Note: This is a preliminary transcript and may contain inaccuracies. It will be updated with a final, fully-reviewed version soon.
Granules India Ltd (NSE: GRANULES) Q4 2026 Earnings Call dated Apr. 29, 2026
Corporate Participants:
Krishna Prasad Chigurupati — Chairman and Managing Director
Sanjay Kumar — Chief Strategy Officer
Mukesh Surana — Chief Financial Officer
Priyanka Chigurupati — Executive Director
Analysts:
Prachi Ambre — Analyst
Hareer Ahmed — Analyst
Unidentified Participant
Tushar Manudhane — Analyst
Unidentified Participant
Unidentified Participant
Unidentified Participant
Krisha Kansara — Analyst
Unidentified Participant
Ritwik Sheth — Analyst
Unidentified Participant
Presentation:
Operator
Ladies and gentlemen, good day and welcome to Granules India Limited Q4 and FY26 earning conference call hosted by MUFG. This conference call may contain forward looking statement about the company which are based on the beliefs, opinions and expectation of the company as on date of this call. These statements are not the guarantee of future performance and involve risk and uncertainties that are difficult to predict. As a reminder, all participant line will be in the listen only mode and there will be an opportunity for you to ask question after the presentation concludes.
Should you need assistance during the conference call, please signal an operator by pressing Star then zero on your touchtone phone. Please note that this conference is being recorded. I now hand the conference over to Ms. Prachi Amre from MUFG. Thank you and over to you Prachi.
Prachi Ambre — Analyst
Thank you Danish. On behalf of Granules India Ltd. I extend a warm welcome to all the participants on the Q4 FY26 financial results discussion call today. On the call we have Dr. Krishna Prasad Chigurupati, Chairman and Managing Director, Ms. Priyanka Chigurupati, Executive Director, Mr. Mukesh Surana, Chief Financial Officer, Dr. P.V. Srinivas, Chief Technology Officer and Mr. Sanjay Kumar, Chief Strategy Officer. Before we begin the call, I would like to give a short disclaimer. This call contains some of the forward looking statements which are completely based on our expectations, beliefs and opinions as of today.
The 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 Krishna Prasad sir for his opening remarks. Over to you sir. Thank you.
Krishna Prasad Chigurupati — Chairman and Managing Director
Thank you Prachi. A very good evening to all of you ladies and gentlemen and thank you very much for joining us today. I appreciate your continued interest in Granules India and welcome you to our Q4 and full year FY26 update. We have shared a detailed presentation on our financials and operating performance and I trust you have had an opportunity to review it. Q4 and full year FY26 FY26 marked a year of deliberate reset and measurable progress for Granules India. Following a period of regulatory and operational correction, the organization stabilized performance strengthened execution and made clear strategic choices to reposition the business for sustainable and value led growth.
The year demanded discipline and focused while external cost pressures and regulatory remediation continue to weigh on operations. Granules delivered steady improvements across compliance, operations and portfolio quality. By the close of FY26, the company had materially strengthened its foundation and is better prepared for the next phase of growth. Strategic and business progress FY26 was a defining year for the organization’s operating platform. The GPI facility in Virginia reached its targeted operating potential and demonstrated consistent performance through the year.
Capacity expansion and the ongoing development of a new distribution center further reinforces the site’s ability to support future growth and scale. I am happy to share that as per IQVR, GPI as a company had moved to 27th position of all US generic companies in terms of sales value in FY26 as compared to 74th position in FY21. It also stands at 4th position in the control substance space. The acquisition of CEN represented a deliberate strategic expansion into the CDMO segment. The business turned EBITDA positive within the third quarter post acquisition, validating the investment thesis and establishing Peptides and CDMO as a meaningful long term growth engine for granules.
Equally important, FY26 saw continued and intentional evolution of the product portfolio. The company accelerated its shift towards more complex and differentiated products. The transition is already strengthening competitive positioning and opening pathways for higher value opportunities, including potential first to files. Financial and operational Performance the fourth quarter concluded a year of stabilization and strengthening fundamentals. Momentum improved sequentially through the year with Q4 reflecting operational stability across both finished dosage businesses.
Improved across both API and finished dosage businesses improved compliance readiness and consistent execution against stated priorities. Finished dosages remain the core business, contributing 74% of revenue. Europe delivered strong growth of 81% year on year and now represents approximately 15% of total revenue. Without CEN, Europe represented a 49% growth. Most notably, peptide CDMO emerged as a fourth revenue pillar, generating $1,593 million in FY26 revenue and delivering a positive EBITDA in Q4.
These results were delivered despite elevated logistics costs and ongoing remediation expenditure, underscoring the benefits of a diversified footprint, disciplined execution and improved business resilience. Quality, regulatory and compliance Quality and compliance remained an uncompromised priority throughout the year at Gagilapur. Remediation activities progressed materially with cleaning validation completed across all PFI mupps and finished dosage blocks using dedicated equipment. The post warning letter engagement with the US FDA was completed in January with all action point responses submitted in February and regular progress updates maintained thereafter.
During the year, regulatory inspections were successfully completed across key sites. The GLS facility at Genome Valley received an EIR with VAI following the inspection. The Chantilly GPI facility underwent a routine U.S. FDA inspection in March March to April 26th resulting in four procedural form 483 observations with no data integrity findings. Responses were submitted within the stipulated timeline. The GCH facility in Virginia completed its inspection with zero observations. Beyond individual inspections, the organization continued to systematically strengthen its quality systems.
Investments in digital quality infrastructure including electronic logbooks, calibration management, document control and MES implementation are now materially enhancing compliance, rigor, traceability and operational effectiveness. Safety ESG and Sustainability Safety remains non negotiable across all operations. The FY26 closed with a clear reduction in reportable injuries. Visible progress towards a more proactive accountable safety culture. ESG performance continued to strengthen and gain external recognition during the year.
Granules achieved the Ecovages Gold rating, received an A rating from CDP for Climate Change and recorded strong scores across Water, security and forests. The company’s S and P Corporate Sustainability assessment score improved to 62, placing granules amongst the top 10% of the global peers. The company further reinforced its commitment to responsible growth by becoming a signatory to the UN Women’s Empowerment Principles. Bangalapur facility achieved zero waste to landfill Platinum plus certification with similar programs progressing across other sites.
R and D filings and Portfolio Development R and D efforts were firmly aligned to portfolio depth, complexity and Future Readiness. During FY26, granules continued to advance filings and approvals across APIs and finished dosages with a clear emphasis on complex generics. During the year we filed a total of 6 US ANDAs, 3 EU dossiers, 1 Canadian dossiers and 15 filings across various regions. We filed 6 US DMFs, all to support integration of complex products and 10 other DMFs across the various regions.
Complex generics accounted for a meaningful share of total filings, reinforcing the long term direction of the development pipeline and the Company’s focus on sustainable value creation outlook. Cranios enters FY27 with improved stability, clearer priorities and greater organizational confidence. The focus in the year ahead remains unambiguous, achieving sustained US FDA readiness in scaling commercial contributions from jls, accelerating the shift towards complex and differentiated products and maintaining disciplined capital allocation.
The company is also preparing for potential US Product launches as approvals progress, including nine applications awaiting clearance from Kagilapur site, ongoing product transfers across Sites will further strengthen continuity, resilience and risk mitigations. While external uncertainties remain. Granules is materially positioned today than a year ago. The strengthened operating platform, healthier balance sheet and sharper execution discipline provide a solid base for delivering long term shareholder value.
Finally, FY26 was a year of recalibration and rebuilding. The progress achieved was necessary, deliberate and foundational. Cranules now moves into its next phase with greater clarity, confidence and control. Thank you very much and I pass this on to Sanjay for detailed explanation on the CEN Chemicals peptide business.
Sanjay Kumar — Chief Strategy Officer
Thank you Chairman Sir Good afternoon everyone. Let me briefly update you on the progress of our peptide CDMO platform. Acelix Peptides and CEN Chemicals Q4 performance was in line with the direction we had indicated earlier. Revenues improved meaningfully supported by planned pharmaceutical deliveries and robust cosmetic offtake during the quarter. The quarter also marked a return to positive EBITDA performance reflecting progress from transition into execution phase. We did ensure certain additional operating expenses linked to an important customer program including higher manpower deployment and additional shifts.
These are largely associated with first campaign of such nature. During the quarter we also executed multiple programs across RD projects, development of TFA free cosmetics and supplies and sample seeding initiatives for prospective pharmaceutical customers. On the organization front, we have moved to a leaner management structure at SAM with a focus on execution and accountability and we have rolled out our long term incentive for key executives at Zurich facility. We are also progressing well on infrastructure upgrades at Zurich side and planning the next phase of Peptide API capacity on the India side.
Our peptide CoE at IIT Hyderabad is now fully active and working in a very close collaboration with our Zurich R and D team on multiple live customers projects. The next stage in India journey will be a brownfield manufacturing facility for Peptide Intermediate which is expected over the coming months followed by a Peptide API capacity in India at the appropriate stage for NY27 though our focus is to deliver a pat positive performance on an annual basis while recognizing quarter to quarter variations inherent in a project driven CDMO business like ours.
Overall we are highly excited by the opportunity in the Peptide CDMO space and by the fact that customer access, credibility and technical heritage that send brings to our Peptide playbook. With that I will now hand over the call back to Mukesh to take you through the financial performance.
Mukesh Surana — Chief Financial Officer
Thank you CMD sir and Sanjay. Good evening everyone. I will now walk you through the financial performance for Q4, FY26 and the full year. FY26. FY26 has been a landmark year for the group this year we crossed a landmark number of 50,000 million in revenue, posted six straight quarters of sequential growth, record gross margin and demonstrated that the strategic priorities we placed three to four years ago, including complex generics are now delivering the revenue growth. Revenue for the year stood at 53,656 million, registering a 20% year on year growth.
Growth was broad based driven primarily by formulations in North America and Europe. Peptide CDMO business is a new revenue vertical following the acquisition of CEN Chemicals AG. This vertical added Rupees thousand 593 million revenue contributing 3% of the overall revenue. Revenue for the quarter was 14,706 million up 23% year on year and 6% sequentially, marking our sixth consecutive quarter of sequential growth. The sales breakup as per business divisions and geographic regions are presented in our investor presentation which is available on the website.
Business diversification is improving the resilience and sustainability of revenues. Gross margin FY26 gross margin expanded to 65% an improvement of 355 basis points year on year. This expansion is on account of a sustained shift towards complex generics and higher contribution from value added formulations. Q4 FY26 gross margin improved to 65.7% up 233 basis points year on year and 186 basis points quarter on quarter with growth particularly from Peptide CDMO converting into margin expansion. Gross margin rose from 50% in FY22 to 65% over four years, demonstrating our sustained strategic progress.
EBITDA and profitability. EBITDA for FY26 stood at 11,851 million up 25% year on year with margins expanding by 100 basis points to 22.1%. This clearly demonstrates the structural improvement in earnings quality. This EBITDA in FY26 includes loss of 445 million in SLS. The peptide CDMO platform acquired during the year Q4FY26 EBITDA stood at 3521 million, growing 40% year on year and 14% quarter on quarter with margins expanding to 23.9%. Q4FY26 marked the first quarter of positive EBITDA in our acquired Peptide CDMO business which is an important milestone.
R and D, R and D remains central to our long term strategy. R and D expenses for FY26 was 2853 million representing a 5.3% of sales. Our focus area include C2, ADHD, Oncology, Mupps and other high barrier formulations. These investments are laying the foundation for sustained differentiated growth which will continue to invest in R and D in the coming quarters. PBT and PAD FY26PBT before exceptional items grew 26% year on year and PAD grew by 19% year on year. Rupees 5595 million post exceptional items Q4FY26PBT before exceptional items grew 48% year on year and 22% sequentially and PAT grew by 33% year on year to Rupees 2015 million and 34% sequentially.
Post exceptional Items Net Debt Net Debt reduced to 4021 million from 7061 million in FY25. Net debt to EBITDA improved to 0.34x from 0.75x. The reduction in net debt was supported by an additional equity infusion of rupees 6656 million during FY26 in addition to EBITDA growth in FY26 working capital net working capital percentage to sales remained at 33% to sales in line with FY25 with higher working capital to support growth in FY26 cash flow from operations FY26 cash flow from operation was 7933 million compared to 8666 million in FY25.
Cash conversion was moderated due to planned working capital buildup to support growth and new launches. Capex spent for Q4FY26 was 1000 million compared to12.98 million in Q3FY26 full year FY26 capex was 5547 million compared to 5700 million in FY25. Roce Roce improved to 17.6% as compared to 16.8% in Q3FY26 16.6% in FY25. With this I open the floor for questions. Thank you.
Operator
Thank you so much sir. Ladies and gentlemen, we’ll begin with the question and answer session now. Anyone who wishes to ask a question may press star and one end that touched on telephone. If you wish to remove yourself from the question queue, you may press star and two participants are request to use handsets while asking a question. Ladies and gentlemen, we’ll wait for a moment while the question assembles. The first question come from the line of Harith Ahemad from Avidis Park. Please go ahead.
Questions and Answers:
Hareer Ahmed
Good evening everyone. Thanks for the opportunity. Sir, will you be able to comment on the pricing environment for paracetamol and Metformin? Currently has there been any increase following the situation in West Asia and also looking at a 33% growth for the UPI segment this quarter. So wondering if there were any benefits from a better pricing environment.
Krishna Prasad Chigurupati
Interesting question, Hareet. Definitely there were no price increases we wish we had. Whereas raw material prices have gone up and are still going up. There’s a small. I mean there is a little bit of uncertainty but we are sure we should be getting price increases to compensate for the raw material increases. So to answer your question, to clarify, the growth in API was due to new APIs that we have been launching and the APIs that we develop for our own integrated formulation development we also sell outside and those have contributed mainly to the growth in APIs.
Hareer Ahmed
Okay, got it sir. And on Ascens peptide, good to see the strong performance this quarter and the EBITDA break even. Just wondering how we should think about the coming quarters. Is this a sustainable level of performance that we should extrapolate into the coming quarters?
Krishna Prasad Chigurupati
I think. Let’s hear from the horse’s mouth. Sanjay, can you answer that?
Sanjay Kumar
Sure. For driving
Krishna Prasad Chigurupati
The growth of SLS peptides and sand chemicals. That’s for clarification. Yeah, go ahead.
Sanjay Kumar
Yeah. So Harith, our objective is very clear to move towards sustainable profitability from FY27 onwards. Individual quarters may vary depending on customer milestone and shipment timing but the platform is now far more execution led and operationally aligned than before. So the direction of travel is firmly towards annual EBITDA and part positivity.
Hareer Ahmed
Sanjay, if you could comment a bit on the business mix here. Pharmaceuticals versus other segments like cosmetics and within pharmaceuticals, what exactly are we supplying? Peptide building blocks or fragments or APIs. Some qualitative color will be helpful.
Sanjay Kumar
Sure. So what you just mentioned already that our business is a mix of pharmaceutical and cosmetics and both are important. Although the opportunity space for peptides AP pharmaceutical is quite good. Our customers vary multiple across I would say three dimensions. One is the big innovator, the big pharma itself and the second one is the virtual biotechs, the startup biotech ecosystem that is looking for a very agile and responsive CDMO to work on their earlier clinical program. And the third is interestingly is we are all partners.
While we might be a competitor in certain spaces. So there are different players across the value chain of peptides and a CDMO space. And we also work collaboratively with the other players in the peptides value stream. So that’s on the pharmaceutical side, on the cosmetic sides that’s definitely a strong pillar for us. And we’ve seen some increased traction starting last two quarters especially in the last quarters where our focus on developing and supplying TFA free peptides has got a good attention and a good traction with customers.
So we are working on multiple projects on making the cosmetic peptide TFA free. So those two are the broad, I would say details on the two sides. Since our base is quite low on both the businesses, the growth opportunity is quite immense. So it’s a complete blue ocean for us.
Hareer Ahmed
And last one sir, specifically on granules C0 so we had set up a pilot plan for DCDA in Vizag and so if you can comment on the scale up on this front and you know what are our plans and what’s the kind of capex that we’re looking at. How has been the progress? So these are some of the questions.
Krishna Prasad Chigurupati
Yeah, it was and is still a dream project being the only DCDM manufacturer outside China. And yes we did stabilize our production. But then what has happened during the process is the Chinese competition, they started reducing prices drastically and we have been trying to do better than them or at least meet those prices and we have been still improving our processes. So I think we are close to wrapping up the pilot stage and getting into commercialization. I think another two months to two and a half months we should wrap up and then we should go ahead with ordering equipments for the commercial plant.
So the project should cost somewhere around 200 crores and we’ll freeze the numbers shortly.
Hareer Ahmed
Got it sir. Thanks for taking my question.
Operator
Thank you. Our next question comes from the line of Shashank Krishna Kumar from MK Global Financial Service. Please go ahead.
Unidentified Participant
Hi, thanks for taking my question. My first one was on the gross margin expansion that we have seen QoQ. I think the sale of API this quarter was still higher. So just trying to understand what has driven the sharp GM expansion on a QQ basis and also wanted to try and understand how should we look at it look at gross margins going forward. Given that input costs are sort of inching up though the mix improvement will also sort of play out. Just want to get your thoughts on how we should look at GM for FY27.
Mukesh Surana
Thanks Krishna. Mukesh this side. So quarter on quarter sequential gross margin improvement is primarily because of CDMO business which has significantly grown from 33 crores to 70 crores where the VA percentage gross margin percentage significantly higher. That has helped the margin expansion for the quarter. With respect to our second question, Chairman has elaborated, you know and also you know, current war situation, cost escalation situations, it is little uncertain in terms of giving margins clarity in terms of percentage but of course we are trying our best to get the entire raw material cost escalations.
Unidentified Participant
Got it. Second, just my second question on the CAPEX plan for FY27 28 if you could just sort of highlight how you are looking at it in terms of the overall figure and as well as which are the areas where we should see the incremental investment being deployed. If you could just share that
Mukesh Surana
Next year the capex will be broad based. You know there is a new APA facility which we are doing. In addition to that we are also investing on the IT side and we are also planning for, you know as part of chairman speech also it was covered the distribution center, warehouse distribution center in usa. So it will be broad based multiple capex projects in the coming year.
Unidentified Participant
Any figure which you could sort of share.
Mukesh Surana
So we are talking about in the similar range of 600 odd crores in the upcoming year 200 crores plus will be for distribution.
Unidentified Participant
Got it, Got it. Just last one if I may squeeze in. So if you can follow the remediation spend cumulative for FY26 and what is the kind of remediation spend that we should expect probably from 1Q onwards,
Mukesh Surana
FY27 onwards it should be substantially lower which has already come down Q3 Q4 expenses were very high in H1 cumulatively only the remediation expenses we have incurred, you know close to 50 plus crores in the current year. Got it. Thank you, I’ll join that.
Operator
Thank you. Our next question comes from the line of Tushar Manudane from Motila Loswell. Please go ahead.
Tushar Manudhane
Am I audible?
Operator
Yes you are.
Tushar Manudhane
So sir, as far as, as far as West Asia issue is concerned as far as freight cost will just to have understanding correct the freight cost increase will get reflected immediately in the coming quarters. But as far as passing on of the increasing the raw material prices will that have a lead lag impact? And secondly we would have certain inventory already which will take care for at least 12 quarters. If you could just you know help us with that trajectory.
Krishna Prasad Chigurupati
You have today’s there are inventories and we can wait for a while. It’s not going to be overnight price increases, it’s going to take a while and that will take care of the current inventories will take care of that. But all said and done, still uncertain period. While we are confident that over the year we’ll be fine quarter on quarter variations may be there and yeah we have got to get used to the uncertainty and work towards improvement.
Tushar Manudhane
Got it. And as far as the Peptide or the Shen chemicals business is concerned. If you could just break down the revenue into projects which are at R D and do the commercial manufacturing.
Krishna Prasad Chigurupati
Sanjay,
Sanjay Kumar
We rather not get into that exact split but I think for it’s sufficient that this is a project initiated pipeline. So whatever is at the commercial stage are result of our development in the past. We do have a lot of exciting projects underway but I will not like to at this point in time split the revenue and give the details along those lines.
Tushar Manudhane
Broadly just to understand that at least for FY27 28 while the investment is underway which is 200 crores but prior to that how the scale up of business is expected to happen Is it like more projects driven increase or it’s more commercial manufacturing?
Sanjay Kumar
So I understood the question. So let me just give you that we are working on some active projects which would have a commercial supplies pipeline although at a development stages, various clinical stages that we are seeing a few interesting projects. We got at least one project graduated to a stable commercial supply starting this financial year so we are working on few of those as well. Given the business size is low currently low base effect it may be not prudent for me to call out those specifically and club it together into six.
But we do have a very interesting program which could drive the future growth.
Tushar Manudhane
And just lastly on the overall net debt for the company considering the projects in terms of capital expenditure as well as working capital probably increase requirement maybe not immediately but if the situation prolongs then what kind of net debt we should sort of build for FY27
Mukesh Surana
There can be a, you know, flattish net debt or a slight increase depending upon you know, the timing of the capex and increase in the growth in the current uncertain period because of the cost escalation the working capital investment is also going to be higher side so you know there will be small increase in very small increase in the net debt.
Tushar Manudhane
Thanks. Thanks. That’s it from.
Operator
Thank you. Our next question comes from the line of Sijal Kapoor from Anti fragile thinking. Please go ahead.
Unidentified Participant
Yeah, thanks for the opportunity. Hi team. Congratulations on an amazing execution despite the Gagila pool constraints. I have a few questions please. What proportion of granules current and upcoming CDMO capacity is already tied to or tied to committed or late stage customer programs? And what utilization level would you fall to if let’s say a hypothetical scenario, your top two or top three projects were to be delayed or cancelled?
Krishna Prasad Chigurupati
Sanjay, you want to go with that? Thank you Sajal first of all
Unidentified Participant
Thank you.
Sanjay Kumar
Yeah, so Sajal, see we are in terms of utilization, our capacity today is not very large but we do not want, we are not expanding unresponsibly. Our approach towards CAPEX deployment is also always demand link and as the customer program progresses we are investing and that’s the promise with which we are approaching the customers. Having said that, the utilization in the Q4 was at a healthy level and at the same time we are building capacities that will come online towards the second half of the year and our visibility, if everything is all right, is we will be quickly seeing a full utilization to that.
So there are capacity that we’re building in Zurich, the capacity that we will be building in India especially on the intermediate side and we see a quick utilization turnaround within the year itself on those capacities. But the larger point is we haven’t built capacity ahead of time. We are doing it concurrently and we are doing it as an optionality in a close, I would say partnership with the customers and quite close disclosure. Closer where we have been open to them and open with the willingness to invest in the future capex should they choose to and as and when the program advances.
Unidentified Participant
No, that’s helpful. So I think if I translate what you said Sanjay, it’s not any speculative. It’s tracking either a verbal commitment or tracking a late stage client program. So the capacities are not created for the heck of it that that’s how I translated. And if you could also clarify what is the level of customer concentration? I mean typically what happens is at a low base and this has been the journey with Niland Labs, Rosas Labs, all of them. Typically when your base is low you are really dependent on just one or two customers.
Are we also having that level of high dependency of customer concentration or are we having a broad based participation albeit despite having a very low base today?
Sanjay Kumar
So Sajal, on part one, your interpretation is correct on the capacity on the CapEx investment and we are very transparent with the with the customers and giving them the optionality to choose across the two components, two continents across the various timeline during their journey, number one. Number two, our customer base is not overly concentrated. We will definitely like customers with a big share in our portfolio. But right now we are working on multiple projects and they are very well spread across double digit customers and they’re all at the initial stages with a good pedigree across both the big pharmaceutical and startup biotech and interestingly the cosmetic side as well.
Having said that, what differentiate us with the other CDMO apart from diversification is the quality of the customer itself. The quality of customers that we have access to through the legacy of SEN is quite remarkable. And this is the value that this acquisition has bring on the table. We got the proof of concept, we got the validation of access. What now lies ahead is our ability to execute on these two continent model which is going well with the customers.
Unidentified Participant
Thank you. And second question is for Dr. Chiragupati if I may sir. If you had to pinpoint the single biggest constraint to scaling the business over the next two, three years, whether it’s pricing pressure or customer concentration, regulatory timelines or execution, I mean what would that constraint be and what specifically are you doing to sort of make the business stronger and counter that potential constraint?
Krishna Prasad Chigurupati
Sajid, I think you have part of the answer. It’s mainly regulatory timelines and execution. The quality of execution. I think the regulatory timelines also depends on how we execute the project and the quality of the filings. I think we have almost got it right and we are fairly confident that we should be able to reduce regulatory timelines. And of course you know, other thing is the GGP remediation and FDA acceptance which where we are already ready and waiting for the FDA to come in. We can’t push them but we keep letting them know that we are ready.
Unidentified Participant
Sure. So on that basis, Dr. Chiragu Pathi, assuming that we get the Gila pool back in action because we have got some outstanding filings there and that should. And assuming that the gross margins stay where they are despite an imminent threat that some input, solvents, etc. Will get expensive, you may already be facing some packaging cost escalation due to what’s happening in the Middle East. But adjusting for all those, broadly speaking, if we stay at 64, 65% gross margin, is it fair to expect a 24, 25% EBITDA margin going forward?
Krishna Prasad Chigurupati
I think the raw material prices and packing material prices, freight prices have gone up. So there’s a lot of uncertainty in the market. But hopefully we are sure that we’ll get some price increases. So this uncertainty continues till we get the price increases and gross margins. While we were very confident of that some time ago, now we are taking a step back and not committing to anything. But we remain confident and positive.
Unidentified Participant
Sure, that’s helpful. Thank you so much. All the very best.
Operator
Thank you. Ladies and gentlemen, in order to ensure that the management will be able to address all the questions from the participant, we kindly request you to please limit your question to two questions per participant. If you have a follow up question, please rejoin the queue. Our next question comes from the line of Tarun Krishna from I thought pms. Please go ahead.
Unidentified Participant
Thank you for the opportunity. My question is on the large scale peptide that we are going to set up in India. So we have indicated that we will be manufacturing DLP there and we also have an option to manufacture the peptide drug conjugates. And so when this site comes live, which products will we exactly be manufacturing and will all these three products come at the same time? Can you please give some light around that?
Unidentified Participant
Sanjay.
Sanjay Kumar
Yes sir.
Unidentified Participant
I’ve got a question for you and PV but I think you should go ahead.
Sanjay Kumar
Yeah sure. And Dr. TV please feel free to come in. First of all we are doing a measured CAPEX investment and the way it has been sequenced is building a peptide API capacity at Zurich at certain scale followed concurrently by investment in a brownfield manufacturing facility for for the intermediates in India. And then once we complete this we are right now at a planning stage of the India peptide API facility and that will be out by at least a year. To begin with we are looking at peptide drug conjugate as a market stage, as a market segment and we are at a planning phase in assessment side of it.
But our focus is completely the peptides business. As for the moment this platform does give some optionality on the oligonucleotide side in the future. But our current attention and the focus is completely on the peptides and it’s the value chain and making sure that our investments are sequentially well aligned and proportionally upgraded across the two locations. Which is, which is aligned with the customer’s demand. Dr. PV, you want to add something to this?
Unidentified Participant
You have got it everything. And at this point of time we are just focusing on peptides and then certainly we will have a look at ADCs and then oligonucleotides but still we are sitting selection phase. We’re in the process of selecting portfolio.
Unidentified Participant
Understood. And exactly which product will we be manufacturing from this and what would be the split for it or if there were multiple products from this.
Sanjay Kumar
So Tarun, your question is about what which fund you’re looking at? India API manufacturing?
Unidentified Participant
No, it’s about the large scale pestilence manufacturing which we are setting up in India. The intermediates.
Sanjay Kumar
So those are intermediates and basic amino acid protected amino acid derivative that actually is required for the peptide API manufacturing. So think of it as a backward integration and a common element across multiple projects where it could be used internally for our own program and whereas it could also be supplied from India to other players also to go into their peptide APIs.
Unidentified Participant
Understood. That is it. Thank you.
Operator
Thank you. Our next question comes from the line of Krisha Kansara from Molecule Venture. Please go ahead.
Krisha Kansara
I’m sorry if this is a repeat question. I had a weak connection. But I had a question on our Gagila Pur facility inspection. So you already mentioned that we submitted additional documentation with them after our meeting in January. So could you give us an update on when is the reinspection expected? And my question is because it’s been more than a year since we received the warning letter. So I wanted to know your opinion, your take on this. Why is it taking so long and how confident are we to clear this follow up USFB inspection And what is your estimate on the timeline?
Priyanka Chigurupati
Hi Krishna, this is Priyanka. I’ll take your question. You’re right in saying that we have been corresponding with the FDA for the last two years. Since we got the original observations. After the warning letter, our updates continue. We had a meeting with the FDA and we have continued to update the FDA with our progress. In our updates. We did mention that a lot of our activities like CMD mentioned would be closed by the end of March, which we are on time. 4. So we’re like CMD said, we are ready for an audit.
And it really depends on when the FDA wants to come in at this point from our side. We’ve notified to them that the activities are essentially complete. But now I don’t think we can estimate when they would walk in. But we’re ready for an anytime audit. But that said just we are actually confident in getting through with the FDA because we’ve had almost, if you look at the investor presentation also we’ve had a lot of audits in the last year across several regulatory bodies and many, many customers.
And there’s nothing critical that came out of them. So we’re very positive about getting through.
Krisha Kansara
Right, but not even like a tentative timeline that you can give.
Priyanka Chigurupati
See, last time we mentioned something, we got comments now saying you skipped three times. I mean we can’t read the FDA’s mind, right? So it really depends on when. There has been no communication from the fda. But we are in touch with them.
Krisha Kansara
Okay. And given that we recently received Nvidia GMP certificate for Gagilapur facility. Has this prepared us in some way for the US FDA reinspection or is it not the case? How do we reach?
Priyanka Chigurupati
Like I said, it’s not just the NVISA but 108 customer audits and 13 regulatory audits happen in FY26 and we welcome these audits because like you said it prepares us better to be audit ready when the FDA walks in. So yeah, like to answer your question Danvisa audit and these other audits all prepare us for the fda.
Krisha Kansara
Sure. So in summary it is like a wait and watch situation for us. Sure. Thank you.
Operator
Thank you. Next question come from the line of Preet Jain from NILA chair. Please go ahead.
Unidentified Participant
Congratulations on good set of numbers. Basically my first question is for lysedexam you had 5% prescription share in CY25. So what quota did DEA assign you for CY25 and can I know the same quota for current year 26 and current year 27 and is this quota will support your sales of the sales of the product, specifically this product
Priyanka Chigurupati
With Listx? That’s what you mean? I mean we obviously cannot share the quota details but we got everything that we wanted and I think we have demonstrated our ability to supply to the customers on time and in full. Which essentially is a precursor to why you would get quota. And even for FY27 we expect the quota situation on this product to be as we budgeted for
Unidentified Participant
Sure. And my next question is you have said, said that you plan to add 1, 2 new control substance products annually for next 2 to 3 years. Can you name or give us the light on which products you expect to launch in next coming two years and what is the addressable market size for them?
Priyanka Chigurupati
I don’t again I can’t give you names of any products. I think it’s best you wait and watch because the products actually the products, two of them are already in the public domain. So you can just research that two of them we’ve received tentative approvals for already. So based on the next steps will be determined based on an ongoing litigation which I would not like to talk about over a call. But we also have one to two other products that we’ll be launching on the generic side of things and one or two products that we’ll be launching which are potential for us to file outside of the tentative approvals that we got.
Unidentified Participant
And the last question is can you have you any current order book in fans project? The CDMO Science project. Is there any order book for that that project?
Priyanka Chigurupati
Sanjay, if you want to take this question please.
Sanjay Kumar
We can’t disclose those kind of information.
Unidentified Participant
Okay, sure. Thanks.
Operator
Thank you so much. Our next question come from the line of Ritwik Said from one of finance. Please go ahead.
Ritwik Sheth
Hi, good evening sir. Couple of questions from my end. So firstly what are the Plans of deploying the money that we raised from the promoter and QIP few months ago.
Mukesh Surana
Yeah, thanks for the question Ritvik. We have clarified in our EGM as well as last earnings call. This is to strengthen the balance sheet. Also invest for organic as well as inorganic growth. Organic growth is capex as well as working capital and R and D and inorganic. If there are any good opportunities we continuously exploring that money is also available based on the balance sheet strength.
Ritwik Sheth
The second question is that on send chemicals, how should we look at CEN chemicals with a medium term to long term view in three to four years you know what kind of growth and margins one can expect can the margin at company level, how should we look at this business?
Krishna Prasad Chigurupati
Ritwik, we cannot comment on the growth, I mean percentages of growth. But all I can tell you is that’s a key pillar for our growth and that is what will also drive a good percentage of the company’s growth. I can’t go into specifics but it’s very, very important for us. We see a great future there.
Ritwik Sheth
And just one last question. In the past we have mentioned that we are looking to launch control substances outside the US market. Also can you throw some light when do we launch these products? Say maybe in EU and row. How far are we and what kind of infrastructure readiness we have for this?
Priyanka Chigurupati
So I’ll just give you a little bit of background amongst all the control substances or let’s just say medication for ADHD primarily. I don’t want to say controlled substances, medication for adhd. There’s two that are globally prevalent, sorry, globally relevant in terms of size etc. So out of the two products one has already been tech transferred and we started filings across the globe. So within the next couple of years, one or two years we’ll start seeing. Not one or two years, actually two years, we’ll start seeing revenue from those products on the finished dosage side but APIs we should be seeing the numbers come in a little bit sooner.
Ritwik Sheth
The finished doses you can see sometime from FY29 and API maybe a year earlier.
Priyanka Chigurupati
Not just in EU, we’ve been filing in multiple countries.
Ritwik Sheth
Okay, so that’s it from my side. Thank you and all the best. Thank you.
Operator
Thank you. Our next question comes from the line of Shreya Chatterjee from Ageless Capital. Please go ahead.
Unidentified Participant
Thank you for taking my question. Congratulations for a good set of numbers. So my first question is regarding the statement that you say that controlled substances, you are now at the fourth position. So would it be Possible to give out the number like total revenue control substance and also in the control substance based basically adhd you have a very high potential drug which is Lis, Dex, Amitamib in dimasylate or the gendering fiveanse. So how is that going on? Because for the other generic companies also there had been some issues of product recalls.
So if you could just comment on that. Thank you
Krishna Prasad Chigurupati
Shreya. We have a good history. I don’t think product recalls and such is a great constraint for us. What was the other question you had Shreya?
Unidentified Participant
So what is the current like revenue?
Krishna Prasad Chigurupati
We cannot by product, we cannot go into details but ListX is a good product for us but we also have equally good products in our portfolio and more are in the pipeline and it’s just not one product. That’s all I can tell you.
Priyanka Chigurupati
I just want to, I just want to mention Shreya because the prior participant had the same question on lisdexampyramine. If you look at all our historical investor calls also and if you just I guess track the number of approvals we’ve received, you’ll know that it’s not just Lisbex Amphetamy. Like CMD just said, there are other products and the name of the game is to make sure that you’re consistently growing in all the products to achieve this position in the ADHD control space.
Unidentified Participant
Got it. And would it be possible to give out the market share for this 516the current market share that you have captured? Okay. And any comments on the pipelines more for both the control substance and the oncology drugs like in the next three to five years how big you see that opportunity?
Priyanka Chigurupati
The market size is heavily. I can, I think in the investor presentation we said $41 billion as a TAM. But that said that is a combination of the brand and generics. All I’ll say is that the quality of filings are significantly improving. They’re moving more and more towards complex products, more in the controlled space and oncology space. Two big drivers for us. And we have a first. Well we have a few first of files targeted, a lot of NC minus one targeted and we plan to be there on day one with a very, very good value proposition.
Unidentified Participant
Got it. And would it be possible to guide on the working capital situation maybe this year FY27 given the vulnerability is going on.
Mukesh Surana
This is of course uncertain period Shreya. So the cost escalations are currently there. Whether it will continue for few months, few quarters, we are not so sure. But considering that we would, you know, would want to maintain our working capital to sales ratio of 33% range.
Unidentified Participant
Got it. Thank you. That’s it from mine.
Operator
Thank you. Ladies and gentlemen, as a no further question from the participant, I would like to hand the conference over to the management for the closing remarks. Thank you. And over to you team.
Krishna Prasad Chigurupati
Once again, thank you very much, ladies and gentlemen, for joining us today. And I just wish you all the best for the rest of the week and have a great weekend after that. Thank you.
Operator
Thank you so much, sir. Ladies and gentlemen, on behalf of mufg, that concludes this conference, thank you for joining us and you may now disclaim two lines.