wish you all the best. I’m looking forward for next few quarters.
operator
Thank you. The next question comes from Abhishek with Fatmaja Investments. Please go ahead.
Unidentified Participant
Yeah, Am I audible, sir? Yes, hello. Am I audible, sir? Yeah. Yeah. My question is on the Ganesh polyet. My question is on the Ganesh pallet. And like since the capacity is now running from July, like is there possibility for larger profit potential from the joint venture? I think longer term the capacity we have grown and I think overall the plan is to. The modification that we carried out was to enable ourselves to. To meet more demand of the customer. So that’s what is the endeavor. It may not happen in this year but I think longer term we will have higher capacities which will be able to meet more customers and more market.
So there are multiple products that we have and few of them have application in aerospace also and which is growing quite nicely. So with that we will have growth possibility. Okay. As of now the profit contribution from the joint venture is close to 40 crores or 60. Can you answer this?
Rashesh Chandrakant Gogri
Sorry, what is the question? Can you repeat.
Unidentified Participant
The joint venture contribution to the profit? Because now we won’t be adding it to the revenue and straight to the profit. How much is it going to be following this year or next year?
Rashesh Chandrakant Gogri
So there will not be any impact on the profit per se. It will be still counted as part of the profit after tax. There will be an impact only on the revenue and the expenditure. So last year there was.
Unidentified Participant
I got that part. I’m asking like what, what is the. What was that number?
Rashesh Chandrakant Gogri
Last year was 40 crores. It was 60 crores. EBITDA. EBITDA was 60 crores. So our share was 50% of that.
Unidentified Participant
Okay. Okay. Okay. So. Okay, thanks. That’s all.
operator
The next question comes from Prakash Kapadia from Kapadia Financial Services. Please go ahead.
Unidentified Participant
Yeah, most of the questions are answered. I just had one question. You know, on the CDMO side, obviously we’ve seen good growth and you commented, you know, the trajectory will continue. So given that, you know, growth in CDMO shouldn’t EBITDA trend higher than the 12, 15% which we I think mentioned in this equity.
Rashesh Chandrakant Gogri
Yeah, I think as we mentioned, you know, with the new plants coming in, we will have higher OPEX also and all that. So with that I think we, we have to see how our overall utilization happens. And next year we can definitely have higher growth. But this year with the half year, you know, we’ll have to see how it goes. Yeah. And also along with CDMO we have other businesses also growing. So overall there will be, you know, combined if we see it will be as guided earlier.
Unidentified Participant
Okay, thanks. Thank you.
operator
The next question comes from Avnish with Vakaria. Please go ahead.
Unidentified Participant
Yeah, hi, good evening. Thanks for taking my question. I just have a quick one. This is regarding the CDMO business where you make products for the big pharma, the on patent products. I just wanted to know that the APIs or the intermediates that you make, are they getting exported to the formulation plants in the US or are they getting to Ireland, I mean which is your major export country right now for that business?
Rashesh Chandrakant Gogri
I think they are getting exported all around world. So largely I think Europe is quite concentrated for manufacturing of API and formulation. And of course some goes to US as well.
Unidentified Participant
The goods that are getting shipped to us, as I understand API doesn’t form in the definition of pharmaceutical as it applies for the tariff. So are your API, so are your abs that are getting shipped to us, Are they getting tariffs right now?
Rashesh Chandrakant Gogri
No, no they are not getting.
Unidentified Participant
From. So basically API are also exempt from tariffs as of now.
Unidentified Speaker
Yeah, yeah.
Unidentified Participant
Okay. And let’s assume for a second that section 232 investigation does lead to some tariffs. Is there an understanding on how that might impact our business? Who’s going to take on these tariffs? I mean what are the contracts like? Are they FOP or are they ddp? Can you give some color on that?
Rashesh Chandrakant Gogri
Some of the contacts are fob. I think largely fob.
Unidentified Participant
Oh, is that an understanding that whatever number that comes from the investigation, whatever that number that would be, is it like partly absorbed by us and the customer or fully absorbed by the customer? Is there any clarity on that?
Rashesh Chandrakant Gogri
I think 50% tariff, if it becomes applicable, I don’t know what will happen. But currently anyway we are saved from this. So we are not speculating what will happen because currently they are under the exempt list. So we hope that the things resolve and we have a much better tariff situation in future. And even if something were to come, I think if it comes to 50%, I think there will be some impact because you know, even if we directly may not sell, I think our customers will eventually sell to us market because the US Is the biggest market of formulation of generic products.
And what is the stance of President Trump on the generic. Whether they want to apply tariffs or not and how he wants to take it? You know, it’s more speculative. I think today the tariffs are not applicable. That’s what we can.
Unidentified Participant
Okay, so basically when that number comes, that is when you start having discussions with your customer on basically how this gets split or whether the customer absorbs it or not.
Rashesh Chandrakant Gogri
Yeah, yeah, yeah. Yes. Because lot of customers are India based also which ultimately end up exporting the regulated market. API customers. This could be basis India and they ultimately export. There are a few customers which are US based but largely the manufacturing has shipped to other countries. Right. From us.
Unidentified Participant
So yeah, just one clarification here. Some of the other players have said that the APIs are actually not exempt from this section 232 and it applies to only the final formulation. So you are indicating that you are paying the tariff on the API exports to the U.S. i think the products.
Rashesh Chandrakant Gogri
That we are exporting our. Our sale condition is cif. So we are not paying any tariff. And of course under an extra two list. So it is under exempt. The caffeine and its source are under exempt list.
Unidentified Participant
Understood. Okay, thank you.
Unidentified Speaker
Thank you.
Rashesh Chandrakant Gogri
Thank you.
Rashesh Chandrakant Gogri
Yeah. I would like to thank all of you for attending the call. Thanks.
operator
Thank you. This concludes the conference call on behalf of Nuama Wealth Management Ltd. That concludes this conference. Thank you for joining us. And you may now disconnect your lines. Thank you.