Gland Pharma Limited (GLAND) Q4 FY23 Earnings Concall Transcript

Gland Pharma Limited (NSE:GLAND) Q4 FY23 Earnings Concall dated May. 18, 2023.

Corporate Participants:

Sumanta Bajpayee — Vice President, Finance and Investor Relations

Srinivas Sadu — Managing Director & Chief Executive Officer

Ravi Shekhar Mitra — Chief Financial Officer

Analysts:

Rishabh Shah — UG-BMS — Analyst

Kartik Mehta — Klay Capital — Analyst

Prakash Agarwal — Axis Capital — Analyst

Neha Manpuria — Bank of America — Analyst

Shyam Srinivasan — Goldman Sachs — Analyst

Saion Mukherjee — Nomura Securities — Analyst

Anandha Padmanabhan — PGIM India — Analyst

Bino Pathiparampil — Elara Securities — Analyst

Sameer Baisiwala — Morgan Stanley — Analyst

Alankar Garude — Kotak Securities — Analyst

Nithya Balasubramanian — Bernstein — Analyst

Presentation:

Operator

Ladies and gentlemen, good day and welcome to Gland Pharma Limited Q4 FY ’23 Earnings Conference Call. [Operator Instructions] Please note that this conference is being recorded.

I now hand the conference over to Mr. Sumanta Bajpayee, Vice President, Finance and Investor Relations. Thank you and over to you, sir.

Sumanta Bajpayee — Vice President, Finance and Investor Relations

Thank you. A warm welcome to Gland Pharma’s earnings call for fourth quarter of financial year ’23. I have with me Mr. Srinivas Sadu, Managing Director and CEO; Mr. Ravi Shekhar Mitra, CFO, to discuss business performance and to answer queries during the call. We will begin the call with business highlights and overview by Mr. Sadu, followed by financial overview by Mr. Mitra. After the opening remarks from the management, operator will open the bridge for Q&A session.

Our earnings presentation has been submitted to the stock exchanges is also available on our website. Before we proceed with the call, please note some of the statements made in today’s discussion may be forward-looking and are based on management estimate and this must be viewed in conjunction with the risks and uncertainties involved in our business. The Safe Harbor language contained in our press release also relates to this conference call. This call is recorded and the playback shall be made available on our website shortly after the call. A transcript of the call will be submitted to the stock exchanges and made available on our website.

I will now hand over call to Mr. Sadu for his opening commentary. Thank you, over to you, sir.

Srinivas Sadu — Managing Director & Chief Executive Officer

Thank you, Sumanta. Good evening, everyone. Thank you for joining our earnings call for the fourth quarter and full year fiscal 2023. My best wishes to all our shareholders, analysts and their families.

We have formally closed the acquisition of Cenexi and welcome it to be a part of the Gland-Fosun family. This is our first overseas acquisition and our move into the next phase of growth and expansion. This acquisition is aimed at expanding our CDMO offerings in the European market. It is in line with our strategic roadmap of building a European manufacturing business in sterile injectables. It provides access to leading know-how and development capabilities in sterile forms including vials, pre-filled syringes and other innovative technologies such as ophthalmic gels and needleless injectors and creams. It will help us establish our presence into the branded CDMO space and biologics. Our priority is to focus on a seamless integration of businesses.

We made progress on our path to building a biotech CDMO and signed our first contract with plasma protein at our Shamirpet facility. We are also in advanced stages of other discussions in biosimilar opportunities. I must say this is a testimony to our strength and the robust infrastructure installed at our facility in Shamirpet. We closed this quarter Q4 FY ’23, with the revenue of INR7,850 million as against INR11,030 million in Q4 FY ’22 and our PAT stood at INR787 million for the quarter against INR2,859 million in Q4 FY ’22. Our full-year FY ’23 revenue stood at INR36,246 million, a de-growth of 18% over FY ’22. Our full-year FY ’23 PAT stood at INR7,810 million, against INR12,117 in FY ’22. We have generated INR3,640 million of cash flow from operations in FY ’23.

The performance has been subdued because of lower sales in some of the key products during the current year as compared to previous year. Penems facility shutdown was taken [Technical Issues]. Strategic shift at some of our customers has impacted revenue. We have initiated an action plan by transferring some of the products for the customers. We are focusing on ensuring the supply continuity across our portfolio of products and and has stocked up inventory for key products to avoid any material shortage.

We completed nine ANDA filings during Q4 FY ’23, in line with our filing plan. We made further investments in our R&D this year and we were able to make 29 ANDA filings during FY ’23. As an important milestone, we received our first China approval and have also initiated a launch of our product, Dexrazoxane. We should receive another three to four product approvals in China during the year. Our progress in the complex portfolio is also growing strong and this year we filed a total of three complex products during the year.

During Q4 FY ’23, upon excluding capital R&D expenditure, the R&D expenditure stands at INR603 million, which is 7.68% of the revenue for the period as against INR443 million during the previous quarter. For the full year our R&D expenditure stands at INR1,845 million, which is 5.09% of the revenue for the period. As on 31st March 2023, we along with our partners have 334 ANDA filings in the U.S. and 1,601 product registrations globally.

We continue to hire the right talent for our U.S. subsidiary, strengthen the business development initiatives and building new partnerships. We are also strengthening the plant operations teams with new capacities coming online. This year, we again saw physical audits start after the halt due to COVID. We have successfully completed U.S. FDA audit with no observations at our API facility in Vizag. We continue to invest in constant improvements and our teams across all our sites remain prepared for any regulatory audit.

Let me summarize our performance across various geographies. Our Rest of the World markets account for 22% of our Q4 FY ’23 revenue, against 17% during Q4 FY ’22. Our full year FY ’23 revenue for these markets stood at INR6,894 million as against INR8,481 million in FY ’22. We maintain the inventory of raw materials and packing materials to be able to cater to the demand. We continue to register our products in new geographies. Our key markets continue to remain MENA, LATAM and APAC. Our core markets namely U.S., Canada, Europe, Australia and New Zealand accounted for 70% of the revenue as against 64% in Q4 FY ’22. Our full year FY ’23 revenues for our key markets stood at INR26,851 million as against INR29,248 million in FY ’22.

Part of our new launch product portfolio, we have shipped our 10 product SKUs during the quarter. We are constantly working on improving material availability and resolving any production delays. India market accounts for 8% of Q4 FY ’23 revenue. Our full year FY ’23 revenue for Indian market stood at INR2,501 million as against INR6,278 million in FY ’22. We saw impact from normalizing of COVID-related sales in the Indian market. We are focusing on integrating the business by connected brands, and understand the importance of seamless integration. Our focus is on leveraging synergies between the businesses to generate stakeholder value. This acquisition has the potential to drive value-creation of our business accounts.

With this, I wish everyone good health. I would like to now hand over the call to our CFO, Mr. Ravi Mitra who will share details about our financial performance for the quarter and full year 2023. Thank you.

Ravi Shekhar Mitra — Chief Financial Officer

Thank you, Mr. Sadu. Good evening, ladies and gentlemen. Thank you very much for attending our fourth quarter and financial year ending 2023 earnings call. Our earnings presentation has been uploaded on the website.

Let me begin by sharing the financial performance of the quarter and financial year of ’22-’23. For the fourth quarter, we have reported revenue of INR7,850 million, a reduction of 29% on year-on-year basis. Revenue from operations for fiscal ’23 stood at INR36,246 million, a year-on-year decrease of 18%. Key reasons for reduced revenue during the year are inventory rationalization across customers in the U.S. market, high tide pressure with increased competition, impacting revenue and higher base of last year due to COVID-related product [Technical Issues].

In terms of bifurcation of revenue during FY ’23 at core markets, core markets comprising of the U.S., Europe, Canada, Australia and New Zealand has contributed 74%, followed by ROW market, adding 19% of revenue. India contributed balance 7% of the revenue from operations. Our core market has seen a decline of 23% during fourth quarter of FY ’23 as compared to same period of last financial year. It has registered an 8% de-growth during the financial year. ROW markets have witnessed the reduction of revenue of 10% for Q4 FY ’23 and 19% de-growth on a full year basis. India market declined by 68% for Q4 FY ’23 and 60% for FY ’23.

Other income for the fourth quarter was INR389 million, which includes interest on fixed deposits and foreign exchange losses in operations. For FY ’23, the other income was INR2,405 million, of which interest on fixed deposit was INR1,794 million and foreign exchange gains from operation was INR571 million. Gross margin of the company improved during the quarter as compared to same quarter previous year. Gross profit margin has improved for the year as compared to the previous financial year, largely due to favorable geographic mix.

We have reported an EBITDA of INR1,684 million in Q4 FY ’23 compared to INR3,484 million in Q4 FY ’22, which is a decrease of 52%. EBITDA margin for Q4 FY ’23 stood at 21% as compared to 32% for the same period of the previously mentioned year. EBITDA for the full year ended March ’23 was INR10,248 million compared to INR15,102 million of the previous financial year, a decline of 32%. We have reported EBITDA margin for FY ’23 at 28% as compared to 34% of previous financial year.

Our energy cost have gone up 17% in Q4 FY ’23 and 31% in full year FY ’23 due to increase in power tariff and oil and gas prices. Employee costs have increased by 9% in Q4 FY ’23 and 19% in full year FY ’23, largely due to additional headcount to support the new production lines in Pashamylaram plant and the bio-CDMO facility in Shamirpet, as well as the annual incremental impact. Other expenses increased by 11% during FY ’23 as compared to the previous year, majorly due to the increase in professional fees paid for the M&A.

The total R&D expenses for the financial year 2023 was INR2,014 million compared to INR2,273 million for the previous financial year, which is a decrease of 11%, which stands at 5.6% of the revenue. R&D expense for the fourth quarter was INR678 million which is 8.6% of revenue compared to INR559 million in the previous financial year. The increase in R&D revenue expense is due to the higher number of ANDAs and DMFs filings during the fourth quarter. The higher percentage of revenue is due to the lower revenue base in Q4 FY ’23.

Our net profit for the fourth quarter was INR787 million, a significant reduction of 72% compared to Q4 FY ’22. During the financial year ’23, our PAT was INR7,810 million, which is a decrease of 36% as compared to last year. We have reported PAT margin of 10% for Q4 FY ’23 and 22% for full year FY ’23. Subsequent to year end, one of our customers filed for Chapter 11 bankruptcy in US and hence, we have provided the outstanding balance of INR565 million and is disclosed as an exceptional item. Our effective tax rate was at about 29% in fourth quarter and 26% for the fiscal year ’23.

So, the gross profit margin improved over the previous year, but due to meaningful reduction of revenue over the same period had negatively impacted EBITDA and PAT margins. Some of the measures related to cost-reduction, efficiency improvement are being undertaken and will have several effect on margins. Cash conversion cycle stood at 256 days for the financial year 2023 as compared to 180 days as of last financial year-end. The increase in working capital was due to higher inventory and receivable level. Increased receivable and inventory days has pushed overall cash conversion cycle. We are actively monitoring both our receivable and inventory position for improving our working capital and operating cash flow.

Total capex incurred during the financial year ended March 31, 2023 was INR2,230 million used for increasing, API and formulation capacities. We are adding new capabilities for Combi-line for Microsphere, additional Bag line and lyos for the Penem block in Pashamylaram facility in Hyderabad. Our ROC on ex-cash basis as on 31st March, 2023 stood at 17%. And fixed assets turnover at 2.6% for FY ’23. As on March ’23, we had INR37,707 million of cash. Part of which we have utilized subsequently for Cenexi acquisition.

As we have completed the acquisition of Cenexi, we are now moving forward from pre-closing activities to post-acquisition integration stage. We are gearing up for the dedicated efforts for seamless integration of both companies and realization of synergistic benefits. On this direction apart froming a dedicated team for PMI from both Gland Pharma and Fosun Pharma we have also engaged with the global management consulting firm.

With this, I would request the moderator to open the line for questions. Thank you.

Questions and Answers:

Operator

Thank you very much. [Operator Instructions] The first question is from the line of Rishabh Shah from UG-BMS. Please go ahead.

Rishabh Shah — UG-BMS — Analyst

Hello. Am I audible?

Operator

Yes, you are.

Rishabh Shah — UG-BMS — Analyst

I have couple of questions. My first question is since there are many companies, we are seeing new age companies entering into the CDMO business and due to our company is having a lot of problems. So, how are you going to tackle your — how do you want to tackle with such an intense competition entering into the entering into CDMO business?

Srinivas Sadu — Managing Director & Chief Executive Officer

Mr. Sourav, it was difficult for us to comprehend your question. Can you please come again?

Rishabh Shah — UG-BMS — Analyst

We are seeing many companies entering into [Technical Issues], how are going to tackle such a intense competition?

Operator

Members of the management, were you able to hear the question?

Srinivas Sadu — Managing Director & Chief Executive Officer

I think the question is related to the competitive landscape, right, in the present scenario, am I right, Mr. Rishabh?

Rishabh Shah — UG-BMS — Analyst

Sir, my question is new companies entering into the CDMO business, how are going to tackle with such an intense competition — competitive environment?

Srinivas Sadu — Managing Director & Chief Executive Officer

Yeah, so if you are see the pure development from B2B business, that still I think not many players are there, you could see some CMO players coming in and manufacturing product for companies. But our own model, where we develop products and license out, still I think there is not that much competition like before. But yes, in terms of companies who are developing the product and trying to outsource like contract manufacturing, there is a competition, there is a price pressure.

And if you look from our strength’s perspective from regulatory side or from quality side, we’re maintaining claim records and that should sustain us in the long run compared to newer players where you able to see the current regulatory inspections, how they’re going on and whether they could sustain with lower margins in the longer run. Especially in the injectable business where capex is very high and maintenance is high, these large — with low-margin competitive landscape survival in the long-run could be difficult. So, I think the time will come when companies have to raise the margins profile so that they invest into future growth or allocating investments into future growth, as well as maintaining [Technical Issues].

Rishabh Shah — UG-BMS — Analyst

Okay, thank you. And since as our business is so much focused on CDMO and CMO business, if you could help me out with the percentage of repeat orders, which you are receiving from the customers?

Srinivas Sadu — Managing Director & Chief Executive Officer

You mean the repeat orders from the customers?

Rishabh Shah — UG-BMS — Analyst

Yes, from the customers. What is the percentage of repeat orders we are getting?

Srinivas Sadu — Managing Director & Chief Executive Officer

So, if you look at from a volume, quantity perspective, our FY ’22 and ’23 volumes are almost similar. The degrowth has happened from specific few products and as well as COVID-related products. If you see our domestic sales last year compared to this year, we lost almost INR380 crores, mostly pertaining to the COVID sales that happened last year and also one of the largest products, Micafungin, which we had the initial exclusivity, it went down from almost INR440 crores to INR65 crores. That has actually what you call beaten the numbers a bit because we lost about INR370 crores there. So, these two main factors have contributed to de-growth INR750 crores. But then there are also products that we have grown, products that have doubled our revenue. There also is de-growth happening. Again, that was a COVID-related product.

So, in terms of de-growth has happened specifically for three of our major products, which got hit. I think is a combination of COVID as well as the exclusivity product, but on the majority of the products still we are able to maintain that unit. While there is a pressure on prices, still the units have gone up. If you really see the breakup of the revenue bridge what you see, normally, our new product launches help us to grow about 10%, but year it only contributed 3%. That shows a bit of competition in the market when we launch our products. So, that has not contributing substantially. It’s a combination of what products we sold, also the competition at which people are launching at [Technical Issues].

Rishabh Shah — UG-BMS — Analyst

Okay. And sir, since the majority of business is in USA, what do you think about the growth in India? Are there any plans to grow in India?

Srinivas Sadu — Managing Director & Chief Executive Officer

Again, so, that’s been our plan, but if you see, we are focusing in injectables and most of the injectables in India are tender-driven business. Also, a lot of products comes under price control and with the facilities what we run, it’s very competitive industry and tends to compete in the space. While we are looking at some opportunities specifically on margin-driven products, but because most of the portfolio falls under the control — the price control, so that’s been — that’s been a deterrent for us.

Rishabh Shah — UG-BMS — Analyst

Can I squeeze just one more in?

Operator

Sorry, to interrupt here. I would request you to please come back in the queue. The next question is from the line of Kartik Mehta from Klay Capital. Please go ahead.

Kartik Mehta — Klay Capital — Analyst

Yeah, hi, thank you for the opportunity. I just want to understand in terms of base business, while there will always be competition and it’s not something which we don’t see in the industry, what is your — what is your assumption for reaching stable rate of revenues for quarter, even if it is on a half yearly or an annualized basis? The problems, which you mentioned in terms of competition, new products, not competing more, we need to get some new color from you from the perspective of, are there new products which will compensate for this while your gross margin continues to remain where it is? What is it at the expense side or is there any large products that you expect? And also in terms of broad revenue items, in terms of the fact that we will also be acquiring — you will also be integrating an asset?

Srinivas Sadu — Managing Director & Chief Executive Officer

So, from the business perspective, like I said, the major products got hit, so to cover that now it takes lot of other products to get smaller. So, if you look — like I said, from the units perspective, we still maintain at the company level, so the volumes have grown in some other products, but specific products where we lost business too. Now, there are several large molecules, which will be launched, but looking at last year experience you can see even $500 million, $600 million product after they launch, the prices has got down almost 80% to 90% there was crash when it got launched.

Whether it’s sustainable in the long run, we can’t say, but that’s been the case of — so we can’t really vouch for the products, the big products really do well under this competitive scenario, but we have almost 28 products, which got approvals this year and that approval — the filings are on track and all of facilities are in track in terms of supplying this product. And in terms of margins, you can see, we have invested heavily and some of the lines are not on commercial scale yet, whether it is biologics plants, whether it is some of the Microsphere lines, we have established recently and two other lines we’re still under approval process. So, that’s actually adding up to the cost. But then we filed several products on our transfer from other lines. If it gets commercialized again that should increase the revenues.

And with Cenexi’s acquisition, there are lot of opportunities opening up in terms of the same customers who we are working in the U.S., where they are sourcing products from European — other CMOs for the European market. We are working with them how to ship those kind of volumes to either [Technical Issues] in Europe or [Technical Issues] India. So, in a longer run, we see the business is strong with the kind of portfolio we have and with the toned up distribution and the contract, we have across the globe. But there are headwinds in the short-term, like you said, but it is getting stabilized. When we do such large molecule and get [Technical Issues] few other products if they get lower and that’s what we’re working on.

Kartik Mehta — Klay Capital — Analyst

Would you want to give some color on the broad revenue guidance combined entity, if not for — if possible, throw some color on the China approval and the opportunity if any that comes in, that one can see in the revenue upside in FY ’24?

Sumanta Bajpayee — Vice President, Finance and Investor Relations

So, Kartik, Sumanta this side, so we have taken kind of constant position given the availability into the market as well as our past experience on the product. We refrain from giving any kind of validation either on the top line or on the margin proprietary side of it. That is point one. Also, I’d like to highlight here that in the previous question, Mr. Sadu has indicated INR380 crore offtake, which is an assessment, which is an assumption because of some of our products being used for COVID and non-COVID as well, so is not a like a verified number, just for clarity of everyone. It is assessment — management assessment could be kind of impact on the domestic side of it.

Kartik Mehta — Klay Capital — Analyst

Yeah, okay. So, without talking about the guidance, any color on the business and I’m not talking here in terms of the numbers, product approval likely for launches in this year and next year? Thank you.

Srinivas Sadu — Managing Director & Chief Executive Officer

So, in the next quarter, we have almost 11 to 12 products, which are getting launched like Mr. Ravi said in his speech, we have a customer, of course, there is [Technical Issues] where we’re trying to move those products as well, to the customer. There are also several opportunities where because of price pressure, large customers are tranferring the products to our side, so which could see some good business in terms of newly planned numbers in the second half of this year.

Kartik Mehta — Klay Capital — Analyst

China in particular, would you want to just probably highlight?

Srinivas Sadu — Managing Director & Chief Executive Officer

It’s too early to comment on the numbers. I would say, first [Speech Overlap].

Kartik Mehta — Klay Capital — Analyst

Not the numbers, in terms of — in terms of the number of launches. You have an idea of how the market works.

Srinivas Sadu — Managing Director & Chief Executive Officer

So, we are launching one product — we’re launching one product this quarter, we just shipped out. And then there are three or four products expected in the next nine months.

Kartik Mehta — Klay Capital — Analyst

Thank you.

Operator

Thank you. Our next question is from the line of Prakash Agarwal from Axis Capital. Please go ahead.

Prakash Agarwal — Axis Capital — Analyst

Yeah, hi, good evening. Just on the current status, you mentioned Q4 has been impacted by closure of some lines, the Penems. So, what is the current status of all the lines during this quarter and next three month? Do we expect more closures and the earlier ones have been resolved? If you could clarify that.

Srinivas Sadu — Managing Director & Chief Executive Officer

So, the past quarter, we have as a part of the capacity expansion [Technical Issues] which is because we were not able to cater to the demand. So, we had one more line to that. On May 15th we have opened up that. So, the commercial production started again on that line. That’s only line which got shutdown that’s specifically to add one more line, because if you contemplate it for a while, and we are not able to meet the demand, so we took that call.

Prakash Agarwal — Axis Capital — Analyst

So, one more line has been added apart from the one line which has started from — restarted from May 15th, is that right or…

Srinivas Sadu — Managing Director & Chief Executive Officer

We had the two lines before we added one more [Technical Issues] to that line. So, that’s why we had to take a shutdown.

Prakash Agarwal — Axis Capital — Analyst

Okay, so now three lines are operational, is what I understand.

Srinivas Sadu — Managing Director & Chief Executive Officer

Three lines, yeah correct.

Prakash Agarwal — Axis Capital — Analyst

Okay, lovely. And in terms of, you mentioned about last quarter, you will not mention about guidance, but I’m trying to understand that gross margins are there, inventory rationalization is largely done by the customers or you think there is more inventory in the system?

Srinivas Sadu — Managing Director & Chief Executive Officer

I think the few products reached, one more quarter it will be there. Most of the customers have rationalized. And that’s the reason while the end-market volumes have not come down, for us — for most of the customers. As you can look at even our largest product, we sold 50% of actually the end-market, number of units, so that should get back in a few quarters. So, other than that I think most of it should get rationalized.

Prakash Agarwal — Axis Capital — Analyst

So, inventory is volume only, so I am little confused here.

Srinivas Sadu — Managing Director & Chief Executive Officer

Yes, yes, inventory at the front-end customer level. Because they were maintaining the higher inventory levels earlier but because of the high interest cost now everybody is rationalizing their inventories, they’re depleting to a lower level. Some customers used to maintain 9 months to 12 months inventory because if you have [Technical Issues] contract, they have to maintain minimum six months inventory, but now, with the high interest cost, they are trying to reduce the inventory at the level. So, our transfer — some of our [Technical Issues] was reduced, that impacting — that’s impacted our business a bit, but then end-market wise [Technical Issues].

Prakash Agarwal — Axis Capital — Analyst

Okay, okay, understood. So demand is there, but in general there is a destocking or reduce inventory levels that is being kept?

Srinivas Sadu — Managing Director & Chief Executive Officer

Correct and that’s the reason actually because the pushed out — because of various rationale inventory, they pushed our some orders and that’s where we are ending up with higher inventory at our level.

Prakash Agarwal — Axis Capital — Analyst

Okay. And you mentioned about this one large product, Micafungin, but how about Heparins and Enoxaparin. You earlier used to mentioned about the a little bit on the size. So, would that have contracted significantly and demand still prevails for those kind of products?

Srinivas Sadu — Managing Director & Chief Executive Officer

So, Heparin is mostly price driven and we consciously took a call that we will not grow for very lower margin because it doesn’t make sense. Utilizing [Technical Issues] a low margin. So that’s what happened. Enoxa, we still have grown as number of units as have grown, but some market, the pricing is lower, so the revenue has gone down by about 10% for Enoxa as a company but the volumes have gone up by about 7%.

Prakash Agarwal — Axis Capital — Analyst

Okay. And Heparin sir?

Srinivas Sadu — Managing Director & Chief Executive Officer

Heparin, actually we have gone down in terms of units. That’s the combination of price and also last year there were lot of sales in the last quarter because of COVID. I think it’s a combination of both.

Prakash Agarwal — Axis Capital — Analyst

Okay, lovely. Thank you. I have more questions. I’ll join the queue.

Srinivas Sadu — Managing Director & Chief Executive Officer

Thank you.

Operator

The next question is from the line of Neha Manpuria from Bank of America. Please go ahead. Neha, your line has been unmuted. Please go ahead with your question.

Neha Manpuria — Bank of America — Analyst

Yeah, can you hear me?

Operator

Yes, now. Please proceed.

Neha Manpuria — Bank of America — Analyst

Yeah, sorry about that. Could you explain to us what is the sort of the one-off impact, if at all there is any in the quarter and what should be the base that we should be working for when we look at a normalized business given there was Penems shutdown, etc., that we saw in the quarter? Hello?

Operator

Members of management, we are unable to hear you.

Srinivas Sadu — Managing Director & Chief Executive Officer

So, on the revenue side, I think the one we called out is that Penem plant shutdown. So that should be around INR30 crore, INR40 crores has impacted. And I think on the others is also the ROW and what we mentioned is [Technical Issues]. On the expense side, we have spent a bit on the M&A but closer.

Neha Manpuria — Bank of America — Analyst

Understood. So, even if I were to adjust this INR30 crores, INR40 crores, when you take seasonality does it mean that some of the sales have probably slipped into the first quarter as against last quarter?

Srinivas Sadu — Managing Director & Chief Executive Officer

Yeah, it could be last quarter or the next quarter. For example, one of our — the ROW tender, which we were supplying substantially. So, those quantities some going into next quarter and new tender coming up, which we have participated now. So, because of that there is a shift in which quarter it got sold.

Neha Manpuria — Bank of America — Analyst

Okay. So, there could be some [Technical Issues] which comes back in, first quarter or second quarter?

Srinivas Sadu — Managing Director & Chief Executive Officer

Yeah, correct.

Neha Manpuria — Bank of America — Analyst

Okay. But overall, we haven’t lost any tenders in our ROW market versus last year, right, or let’s say versus last quarter?

Srinivas Sadu — Managing Director & Chief Executive Officer

Tenders, no, we have not lost the tenders. But we like I said, Heparin, we intentionally reduced our sales, because the margins are pretty low for that. And compared to the cost of holding those inventories and committing to the volumes larger for a longer period of time, it’s lot more riskier, because the margin profile is low for these supplies, so we stayed away from that. But otherwise, from tender perspective, we have not lost.

Neha Manpuria — Bank of America — Analyst

Understood. And I think in the opening comments, you mentioned about strategic shift that some customers. Could you quantify? Are there certain customers that have stopped taking supplies from Gland, and therefore, we are looking for alternative — supplying this to alternate customers. Is there some amount of lost sales that we have seen because of these strategic shift that you’re talking about.

Srinivas Sadu — Managing Director & Chief Executive Officer

So, one customer has shifted almost 14, 15 products, exited this market, but that’s not an immediate. So, they did give us time. So, we are actually — already shifted some of these products to another company and a few more to be shifted, but they’ll continue to have few of our larger products, still continue to serve this. The other company which we mentioned was going to file a bankruptcy, right from the public domain. So, that — those products are still they are going for liquidation, if somebody buys, then that business will continue. Otherwise, whoever buys it, [Technical Issues] should move to them. So, that is not clear how that business goes. But that’s the only I think business where we don’t have clarity yet.

Neha Manpuria — Bank of America — Analyst

And would you be able to quantify the percentage of 14 to 15 products. What is the size of that in terms of number for us to understand how this will move?

Srinivas Sadu — Managing Director & Chief Executive Officer

The customer, which gone to the bankruptcy?

Neha Manpuria — Bank of America — Analyst

No, no no, the 14 to 15 products that you mentioned, the customer shifted to another player or shifted out from.

Srinivas Sadu — Managing Director & Chief Executive Officer

That’s already been shifted, most of the products have already been shifted and getting relaunched the next quarter. So, we can’t really quantify yet on how that goes, but we’re pretty confident of that business doing okay.

Neha Manpuria — Bank of America — Analyst

Okay, so that will come back in the subsequent quarter for us as we shifted towards customers.

Srinivas Sadu — Managing Director & Chief Executive Officer

Correct, correct.

Neha Manpuria — Bank of America — Analyst

Understood. Okay, thank you.

Operator

Thank you. The next question is from the line of Shyam Srinivasan from Goldman Sachs. Please go ahead. Shyam, you may proceed now.

Shyam Srinivasan — Goldman Sachs — Analyst

Yeah. Are you able to hear me. Hello?

Operator

Yes.

Shyam Srinivasan — Goldman Sachs — Analyst

Yeah, great. So, my question was on the core markets and the divergence between US versus, say, Europe and the rest of the market, right. So full year, I think US declined 7%, these other markets have declined higher. And I think for the quarter, maybe there is a lot more convergence. So, just wanted to understand the differences between these two markets. And is there something that is specific that is driving on a full-year basis, like the weakness in the — in non-US core markets.

Srinivas Sadu — Managing Director & Chief Executive Officer

Not really. I think it’s the question of timing and what kind of products. And like I said heparin is the largest product for us. And as you see as a company we lost about INR150 crores of that and that — so I think ROW that’s one of our major products as well. So, because of the pricing we didn’t participate, we didn’t want to supply for many offers what we got. But I think it’s more to do with which quarter. And also Egypt includes last year — if you are comparing with last year, they were also sales for if you include COVID, like you said.

Shyam Srinivasan — Goldman Sachs — Analyst

So do you — Mr. Sadu, do you see any divergence in the pricing pressure between these two core markets, or you think it’s just a function of which product is when and if there is a COVID element? And it’s difficult to get an underlying trend saying, okay US is so what about pricing pressure and the rest non core is rest core higher, lower?

Srinivas Sadu — Managing Director & Chief Executive Officer

I think the price wise, looking at the company, both markers we see like 1% decrease if you look at the prices for these products. So, although the growth income from new products, like we said but the price reduction when you see the revenue bridge, the margin gap is 1%. And lost because of the pricing, but it’s mostly because of the revenue, the bigger we are not able to go back the fixed cost what we have in the sites. That has impacted the margin. And that’s the reason why contribution margin was still we’re at 64%. So, some pricing a little, still it’s okay.

Shyam Srinivasan — Goldman Sachs — Analyst

Got it, helpful. Second question is just on the supply of your raw materials and stopper for individual, so can you just comment on where are we in that journey? Pre-filled syringes, stoppers, do you face any constraints today and if you were to look at fiscal ’24, you also talked about inventory for both finished and I think for materials being higher. So, are we good on that and we shouldn’t see a supply shock like what we saw last year?

Srinivas Sadu — Managing Director & Chief Executive Officer

Yeah, from supply side, mostly I would say 90% stabilized. Few products, filters and syringe on and off, but not a major — I don’t think there is any major issue on that side.

Shyam Srinivasan — Goldman Sachs — Analyst

Got it. Mr. Sadu, just I know you’re not giving a quantitative number for top line. So it’s just a question of getting the demand now either say let’s assume ROW through the tenders, if you were to kind of — since supply is not a constraint, you can now start looking at being, if I use the word aggressive to try and get demand because supply is not an issue. Would that be a fair statement to make? And as you look forward, also you did Cenexi over EUR25 million per quarter coming through. Roughly, I’m just quarterizing an annual number, so is that how we should broadly think of fiscal ’24? I know you’re not giving a number, but help us construct the revenue bridge for say ’24, that would be useful. Thank you.

Srinivas Sadu — Managing Director & Chief Executive Officer

Yes, so absolutely. I mean, one is working with our partners closely on the front-end side and how it’s going to work. Because the market mantle is different compared to earlier. The assumptions what you made earlier when you — when the product gets simplified and with what price you go and bid, that’s completely different now. So, there was opportunity lost, because they were agreeing that the prices won’t fall that long, also we had leeway in terms of our cost and transfer prices and what you could have made a bid for a contract. But because assumptions went wrong, our partners couldn’t get — those bids.

Now, we are working closely with them compared to other rates, what price they are at and what price we can offer and what are the internally, how much we can go down in terms of transfer prices, if there is a need. So, we are working very closely with them and addressing looking at each product where we have lost market share. So, we have actually mapped which are the products which we lost substantial market share and the reasons behind that. And we are working towards that. So, that’s one big action that we are taking. And of course, Cenexi is a big focus for us, because that market they have never penetrated and this is an opportunity for us the several business opportunities are looking at and is already there, discussions happening with companies how to move product there. There is also other angle where we are able to taking products from plant to Europe through this acquisition. And then, like you said, of course, there is consolidation that going to happen with the regulator [Technical Issues].

Shyam Srinivasan — Goldman Sachs — Analyst

Got it. Thank you and all the best. Thank you.

Operator

Thank you. The next question is from the line of Saion Mukherjee from Nomura Securities. Please go ahead.

Saion Mukherjee — Nomura Securities — Analyst

Yeah, hi, good evening. Sir, can you share the impact that can potentially come from your partner who has filed for bankruptcy, assuming that those suppliers get impacted?

Srinivas Sadu — Managing Director & Chief Executive Officer

So hopefully, because they have gone for liquidation and people are looking at aggressively how to get the our contract. In fact, there are also customers who are reaching out to us without knowing the bankruptcy process whether they can buy off the contracts because there are three or four products there, we have a GPO contracts attached which has a good value. So, it could be a temporary impact, where suppliers have stopped because we time to recovery the money. But I think long run, it is really protected because it is under this clauses where if somebody acquire it, they to acquire the contract where they have to pay the cure money and also they get rights for the GPO contracts where they get canceled. So, hopefully, short time margin impact. But till the time it process, day before end of June, by the time the sales process should complete, so we should get a clear idea of who is going to get this product. And if the business is on [Technical Issues] or somebody is going to buy products or the contracts.

Saion Mukherjee — Nomura Securities — Analyst

So I was wondering, in case I mean, in the interim, you are not supplying, right. So somebody else is probably meeting the demand at this point. And if that is the situation, then why would someone buy those assets because the value would keep eroding as time persists?

Srinivas Sadu — Managing Director & Chief Executive Officer

The business has not stopped. While they have removed a lot of people they’ve still kept the quality, regulatory and commercial staff. And there’s inventory lying in the channel. So, that’s been supplied, so our inventory of almost two months or five months, so that’s not a problem. So, business offers a business. business is [Technical Issues], its just that if you look at going into an escrow account, it doesn’t have. So, it’s not an issue.

Saion Mukherjee — Nomura Securities — Analyst

And sir, I mean you are not sharing the number, but I mean, is it a meaningful number in the sense is this one-off large partners that you have? I mean I just in the case of an eventuality, there is a disruption, it could have a meaningful impact or do you think it would be smaller?

Srinivas Sadu — Managing Director & Chief Executive Officer

If the business what — the business what we do, is around INR200 crores a year.

Saion Mukherjee — Nomura Securities — Analyst

Okay.

Srinivas Sadu — Managing Director & Chief Executive Officer

Yeah, and then we — we have — we are pretty much confident of, it’s not 100%, 78% should come back at least for the product where they have GPO contracts in place.

Saion Mukherjee — Nomura Securities — Analyst

Okay, understood. Sir, on the Cenexi acquisition, the numbers that you disclosed imply that the EBITDA has come down materially for the second half, so I know when you did the acquisition you did mention that first half was inflated. So, if you can give us some indication as to what’s the right level of EBITDA for Cenexi that we should look?

Ravi Shekhar Mitra — Chief Financial Officer

Yes, so, Saion, like last time when we talked about the the Cenexi we told that it’s a half year, it is not indicative of the full-year. However, the second half of the calendar year ’22 has also been impacted because of the high energy cost, which we are expecting to improve now because that is kind of behind the handgun. So, in terms of revenue, they have definitely grown. And EBITDA margin is currently the full-year what we have achieved and should be better as indicated, as for projection, I cannot give a number right now. But because of the cost factors it’s going to improve and the product profile which they are currently working on is in a better margin profile than previous year. So, numbers we will talk about later on when we have a full clarity on the plan.

Saion Mukherjee — Nomura Securities — Analyst

Okay. And finally, if I can on — sir, you mentioned about competition in Heparin and Enoxaparin particularly in Heparin, right where it has come to a level which is not very lucrative for us. I mean, so how important are these two products now? I remember like initially it was very important, like how big contributor are these two products to your overall revenues. And if you can give some color on what is really driving? Are this Chinese player who are beating down the price? Do they have some cost advantage, which is leading to this sort of erosion?

Srinivas Sadu — Managing Director & Chief Executive Officer

Yeah, absolutely. So, if you see Heparin as directly now the two Chinese players have directly launched in the US. So, that’s one major road block I would say. If we look at from a member perspective Heparin for company is around INR250 crores from FY ’23, but that’s for the company. So, what we have are working on a strategy there. We have nine SKUs, lot of other companies do not have nine SKUs. We are seeing how we can increase that volume going around. Looking at as a basket in sort of gearing level. So, we are working on that as well and we are also working with our own parent company subsidiaries and qualifying their crude to get a better pricing. So, once we get approval, I think we will been in a better opposition than now.

Saion Mukherjee — Nomura Securities — Analyst

And the same situation is Enoxaparin as well?

Srinivas Sadu — Managing Director & Chief Executive Officer

Enoxaparin, US what happened, of course, there again, direct supply from China. There is competition in that. The compliance of the GPO is not there yet, although our platform has recent contract, the compliance is around 55%, 60%, averaging 85%, 90%. So the offtake is not as per our estimate which kind of impacted our pick up of the stuff. If you recall, they had larger inventory last year and they are rationalizing that inventory that has impacted, but I think if not this quarter, next quarter, not June quarter, but probably September quarter it should start picking up the product from us.

Saion Mukherjee — Nomura Securities — Analyst

So, can you share the total contribution for Heparin and Enoxaparin for FY ’23 for the company?

Srinivas Sadu — Managing Director & Chief Executive Officer

For the company for Enoxaparin and Heparin together is INR970 crores. INR970 crores, okay sir, thank you.

Operator

Thank you. The next question is from the line of Anandha Padmanabhan from PGIM India. Please go ahead.

Anandha Padmanabhan — PGIM India — Analyst

Thank you for taking my question. Sir, just to understand, in Q1 we will continue to see the impact of production shutdown. So, that would again be a factor that would play in the next quarter as well if I have to understand right?

Srinivas Sadu — Managing Director & Chief Executive Officer

It started now, from May 15, the line is back on track in commercialization. So probably half quarter impact but is back on track. But as against earlier two lyos, now, we are producing two lyos so that should makeup for the quarter number.

Anandha Padmanabhan — PGIM India — Analyst

And with respect to Cenexi acquisition, by when do you expect the acquisition to get close completed?

Srinivas Sadu — Managing Director & Chief Executive Officer

It’s already closed last month.

Anandha Padmanabhan — PGIM India — Analyst

Or by when should we expect — Q1 we should se consolidation happening?

Srinivas Sadu — Managing Director & Chief Executive Officer

It will consolidate this year, next quarter, for two months. Because we closed on April 27. So the consolidation happened for next quarter for two months, May and June for this year.

Anandha Padmanabhan — PGIM India — Analyst

And sir, Heparin and Enoxaparin for FY ’22 how big are they? Contribution of Heparin and Enoxaparin…

Srinivas Sadu — Managing Director & Chief Executive Officer

Around 1,100, about 1,100, sorry 1,200. FY ’22, it was 1,200 and FY ’23, it’s about 980, 970 to 980.

Anandha Padmanabhan — PGIM India — Analyst

And in US do you see in terms of the pricing pressure or in terms of there are some news flows of some key players facilities getting impacted because of increase per — because of regulatory action. Are you seeing any impact of the same in terms of customer inquiries on your contracts or in terms of demand?

Srinivas Sadu — Managing Director & Chief Executive Officer

So, the volumes have several products have gone up because of this. But pricing has not gone up that much, but we are some 70 products, the volumes have gone up. And I think more and more, we are getting queries on certain products.

Anandha Padmanabhan — PGIM India — Analyst

Okay. Thank you, sir. I have few more questions, I’ll come back to the queue.

Operator

Thank you. The next question is from the line of Bino Pathiparampil from Elara Capital. Please go ahead.

Bino Pathiparampil — Elara Securities — Analyst

Hi, good evening. Just a clarification on your inventory levels, it seems to have gone up significantly Y-o-Y.

Srinivas Sadu — Managing Director & Chief Executive Officer

Yes, like I said, because of the shutdown of inventories at our partner level. So, it got switched out by few months and that got added up at our end. And because of this situation of last year we’re trying to keep up a little more inventory than usual. And like we said for Heparin offers a lot of inventory with us. One is anticipating the pickup in next quarter. The other is we don’t want to sell at a low price. So, once I just talked about how we want to manage US situation. Once that gets finalized, then we will start utilizing that. Yeah, we are focusing on that and seeing how to reduce that inventory for sure.

Bino Pathiparampil — Elara Securities — Analyst

Okay. This customer who has filed for bankruptcy did their take off from you decreased significantly in quarter four compared to quarter three?

Srinivas Sadu — Managing Director & Chief Executive Officer

Not bigger, but I would say probably 25%, 30% because we actually started reducing supply looking at the COD to reduce to receivable. So we kind of reduced supply.

Bino Pathiparampil — Elara Securities — Analyst

Understood. And the other customer who exited the business, when did they exactly stop taking products from you, which quarter was that?

Srinivas Sadu — Managing Director & Chief Executive Officer

This quarter, the previous quarter and — but we have already transferred those products and getting launched in the coming quarter. Some are getting launched in June and some getting launched in July.

Bino Pathiparampil — Elara Securities — Analyst

Yes, sorry, but when did they stop taking product from you, was it 4Q or 3Q or 2Q?

Srinivas Sadu — Managing Director & Chief Executive Officer

4Q last quarter.

Bino Pathiparampil — Elara Securities — Analyst

Okay, thank you.

Operator

Thank you. The next question is from the line of Sameer Baisiwala from Morgan Stanley. Please go ahead.

Sameer Baisiwala — Morgan Stanley — Analyst

Yes, thank you very much. Good evening, sir. First of all, what was the profit share for the quarter and for the full-year.

Srinivas Sadu — Managing Director & Chief Executive Officer

You want the full year?

Sameer Baisiwala — Morgan Stanley — Analyst

Yeah, Q4 and full-year. I remember, it used to be around 10%, 11%, has this materially changed?

Ravi Shekhar Mitra — Chief Financial Officer

Yeah, so full-year is 8%. and quarter four is 7%.

Sameer Baisiwala — Morgan Stanley — Analyst

So, that’s a straight 300 basis point to 400 basis point hit to your margins?

Ravi Shekhar Mitra — Chief Financial Officer

Yes.

Saion Mukherjee — Nomura Securities — Analyst

And this has all the impact of the the end market price erosion, which is now getting filtered down to you as a supplier?

Ravi Shekhar Mitra — Chief Financial Officer

Yeah, it’s both actually. Because along with that there is also the impact of the high-margin inventory lowering at the customer end, which we were talking in the beginning.

Sameer Baisiwala — Morgan Stanley — Analyst

Yeah, which means revenue mix. So, the high margin stuff is kind of not moving.

Ravi Shekhar Mitra — Chief Financial Officer

One second. Yes, and the product mix also. Like products like Mica has high profit share.

Sameer Baisiwala — Morgan Stanley — Analyst

So, where do you go from the 7% now as you look out in the future. Is this a new level or you think you are not quite get back to your previous levels?

Ravi Shekhar Mitra — Chief Financial Officer

From profit share perspective?

Sameer Baisiwala — Morgan Stanley — Analyst

Yes.

Ravi Shekhar Mitra — Chief Financial Officer

I think it all depends on currently charges happening so probably the pressure on some of these products are not that much. And mica, now it has gone away. Like I said, it’s from INR440 crores now it’s at INR65 cores. The volumes should increase a bit, because it also taking considering the high inventory they held last year, so they were using that inventory that should go up. I would still feel that it should settle around 10%.

Sameer Baisiwala — Morgan Stanley — Analyst

Okay, that’s very that’s very good to hear, sir. And, sir, the second question, you were talking about the end-market pricing pressure. So, your customers are sort of losing market share. So you want to sit down and plan the price-volume metrics. I wasn’t too sure that I understood your comment fully, so what percentage of your business does that planning apply to? And does that mean that we should brace for sort of portfolio-wide or something price erosion in fiscal ’24, as your plans get finalized with the customers?

Ravi Shekhar Mitra — Chief Financial Officer

So, I think we can’t generalize same plans will work for product side. So, this is different tree different kinds of, that’s why we are getting to each product level, some products actually, there is a lot of margin. There, customers can take, but they don’t want to do it, so that’s really customer and what’s the logic behind not doing after that higher market shares and there is a high margin between the selling price and cost. There are also products where probably transfer is a little higher higher where we have worked on reduction of cost over the last 12, 18 months. I would say, now, 30%, 40% of R&D cost goes into lifecycle management, where we reduce costs. So, where we can actually go for a higher market-share. So, there is different factor for different product. So, that’s what we are trying to do which product we have lost market share or where we have lower market share and where there is a positive to increase those volumes. So there is no one solution product for each [Technical Issues].

Sameer Baisiwala — Morgan Stanley — Analyst

Fair enough, sir. But what’s the average picture what should we expect in fiscal ’24. And just roughly about? It is about lower pricing? Higher volumes for the base business and what percentage of your business is getting impacted? Is it like 20%? Is it 50%.

Srinivas Sadu — Managing Director & Chief Executive Officer

We can’t really give a number that’s what I’m saying. We also had some higher-margin product where the volumes currently are not that much. And we are trying to see how we can increase those kind of volumes also. So, some partner, they really don’t want to go after what you call a competitive bid, they don’t want even participate bid, so we have to sit with them and say how to get into this kind of [Technical Issues]. So, it’s a combination of both. One, probably, where we still have margins where they can go aggressively for market share or where probably, the volume is helping to absorb our fixed costs. Even if the margin is lower, but at the EBITDA level, it’s going to help the company. So, it’s a combination of both.

Sameer Baisiwala — Morgan Stanley — Analyst

Okay, got it. So, one final question. Not too far back maybe six quarters back your operating margins used to be 35% and this quarter it’s 21%. It’s a very, very big move. So how should we think about it, I’m not looking at next two quarters. But like in a year or two. How is the business going to evolve and what’s the right range or any guidance, any qualitative points on this would be very helpful? Thank you.

Srinivas Sadu — Managing Director & Chief Executive Officer

I think it’s a combination of the lower base also because of cost they’re almost like I said, the only other costs in that we’re just not commercialized. So these lines will get a on-track next few quarters. Now the revenue base is low. The cost are similar or a little higher than last year. And that’s why it has gone down. Once your revenue base becomes normalized then this will automatically goes up.

Ravi Shekhar Mitra — Chief Financial Officer

Yeah, so it’s like the leverage impact us, injectable cost, most of it is being fixed. And inflation and power costs have gone up. While the gross margin percentage remaining similar, EBITDA and PAT has been [Technical Issues] we are dividing by lower base of revenue now. And the cost, has gone up.

Srinivas Sadu — Managing Director & Chief Executive Officer

And also if you see the R&D cost because the base is lower like last quarter is almost 7%, 7.5% because of the complexity of products, what are dealing today. Historically, our original plan was to stick around 4% to 5% with the normal growth, what we have as a company, but because our base is lower now that’s showing that 7% and it’s showing at lower EBITDA number because the absolute number is still as per the plan. And as per the year normally I think higher this year is around 5%, 5-point to 6% or something. Historically, it’s been around 3%, 3.5% to 4%.

Sameer Baisiwala — Morgan Stanley — Analyst

Okay, got it, sir. Thank you so much.

Operator

Thank you. The next question is from the line of Alankar Garude from Kotak. Please go ahead.

Alankar Garude — Kotak Securities — Analyst

Yeah, hi, good evening, everyone. Sir, in the past, we used to be quite confident of the growth trajectory in ROW. Would you still maintain that ROW will grow at a significantly faster pace for us say compared to US?

Srinivas Sadu — Managing Director & Chief Executive Officer

The base has gone up. If you see last year a substantial increase in the base. And that’s why you see. And the US business is very large. And that’s why the percentage growth looks smaller. But the efforts are there how to increase the growth in, especially the Asia and MENA markets where we see substantial opportunities opening up there even compared to LATAM.

Alankar Garude — Kotak Securities — Analyst

Understood. And, sir, has there been any meaningful change in the gross margin profile across geographies in the past one year, because I remember couple of quarters back you had talked about ROW margins being significantly lower than US, as well as the regulated markets?

Srinivas Sadu — Managing Director & Chief Executive Officer

I think it’s in the similar range. In fact, the price pressure in US is — was larger, whereas other markets, it’s still except one or two products, but mostly it’s been stable.

Alankar Garude — Kotak Securities — Analyst

Understood. And sir, final question, quite similar to the previous question, if we go back and hear, we were guiding for about 20%, 25% top line growth with a 35% EBITDA margin for FY ’23. Now versus that you have delivered about 18% drop in sales with about 28% EBITDA margins for the full year. So, while we’re not giving a numerical guidance, would it be fair to say that structurally this is the new normal now, or we are very close to the new normal now?

Srinivas Sadu — Managing Director & Chief Executive Officer

I can’t really say that because like I said, it’s been a very dynamic situation out there. With high-interest rate, people are looking at how much inventory they have to do it. And now the inflation start happening, we have to see how that’s going to play out. We have seen three or four big players having issues in the US. So, is it going to come back to maybe four years back where there companies had these kind of issues or is going to settle, it’s very difficult to tell. We have to see how strong from the company perspective, from a regulatory perspective, from quality perspective, from development pipeline perspective, we’re doing the best what we can. And we’re filing more than actually what you were doing before. We’re always guiding on ’23-’24 and as we file 29 ANDAs.

So, we’re not stopping with that, we are moving on the complex side. We filed three complex injectables with [Technical Issues]. So, in that sense, as a company, structurally as a company we are strong and I would say, better than lot of other companies who are going through this process. Now from market dynamics, we have to wait-and-watch, because of the competition and some are exiting the market. So naturally, it could be a shorter impact for us. But the same people maybe were importing the products from others and selling in the market. So, there the competition has reduced. So either, one way, it might be disturbing for us to see that some business is lost, positively we are thinking well, let’s say, positive, they are also saying several other products that are more competitive, that our own products, so probably there is an opportunity for us there. So, it’s it’s a give-and-take there could be a temporary issue with that. But in the long-run, if the competition is going down in the market. So, the policy we should think that maybe going is back two, three, four years ago where they were lesser competitors with these guys exiting the market.

Alankar Garude — Kotak Securities — Analyst

Okay, sir. Thank you and all the best.

Operator

Thank you. The next question is from the line of Bharat Shah from Bernstein. Please go ahead.

Nithya Balasubramanian — Bernstein — Analyst

Hi, this is Nithya. Thank you for the opportunity. One question on the line shutdown. So we saw an insulin line shutdown in the year and then a line shutdown. Are these planned line shutdowns are an anticipated one? Why given the substantial nature of these shutdowns is this something that can be communicated to the market and launch? And what can we expect next year? Are there any planned shutdowns?

Srinivas Sadu — Managing Director & Chief Executive Officer

So from the tenant’s perspective this line, we’ve been contemplating. But it was holding up because of the supply situation, we didn’t want to disrupt the market for a while, while we have put up the lyos, but we never connected to the line. But if you see our own Enoxaparin product, we have doubled our revenue last year. And there is an opportunity still grow there. So, we thought will take one-time hit, but then there’s an opportunity out there to take it and that’s the reason why we took that call and did the shutdown. So, it was a timing was not very clear when we want to do it, but we did that. So, I think, so that was the reason for it, but in the near future we don’t have plans to take a shutdown at least, planned shutdown, unplanned, of course we don’t know.

Nithya Balasubramanian — Bernstein — Analyst

Got it, thank you. The next one on Heparin, I didn’t quite comprehend your comment. So, last quarter you had mentioned that at least from a US perspective, the demand was still intact. And your ability to supply with what was constrained, because of the coated stopper non-availability. Is the US demand still intact and have you solved for the coated stopper issue and will we see Heparin in the US, the revenues from Heparin US, will it be back in FY ’24, how should we think about it?

Srinivas Sadu — Managing Director & Chief Executive Officer

Heparin in US that impact was like I said, in 9 coat, the 30 ml is the largest coat what we sell and that continued to sell, so that stopper issue has gone way, so, we have the supply now, so that’s happening, but we are not selling too much of other two, that now we are focusing on how to get back into the other seven or eight clouds to increase that business. The revenue impact for Heparin has come more from India and ROW in this year.

Nithya Balasubramanian — Bernstein — Analyst

Got it. And one quick one, on Enoxaparin, Enoxaparin again lLast quarter you had mentioned Sadu that your run-rate is approximately $50 million. And as the rest of the GP — rest of the hospitals as well convert to your product, that can potentially go up to $70 million. Do you still anticipate that to happen in FY ’24?

Srinivas Sadu — Managing Director & Chief Executive Officer

So, Nithya, that’s what I told the compliance. What we thought of getting to 85 to 90, the compliance is 255% [Phonetic], so the estimated volumes around 20 million, 23 million, that is standing around 15 million, 16 million. So, the efforts are made how to increase our compliance, so partner is discussing with GPO, because that’s not, a fair value on that you only have 55% so that’s work-in progress, but as of now the forecast is about 50 million, 60 million as against 26 [Phonetic].

Nithya Balasubramanian — Bernstein — Analyst

Understood. If I might just squeeze one very short one, do you anticipate any substantial increase to the cost items in terms of any investments, plant-related investment do you anticipate to make in FY ’24 or are most of the costs in the P&L.

Ravi Shekhar Mitra — Chief Financial Officer

So, P&L costs are all taken in, there is no incremental cost as you come up because of client coming into commercialization.

Nithya Balasubramanian — Bernstein — Analyst

Thank you so much.

Operator

Thank you. Ladies and gentlemen, that was the last question for today. I would now like to hand the conference over to Mr. Sumanta Bajpayee for closing comments.

Sumanta Bajpayee — Vice President, Finance and Investor Relations

Thank you, everyone, for joining us today. We appreciate your participation during the call. And we request, if you have any clarity, please reach out to me. Thank you, again. Goodnight.

Operator

[Operator Closing Remarks]