Granules India Ltd (NSE: GRANULES) Q4 2025 Earnings Call dated May. 28, 2025
Corporate Participants:
Unidentified Speaker
Krishna Prasad Chigurupati — Chairman and Managing Director
K.V.S. Ram Rao — Joint Managing Director & Chief Executive Officer
Mukesh Surana — Chief Financial Officer
Analysts:
Unidentified Participant
Prachi Andre — Analyst
Tushar Manudhane — Analyst
Rashmi Shetty — Analyst
Tarang Agrawal — Analyst
Sahil Vora — Analyst
Presentation:
operator
Ladies and gentlemen, good day and welcome to the Granulous India Limited Q4FY25 earnings conference call. 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. Should you need assistance during the conference call, please signal an operator by pressing start then zero on your touchtone phone. Please note that this conference has been recorded. I now hand the conference over to Ms. Prachi Andre from MUFG Investor Relations Team. Thank you. And over to you, Ma’ am.
Prachi Andre — Analyst
Thank you, Anushka. On behalf of Granules India Ltd. I extend a warm welcome to all the participants on Q4 and FY25 financial results discussion call today. On the call we have Dr. Krishna Prasad Chigurupati, Chairman and Managing Director, Dr. KVS Ram Rao, Joint Managing Director and Chief Executive Officer, Ms. Priyanka Chigurupati, Executive Director and Mr. Mukesh Surana, Chief Financial Officer. Before we begin the call, I would like to give a short disclaimer. This call may contain some of the forward looking statements which are completely based upon our beliefs, expectations and opinions as of today. These statements are not a guarantee of our future performance and involve unforeseen risks and uncertainties.
With this, I would like to hand over the call to Dr. Krishna Prasad sir for his opening comments. Over to you, sir. Thank you.
Krishna Prasad Chigurupati — Chairman and Managing Director
Thank you Prachi. Good evening ladies and gentlemen and thank you very much for joining us on the Q4FY25 earnings call. We appreciate your continued interest in Granules. We have uploaded a detailed presentation of our quarterly and full year performance on our website and I trust you have had a chance to review it. I will start with the Update on the U.S. fDA remediation at our Gagala Port facility. Let me begin with the Update on the U.S. fDA inspection status at our Jaguarpur finished research facility. As shared in our previous quarterly call, the facility underwent a FDA inspection in August 24th which concluded with six form 483 observations and was classified as official action initiative.
On February 26, 25, 26, 2025 we received a warning letter from the FDA for this site. The warning letter does not affect supply of approved commercial products. However, it may temporarily impact the FDA’s review of pending product submission from this facility until the matter is resolved. While manufacturing and distribution continue. The ongoing remediation measures have resulted in a slowdown of operations which impacted our Q4 output and is expected to continue for another quarter or two. Our remediation program initiated immediately post inspection had been driven under the guidance of three globally recognized consulting firms with deep expertise in quality compliance and regulatory affairs.
These experts have been closely collaborating with our teams both on site and remote since September 24th. As part of this initiative, we voluntarily passed operations September to conduct a comprehensive risk assessment. Operations resumed only after confirming there was no product safety or contamination concern and in concurrence with the US fda, we initiated extensive testing of both previously manufactured and ongoing batches for cross contamination. So far over 1200 post inspection and pre inspection batches have been tested. All are within acceptable limit. Additionally, more than 2,600 swab and rinse samples have been tested with no deviations observed.
We developed and validated 89 test methods specifically for contamination testing and analysis remains ongoing. We continue to generate and compile data to demonstrate the robustness and sustainability of our kappas in preparation for a future FDA meeting. Beyond compliance, we have implemented enterprise wide quality culture initiatives including corporate procedures for cleaning validation, visual checks, residue limits, change controls and competency building across teams. We remain fully engaged with the FDA customers and other stakeholders throughout this process and are committed to embedding long term improvement in our quality system. We are confident that the steps we are taking will lead to a satisfactory resolution within a reasonable time frame.
Granular’s growth trajectory remains focused and diversified, underscoring that our strategy is not solely dependent on new product approvals from the Gagalapur site. Key drivers include new launches from our GPI facility in the US growth from large volume products in the US and Europe, capacity addition and commercialization of the greenfield formulation facility at Genome Valley, value chain advancement in Europe and our expanding on quality pipeline from Unit 5. Our near term growth will be driven by new product launches among GPI clients for the US market, especially the CNS and ADHD segment. During Q4 we received approval for Lisdex Amsterdam main capsules following the early approval of the durable dablet formulation in Q3.
With this we now have both dosage forms, capsules, consumables to fruit and commercially launched, enhancing our presence in the CNS and ADSP segment. Additionally, we launched multiple key products during the quarter including paracetamol, oxycodone, paracetamol hydrocodone combination and tofetolide capsules. These launches reflect a continued focus on expanding our complex generic portfolio and reinforcing our position in the US prescription market. Our formulation facility at Jalom Valley under Granules Life Sciences is progressing well. Phase one, with a capacity of 2.5 billion doses has been commissioned and commercial dispatch of Monograph products are ongoing. We are awaiting inspections by both European Agency as well as the US FDA towards commercialization of prescription products from GLS.
Inspections are expected in Q2 of FY26. Phase 2, with an additional $7.5 billion capacity has been commissioned in the current quarter and validation activities for monograft products have also commenced. I will now talk about Granules foray into Peptides and the acquisition of STEM Chemicals. The global market for peptide based anti obesity and anti diabetic therapy has already crossed 50 billion in annual sales and is projected to reach 100 to $150 billion by 2030. Beyond metabolic disorders, we see exciting opportunities in oncology, cosmetics and therapnostics where peptides are enabling next generation targeted therapy. With the strategic acquisition of STEN Chemicals, Spare CDMO Granules has entered the high growth peptide therapeutic space.
This marks a formal entry into complex peptides including GLP1 receptor antagonistic, 1 of the most transformative classes of therapy in the fight against diabetes and obesity. Founded in 1963 and headquartered in Bilstock, Switzerland, CEN Chemicals is a specialist PDMO with a strong multi decade track record in developing complex liquid phase and solid based peptide synthesis processes for peptide APIs and fragment offering end to end customer manufacturing solutions across pharmaceutical, cosmetics, terragnostic and amino acid derivatives. We have completed the acquisition formalities in April and integration activities are in progress. We would provide more updates in the coming quarters.
On the sustainability front, we made significant progress during the year. Granules received a Gold rating from Ecovadis placing us in the top 5% of the pharmaceutical companies globally in our very first corporate level assessment. We also improved our CDP climate rating to FB and secured CBTI validation of our climate goals. Additionally, we launched our Supplier Sustainability program to extend our impact across the value chain. To summarize, we remain firmly focused on strengthening quality and compliance systems across the organization while staying on course with our clearly defined growth strategy. In the near term, momentum will be driven by new product launches from our DPI facilities and ramp up commercial operations at our Genome Valley formulation site.
Looking ahead, we are strategically expanding into high growth areas such as oncology and peptides which will shape our medium to long term target frame. Concurrently, we continue to invest in R and D to build a differentiated portfolio that underpins sustained value creation and global competitiveness. Dr. K.B.S. ramra will provide further insights on some of these initiatives. I now hand over the call to Dr. Amra.
K.V.S. Ram Rao — Joint Managing Director & Chief Executive Officer
Thank you Chairman. Good evening all of you at Granuts Developing a strong and a diverse product portfolio has always been a key priority and it remains central to our strategic approach. Over the last financial year, Daniel’s R and D spend was 238 crores versus the 199 crore in FY24 representing a 20% increase in investment which demonstrates our commitment towards R. We have been making steady progress in achieving our R and D goals. With every passing quarter we continue to expand and strengthen our product portfolio. We have a total of 127 dossiers filed across various regions.
We have 85 ands in the US, 16 pending for approval, 18 in Europe with 10 pending for approval and 24 in other regions including Canada with 8 pending for approval. We have received two approvals, one in US and one in Europe. In the last point we filed three US and as European dossiers in quarter four including a first two file product from the GPI facility. On the API front, we filed 18 DMFs including US DMF, CEPS, ASMFs, Korean and Brazilian EMFs. There has been a significant progress in our ADHD portfolio. We have been developing a robust ADHD portfolio with about 10 products in the pipeline for development which includes day one launches and day 181 launch opportunities including some first two files.
In February we launched three tamperable caps and chewable tablets in the US market. Furthermore, API validation and EMF filing is expected to be done in Quarter 1 FY26 for mixed exam technique which leads to vertical integration and supply chain reliability for the product. Overall, Granules ADHD portfolio covers a significant portion of the US ADHD market. We continue to expand our oncology portfolio with around 10 products currently under development. This includes NCE one day one launches, first two files and day 181 opportunities. We continue to make significant progress in our oncology portfolio. Last quarter we submitted a promising high growth oncology ANDA in the US and the European geographies marking the commencement of our oncology filings.
FY25 also saw entry of Granules into the Peptide and the global CDMO business. Peptide has emerged as one of the most important and promising class of therapeutic agents from treating metabolic disorders like obesity and diabetes GLP1 agonist to offering innovative targeted therapeutic cancer treatment. Peptide holds the potential to significantly enhance treatment outcomes across a range of conditions as a part of strategic objective. To tap into this rapidly growing segment, Granules has acquired the Switzerland based engine. This acquisition marks a pivotal moment for Granules. It will accelerate our transformation into a more diversified science and innovation led organization with sophisticated product capabilities with CEN Chemicals AG we are not just bringing a European company to our pool.
We are gaining immediate high value access to the rapidly expanding peptide therapeutics market while also firmly establishing our footprint in the specialized CBMO sector. CEN Chemicals adds to granules proficiency in complex high growth areas like peptide development and manufacturing using technologies like liquid phase solid phase peptide synthesis. It also brings in long standing relationship with pharmaceutical, cosmetic and terragonostic clients worldwide. Looking ahead, we are confident the strategic synergies created by this acquisition will unlock significant value. Our focus going forward will be on seamlessly integrating their expertise while maintaining the operational excellence, accelerating joint development activities and maximizing the opportunities this new venture presence.
This acquisition represents a tangible step in our journey to evolve our complex product portfolio, enhance our technical capabilities and solidify granules position as a leading global pharmaceutical player in high value specialized segments. I’m pleased to share that we have remained steadfast in our commitment to executing our R and D strategies and developing robust portfolio and capabilities for the future. Thank you all. Now I hand over to Mukesh Surana, cfo.
Mukesh Surana — Chief Financial Officer
Thank you, thank you CMD and gmd. Let me take you all to the top financial parameters now. Revenue the fourth quarter revenue were Rupees 11,974 Million compared to Rupees 11,758 Million in Q4FY24 with a growth of 2% and revenue grew by 5% as compared to Q3FY25 sales growth is from increase in FD and API sales thought there was a continuous price erosion. The full year revenue were rupees 44,816 million as compared to rupees 45,064 million in FY24 formulation Sales grew by 18% despite a voluntary pass of production in September 24 at a Gagalapur facility in response to US FDA observations and with remediation efforts.
Slowdown of production in H2 further price erosion and demand issue in AP and PFI has impacted the sales growth. The sales breakup as for business divisions geographic regions are presented in our investor presentation which is available on the website. Gross Margin Our gross margin as a percentage of sales for Q4FY25 was 53.4% as compared to 60.1% Q4FY24 gross margin as compared to Q4FY24 is up by 333 basis points achieved due to higher finished dosages. Sales with higher margin Gross margin as a percentage of sales for Q4FY25 is up by 169 basis points from Q3FY25. Sustained higher finished dosages. Sales with higher margin has given this improvement the full year. Gross margin as a percentage of sales for FY25 is up by 635 basis points from FY24. Margin improvement is due to strategical shift towards high margin formulation products. EBITDA and EBITDA Margin EBITDA for The quarter was Rupees 25. 24 million I.e. 21.1% of sales as compared to Rupees 25. 57 million I.e. 21.7% of sales in Q4FY24 a decrease of 16 basis points from Q4FY24. Professional expenses have gone up on account of consultancy for remediation of US FDA observation that has impacted the EBITDA margin. EBITDA as a percentage of sales for Q4FY25 is up by 83 basis points from Q3FY25.
EBITDA margin is better despite continued professional expenses on account of consistency for remediation of U.S. fDA observation and increase in R D expenses. EBITDA for the year was rupees 9452 million as compared to 8560 million in FY24, a growth of 10% over the previous year. EBITDA improved with a better margin despite APP right and professional expenses incurred for remediation of U.S. fDA observation R D. Our R D expenses for the quarter was Rupees 665 million as compared to Rupees 609 million in Q4FY24 and Rupees 568 million in Q3FY25. R&D expenses for the year was Rupees 2,377 million.
We are going to continue to spend on RD in the coming quarters as well. Net Debt Our Net debt was Rupees 7061 million as compared to 8289 million in Q3FY25. Our net debt was Rupees 8421 million at the end of March 24. Cash to cash Cycle Our cash to cash cycle was 202 days in the current quarter as compared to 213 days in Q3 FY25 and 161 days at the beginning of the year. Cash flow from Operations Cash flow from operations for the quarter was Rupees 3183 million as compared to Rupees 13. 15 million in Q3FY25 and for the year was Rupees 8666 million as compared to Rupees 4394 million in FY24 CAPEX.
CAPEX spent during the quarter was Rupees 1598 million and for the year was Rupees 5700 million primarily invested in Granular Life Science. Of Rupees 3135 million in FY25 ROC ROC for Q4FY25 is 16.6% as compared to 16.4% in Q3FY25 and 16.5% in Q4FY24. With this I open the floor for questions.
Questions and Answers:
operator
Thank you very much. We will now begin the question and answer session. Anyone who wishes to ask a question may press star N1 on their touchstone telephone. If you wish to remove yourself from the question queue you may press STAR and two participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question is from the line of Tushar Manood Hane from Motilal Oswal Financial Services. Please proceed.
Tushar Manudhane
Thanks for the opportunity. Sir, with respect to the same chemicals, what.
operator
I would like to request you to please come closer to your device while asking a question.
Tushar Manudhane
Is this better?
Mukesh Surana
Yes, that’s better. Tushar
Mukesh Surana
sir, just wanted to know in terms of this end chemicals what further investment would be required for next two years to further sort of either integrate with granules and further scale up the capability or capacity.
Krishna Prasad Chigurupati
We have been. We are analyzing the whole situation. We have to. There’s going to be a lot of Capex that has to come up in Switzerland and also we are putting up a peptide R and D facility in Hyderabad and which will be followed by a peptide manufacturing Also some of the developments will happen in Switzerland and commercialization of large volume product will happen here. We are analyzing what we have to do and maybe the next quarter we’ll have a clear idea on this. But definitely there’s going to be Capex on peptides.
Tushar Manudhane
Currently sir, any sales or profits from this entity if you could share that number.
Krishna Prasad Chigurupati
It’s sort of breakeven or a slight loss as of today. Yeah, and I think in the next 1 or 2/4, 3/4 it will continue to be around that level but going forward with the new strategy it should improve.
Tushar Manudhane
And just secondly as far as concerned you said the production disruptively. If you could share FY26 revenue, EBITDA guidance.
Krishna Prasad Chigurupati
We cannot give you any guidance on this. But definitely all I can say it’s going to be better than the last year. And I also want to make it clear that the slowdown on operations in Gagulapur will continue for a quarter or two. Despite that, we think that we will do better than last quarter last year.
Tushar Manudhane
Got it. And just lastly this professional and consultancy fees which would have used paid for Gilapur in FY25 if you could quantify that.
Krishna Prasad Chigurupati
So I’ll just quantify not only professional expenses, all kinds of expenses including air and you know the US consultancy expenses all have been close to 60 crores for FY25.
Tushar Manudhane
And this will not recur in FY26 or there will be some more spending. FY26.
Krishna Prasad Chigurupati
It will continue for Q1 and Q2 but slowly or declining. But definitely till Q2 we see that it should be continuing. We have taken up a complete remediation plan, not a band aid export exercise. So we have a lot of consultants working on the site. So we think that this will continue for some time.
Krishna Prasad Chigurupati
Just clarification, you know the as right may not be as high as what we have incurred in Q3, particularly in FY25. There we are seeing a pro, you know improvement with the better planning.
Tushar Manudhane
Okay. Okay, thank you.
operator
Thank you. The next question is from the line of Rashmit Shetty from Toilet Capital Market Private Limited. Please proceed.
Rashmi Shetty
Yeah, thanks for the opportunity. Just on the Sen Chemicals you said that you will also be exploring the GLP1 opportunity. So which part of the value chain you would be targeting only intermediates or you know the entire formulation part and you will be targeting generic companies, I mean in the CDMO space or you will be targeting, you will be supplying to the innovators.
Krishna Prasad Chigurupati
On the CDMO it will be some of the innovators we are targeting already. And on the GLP wants your question. Basically let me explain a little bit in detail for everybody’s benefit. Our relationship with Sun Chemicals started with us wanting them to develop GLP1 products for us. We give them a contract manufacturing opportunity and and when we saw that they had some very good capabilities we thought we should get hold of that company so that we can also have a kickstart with technologies ready made. And we are working on APIs for GLP1s and we expect to plan to do formulation and formulations. We will be developing in India and getting it contract manufactured for the time being.
Rashmi Shetty
And it will be for various markets like because India and the other emerging markets are already opening up, you know from March 25 end.
Krishna Prasad Chigurupati
India markets also but will be little late for India market starting now because Our API will be available after a while, but definitely for the US market. US is the biggest target we have. We have to wait for a while. But the other GLPs going forward we have lot of time and we will be targeting all markets at one time.
Rashmi Shetty
Okay, and you mentioned that, you know, EBITDA or the PAT currently is at the breakeven level or slightly lost. But what is the current sales from CEN Chemicals and what kind of products are being manufactured over here?
Mukesh Surana
So currently they are doing roughly 20 million CHF a year and with the breakeven EBITDA and they are largely into CDMO related to peptides, pharma, cosmetics and carnotics. And they also have amino acid derivative largely, you know.
Rashmi Shetty
Okay, so with the, you know, CapEx, you know, plan forward for CEN Chemicals and plus you know, we also have ongoing CAPEX for granules. So put together what will be the capex guidance for FY26 and FY27.
Mukesh Surana
So currently we have done estimate for FY26. FY27 we are still, you know, working in, working on. So FY26 capex estimate is about 600 crores. This includes, you know, further capex which we have to incur for granular lifestyle and also oncology and peptide inversion.
Rashmi Shetty
This includes the send chemicals CAPEX also. That will be additional in case if you plan it.
Mukesh Surana
Yeah, this includes that as well.
Rashmi Shetty
Understood. And on the GLS, you know, phase two, that is 7.5 billion dosage. The entire CAPEX is over or you know, that extra amount is going to come in FY26 also.
Mukesh Surana
It will come in FY26 also.
Rashmi Shetty
Okay, so the plant is not ready for 7.5 million doses billion dosage.
Mukesh Surana
Sorry, we do have some CAPEX creditors and also we are incurring additional, you know, CAPEX expansion in terms of packing facility and some test fits. All of that will be spent in.
Krishna Prasad Chigurupati
F20 but commercialized already started in the new phase two rationing.
Rashmi Shetty
Okay, but the capacity, total install capacity currently is not 7.5 billion. I mean it is ongoing, right?
Krishna Prasad Chigurupati
No, no, no. We have already 2.5 billion in phase one. And this will be.
Rashmi Shetty
Yeah, that is first phase. So that is your first phase.
Krishna Prasad Chigurupati
That’s right. 7.5 billion is, I think you can say 7.5 billion capacity by next month. Okay, 7.5 billion from next month. But it will take us time to get into full utilization because we must need to get the approval from the FDA and the European authorities which we expect to have in Q2 once we get these approvals, we’ll start full production and then I think by possibly this year we may do about 40%, 50% capacity utilization and close to 90% by next.
Prachi Andre
Got it. So 7.5 billion dosage will get over by you. We can expect by Q2 of FY26 the capex will get over.
Krishna Prasad Chigurupati
No, no, no, no. It will be 27.
Rashmi Shetty
27. Okay, okay.
Krishna Prasad Chigurupati
Close to 190 or so.
Rashmi Shetty
Got it, got it. And just on the gross margin, so you know, we, we had a strong formulation sales during the year and that is why with the help of good business mix, our gross margin was 61.5% during the year. But what are we expecting for the API and PFI segment from the last two consecutive years? Due to the external factors we have seen a decline. But whether any small growth or anything we can expect in these two segments and if the sales increase of these two segments, you know, FY26, the gross margin would decline or it would be at the similar level.
Krishna Prasad Chigurupati
First of all, all the APIs and PFIs we make are slowly getting consumed in house. So it’s a vertical integration that’s giving us the benefit. Except paracetamol, API, where we have a large capacity, other APIs are all being used in house. So paracetamol, we had quite a substantial API sale which has been impacted by extra capacity created in the world. And so instead of trying to push more API into the market as negligible margins, we are concentrating on converting most of it into PFIs and FDs. So we will see the FD at this level or possibly increase a little bit more. Definitely. I can tell you API percentage will not increase.
Rashmi Shetty
API percentage will not increase. So year on year we will see a small decline or maybe flattish.
Krishna Prasad Chigurupati
Yeah, because all that is the capacity.
Rashmi Shetty
Going into getting converted to the fds. Got it, got it. So then this kind of gross margin is sustainable?
Krishna Prasad Chigurupati
We hope to. And we are confident as of today, definitely.
Rashmi Shetty
Okay, okay, got it, sir. And one last question just on the Europe business, you know, we have seen for quarter four and for the full year decline, whereas even in the rest of the world we have seen a decline. Your other markets like India and US has done well. So is it mainly because of the paracetamol and the API segment impact which is actually reflecting in the geographies like Europe and all?
Krishna Prasad Chigurupati
Yeah, you’re perfectly right. Europe was mostly driven by API with some of the big brands and there was a slowdown there, slowly picking up. But I don’t think it will go back to where it was. The price erosion continues to stay. I don’t think we’ll get back to the old levels which actually was helped during COVID And except for very valued customers, we do not plan to sell paracetamol. And European sales will be mostly driven by formulations where we had a lot of filings. There was a little delay in launching this product. And once these products are launched, European sales will increase, but as a percentage it may remain the same.
Rashmi Shetty
Okay. Okay, got it sir. Thank you. That’s it from my side.
operator
Thank you. The next question is from the line of Tarang Agarwal from Old Bridge. Please proceed.
Tarang Agrawal
Thanks A good evening and congrats for a reasonable set of numbers given the background of Kagalapur. So three questions, sir. Firstly on. So what’s the. Milestones? And.
Krishna Prasad Chigurupati
You’Re breaking up sir, and I can’t hear you properly.
Tarang Agrawal
Yeah, audible.
Krishna Prasad Chigurupati
Yeah, but let’s try again.
Tarang Agrawal
Okay, so what are the. This is basically with respect to the Sean Kim acquisition, what are the medium term milestones and say slightly longer term milestones that you’re looking at? And a subsequent question, you know, given the strategic nature of this acquisition, how should we calibrate the eventual success or failure of this acquisition?
K.V.S. Ram Rao
On the cell acquisition, the medium term I think we will be focusing on a improving the CVMO segment. So as already mentioned in the speeches that there are four areas where there is already enough customer base and also there is a lot of potential and we will be exploiting this potential on both the science technology as well as the infrastructure to enable SEN to be competitive, diversified and lead to a kind of a good CDM role play in the medium to long term, that is one segment, second segment, the GLP1s as already mentioned by Chairman, we actually started our journey with them on GLP1s and we have gone quite a bit of distance in development of the products.
So this will become an important journey in terms of looking at GLP1s and therefore using this knowledge, experience and technology to look into various fragments of GLP1 both for CDMO business and also for the granules consumption. I think that will be the long term approach to CEF.
Krishna Prasad Chigurupati
And the strategic importance is that we have access to good capabilities rather than starting from scratch. So it’s just going to be transfer from there to India for increased volumes of DLP1 to start with. And then there are various other peptides we want to concentrate on as we go by.
Tarang Agrawal
Got it, got it. The second I mean your R and D clip has been quite significant especially in the last five years. How are you measuring the productivity of your R and D spends? I mean if you could help us with some anecdotes it will be quite helpful.
K.V.S. Ram Rao
So RD spend productivity is seen through one the number of quality filings that we are doing both in US and Europe in ADHD and oncology segments. I think that’s the first measurement that we see. The second measurement is on the value of the filings. So the NCE minus one the first two files are the differentiated filings. So I think we have been very consistently maintaining that our portfolio is going to be focused on ADHD and oncology segments and the measurement of filings. And you already see that we have Lisdex amphetamine tubules and and oral tablets approval as a beginning of our journey into the ADHD segment.
So we are very clear on the number of filings globally and also in specific geographies as one big productivity measure. And I think we are pretty satisfied with the kind of progress we are making on our R and D spend and its productivity.
Krishna Prasad Chigurupati
Taran we also have a benchmark for return on investment of one particular anda how many times of that in what period and these are different numbers for regular products, P3 products and for going forward with first two files and all it’s going to be in other aspects. So we are fairly happy with the progress and the returns we are getting shot out.
Tarang Agrawal
Just last question sir. With whatever uncertainty that’s been sort of been created over the last 23 months with the impending tariffs given your significant exposure to the US our how people looking at it, I mean you positioned or how I mean what are the conversations that are happening internally to address the eventuality if at all it would.
Krishna Prasad Chigurupati
Do it more than internally. I think external communication is important. We are talking to all our customers in the US about the possible impact and we have been mentioning that if duties come in we will have to increase prices. There is no way we can absorb this and we don’t see too much resistance as of today. But let’s see when it actually happens what the impact will be. And my feeling is this is going to impact everybody, just not us and it’s a level playing field and there may not be too much of an effect because everybody is going to get hit with this tariff and there’s so much anybody can absorb on margins, especially. Products. Genesis long ago
Tarang Agrawal
got it. And last I mean Mukesh on CapEx what’s the CapEx number for FY26
Mukesh Surana
600 crores. That is what we stated.
Tarang Agrawal
Okay. And Sean Chem is on top of that. So about 1100 crores of outlay, correct?
Mukesh Surana
Yeah, you are right. Then chemical investment is on top of that. That is, you know, equity plus debt put together. 450. As you know, when we did that. Okay, thank you. All the best.
Krishna Prasad Chigurupati
Thank you.
operator
Thank you. The next question is from the line of Sahil from MNS Associates. Please proceed.
Sahil Vora
Hello sir. Thank you for the opportunity. So I have a couple of questions. Firstly, regarding the new formulation facility at John Valley which commenced commercial dispatches. Sir, could you discuss the impact of it? Could you discuss its impact on the overall capacity and revenue?
Krishna Prasad Chigurupati
Only phase one has been commercialized and phase two is under commercialization right now. It should happen within a quarter or two. So there has been like we said, a slowdown in Gagalapur till the FDA remediation is completed. There will be slowdown because of various activities that are being undertaken there. So all that from this quarter, both to some extent and Q2 in a better way will be made up by GLS and also from our US sites with new product launches. So going forward, Genome Value site is going to play a very important role in our revenue.
Because even when Kagalapur returns to full normalcy, the demand for our products we foresee will be increasing. And we definitely see that this site will contribute quite a bit.
Sahil Vora
Understood, sir. Secondly, how is the company addressing the decline in European sales And what are the plans to regain market share in that region? If you can shed some light on that.
Krishna Prasad Chigurupati
I just mentioned a little while ago that Europe was mainly dominated by paracetamol API sales. And now API sales demand has come down and we are moving the APIs more into PFIs and formulations that have been happening in US and other places. And this will Paris atmosphere API will improve a little bit. But we do not see it going back to the old times. And we will make up for European sales web formulations where the margins also will be high. And we had a delay in launches of some products and we expect that to be back on track.
And sales will definitely improve. But as a percentage, I said a little while ago, will not be US will continue to be the biggest growth driver.
Sahil Vora
Okay, sir, thank you. That’s it from my end. Thanks.
operator
Thank you. The next question is from the line of Varun Mishra from SK Investment. Please proceed.
Unidentified Participant
Hi sir. Thank you for the opportunity. Sir. So I had a couple of questions so wanted to know like from North America, like we have been accounting almost 79% of our total revenues. As for Q4 and FY25. So like what are our strategies in place to diversify geographical revenue mix?
Krishna Prasad Chigurupati
Yeah, we do have a strategy. Priyanka, would you like to take that?
Unidentified Speaker
Sure, I’ll take that question. So we’ve been working on the North America strategy for almost 10, 10, 12 years now in terms of filings etc. So that market has been and will continue to be our biggest growth driver. But if you look at the number. Of filings that we’re doing in other regions this year We’ve done about 11 filings for Europe and we continue to increase that momentum. In addition to that, we are framing. Up the strategies for the rest of the world for finished dosages and plan. On increasing our existing current API and PFI business as well. So going forward you’ll see an absolute increase in numbers coming from row markets as well. But again, I just want to reiterate that the US the size of the market is so big that even for us that will continue to be a focus.
Unidentified Participant
All right ma’ am, thanks a lot for that. So my second question was around what is your outlook on the API and the PFI segments? Could you like give the current contributions to the revenue? How are they contributing? Could you throw some light on that?
Krishna Prasad Chigurupati
Yeah, currently it is less than 25% and this is how the trend also we see going forward as chairman clarified in the earlier conversation, so we are producing API more for in house consumption. So we are focusing more on formulation. So this trend of, I know around close to 25% of API PFI will be in that range.
Unidentified Participant
All right, so my last question is, can you please provide an update on the CAPEX spend on the GLS and the czro projects in FY25? How do we see these projects like contributing on the top line in the coming years?
Krishna Prasad Chigurupati
So in terms of CAPEX investment I had you know clarified in my speech, we have spent about 313 crores in FY25 and we have further in left investments left amount to be spent in FY26 also in granular lifetime and in C0 we are going slow. We have not incurred much in FY25. Largely whatever we have incurred is on the land which was incurred a year before and some pilot, you know facility which we have incurred over the last two years. C0 is we are cautious and going slow At a right appropriate time we will do. In terms of priority, the GLS expansion is our priority and also the new oncology and peptide facilities are our priority in terms of near time revenue. We don’t expect much from C0 immediately in near term and also similarly from peptides in the near term. In terms of revenue other than the acquired revenue percent in terms of granular life science, Our chairman has clarified that this year it would be about 40% of capacity utilization. Next year it will be closer to 90 plus percent.
Unidentified Participant
Alright. So thank you. That’s all from my side, sir. Thank you and all the best.
Krishna Prasad Chigurupati
Thank you.
operator
Thank you. Before I take the next question, I would like to remind participants that you may press star N1 to ask a question. The next question is from the line of Mr. Doshi from an individual investor. Please proceed.
Unidentified Participant
Hello sir. So thanks for the opportunity. I hope you can hear me.
Krishna Prasad Chigurupati
Yes, yes. Mr. Doshi.
Unidentified Participant
Yep. I just wanted to have some color on the oncology portfolio that we have you just mentioned that we filed one U.S. anda. I wanted to understand what are the total number of molecules that we have here in the pipeline and where are we in the development or regulatory timeline along with any market sizes for the same. If you can share.
Krishna Prasad Chigurupati
On the oncology pipeline, as I mentioned in my speech that we have already filed one molecule in the US and European segment and we have a good double digit pipeline of oncology products which will be as I told before that which will be LC minus one segment. Some of them are first to launch, some of them are therefore 181. And most of these products are for global development. And as mentioned by Priyanka that we are building our Europe and Harwood upload new business and oncology will become a significant element of this building of the business in terms of PFI stroke the formulation business. So overall this is the portfolio. And we expect this portfolio to start yielding US revenues from FY28 onwards.
Unidentified Participant
Okay? Okay. All right. Got it, sir. So this was the first filing. And do we expect to see filing every quarter or every six months from now on?
Krishna Prasad Chigurupati
I think every quarter we make the progress in terms of filing. But you know R D and therefore I would not like to say quarter or this one. But we have a fairly good idea about the timeline of filing in US and in other geographies.
Unidentified Participant
All right, got it. And just an extension that extension to that one. We would be here looking at making the API in house with full integration and then going on to the formulation or how are we thinking about it as granule strategy.
Krishna Prasad Chigurupati
And as you heard there were challenges a few minutes ago. I think most of it will be vertically integrated. So entire differentiation in the API comes completely from a vertical integration, and that is one of the reasons and also one of the strategies for selecting our portfolio.
Unidentified Participant
All right. Okay. Thank you so much, sir. That’s all from my side. All the best.
Krishna Prasad Chigurupati
Thank you.
operator
Thank you. As there are no further questions, I would now like to hand the conference over to the management for closing comments.
Krishna Prasad Chigurupati
Thank you very much, ladies and gentlemen. It’s been an interesting discussion, and I look forward to meeting you all once again in the next earnings call with possibly better results. And till then, have a great day and a great time ahead.
operator
On behalf of Granulous India Limited Q4FY25 earnings conference call. That concludes this conference. Thank you for joining us. And you may now disconnect your lines.