Eris Lifesciences Ltd (NSE: ERIS) Q1 2026 Earnings Call dated Aug. 05, 2025
Corporate Participants:
Unidentified Speaker
Amit Bakshi — Chairman and Managing Director
Analysts:
Unidentified Participant
Presentation:
operator
[Starts Abruptly] Six earnings conference call of Eris Life Sciences Limited today we have with us on the call Mr. Amit Bakshi, Chairman and Managing Director, Mr. V. Krishna Kumar, Chief Operating Officer and Executive Director Mr. Sachin Shah, Chief Financial Officer and Ms. Kruti Rawal, Vice President M and A and Investor Relations. As a reminder, all participant lines will be in the listen only mode and there will be an opportunity for you to ask questions after the presentation concludes. Please note this call is being recorded. I would now like to hand the conference over to Mr. V. Krishna Kumar, Chief Operating Officer and Executive Director of the company.
Thank you. And over to you sir.
Amit Bakshi — Chairman and Managing Director
Thank you. Good evening everybody and welcome to our Q1 earnings call. So to get started, the key highlights of the quarter. The domestic branded business segment which is now representing the fully integrated segment consisting of all acquisitions. It has grown 11% this quarter, thereby outperforming the IPM by 330 basis points. And if we exclude the impact from discontinued FDCs and some insulin shortages we’ve seen this quarter, the segment growth was 13 to 14%. The operating margin of the DBF segment has expanded to 37%. Despite the addition of 300 misses this year. The value creation in the Biocon segment continues.
The Q1 operating margin for this segment was at 30% which is up from 19% at the time of acquisition. The EPS acceleration has kicked off as per our guidance. We recorded a 41% growth in pad stroke EPS in the quarter. We have taken a decision to ramp down the trade generics business. We took an EBITDA loss XTBF of around 5 crores in this quarter after significant delays. We are happy to share that we have commenced the manufacturing of insulin vials at Bhopal and we expect the production of insulin cartridges to commence from quarter four. We expect the upside from the RHI cartridge market opportunity to accrue starting November December of this year and the OCF to EBITDA ratio from protein operations came in at 65% this quarter and post adjustment for strategic stocking up of Biocon products inventory stood at 40%.
We’ll talk more about this going forward. The key numbers for the quarter DBF revenue of 702 crores versus 632 crores. So 11% growth year on year. DBF EBITDA margin 37.2%. An expansion of 155 bips year on year. Biocon segment margin of 30% versus 19% at acquisition. Consolidated revenue of 773 crores up 7.4% year on year. Console EBITA margin of nearly 36% up from 35% in the last in the Q1 of last year and consolidated profit after tax of 125 crores in the quarter up from 89 crores in Q1 of last year. Some key updates on the Insulin business so the the DS shortage is, you know by and large behind us.
However the DP shortages continue to persist so we took a revenue hit of around 10 crores in this quarter on that account. In response to that we have created a strategic stockpile of insulins to help us in the subsequent quarter. This has created a working capital increase of 73 crores in this quarter with a consequent impact on OCF Bhopal Vial Manufacturing Commission as already articulated and we have also initiated the supply of incision vials from MJ Biopharm site as an additional source. The cartridge operation in Bhopal is expected to be commissioned in Q4 and we are on track to leverage the market opportunity in RHI penfs starting November December.
This is a visual of the Wild Line which is operational at Bhopal which is capable of handling liquid as well as lyzed biologicals. Key Updates on the GLP front so the the the cartridge line from Bosch and Strobel is under installation. It is the latest KFM series line which is built to regulated market standards and we will be using this for RHI Glargine as well as GLP1. In terms of the market front we see a significant uptick in the market activity and the market buzz around the weight loss therapy. This is more or less in line with our expectation that there would be a large GLP1 market formation in India post loe in terms of driving DP self sufficiency.
We have initiated the validation of synthetic semaglutide at our Swiss parenterals facility in Ahmedabad. We have the cartridge line under installation as discussed and we are planning to take validation batches of our recombinant semaglutide at the Bhopal site in quarter 4. Also happy to share that the recombinant SEMA candidate is on track to enter Phase one in quarter four. So we retain our position that we expect to be among the first launches in India post loe moving to a small molecule R and D pipeline. We have shared with you before that we have 25 candidates that went into development this year.
This is a combination of oral solids as well as injectables products. So some of the launches where we have clarity on calling them out for quarter two and quarter three are as outlined on the slide, including several combinations of dapagliflozin, Cetagliptin and Isaac Serenon. Cutting over to the international business, glad to share that most of the investments that have gone in over the last 12 to 15 months have. We can see clear line of sight now. So just to give a bit of recap, at the time of acquisition Swiss had a 20 year legacy in injectables, but largely from the row markets.
So despite having two EU approved plants, Europe accounted for less than 3% of their revenue. And this revenue mix was carried forward in FY25. And the current year is also likely to be similar. One of the biggest decisions we took post deal was to pivot the business so that we deepen our EU presence. We consciously chose the CDMO model so that we would have proprietary contracts with marquee generic companies. We have been able to leverage our advantage of having the widest range of dosage forms among all the EU approved injectable manufacturers in India. And what we essentially sought to do was to migrate the business to the top of the pyramid in terms of clients as well as market.
This has been our strategy in our DBF business as well and this is something that we sought to mirror in international. So happy to share that this business is on the cusp of exciting growth starting the next financial year. We have confirmed contracts of more than 100 crores revenue per annum which are in various stages of execution. And this is just to give you a flavor of what some of those contracts look like. So we have a contract for a range of corticosteroids across several EU countries. We have some niche Beta Lactam dpi. So the whole EU accreditation has opened up Canada and ANZ for us as well because the same GMP is adequate to supply to these markets.
The client mix consists of global and regional generic players and starting with less than 3% in FY28, we expect that at least 3 out of the top 5 European countries will rank among our top 10 international markets. The quarter one update export revenue of 68 crores versus 74 crores year on year and EBITDA consequently of 22 crores. And in terms of the regulatory updates, we received the EU GMP approval for both the injectable sites as well as a bunch of additional approvals. In terms of the key inspections done during the quarter, the Latin American inspections are, you know, among the top in terms of commercial significance.
Our new product development approach has also been pivoted with an EU centric approach. So we added a very interesting loe opportunity to our injectable pipeline. We are targeting to be among the first generic launches in Europe. We also added several niche products in Critical Care, Women’s Health where there are only one or two players in Europe. So these are all products that we will look forward to launching in subsequent quarters. We are on track to deliver the guidance Swiss is a lumpy business quarter one is the lowest quarter for them though growth over the next 18 months as we have called out will be driven by migrating to the top of pyramid in terms of markets and clients.
We do have some capacity constraints in a couple of lines which will ease up once the new unit gets commissioned. Summary of consolidated financials revenue of 773 crores for the quarter with a growth of 7 and a half percent. So a couple of things dragging it down. One is exports which is lumpy as we’ve called out and the second piece is the trade generics business which we have started ramping down. So we got a revenue of 3 crores this quarter versus 13 crores in the quarter one of last year. This has also led to an EBITDA loss of 5 crores at a consolidated level.
EBITDA margin for Q1 has expanded from 35 to 36% at a consolidated level and we got around a 20% interest reduction, interest expense reduction year on year. So quarter one PAT stands at 125 crores which is a year on year growth of 41%. So quarter one net debt stood at 2300 odd crores which is 100 crores over what we closed FY25 at. This has been on account of a couple of factors capex of 66 crores and the inventory buildup of the Biocon products. Having said that, we reaffirm our net debt guidance of 1800 crores by the end of the year which will bring us to a net debt to ebitda of around 1 1/2x.
The details of our consolidated financials I think we’ve we’ve covered all the major points on the earlier slide. EPS for the quarter came in at around 9 rupees and cash EPS at around 12 and a half rupees. In summary we are on track to execute all our strategic priorities for the year in the anti diabetes segment, in the base business, in the international business as well as with respect to our balance sheet and we reaffirm our consolidated guidance for the year as called out in the previous quarter. This brings us to the end of the presentation and now we can take questions.
Questions and Answers:
operator
Thank you, sir. Ladies and gentlemen, we will now begin the question and answer session. Participants who wish to ask questions may do so by clicking the raise hand icon at the bottom of your screen and wait for your turn to speak. When prompted, you can accept the prompt on your screen, unmute your audio and ask your questions. We’ll wait for a moment while the question queue assemble. Okay. The first question comes from Harith Ahmed. Please go ahead with your question, sir.
Unidentified Participant
Good evening. Thanks for the opportunity. So my first question is on liraglutide. In the past you had said that this should be an interesting opportunity for us, but when I look at AOCD data, we don’t see much traction for us for our brands. So given that this is the only GLP1 drug approved for obesity indication that’s launched in India till date, the slow ramp up is a bit of a surprise. So any color here?
Amit Bakshi
Yeah, so look, little bit of a, you know, check there. We have two products which have been approved for obesity in India. Now the first one we all know was Manjaro and then subsequently Wei also kind of got approved with the same similar indication. And the last thing is we haven’t yet got the our obesity lira which is a 3,3 milligram lira, commonly called 6 sender. We haven’t got the permission yet so we are just waiting. There’s some little bit hiccup there. So that’s on the obesity approval in India. Second, why is l not picking up Lira is.
Look, now the competition is stiff. What we believe is that till the time the higher cost GLPs are available, the patient would logically get on lira as a follower. But that will take some time, that will take a lag, another three months roughly. So our plan was to kind of ramp up our sex and agenda extender which hasn’t been launched yet. And we were not expecting so much of action from two brands which have come in. We were, we were thinking about one brand which would have come by this point of time. So our expectation from generics accenta has, you know, internally we have lowered it for the remaining part of this year.
But I think lira should ramp up. Give us another three months. It should ramp up. But you know, please remember we’ve always talked about post SEMA patent expiry lira would have a limited run.
Unidentified Participant
Okay. And on second one on SEMA you mentioned you confirmed that you’re planning to be there at market formation. Just to confirm whether this is for both indications, diabetes and obesity. And if you could give some color on the status of development for your partner. Have they completed the trials, any indication on their filing timelines, etc. Just to get more comfort around the, you know, launch.
Amit Bakshi
No, no, I, I completely agree with you. So, yes, we maintain that we should be first off the block in SEMA as far as, you know, the regulatory approvals are concerned. So we would be having our last patient in by the end of August. So the randomization has been done. The last patient we have recruited. The larger, larger part of the patients have already been recruited. So we will have the last patient in by the end of October, by the end of August, which makes it six months from there for the final report, which is say December Jan, and then another two months for approval, you know, on a higher side.
So that’s how we are placed. So as of now, it looks safe to say that we should be there.
Unidentified Participant
Okay. And with your permission, if I can ask one more your comment that shortages persist in, in drug products. So, you know, while the opportunity in human insulin due to Noah’s Exit is going to open up later this year, will the shortage of capacities for drug product be a constraint for us in terms of capturing a share of that opportunity?
Amit Bakshi
Yeah, so, you know, I indicated earlier that there will be a little touch and go when it comes to dp, but you know, there is, the situation is getting actually a little better. So the thing which we were expecting to happen earlier in terms of shortages will now take a while longer. And you know, if you would have seen the presentation, there’s a picture which we show of, you know, Bosch and Stubble machine being installed. So we received the machine in the month late, late in July and the ramp up is starting now. If we are lucky and both of these things kind of coincide, then, you know, it will be a huge amount of supply which we will have.
And you know, if it takes one month or two months, we will have to struggle for that time. Our struggle is say limited to 20 of what we wanted. So if we were planning for 10, we are good at 8. So that 20 gap still persists. We have added another site, you know, for insulin, but that is again for violence because violence is also something which we were kind of, you know, we were having a little bit of a shortage. So as of now, the plans which we have given has been in keeping in mind the kind of supply we had, but because it has gone delayed and this is also coming, so if it happens together, then we are actually in a better position, but we will wait it out for the next quarter to, you know, be really on top of that.
Unidentified Participant
But I mean specifically on the cartridge front because that’s where the opportunity is opening up, right?
Amit Bakshi
Yes.
Unidentified Participant
So how’s our readiness on that front?
Amit Bakshi
Readiness in terms of the new facility you’re talking?
Unidentified Participant
Yeah, yeah, yeah. Will we be ready with the new capacities or will the, will the shortages on the cartridge front ease by the time, you know, towards the end of the year, which is what you indicated.
Amit Bakshi
That’s the calculation which we are going as of now.
Unidentified Participant
Okay.
Amit Bakshi
This is the calculation. Our machine has already arrived. It will now start the, the whole process will start. Then we will take the know validation batches and all those things. So as of now it looks good. So we are still saying that Q4 is the time when we will get it out. And we are also saying that November, December is the time when the shortages will actually kick in. If these two coincide, then we are, you know, better than what we think. If there is a delay, then again, you know, we have a 20% kind of a risk which lingers.
Unidentified Participant
Okay, okay, okay, I’ll get back in the queue. Thanks for taking my question.
Amit Bakshi
Thank you.
operator
Thank you. The next question comes from Kunal Damesha. Mr. Kunal, you can unmute the prompt on your screen, unmute your audio and ask your question.
Unidentified Participant
Can you hear me?
Amit Bakshi
Yeah, hi.
Unidentified Participant
Yeah, hi. Thanks. Thanks for taking my question. The first one on the current GLP1 market. So both Lilly and Novo is in the market. Do we have any view as to, let’s say the current market size, whether these medications are primarily being prescribed for type 2 diabetes or for obesity or any proportion in between.
Amit Bakshi
Early. But you remember maybe we were one of the first to call out that, you know, we expect this market post Loe to be 2000 to 3000 crores. And at that point of time we had a discussion on this. But as the things are getting clear, you know, as we can see more of it now, you know, our confidence is only going up. So let’s get the first thing which we spoke last time maybe a quarter earlier that the market formation is very encouraging. Right. The pent up demand has, was there for weight loss and we see the pent up demand, you know, being met.
The first of the hook is the weight loss guys. They are more motivated with the current cost prices. They are kind of, you know, more, their readiness is bigger. So unless and until the prices come down, which happens after Loe, I feel it would be more like 70, 30. But once it opens up, I believe it will be 30 70, 30 for weight loss and 70 for diabetes.
Unidentified Participant
Which is what it is globally now.
Amit Bakshi
Right.
Unidentified Participant
Or for the innovator also.
Amit Bakshi
Yeah, it’s roughly 70. You are right, you are right. This is what has happened after, you know, after a decade of these drugs being available. So for us it will happen little early. This is what I estimate. Sure, it’s very, very interesting. You know, we are working on the adjacencies also and we find even that is very interesting. We’ll talk about it later. But the adjacencies to GLP seems to be very interesting.
Unidentified Participant
Sure, sure, that’s great. Second one on the export business. It has obviously year on year it is, come on. And we suggested that the timing of shipment etc. But is there any change in the outlook for that business for FY26 or. We stick to it. There’s been deferred shipment which would come in Q2 or something.
Amit Bakshi
So right now we don’t, we do not, we don’t believe that there’s any change in what we have said. And the business has been like this, look, 30, 35% has always been in H1 historically. So that changes from that point of view. In fact, we have told you, we have, you know, we have tried to convey on the slide that how we are trying to, you know, improve. The only problem which we see in, in the export business injectable is a little bit of a CAPS capacity problem and this would remain for at least one and a half years.
So most of the growth, or all of the growth will come from a higher ticket size of what we have been preparing in the last one and a half years. And we, you know, we showed you in the slides that we have some deals jotted down already and some of them are in the pipeline. But all in all, you know, we got the EU approval which was a good thing, you know, for us to get and the other approvals are also work in progress. So we, our belief is that we will be able to rack up the ticket size but the volume will remain a little bit of a problem unless we have the new, you know, the new capacity coming up which will take a year and a half from where we are.
Right. And this is not conservative. So it can be one and a half to two years on the, you know, on the other side. But once it comes up, Kunal, we are then preparing for a 3x capacity of what we are because, you know, numbers which used now we are doing a lot of, you know, there’s a lot of rationing which is happening not being Able to supply the lower margin products and concentrating on the higher margins and what it also takes when once you get into EU markets and bigger clients then what happens you have to call the companies also for an inspection.
So those guys also come for inspection and that causes a little bit delay on the average production time. So all together we believe we will be numbers will be done in this year and the ticket silhouette, ticket size would improve and once the capacity comes in, this business might see a better than expected ramp up.
Unidentified Participant
And what should be the steady state profitability of this business let’s say without taking into account the new capacity with their current existing capacity, how should this.
Unidentified Speaker
So Kunal, the base row business has been always been a 34, 35% operating margin business and there’s no reason to believe that it should change. I think from a quarter one perspective you see a slightly slow low number because it’s carrying the cost of some investments which we’ve made which will start seeing results in 21st, 27 onwards. But there’s no reason to believe that the profitability of the business is going to change substantially. If anything with the product mix and the market mix and the client mix improvement which Amit spoke about, it should only improve.
Amit Bakshi
We are, we are inducting a lot of people so but you know, that’s not a cause which really kind of.
Unidentified Speaker
You know like CDMO is a whole new team.
Amit Bakshi
Yes.
Unidentified Speaker
Because the CDMO business is a very different business in terms of, you know, it’s a solution selling business, not a product selling business. So it’s a different ecosystem altogether. So all those costs are being carried by the business. But the revenues are not here yet.
Unidentified Participant
Right. And CDMO revenue, we are expecting it to start from FY 2827. So, so then in that case some of these products should already be in a tech transfer state.
Unidentified Speaker
Tech transfer validation multiple stages. So we have, we’ve outlined five contracts on a no name basis. So those are the ex. You know, those are illustrations of the kind of products we are dealing with. And as you rightly pointed out, they are in various stages of development.
Unidentified Participant
And just a last clarification, what does DPI stand for?
Amit Bakshi
A drug order function.
Unidentified Participant
Beta Lecter is an antibiotic.
Amit Bakshi
Right? Yes, yes, there are, there are DPIs for that. I can take that.
Unidentified Speaker
Yeah. So there are, there are general, there are dps which are non Beta Lactam which is, which is part of unit one. And then we have.
Unidentified Participant
Okay, got it. Dry powder injection. Yeah, no worries. Yeah, thanks. And all the best.
Amit Bakshi
Thank you. Thank you.
operator
Thank you next question comes from Tushar Manudane. Please go ahead with your question. Mr. Tusha, I request you to accept the prompt on your screen and ask your question. So there seems to be no response. The next question from Bino Patiparampil.
Unidentified Participant
Good evening. Can you hear me?
Amit Bakshi
Yes, you can.
Unidentified Participant
Okay, a couple of questions. One, I was looking at the depreciation and amortization number compared to last year’s quarters. It has come down by 78 crores at 70 crore. From your notes to accounts I see that you have done some reclassification in the Swiss parenterals assets. Is that the only reason or any other reason to.
Amit Bakshi
Depreciation Coming. Hi, I’m Sachet. So the reclassification is because of PPA. The impact is only 0.13 crores. So that’s the general timeline that happens that we do the initial PPA based on basic numbers and then the final. Report comes in and we do that. But that impact is only 1.13 cor. So the impact that you seen depreciation because of the assets. So large number of assets were capitalized last year. This year that number is lesser.
Unidentified Participant
So. You see there is no change in amortization. The change is in depreciation. Okay, that I understood. But if I look at your intangibles as of FY24 and FY25. FY25 has gone up or FY24. So why would the depreciation sorry amortization number come down in this year?
Amit Bakshi
Amortization has not come down. Depreciation has come down. That’s what I’m saying.
Unidentified Participant
Okay.
Unidentified Speaker
Amortization has been 56 crores for both the quarters current quarter as well as quarter one of last year.
Unidentified Participant
Okay. So you. Your fixed assets have gotten depreciated. So this 70 crore is the number we should assume is the sustainable number for the near future.
Amit Bakshi
Yeah, on the base to. At a basic level, yes. But more and more that’s just coming in and be doing a lot of capital investments this year. As and when they capitalize the depreciation to go up.
operator
We know. Hi, Kruti here. So in Q4 we had guided that for FY26 the depreciation and amortization for the full year will be about 335. So I would request you to not take a quarterly, not go for a quarterly trend but look at this number more as a, as a, as an annual figure.
Unidentified Participant
Got it. Now that’s fine. 335cr is fine. Perfect. Second question on this insurance shortage. Could you elaborate on the nature of the shortage? Because you said that you lost some sales because of shortage. But then you also said you have taken some strategic reserves. So how can both these happen? You know, you need some access to take a strategic reserve.
Amit Bakshi
Right.
Unidentified Participant
So is it a different product or. Could you elaborate on that please?
Amit Bakshi
Yes, sir, I will. So there are two different things, boss. One is the drug substance which is the API and the second is the drug product which is the formulation. So it is the API which we have bulked up considering that our own facility will start soon. It’s the problem which we kind of were talking about was more from the formulation point. So we typically call it in our parlance drug product. So that’s the difference.
Unidentified Participant
Understood. So, okay, so, but, but API, there is no shortage per se. Right? Then how does this strategic reserve help?
Amit Bakshi
API is a. API is a challenging thing, boss, in insurance because our dependency is only in biocon. So we would always like to maintain, you know, a large reserve as far as possible. So the reserve will always be much higher than the other products which are easy to get. This is a motor product. It’s our moat. So. And there’s only one supplier which we completely depend upon. So we would generally also build a larger inventory and this time we just kind of exceeded that number also.
Unidentified Participant
Understood. Last on your guidance. So if I remember correctly, your original guidance was a growth in the range of 15 to 21. First quarter is a bit low at seven or seven and a half. So would you be revising that or for the time being you will maintain it?
Amit Bakshi
Yeah, so for the time being we will, we will maintain it. Other than the caveat that, you know, There was a 50 crore number last year. So, you know, we, we will talk about, let’s talk about DBF which is very a large part of the sales and also a larger part of the profits. So within the DBF we maintain our guidance and that’s the guidance which we have given at a consolidated level. The only moving part as of now looks like the generic piece which we want to ramp down. So that did almost 50 crores last year.
We don’t expect more than say 7, 8 crores in this year. So that is the gap which might come in the console, in the console numbers, but it was never profitable. So that’s the reason we are ramping it down. So because of that reason, EBITDA might not have any impact.
Unidentified Participant
Understood. Thank you very much.
Amit Bakshi
Thank you.
operator
Thank you. The next question comes from Madhav Marda. I would Request you to accept the prompt on your screen, unmute your audio, introduce the firm you represent, and ask a question. Hi, my name is Madhav. I’m, I’m with Fidelity International. My question was on the generic semaglutide opportunity. You said that the opportunity could be larger than what we earlier thought, which is 2 to 3,000 crores. I think that’s what we indicated earlier. Could you give some sense in terms of how you all are thinking in terms of the market opportunity for the first year and if you could break it down in terms of, you know, what could be the price point at which the generics could be launched as well, that would be very helpful.
Thank you.
Amit Bakshi
Yeah, so this is something which I have already already stated in one of our calls. So I was just trying to reiterate that. So we were confident that this will be 2500-3000 crores in the first year of LOE and now we are more confident about that looking at how the market is accepting the whole thing. The price point, you’ll have to wait it out. We have a certain price point in mind, but that is little strategic nature. So not being able to tell. But it will be very significantly lower than what you see the, you know, the innovative product at this point of time.
Regarding how has, how do we see that playing out in the market? The acceptance is really going up and, you know, we feel a lot of people are now ready to adopt. So we have been selling lira glue type for quite some time now and we were seeing it slowly kind of was building up. But then as soon as these products were launched, it just ramped up to a different level. And the kind of, you know, awareness which is happening today in the marketplace, the number of education programs which are going up, the amount of talk which is there, and the kind of confidence I see among the practitioner.
So that gives me more confidence that this, this is going to be a large market creation.
Unidentified Participant
Okay, got it. Good. And just the second question was on the, the domestic, the DBF business, could you help us with how much was the biocon business? I think you usually used to split that up, but I’m not sure if I saw it in the presentation.
Amit Bakshi
Yeah, so matu. We split it up for one year’s time. That’s been a standard practice.
Unidentified Participant
Okay.
Amit Bakshi
So once the 12 months or four quarters are over, then everything comes together.
Unidentified Participant
Sure. No, makes sense. But what I just wanted to check is the, I guess this business was facing some issue with the supply side, which you said will take a Bit of time to resolve. So do you, when do we see traction building up for this? I don’t know if you already answered that, but when do you see sort of this ramping up again for us?
Amit Bakshi
So there are two, two parts. If you, if you isolate the whole thing from the opportunity which we are getting from the discontinuation piece. The ramp is quite nice.
Unidentified Participant
Okay.
Amit Bakshi
The growths are very good. Everything is online. We are more or less in line of what we had thought. But if you take that opportunity, which is a large opportunity that is still to come. So that we think we have mentioned in the slides, we think that November, December is the time when that particular piece kicks in. And if we are ready by that time with our own facility, we will be having enough and more capacities. And if there is a gap then we will have a little bit of, you know, here and there as far as capacities are concerned.
So that’s where we stand as a.
Unidentified Participant
Got it. Okay. Yep. Thank you.
Amit Bakshi
Thank you.
operator
Thank you. The next question comes from Kunal Randaria. I would request you to accept the prompt on your screen, unmute your audio, introduce the firm you represent and ask a question.
Unidentified Participant
Good evening Kunal from Access Capital. Amit sir, just a clarification on this human incident opportunity. So there’s no exiting all the human brands that it has in the country or is it just mixtard and even in mixture are the existing, you know, I mean is it an entire exit or is just a few forms like a cartridge or a wire or a pen? If you can just elaborate on that.
Amit Bakshi
The information which we got from the press release was that all human film cartridges will be discontinued. All human cartridges will be discontinued. They would still play the player in the wilds category.
Unidentified Participant
Right. So India was largely a wireless market, right. So cartridge opportunity would be how big? Nextar would be like an 800 crore brand. So how big would the cartridge be?
Amit Bakshi
So I don’t, I mean what I remember the whole cartridge was more like 500, 600 crores started. Yeah, the entire cartridge piece. Yeah. So the entire cartridge piece which, which according to us will get discontinued is more like 600 to 800 crores.
Unidentified Participant
Right, right, right. So that includes mixture and other brands that it has in the country, like extra paid and all this.
Amit Bakshi
Yeah, absolutely.
Unidentified Participant
Right, right. That’s helpful. A second question just on your CDMO opportunity, right. And you said that you have a visibility of 100 crore plus order. So you know, if you hope to have, let’s say three of the top five players, I’m wondering You know, what’s the kind of investments you’re looking to make? Because I’m sure you would like to make this business a big one in the next five years. So the kind of capex you would be doing, what’s the current gross block and what’s the five year kind of a revenue opportunity.
Amit Bakshi
So Kunal, look at this point of time we are not very fancied about, you know, CDMO and you know, all those kind of things. This is a natural progression which we are leading the business to because the plant is EU approved. It was always EU approved and we are getting more approvals. So right now what I can tell you that in the next two years the capacity is a constraint. Post the capacity opening up, the ramp up could be very significant. But we don’t what, what clarity we had till this point of time. We have put it in the slides.
We feel in the next financial year we would create a 100 crore opportunity from the CDMO business. Beyond that everything will work out depending upon how fast we are able to put our the new facility and how fast we are able to ramp it up. Now revenue, if you remember we have talked about that there is a good possibility of the international businesses going up to 1000 crore in FY 2829. That was a number. Right. And that would also include our OSD business where we’ve already have the inspection and we are expecting the N Visa approval to come at any point of time which of course we inform.
Unidentified Participant
Right, right. So it’s more of a longer term post. FY28 is something that, you know, you would be, you know, keen to, you know, explore. As of now it could be largely DBF driven by insulin and then GLP ones.
Amit Bakshi
Yes, yes, yes.
Unidentified Participant
Perfect. That’s, that’s great. Thank you.
operator
Thank you. Participants who wish to ask questions may do so by clicking the raison icon at the bottom of your screen and wait for your turn to speak. The next question comes from Nirali Shah. I would request you to accept the prompt on your screen, unmute your audio, introduce the firm you represent and ask a question.
Unidentified Participant
Yeah, thank you for the opportunity. I just wanted to continue on the CDMO question. So we have mentioned about 30 crore plus CDMO pipeline which is set up to ramp up from FY27. Could you give some more color on this? Basically wanting to know how much of it is firmed up via binding agreements and how much of it is in soft commitment.
Unidentified Speaker
Yeah. Hi. First the number we called out is 100 crores, not 30 crores.
Unidentified Participant
Yeah, I mentioned 100 crores.
Unidentified Speaker
Okay, sorry, I. I must have misheard. And then we. So this 100 crores is basically what we have put out based on confirmed assignments. And we’ve also given you disguised examples of some of the contracts that are under execution. So this is not a prospective number. This is a number based on confirmed contracts.
Unidentified Participant
Understood. And one more question. I had on the Biocon margin. So it has improved from 19 to 30%. Just wanted to know what’s the steady state margin that you can expect for this vertical once cartridge volumes normalize and how much is the further scope that we see for FY26 and onwards? So 27, 28.
Unidentified Speaker
I mean, it’s little difficult to put a specific answer to that, but I’ll try to answer it in a different way. So, I mean, you’ve seen. You’ve seen how our acquisitions have played out. And what I would say about the error system is that I think it automatically rejects anything which is not high margin or. Or does not have the potential to become high margin. So our DBF aggregate margins are at 37%. So I would say, you know, that is the kind of aspiration we would have. At the very least, correct.
Unidentified Participant
Understood. Got it. Thanks.
operator
Thank you. The next question comes from Pragati Lunavat. I would request you to accept the prompt on your screen, unmute your audio, introduce the firm you represent and ask a question.
Unidentified Participant
Am I audible?
Unidentified Speaker
Yes.
Unidentified Participant
What are the reasons for the ramp down in trade? Generic segment.
Amit Bakshi
I think. You know, our ability to ramp up that business didn’t come through and March. We didn’t have any. At least we couldn’t have kind of, you know, thought about good margins in this business. So we kind of did our work and we found even if we scale up to say four times where it is today, the margin will still be very scratchy. And we have so much on the plate at this point of time and lot more is happening actually. So we just wanted to preserve ourselves to get to the core of the business.
Did I answer your question?
Unidentified Participant
Can we take the next question, please?
operator
Sure. Ma’, am. The next question comes from Tushar Manudane. I would request you to accept the prompt on your screen, unmute your audio, introduce the firm you represent and ask the question. Mr. Tusha, your voice is not audible. Please unmute yourself and ask a question. Ma’, am, there seems to be no response. The next question from Rahul Agarwal. I would request you to accept the prompt on your screen, unmute your audio, introduce the firm you Represent and ask your question.
Unidentified Participant
Hi, am I audible? Yes. Thanks for the opportunity. This is Rahul from Everflow Partners. My question is that on the insulin side with the exit of Novo, what’s the current run rate that you are at? And, and once all of the stocks are out from the market over the next three four quarters, what sort of a run rate are you targeting?
Unidentified Speaker
Yeah, Rahul, Hi. We’ve called out earlier that you know, this market opportunity is something where you know, we can get a upside of 200 plus crore per annum on a steady state basis once, you know, all the stocks are exhausted.
Unidentified Participant
200 crores on top of what we have today.
Unidentified Speaker
Yes, this is the. I’m. I’m assuming. I’m assuming you’re talking about the RHA Penfill opportunity.
Unidentified Participant
Exactly. Yes.
Unidentified Speaker
Yeah.
Unidentified Participant
200 crores per annum incremental to our current base.
Amit Bakshi
Yes.
Unidentified Speaker
Because the current market that is being vacated is of the order of 500 crores per annum.
Amit Bakshi
Got it, Got it.
Unidentified Participant
And on regulated markets I think Amit made a comment that you’re talking about thousand crores by FY29. So I’m assuming Swiss today is around 350, 400 crores, 100 crores from the CDMO in Europe next year and the balance 500, 550 crores from other semi regulated markets. And as the new capacity comes up and that happens over FY 28 29. Is that understanding broadly correct or.
Unidentified Speaker
Yes. Thousand crores is a number all international put together which is regulated. And row, which will be a combination of all of these things coming together, which is the row based business, the CDMO business, the OSD exports business. There is a B2C piece which we are working on, which we are not. We can talk about it to you in a few quarters. So all of this coming together will get us to that thousand cr number.
Unidentified Participant
And today the base there is only about 350, 400 crores. Right?
Unidentified Speaker
That is right.
Unidentified Participant
Got it. And on GLP1 your presentation mentions that the line is going to be in line with regulated market standards. Do we have plans to potentially go beyond just a branded generic opportunity in GLP1 to export or we’ll just stick to the domestic market?
Amit Bakshi
Yeah. So there’s some things which we are exploring at this point of time. So largely, you know, how, how I would like to put it in a manner that looks having a card facility, a bio card facility at this point of time is quite, you know, is quite a good thing and our capacities are good at this point of time. So you know there are people who are talking about different things including export because both our line and our, you know, our setup we think is completely doable for you know, regulated market like EU and Visa.
We don’t talk about us at this point of time. So a lot of things are happening but we will not be able to put a finger on that. But yes, we are open and we are talking.
Unidentified Participant
Got it?
Amit Bakshi
No.
operator
Thank you so much. Those were the questions from my side.
Amit Bakshi
Thank you so much.
operator
Thank you. As there are no further questions I would now like to hand the conference over to Mr. V. Krishna Kumar for the closing comments. Over to you sir.
Unidentified Speaker
Thank you all for your participation today. In summary, we delivered a DBF revenue growth of 11% in the quarter with an EBITDA margin of 37% and a year on year growth of 16%. We continue to create value in the Biocon segment which clogged a 30% EBITDA margin in Q1 even before we bring the insulin production in house Q1 consult revenue stood at 773 crores with an EBIT of 277 crores. Year on year console EBITDA margin has expanded from 35% to 36%. Quarter one PAT came in at 125 crores which represents 41% year on year growth.
OCF from routine operations came in at 65%. We incurred a capex of 66 crores largely towards insulin, GLP1 and general injectables. In the quarter net debt stood at 2,300 odd crores and we reaffirm our net debt guidance of 1800 crores by the end of the year. The international business delivered a Q1 revenue of 68 crores. And the European CDMO segment is well on track for commercialization in FY27 with significant contribution expected from the top five European markets. We are well on track to execute the strategic priorities outlined for the year in the areas of insulins, GLP1, R D pipeline and international operations.
Thank you and a good evening to all.
operator
Thank you very much sir. And thank you members of the management. Ladies and gentlemen, on behalf of eris Life Sciences Ltd. That concludes this conference, thank you for joining us and you may now exit the meeting.