Key highlights from Caplin Point Laboratories Ltd (CAPPL) Q3 FY22 Earnings Concall
Management Update:
- In Caplin Steriles, CAPPL stated its last 9 month sales overtook the 12-month sales of last year. CAPPL also stated that it has 12 ANDAs approved on its own and a further 6 approved through partners. Out of these, 15 have been launched and the other 3 would be launched by the next two quarters.
- CAPPL commented that the first ophthalmic product has been approved from Caplin Steriles facility that has happened without an inspection of the ophthalmic section. Additionally, CAPPL filed its first product in China through its partner.
- The company said it is in talks on the new drug delivery system with a party in the UK; hoping to make it available by 2025 and beyond.
Q&A Highlights:
- Nikhil from Galaxy International asked that on setting up the company’s own API plant, is CAPPL looking to sell the APIs to external customers also. C.C. Paarthipan Chairman answered that the idea behind going for an API plant is for captive consumption.
- Ashish Thavkar of MOAMC asked that between US and non-US market (RoW), which market the company is focusing on. C.C. Paarthipan Chairman answered that focus has been there for the RoW market, especially the Latin American market, which has created a stickiness factor.
- Ashish Thavkar of MOAMC also asked if the company is planning to setup its own front-end in the US and the timelines of it. Vivek Partheeban COO replied that at present the company has 12 products of its own and half have been signed exclusively with a partner in the US. The exclusivity will start to run down sometime by 2023-2024. By this time next year, CAPPL expects to have the structure in place for entry into the US and on actual sales etc. the company feels by middle of next year it can launch its own label there.
- Ashish Thavkar of MOAMC also enquired that in terms of cash flow, if the company has broken even in the US business. Vivek Partheeban COO answered that in terms of breakeven, excluding R&D and the assets the company is filing, on a cash flow basis CAPPL would breakeven at the end of this year. And on a wholesome basis, the company feels that in the next financial year it should breakeven.
- Girish Bakhru from OrbiMed asked about capacity expansion. Vivek Partheeban COO said that on capacity expansion, currently the company will be targeting $100 million revenue by 2026. CAPPL added that the current capacity expansion, which will triple the capacity, will be enough for 2026 and beyond.
- Alisha Mahawla from Envision Capital asked to quantify the US revenue for the quarter. D. Muralidharan CFO answered that for the first nine months, total revenue from operations is INR87 crores in FY22 as against INR53 crores last year nine-month period.
- Ashish Thavkar of MOAMC enquired if there is seasonality in the company’s business. C.C. Paarthipan Chairman said the company’s business is not a seasonal business since it’s more a generic kind of business.
- Ashish Thavkar of MOAMC asked about the agreements signed with partners for two complex products and one suspension last year and has the filing being done now. Vivek Partheeban COO answered that for two of them the exhibit batches have been completed and under stability. Therefore, in the next 7-8 months it should be filed. For the third one, it’s still under development process.