Dishman Carbogen Amcis Ltd (NSE: DCAL) Q3 2025 Earnings Call dated Feb. 13, 2025
Corporate Participants:
Pascal Villemagne — Chief Executive Officer
Harshil Dalal — Global Chief Financial Officer
Stephan Fritschi — Executive Vice-President Business Units; Deputy CEO
Analysts:
Priyanka Patel — Analyst
Sajal Kapoor — Analyst
Subrata Sarkar — Analyst
Amit Mehendale — Analyst
Satish Bhat — Analyst
Deepak Poddar — Analyst
Dharmesh Haria — Analyst
Presentation:
Operator
Thank you ladies and gentlemen, good day and welcome to the Dishman Carbogen Ampsys Limited Q3 FY ’25 Earnings Conference Call. As a reminder, all participant lines will be in 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 then zero on your touchstone phone. Please note that this conference is being recorded.
I now hand the conference over to Mr Pascal Villevango. Thank you, and over to you, sir.
Pascal Villemagne — Chief Executive Officer
Thank you. Thank you, moderator, and good afternoon, dear shareholders. I’m happy to be with you today and it’s a bit of a bittersweet moment that I have to address to you today. As you may have read in the news, I’m going to step-down from my CEO at Cabo by the end of this fiscal year-on the 31st of March. It was an incredible journey and I’m extremely proud of what we have achieved together from the constant growth to the implementation of the new facility of drug product in France or through the transformation of the branch of the carbodynamics company.
These success are thanks to the amazing teams that has worked with me and to whom I’m deeply grateful. I thank also you, our shareholders for your support and the belief in our visions and the confidence you place in carbon and carbon. I will be replaced from the 1st of April by Dr Stefan who has been with the company since more than 25 years. And he knows the company extremely well. He has been the deputy of my predecessor, Mark Griffith and my deputy for the last three years.
And I’m extremely confident that he will continue the extreme good work we have done together with the support of the Group as well as the team at. I’d like to thank you again for your — for your support. And I wish Stefan all the best for the future and I’m very confident that he would be successful and I will be always a good supporter of the company and the Group.
That said, I’d like to have a few words about the 3rd-quarter, especially at where we have registered a few good events and one of them, as you know, we were expecting the French authority to come and did the site. It was planned to be in December and unfortunately because of the flu, the inspector postponed to January, but it was — it was done in January and it was extremely successful. So now we are expecting the official GMP certification of that site coming by the end of this quarter. So it’s a big milestones for carbogenesis and for the drug product business.
Alongside with this in France, we have also booked a number of important new customers and orders, which are placing us in a in a very-high confidence that we will achieve the forecast as well as the our ambitions for next year. Our Swiss activities has been quite good, especially around the commercial productions. We are right now achieving a nice figures by the end-of-the 3rd-quarter and it looks like we are going to achieve a number above digit by the end-of-the fiscal year for the Swiss activities, mainly driven by the commercial product.
Development activities, you know, 2024 has been a bit more difficult on that side, especially by the middle of the year. But lately, we have seen that the number of requests from the market is picking-up and that’s a very good news because that means that we will be able sooner rather than later to book new projects and new customers for sure. Regarding the overaffiliates, UK, China, nothing very specific to notice on The business side. However, with our Chinese affiliates, as France we have been audited by the local authority and same as France. We should get the local Chinese certification, which is going to allow us to chase for Chinese business, which represent an immense opportunity due to the size of the Chinese market on the pharmaceutical business. Last regarding Netherlands, although the beginning of the year was difficult, especially around the analogs family of products, we registered some nice changes, although the competition is very difficult. And especially on cholesterol, we have seen a number of orders coming in lately, which are going the right directions and probably we will be able to go beyond the target for that for that business unit. Last but not least this week and next week we organizing a global sales meeting here in India with our drug substance people at carbogenesis to reinforce the collaborations between carbogenesis and carbogenesis and to drive the synergies between the two companies with the objective to present a global strategy and enable more business for both companies. So we are looking-forward to that very close collaboration that we have started many, many years ago, but where since now several weeks and several months, we are reinforcing and we are starting to see the fruits out of all those efforts. That’s it on my side, and I’m going to hand it over to our Global CFO, Ashil Dalal, for presenting the numbers. Thank you very much.
Harshil Dalal — Global Chief Financial Officer
Thank you very much,. Hello, everybody. A very good evening to all of you. I’ll just take you through the financial highlights for the Q3 and the nine months ended December 31, 2024. As you would have already seen the numbers, this was again a very strong quarter for us at a group level. And so this is the second consecutive quarter where we have delivered a good amount of or a good number in terms of the operating profit as well as revenue. The revenue for Q3 FY ’25 stood at INR682 crores. This translated into a nine-month revenue of INR1,995 crores as compared to INR1,961 crores in the nine months ended December 31, 2023.
As far as the COGS is concerned, in Q3, the COGS stood at about INR98 crores, which is roughly about 14% of the revenue. This obviously is kind of an outlier. Usually our COGS at a consolidated level is at about 17% to 18%. But the major reason why the COGS was lower in Q3 was because in December and November, we had higher share of development revenue as compared to the commercial revenue. However, for the nine months, the share of the commercial revenue this year has been significantly higher and that is basically driving the revenue at a group level as well.
The consolidated COGS for the nine months stood at about INR355 crores, which represents roughly about 17% to 18% of the revenue. The employee expenses stood at about INR332 crores as compared to INR309 crores in Q3 of FY ’24. This represents an increase of 7.4% and this is largely driven by the foreign-exchange fluctuation because the Indian rupee depreciated against the Swiss franc. Additionally, there was also an impact of the yearly increment of the salaries that we give to the employees. For the full-year, this number represented INR969 crores as compared to INR887 crores, resulting in a 9.2% increase.
The other expenses for Q3 FY ’25 stood at about INR11 crores as compared to INR181 crores for Q3 FY ’24. This is a decrease by about 39%. And this, if you remember Q3 FY ’24, we had booked a notional ForEx loss of almost INR70 crores on the US dollar balance that we had at Switzerland on account of the fluctuation of the US dollar Swiss franc. For the nine months, this figure amounted to INR352 crores as compared to INR425 crores for the nine months ended FY ’24. Overall, this translated into an EBITDA of about INR140.6 crores as compared to INR42.5 crores in Q3 of FY ’24, which is almost a 230% increase and for the nine months, this translated into INR318.5 crores as compared to INR232 crores in the nine months ended FY ’24. From a margin perspective, for Q3, this — the operating margin stood at 20.6% and for the nine months, they stood at about 16%.
As far as the depreciation and amortization is concerned, more or less it was steady. We have operationalized both the manufacturing lines in France. So the current depreciation figure of INR71.9 crores for Q3 FY ’25 takes into account the depreciation of one manufacturing line because the second one got operationalized in January of this year. For the full-year, this — this amount was INR214.6 crores. The finance cost stood at INR48.78 crores, which is which is an increase by 47% as compared to Q3 of FY ’24, whereas the finance cost was INR33 crores.
And this increase is mainly on account of, as we had explained earlier, there was certain breach of financial covenant with the banking syndicator Carboge holdings, which essentially increased our borrowing cost-based upon the new terms that were agreed. However, with the improved performance of Q2 and now Q3, this interest cost should reduce substantially and we should start seeing the impact of the same from Q4 of the current financial year. Overall, this translated into a profit before-tax for the current quarter or of Q3 FY ’25 of INR27 crores. The tax expense provision stood at INR22 crores and the reason you see that the tax expense as a percentage of the profit before-tax looks exceedingly high is mainly because this tax provision is for the entities, which are making profits.
So it’s mainly for carbon analysis are gay and the other entities which are — which are making losses of the losses eat up the profit before-tax, but there is no additional tax provision. So overall, this was a very good quarter for us. As far as the segment-wise breakup is concerned,, which includes the Swiss entity as well as Manchester, Shanghai and France, the revenue for Q3 stood at INR512 crores as compared to INR505 crores in the same quarter of the last year.
The cholesterol and vitamin D analogs business, which is our Dutch business did a revenue of about INR50.65 crores as compared to INR61 crores in Q3 of FY ’24. What we expect is that the Q4 of the current financial year should be extremely strong for this particular business on the back of higher sales of and that would also result into higher profitability for us. The India business, the business for India did a revenue of about INR77.7 crores as compared to INR55.5 crores in the comparable quarter last year, which is an Increase of 28.5%. And for the nine months, this number stood at INR209 crores as compared to INR130 crores of the nine months of FY ’24, which is an increase of 61%. The India quots and generic business, which is largely done out-of-the Naroda facility, did a revenue of INR41.5 crores as compared to INR28.68 crores in the quarter, which is an increase by 31%. And for the full-year, it did a revenue of about INR87 crores. So the India business is — India business has also done — has performed quite well and we expect that the next year should be the real year of turnaround for the India facilities. From a margin perspective, Ancis CRAMS did a margin of 23.7% for the quarter as compared to 19.9% in Q3 of FY ’24. And for the nine months, it did a margin of 18% as compared to 18.3% in nine months of FY ’24. The Vitamin-D analogs and cholesterol business did 14.6% as compared to 16.6%. But as I mentioned, we do expect that the margin should increase in Q4 and going-forward on the back of renegotiation of the prices that we had mentioned earlier as well. The India and NCA API and Intermediate segment did a margin of about 11% and the and generics business did a margin of 7.2%. As far as the net-debt is concerned, as of 31st of December, this stood at INR168 million Swiss franc, which is a decrease by about $5 million as compared to September 30, 2024. The capital expenditure for the first-nine months stood at $20.8 million US dollars. So we are very much on-track as far as the budget is concerned for the capital expenditure for the end-of-the year. So thank you very much, investors. And with that, I would just like to hand over the call to Dr Stefan Fritchy just to introduce himself so over to you
Stephan Fritschi — Executive Vice-President Business Units; Deputy CEO
Yeah hello everybody thank you very much for taking your time attending this call as my predecessor said, my name is Stefan. I’m working for almost 20 years, 29 years and before that I was working in marketing and sales and I hold a Ph.D in organic chemistry. So I understand the Crown’s business from scratch because I started as a bench chemist and made my way through the organization up to where I’m now.
And I’m looking very much forward to the future and with the collaboration of all the colleagues, also specifically with Carbage and because as Pascal said, this is one of our core focuses in the upcoming future because there is a lot of synergy to be expected that we can get more efficient, more operationally efficient, but also more cost-efficient and penetrate the market.
Yeah, with this, I hand back to Pascal. I’m looking-forward for our next call — to our next calls when we meet next time in May. Thank you
Pascal Villemagne — Chief Executive Officer
Thank you very much, Stephane, and once again I’m wishing you all the best for taking over this important role for the group and I’m extremely happy that that’s going to be you because I know that role and the company will be in good hands.
Stephan Fritschi — Executive Vice-President Business Units; Deputy CEO
Thank you very much.
Pascal Villemagne — Chief Executive Officer
That said, I think we can go to the question — the Q&A session.
Questions and Answers:
Operator
You very much. Thank you very much. We will now begin the question-and-answer session. Anyone who wishes to ask a question may press star and one on their touchtone telephone. If you wish to remove yourself from the question queue, you may press star and 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
The first question is from the line of Priyanka Patel from Krujina Research and Analysis. Please go-ahead. MS. Priyanka, I would request you to unmute your line and speak, please.
Priyanka Patel
Hello.
Operator
Yes, ma’am, please proceed with your question.
Priyanka Patel
Yes, thank you so much for giving me this opportunity. So sir, my first question is, where-is there inconsistency in our profit before-tax? Because last quarter it was INR42 crore and now it is 27 CR. So when give — when we can expect consistency in our profit before-tax?
Harshil Dalal
So Priyanka, thank you for your question. You know what we focus on is the — is the operating profit. And as I already mentioned in my presentation, the finance cost in this particular quarter had increased significantly as compared to the previous quarter. So that was the major reason why the profit before-tax was lower in this quarter as compared to the to the previous one. But what we are focused on is consistency in the — in the operating profit because that is something that the entire operating team that the business is focused on.
The finance cost is something that we need to bring under control and we have taken measures to bring it under control. And that is the reason why we are confident that from the next quarter or now from the current quarter, it should come down because of the improved financial performance.
Priyanka Patel
Okay, sir. And my next question is, in past sales breach of loan covenants and companies submitted council proposal. So can you provide an update on how this issue resolves?
Harshil Dalal
So basically, as we had mentioned in our previous calls, we had certain financial covenants that had to be met as of 31st of March 2024. And there was a bridge in two of the financial covenants and the reason for the breach of those financial covenants was because of the delay in start of operations of our French entity, which we were expecting would have started in January of ’24. However, because of the technical issues that were found relation to the plant and machinery and certain equipment, there was a delay in the start of the operation.
However, as of November of ’23, the plant was deemed to be ready for operations and hence all of the expenses that had to be incurred to — to modify or to make corrections to the equipment, all of those expenditure had to be expensed out through the P&L. So that was the reason in Q4 of last year, we had booked a massive loss of almost about INR50 crores on account of this particular reason in the P&L and that was the reason why there was a breach of financial covenant as of 31st of March 2024.
This was explained in detail to the banking syndicate at Holding and we had also made a — we had also provided how do we — how do we turn this around, we were confident that these issues will be resolved and basis that we had given a plan to the banks as well. And basis that there was an agreement that was signed with the banks wherein they agreed to breach — I mean, they agreed to base the breach of the covenants and that is something which has been agreed to. However, till the time we comply with the — with the original net leverage and the economic equity ratio as has been agreed with the bank, there was a step-up in the interest cost and that is the reason why the interest cost has increased.
I mean that’s the advantage that the banks try to take of the customers. But anyway, that is something that impacted the finance cost in the last quarter. However, now with the improved performance of Q2 and Q3, we are — we are now meeting the financial covenants and that should reduce the interest cost by almost about 4% . So there would be a reduction of 2% that would be visible from January of this year and another 2% by March of this year.
Priyanka Patel
Okay, sir. Thank you.
Operator
Thank you the next question is from the line of Sajal Kapoor from Anti-Fragile Thinking. Please go-ahead.
Sajal Kapoor
Yeah, hi. Thanks for the opportunity. First of all, I mean, good to see an old hand with a BHD in organic chemistry being elevated all the way up to the top. I mean that’s excellent culture. So congratulations and look-forward to the future in very safe technical hands.
And coming to my questions, I have a few and I’ll rejoin the queue if necessary. First up is as a percentage of our consolidated CRAM sales, what is — what is the split between commercial and development and this time around? And what is the normal sort of split? Is it 50-50 or is it at 80% development, 20% commercial? I mean, what is the normal sort of split between these two revenue streams? And the reason is simple, commercial is recurring, development may or may not be recurring.
Harshil Dalal
Thank you,, for your question. So out-of-the total revenue in the quarter, roughly about 34%. So roughly about 60% of the revenue came from commercial and 40% came from development work. Usually, our split for the full-year is roughly 50-50, but this year, the commercial revenue portion has been much higher as compared to development.
But the commercial revenue — sorry if I misunderstood the second part of the question. But the commercial revenue gives us a very good visibility in terms of the revenue that we would be getting from the commercial product over a sustained period of time as compared to the development. So what we are trying to focus on right now on the development side is to get early phase project for the business at CarboGen.
Sajal Kapoor
No, so yes. So Harshal, I get that. So if commercial is the majority of the revenue stream within our, then I think it’s the commercial revenue should be growing at in double-digit because you just follow the scale-up in the in the end-market, right? How much of this commercial pipeline is relatively new, i.e., launched last year or the year before.
Harshil Dalal
So first of all, how you — from where you take your double-digit growth for commercial products, it goes along with the lifecycle of those products, which I remember the audience that are not belonging to us. The IP is belonging to our customer. We are acting as a contract manufacturing organization here. So we are not the promoter of the product sales on the market. We are providing the API only. So in that perspective, we follow the growth and the success of our customer on the market.
So we act as a service provider. We are not a — the commercial are products that are reaching the pharmaceutical market, but we are not managing those products per se. So that’s the first thing.
Second thing is that vast majority of the profit is also coming from the — from the development work because we also act here as a service company and we charge our customer for the work we are we are doing. So it’s an important stream of business. That’s why unhealthy ratio between development and commercial on our side is about 50-50 50 because half of that being commercial, as said, we have supply agreement that are giving us a mid-term view, a rock-solid mid-term view on the revenue we are going to get from those commercial products and 50% of development because, yes, at some point those commercial products we have to manage their end-of-life.
We are working exclusively — exclusively for the innovators. So at some point, those products are facing general competition and we need to replace those products by new product coming out of this development pipeline. So that’s how we manage that business and how we balanced our R&D work, which is a service work to a commercial, which is also a service work at the end-of-the day. I hope it answered the questions.,
Sajal Kapoor
Yes and no. So I understand the economics that if it’s a $1 billion and innovator side of sales. So for example, let’s take one example, let’s say Pfizer, not necessarily that Pfizer is customer. Let’s take Pfizer as an example. The Pfizer’s molecule is a $1 billion small — small-molecule in the market, Dishman should be making somewhere in the region of 2%, 3% of that $1 billion. And that’s the typical kind of API revenues for a molecule which is commercial. So I understand that.
My point is, if that one billion molecule becomes 3 billion, your API contribution should also grow in-line with the growth in that molecule, point number-one. Point number two is, when I track the majority of the emerging market players, so China and India in particular, I see a significant double-digit growth in CDMO CRAMs year-over-year. So there are many companies that have grown at a CAGR of 25%, 30%, 40% on a 10-year basis with lumpiness year-over-year. I don’t see that kind of a trend in Dishwin unless I’m missing something.
I mean, why are we not able to grow our commercial revenues and development put together. I mean, why is our CRAMS not 10 times over the 10 years or so because that’s the sort of average you pick any company, let’s say, New Land Labs, you pick Laurus Lab, UPIK DVs in India, all of them have compounded their CRAM CDMO revenues by a solid 20%, 30%, 40% over a 10-year cycle.
Harshil Dalal
Yeah. I understand your concern, first of all, when you have taken Pfizer as an example, if they have a franchise at EUR1 billion and it goes at $3 billion. And very often, you know, they are not putting all their eggs in the same basket. So if we start to be sole supplier at the very beginning, when they start to grow, they add over a supplier to secure the supply-chain. So we don’t see that growth on our side because they are dividing their volumes with an among other service provider.
So we see a some volumes that are growing, but not in the same ratio because they are splitting their demands between different suppliers to derisk their supply-chain. So that’s one point. The second point is, obviously, if we want to grow, our business is very simple. If you have more cubic meters, you can produce more. So at some point, we were facing in our in our global capacities, especially across Europe, and we were not able to cope with higher demand and that’s where you have seen a number of smaller players coming with quite aggressive pricing and on the market.
So at some point, we have chosen to go and increase our capacities in the drug product. That’s why we have invested 50 million of Swiss franc into the new facility in France to diversify ourselves on the market. And to also the market change between the small-molecule and the biologic molecule because with the product, you can address both markets. So that was a strategic choice that unfortunately, we were not in a position to invest EUR1 billion in capacities everywhere.
But we had to make a choice and that choice was driven by the fact that we wanted to also be able to follow-up on a certain number of new molecules coming in the biologic market and that’s why we have invested into the product business, for instance. I hope that clarify a bit our strategy here.
Sajal Kapoor
Yeah, yeah. No, understood. Understood. Maybe we can have an offline discussion and go into detail, but in the larger interest of this call and in letting others also participate. I’ve got few questions on your slide number 16, I think it is ADCs and bioconjugation business update. And that’s a helpful update.
And the question I have is we have been the pioneers in ADCs and I think we discussed that on the last call as well. Other than other than the ADCs, are we currently working on On peptide drug conjugation as well as small-molecule GLP-1. I mean what other technologies outside the ADCs is where we see good growth emerging over the next three to five years
Pascal Villemagne
So maybe I can try to answer your question if I understand correctly, if a part of the ADC, we got other bio project and the answer is yes. We have — we are not depending only on ADCs but also on other bio regulations and so on. What you see here in the presentation, I guess you got this. It’s in-principle two slides. One is one is the explanation, a short, brief snapshot on how we perceive the ADC or the connegation product, which is consisting of the bulk of the drug substance, what we produce also in-house and then the drug linker, we also produce in-house and the antibody, we get supplied by partners and we conjugate this.
And if it’s not an antibody, but another carrier material, then we also order this normally. And of course, the third bubble, if you see, look at it, it’s drug product is what Pascal just mentioned, the possibility to send our products, the products to France for formulation. And if you want to see — get the feel into which direction we are going, it’s on the next slide.
We have — we perceive our capability still on a growing growth phase, meaning that we acquire more-and-more projects, new requests for quotations and that we can supply our products to clients. Of course, there is a certain weakness, which is that we do not have the antibody in-house that we have suppliers, we have partners. And there we focus now on alliances with commercial partners, who can bring the antibody into our game where we can offer our client base the antibodies from our own source, not that we produce antibodies, but we have our established partnership with our alliance.
Sajal Kapoor
Yeah, no, that’s absolutely fine. What about peptides and peptide drug conjugations as well as the small-molecule GLP-1 because there is a lot of action happening in this space as well. Are you seeing anything — any traction on the peptides and small-molecule GLP one?
Pascal Villemagne
And that’s for sure the very-high trend of the moment regarding this diabeter treatments are driven by the two franchises, the one from Novo Nordic and the other from Elay Livy and there is a high market demand on that. We have few requests around that we cannot disclose because we are under a confidentiality agreement. One thing that is for sure, we are not producer per se on our side. So we have questions around those kind of things, technology that are surrounding those concepts, but GLP-1 per itself and the peptide production is not our core business, this is for sure.
And if we have to go there, that would request a significant amount of capex to invest as well as another knowledge that is not core of our business right now.
Sajal Kapoor
Sure, sure. Okay. I’ve got many more questions. I’ll rejoin the queue and I’ll let others ask as well. Thank you.
Pascal Villemagne
Thank you.
Operator
Thank you. You. The next question is from the line of Amit from RoboCapital. Please go-ahead.
Subrata Sarkar
Thanks. My first question is on — I was looking to get outlook on a debt level for next two years
Harshil Dalal
Thank you. Hi, hi, Amit. Thank you for your question. So as far as the net-debt is concerned, you know what — what our target is that in the next three years, we should be reducing our net leverage to less than 2, somewhere between 1.5 to 2. So that is what our goal is.
Amit Mehendale
Could you mention absolute amount because that some gross level of debt or net level of debt in either dollar terms or rupee terms, that will be helpful.
Harshil Dalal
So I think it would be in sync with the EBITDA as well. So as the EBITDA — because over the next five years, what we expect is that there would not — or at least over the next three years, there would not be any significant amount of capex outlay that we might have to do. So what we expect is that overall, the capex per year should be somewhere between $20 million to $25 million or somewhere around that.
And as against that, we should be able to generate a good amount of free-cash flow-in order to keep on reducing our net-debt. So if I have to — because the working capital requirement is something which will keep on increasing as the revenues keep on increase as the — as other expenditures also keep on increasing. So while the working capital requirement might go higher, but as far as the long-term debt is concerned, more or less it should keep on getting paid down from a net-debt perspective.
So if I have to give a figure just on the net-debt, I would say that you know it should be somewhere around 120 odd million.
Amit Mehendale
Yeah, great. That’s helpful. Also my follow-up on the similar point is on interest. I think it was mentioned earlier that interest cost would go down, you know. So are we looking at about next quarter cost to be closer to INR30 crore INR35 crore Q4 cost?.
Harshil Dalal
So in Q4 it should reduce I don’t have the absolute figure, but it should reduce by
Amit Mehendale
— can we go back to the earlier like Q1, Q2 levels, the last year levels?
Harshil Dalal
Yeah. Well, it would not be that low, but I think it should reduce by about INR10 crores.
Amit Mehendale
Right. That’s helpful. And my last question is on your broad revenue growth guidance for next two, three years. Any outlook will be very useful.
Harshil Dalal
Thank you. So over the next three years with the plans that we have with a closer integration of and plus the incremental orders that we expect to come in the Swiss entity. We expect that it would be safe to assume a CAGR of around 10% if you take a three to five-year view.
Amit Mehendale
Great. Thanks. That’s it from my side.
Harshil Dalal
Thank you.
Operator
Thank you. The next question is from the line of from Mount Intra Finance. Please go-ahead., I would request you to unmute your line and speak, please. Due to no response from the current participant, we will move on to the next participant. The next question is from the line of Satish Bhat from Finance. Please go-ahead.
Satish Bhat
Hi, congratulations on the good set of numbers. And his team. Sir, I wanted a question two, three things. What was the revenue for the France subsidiary this quarter and what has been the EBITDA loss and the PBT loss, if you can throw some light on that?
The second question is on good presentation you made on the ADC capabilities. Can you give some light on how much of the commercial revenue comes from ADC and how much of development revenues you are getting from ADC? And what is the pipeline in terms of late Phase-3 where you have ADC molecules. If you can throw some light on that, you know, that is the thing. And any movement of molecules from going to Phase-3 or maybe going for commercial launches maybe next three to six months. If you can throw some light on that. That’s the only thing which I want, yeah add.
Harshil Dalal
Thank you very much, as far as the French performance is concerned, the revenue was about 3 million in the quarter and the loss was $1.1 million in the quarter. So what we expect is by the end-of-the year, we should be close to EUR9 million of revenue and in the next year, what we expect is we should be closer to about 18 million and that would mean that we would be breaking even in the next financial year.,,
Pascal Villemagne
We will. In term of ADC revenues, the ratio between our commercial and development for the time-being, it’s only development because we are only working on the on the development project Project with our customers and with one of our main partners in that field, we are finishing the development work this year. That means that next fiscal year will be a kind of a pause because with the produce and the time they get their full market authorizations, the business is going to resume by commercial productions in the — in the year ’26, 2027 with a significant growth in that field and that’s going to represent probably at that time according to the marketing figures that we are having. So we have to take those figures with all the consciousness that we can. And I would say between 15 million and EUR20 million revenues for that particular product and to give you an advice on the amount of development revenues that we are currently doing around ADC, it’s about the same level, level 15 million to 20 million depending a bit on the product mix that we are having.
Satish Bhat
And regarding the movements of products from Phase-3 to commercial or maybe going for the FDA filing or something like that, if you throw some light on that?
Pascal Villemagne
It’s always very difficult to give you an answer to those questions because there is many, many moving targets between the success of a late phase clinical to the acceptance from the authority and the market of our authorizations. It’s always a like reading in a crystal ball. We can say that usually in the percentage of attritions, it’s kind of a maximum 10% of the Phase-3 that are going to commercial.
So if you have a 10 projects, that’s one that is going to be commercial. We should have right now about 17 products in each phase. So that means one to two products should go to commercial at some point. Okay.
Operator
Thank you. The next question is from the line of Deepak Podar from Sapphire Capital. Please go-ahead.
Deepak Poddar
Yeah, am I audible, sir?
Operator
Yes.
Deepak Poddar
Okay. Thank you very much for the opportunity. Sir, just wanted to understand interest cost you mentioned will reduce by 2% from Jan and 2% from March. So in quantum, you mentioned INR10 crores is what you mentioned. It will reduce in this quarter on a quarter-on-quarter basis?
Harshil Dalal
Roughly yeah.
Deepak Poddar
And what about in the — in the March quarter? In the June quarter, it will be further INR10 crores because 2% again it will decrease, right, you mentioned?
Harshil Dalal
Yes. Yes, that’s correct.
Deepak Poddar
Okay. So the other — the range, which is now INR4,850 crores, it will come down to INR30 crores in couple of quarters, right?
Harshil Dalal
Yes, absolutely.
Deepak Poddar
Okay, fair. And you mentioned about COGS of 15%, it’s an outlier in this quarter that we have reported. So general — so what sort of EBITDA margin we see as a sustainable I mean, is 20.5% EBITDA margin that we reported in this quarter is a sustainable number? If not, what would be that peak?
Harshil Dalal
Well, I would say, so basically in the current year, what has happened is that the share of commercial revenue has been quite high as compared to development. So what we — and the same was the case even in Q3. So you know if you see the nine months, the EBITDA margin is at about 16%. And our target is that around 17% to 18% at a group level considering the losses that we have in France as well as the subdued performance that we had in Netherlands because of the higher gold risk prices.
Considering all of this, for the full-year, we should be at about 17% to 18%. For the next year, a 20% kind of margin is something which looks to be sustainable. If you see historically at a consolidated level, we had done or we had been doing around 25% 26% margin. And as the India performance keeps on improving, what we expect is that, that is the target that we need to achieve in the next two to three years’ time and then go beyond it at a the Group level.
Deepak Poddar
Okay. So what I understand, this year we are targeting 17% to 18% EBITDA margin and next 20% and from FY ’27 maybe what 25% kind of EBITDA margin, I mean that would be a better.
Harshil Dalal
I think it would still be at about 22% and then it will go to, say, ’24 ’25
Deepak Poddar
By FY ’28.
Harshil Dalal
Correct.
Deepak Poddar
Okay, okay. And in terms of revenue growth, I mean, this year we were targeting about 8% to 9%, right? And this first-nine months, I mean, so what sort of revised outlook we would have for — or are we still maintaining 8% to 9% for this year?
Harshil Dalal
Yeah. I think we should end the year with about INR2,700 crore-plus kind of revenue. So that would be the idea. However, in terms of EBITDA, we would be in excess of INR400 crores.
Deepak Poddar
Okay, INR400 crores plus kind of EBITDA margin.
Harshil Dalal
Yeah.
Deepak Poddar
EBITDA, I mean. But I mean already in nine months, we are at about INR316 crores, right, with this 4th-quarter being INR140 crores in — so ideally, you should be much above INR400 crores right for sure.
Harshil Dalal
Yeah. So that’s the reason I say INR400 crores plus.
Deepak Poddar
Okay, okay. Okay. And then how should one look at tax-rate? I mean, because of so many subsidiaries we have, but so how should one look at tax-rate going-forward?
Harshil Dalal
So I think for now, I mean if you look at the current year because we have subsidiaries which are incurring losses, it would be difficult to just define our tax-rate as a percentage of the PBT like, for example, if you see in the current quarter, if you just calculate the tax-rate, that comes to around 80%.
Deepak Poddar
Yeah.
Harshil Dalal
But 80% is not the tax-rate that we pay, but it’s just that because of the losses which eat into the profits that are made by, say, and are gay, the tax-rate as a percentage of the PBT book is extremely high. So in absolute terms, I think for the year, it should be somewhere around INR40 crores of tax.
Deepak Poddar
For FY ’25 as a whole,
Harshil Dalal
For FY ’25 as a whole.
Deepak Poddar
And anything on next year, I mean, is it possible to understand, I mean, next year what sort of taxes we would be looking at?
Harshil Dalal
So next year, as I mentioned, as the French entity moves closer towards breakeven, and with Netherlands also performing better than this year, we would see that the tax-rate as a percentage of the PBT should be much better. And we are also working on a certain amount of tax optimization as well. So that should also help us in reducing the overall tax-rate.
Deepak Poddar
Understood, understood. I got it. I think that would be very helpful. I mean, all the very best to you. Thank you so much.
Operator
Thank you. Before we take the next question, a reminder to all the participants that you may press star and one to ask a question. The next question is from the line of Dharmesh Haria, who is an Individual Investor. Please go-ahead.
Dharmesh Haria
Hello. Hi,. So I think in-quarter one and quarter two, I think in terms of EBITDA, we were looking at INR500 crores, but in the previous conversation, I just heard that we will be doing about INR400 crores. So what is —
Harshil Dalal
Well, I think the — so if you see the Q1, the EBITDA was quite subdued at somewhere around INR28 crore INR29 crores. What we mentioned was that the next 3/4 should be extremely strong and we should be closer to about INR425 crores to INR450 crores. INR500 crores is something which obviously will not be possible in the current year. That is something you know, for the next year exceeding INR500 crores mark.
But in the current year, it looks like we should be somewhere closer to 425 to 450.
Dharmesh Haria
Okay. Okay. So next year, we are guiding close to 500 or beyond 500 million
Harshil Dalal
It looks like with the triggers that we have in-hand.
Dharmesh Haria
Okay. Thank you.
Operator
Thank you. Ladies and gentlemen, you may press star and 1 to ask a question. As there are no further questions from the participants. I would now like to hand the conference over to Mr Paskal for closing comments.
Pascal Villemagne
It looks like there is Mr Kapoor. This is in the queue. Okay. So once again, thank you very much, dear shareholders. Last call for me, I’d like to thank you all very much for the tremendous support you have given to the Group. And I wish you, of course, all the best-in the future. You are in a good hands with Stefan in-charge of CarboGen as well as the entire team at Group. Thank you very much and enjoy your evening. Bye-bye.
Harshil Dalal
Thank you. Bye-bye.
Pascal Villemagne
Bye-bye.
Operator
On behalf of Dishman Carbogen Ampsis Limited, that concludes this conference. Thank you for joining us and you may now disconnect your lines