Poly Medicure Limited (NSE: POLYMED) Q1 2026 Earnings Call dated Aug. 08, 2025
Corporate Participants:
Unidentified Speaker
Himanshu Baid — Managing Director
Analysts:
Unidentified Participant
Darshil Jain — Analyst
Rashmi Sancheti — Analyst
Suruchi Parmar — Analyst
Keshav Kansal — Analyst
Harsh Shah — Analyst
Bharat Shah — Analyst
Shubham Harne — Analyst
Zain Gulam Hussain — Analyst
Harsh Shah — Analyst
Presentation:
operator
Ladies and gentlemen, good day and welcome to Poly Medicure Limited Q1 FY26 earnings conference call hosted by ICICI Securities. 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 this conference call, please signal an operator by pressing Star then zero on your touchstone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Dashiell Jain from ICICI Securities. Thank you. And over to you sir.
Darshil Jain — Analyst
Thank you. Good afternoon everyone. On behalf of ICICI Securities, I welcome you all to Q1FY26 earnings conference call of Poly Medicare Limited. Today on this call we have with us the senior management team of the company. We are represented by Mr. Himanshu Bhait, Managing Director, Mr. Naresh Vijay Vargia, CFO and Mr. Rahul Gautam, President, Strategy and Corporate Development. I would like to thank the management team of Polymedicure for giving us this opportunity to host their call. And with this we will hand over the call to the management. Over to you sir.
Himanshu Baid — Managing Director
Thank you, Darshil. Thank you very much. A very good afternoon everyone. Again I welcome you all to our Q1 FY 2026 earnings call. I sincerely thank all of you for being here today. Before I provide you with a performance review, I am very proud to announce that Polymedicure was awarded Medical Device Provider of the year 2025 by financial expertise. It was a humbling moment to be recognized for the journey in the healthcare sector. These recognitions reflect our collective efforts of our entire team and accept them on behalf of our employees, partners and stakeholders who have been integral part of our growth and success over the years.
I’ll now take you through the business and financial update for quarter one and after that we are open for Q and A’s. So on the business update side we received approval from our esteemed shareholders for for appointment of Mr. Vishal Bhait as the Executive Director. Mr. Vishal Bhai has been part of the core team and has played a very pivotal role in strategic growth and international expansion of the company. He’s been associated with the company for last 14 years and before to his appointment as Executive Director he was designated as Senior President Sales and Marketing.
Also I’d like to update that board in his meeting today. Shabbat to shareholders approval has approved appointment of Mr. P.K. gupta who was President, Operations and Executive Director of the company. He joined Polymer Cure as a senior manager in 2008 and rose to become president operations leading key operational advancements. His strategic leadership significantly contributed to the company’s growth. We welcome him to the board and looking forward to his strategic insights as we scale up our manufacturing presence in India and globally. I’m also pleased to announce that we have signed two contract manufacturing contracts and this was if you remember I had shared earlier that we are exploring some opportunities in contract manufacturing space specifically where we see reasonable margins and we have signed two contracts in the first quarter.
Companies are based out of. One company is based on us. One is Hong Kong headquartered company which is based which has major operations in the US and both these companies, you know, have products in Vasco axis and in pain management segment. So these are new products we are developing for these companies. These are brand new. So this is basically more like a CDMO operation where we do the contract design and manufacturing operations. And these are some the kind of businesses currently we are building internally also you know, to build a, you know, resilient manufacturing manufacturing setup in terms of our international expansion.
We have also established a wholly owned subsidiary in Brazil to expand our presence over next few quarters we will expand our presence in this key South American market. We are already doing some new product registrations there and we are very excited about this dynamic Brazilian market and we would like to have more depot in road. So we will set up a fully owned subsidiary with people out there where we’ll be interacting directly with the customers. So it will be moving from B to B to B2C operation. And this is one of the major markets for us and we have decided to go directly in that market also.
We are waiting for a land allotment letter from yeda for around 7 acre plot at Medical Device park which is near the JWAR airport in Greater Noida. We have already received the letter of comfort from the UP government and this Medical Device park is very tragically located and will also have a lot of common facilities like labs and other infrastructure which will help manufacturing of medical devices in the country. On the financial performance side, quarter ended June 25th. We have a consolidated revenue of 403 crores marking an overall growth of around 5%. Gross profit was close to 276 crores reflecting a margin of 68.4% at a gross level an increase of almost 170 pips as compared to quarter one last year operating EBITDA for Q1 was 106 crores delivering EBITDA margin of 26.3% slightly down from 27% last year.
On the bottom line, PAT totaled around 93 crores as compared to 74 crores last year translating to a net margin of 21%. Up to 50 waivers. I would like to call it that our R and D spend has increased by 20% in this quarter. I would also expect that R and D spend as a percentage of revenue will rise going forward as we get into high end technology segments such as cardiology and critical care. In Q1FY26 our domestic revenue grew by 20% to reach 126 crores. Domestic revenue growth in the private sector was 25% while the government business witnessed a degrowth of 10%.
So net was around 20%. And that is in line with our projections, in line with our strategy. This clearly reflects our focus on building a strong and sustainable domestic business and to exit the business which we, you know, which we don’t meet our margin threshold. Specifically in the government segment contribution from the domestic revenue to our overall consulted revenue has increased to 31% in Q1 as compared to 27% in the comparative period last year. We continue to outpace the market and competition growth in the domestic market quite significantly. Hence our conviction to invest higher amounts in domestic market is getting only stronger.
This is reflected in the fact that we added 22 new sales associates in Q1. We have set up a target to add around 100 people this year. Out of that, 22 people have already joined in Q1. Hence we are on track to hire 100 sales associates for FY26. And this will give us a lot of firepower to go to tier two and tier three cities. You know, especially the hospitals we have not addressed earlier. So we are expanding our reach into more deeper, you know, markets and territories. In Q1FY26 our international revenue stood at 275 crores which reflects a dip of 1% from 278 growth in Q1FY 2025.
We continue to witness a growth some growth challenges in European market but witnessed a degrowth of around 6.7% in Q1. The current geopolitical situation as well as uncertainty in global trade due to ongoing tariff war is leading to some deterioration of customer sentiment. The recent tariff announcements by President Tamman India does not argue well for export markets of course. But we are hopeful that a reasonable solution will be found in the ongoing trade negotiations between India and US. Of course 50% tariff is kind of unsustainable for exports from India for I think any segment we talk about.
All these factors are leading to customers being circumspect. In predicting the business growth, supply chain stability and hence on focusing on inventory liquidation to meet end use demand instead of building additional inventory. So in our last call we had highlighted overstocking in certain customers specifically in southern European region. We are now starting to see the situation easing out in those market. Hence we are hopeful that things will be better in in in Europe in second half of the financial year. International revenue from rest of the world region has done relatively better. Growing at 5% to reach 142 crores in Q1 FY26.
Now let me give you an update on each of the business segments. Renal business, you know, where we have been putting a lot of energy and efforts has grown by around 46% in Q1 of FY26 to almost 44 crores. Till July 31 we have sold additional 130 machines across the country and we are on track to sell close to 500 to 600 machines in the current financial year. The dialysis machines. We continue to remain excited about these prospects in the industry. I think. Government of India under its Pradhan Mantri national Dialysis program, you know, they have implemented, you know, dialysis centers in 751 districts with almost 1700 dialysis centers which are operational today also has been now covered under Ayushman Bharat.
So further expansion of networks and community health centers will be also taken by the National Health mission. So overall we are very bullish that the demand will continue to increase. We are also ramping up our capacity and by the end of FY26 we will almost double our manufacturing capacity in the dialysis business. So I think that’s also, you know, very important task we had undertaken last year to expand the capacities all across in this segment. We continue to remain bullish and we aim to reach at least 15 to 17% of market share in next two to three years from the current around 8 to 9%.
Let me now move to our cardiology vertical which we have started end of last year. It was just kind of a trial period and this year was the real start. And I am pleased to announce that we have already implanted around 1350 Doug looting stents with a very positive feedback received from patients and clinicians. And these stents were specifically designed at Polymed and all the design elements were done by our R and D team. And this is indicating growing acceptance of our products in cath labs among intervention cardiologists. We remain excited about our pipeline of products.
You know, we have already launched our angiographic catheters, Angiographic balloons. We are also launching drug eluting balloons and PTC gatherers and host number of guide wires, you know, hydrophilic guide wires and PDF coated guide wires. So a lot of devices are coming intervention cardiology space which are getting manufactured at Polymed right from scratch. So we are one of the first companies to make these products in India. Most of the companies were importing and selling them. We are one of the first companies to make such products in India. I’m also very pleased to announce that we have initiated an open label, multi center single arm clinical investigation to evaluate performance and safety of our Risor drug eluting Stent.
The study aims to access safety and performance of in treating coronary artery stenosis patients. And this will be a clinical registry of 2,000 participants. And this is the first time, you know, a clinical registry of this scale is happening in India for stents across 50 sites in India and one in Europe. We have also, you know, you know, partnered with Dr. Praveen Chandra, chairman Intervention Cardiology at Medanta Medicity Hospital and he’ll be the principal investigator in India for these clinical trials. The study will be, you know, completed in almost 24 months. And from strategic standpoint of view this trial underscores polymerase commitment for post market evaluation in India and pre market readiness for the European market and positioning the company in the global growth of the coronary stent markets.
We are gradually moving up the technology chain in medical device market and such initiatives position us strongly to capture the market share in initially in the domestic market and over time in the international markets. Our second growth segment was critical segment, critical care segment. This vertical remains, you know, a very important part, you know, part of our growth journey especially in treatment of oncology. Government of India is already playing active role in ensuring, you know, setting up 200 standalone specialty oncology centers, eventually expanding to 700. So we are strongly positioning ourselves in this segment and especially with make India products and continue to invest significantly in new product development.
Over last 12 months we have launched over 20 products in this segment and we continue to expand our manufacturing footprint. Our transfusion segment has been growing steadily. It’s grown at around 18% in quarter one. There’s a slight slowdown in our infusion therapy business which are our core business and this is mainly because of slowdown in Europe. That’s what we have witnessed and I think historically I think we have done well in this segment but I think we are seeing some headwinds which we saw in quarter one. But I think from quarter two and quarter three Onwards I think things will change and are on track to deliver a better performance this segment.
We are strongly globally competitive. We have a lot of innovation which is sitting within the company. Hence we are very confident continuing to gain market share in coming quarters. Liquidity Position Currently we ended the quarter with a liquidity of 1249 crores. Strong cash flow allows to continue back our ambitious growth strategy both organic and organic. On the M and A front, our thesis focuses on technology acquisitions that are complementing our core verticals, critical care, cardiology and other adjacencies. We are actively evaluating opportunities which we believe are quite exciting in terms of technologies, markets and customers.
We’ll keep the market informed once these transactions are finalized. Let me now connect to our forward looking outlook. We continue to remain bullish on the domestic market and reiterate our guidance for revenue growth of 30% for the domestic business for FY26 for international business we expect our revenue growth between 5 to 10% this year which is lower than what we have given guidance earlier in quarter one 12 to 15%. This is reflective of the current ground realities. We’ll keep you updated and have a better clarity I think once we see this quarter ending further. Polymeter also said some ambitions to grow in the US market.
I think we already have FDA approvals which I informed earlier. There are some products in pipeline. We are in the process of getting them also approved. We have already signed contracts with two large GPOs and distributors in the US and I think we are on track to achieve the revenue which we have projected 15 to 20 million and that is overspread over next two to three years. But I think currently the current situation we are not sure how it is going to pan out but I think we are keeping our fingers crossed. But in the current financial year we don’t have too much impact from the U.S.
because our U.S. revenues are less than 3 $3.5 million. So we don’t see a major impact on our business because of the US tariffs. So I think we are very very insulated because of our strong presence in Europe because 1/3 revenue still comes out of Europe. So I think we have strongly protected, you know for our business with India, Europe and rest of the world presence. So let’s see, I think we keep our fingers crossed for next few weeks and see what is going to happen. We are keeping our EBITDA guidance margin in the range of 25 to 27.
We have done first quarter EBITDA of 26.3% so we are very within the range as we Called out earlier in the beginning of the year. Capex side we maintain our guidance for a spend of around 250 crores plus for FY26 as we have two new plants, you know, facilities under construction in Palwal and Haridwar also. You know, our gamma plant in Palwal has started the operations. Phase one operations have started. We have received the license for our class A and B devices. We are waiting for, you know, further licenses for C and D devices and also expansion of that capacity which will move from 300kci to 2000kci.
So and that’s a major achievement I would say because we are one of the first companies to have their own gamma sterilization plant which gives us, you know, a lot of strength in terms of, you know, you know, sterilization. The products using a special technique to the gamma sterilization which is very unique to medical devices. Also of course, you know, the guidance is building some conservation right now around international business given the current geopolitical and macro uncertainties. But we are very confident. We have almost 30 new products in pipeline which we launched over next, you know, two years or so.
And you know, so we have a huge, you know, pipeline of products which is getting ready. We have also new regulatory accruals which are expected during the year from major, you know, markets like Europe. And you know, also, you know, some akpools are coming from Latin America. So once we have these new approvals we’ll be able to launch some new devices in these markets. There’s a strong domestic momentum. So we’re very confident about the domestic market and I think it continues to give us, you know, a lot of wings to fly today. And I think we can pretty well, you know, offset this headwinds which we see which has been like a one off phenomena.
But I think just to recap ify 2026, I think the business is fundamentally very strong. The model is, you know, that we have developed and moving from, let’s say, you know, from vascular to critical care and to cardiology products. So we have done that transition over last two, two and a half years, invested a lot of, you know, in new technology, new products and I think that is going to start bearing fruits and most of these products are from, you know, higher margin categories. So you know, we’ll continue to make, you know, healthy margins, you know, next years because of the new products we are launching.
And I think domestic market is very strong for us right now. So we’ll continue with the growth trajectory which we have already, you know, told earlier And I think we’ll continue to invest in R and D. So that is scale up is happening. A lot of green initiatives have been taken. By September, October, 40% of our power generation will be from green power. So we invested in solar capacity building. So we have done a lot of heavy lifting in last few years. And definitely in coming years we will see a lot of new things happening with contract manufacturing opportunities with US business.
Of course there’s a caveat there because of tariffs. But I think as we see, I think tariffs are temporary and I think, you know, we have a long journey ahead on that US market. We have some very important contracts which are already in place. And of course we are deepening our presence in Europe, you know, with more product launches. So all in all, I think we are in great shape. Just wanted to update you on this performance of the company. And now I’ll be happy to answer questions from our listeners and viewers and people who are on the call.
Thank you again everyone. Thank you for that.
Questions and Answers:
operator
Thank you very much. We will now begin with the question and answer session. Anyone who wishes to ask a question may press star and one on the Touchstone phone. 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 comes from the line of Rashmi from Daulat Capital. Please go ahead.
Rashmi Sancheti
Yeah, thanks for the opportunity. So one question on the gross margin side, despite a lower international business, our gross margin was pretty high during the quarter. So what has, which segment or what has actually driven this kind of margin and what kind of gross margin would be sustainable for the full year?
Himanshu Baid
I think gross margin, Rashmi generally track, you know, between 65 and 67%. That has been the historical gross margin for our business. But as we go dig deeper into this critical care cardiology areas, I think there the product price is also much higher compared to what we have been selling in the past. So the gross margin, these products is very high, like much higher than what we, you know, than the products we have been selling in the past. So I think that correction will keep on happening. So I think a run rate between 65 to 68 is a great run rate to be at the gross margin level.
Rashmi Sancheti
Okay, so you mean that the major gross margin has actually come from this particular category which has been launched basically in India. So from the domestic segment this time the margins are better?
Himanshu Baid
Yeah, definitely. Because if you see export sales has gone down, basically. The margin contribution used to come higher from the export business. Yes. In spite of international business going low. Still, you know, we have, you know, sustained our margins in terms of ebitda, which is not a big difference from what we have been doing in the past. Okay, variation is there in the first Quarter, which is, I wouldn’t say is hardly any variation.
Rashmi Sancheti
Understood. And on the export market, you know, if you can explain a bit in the Europe, you know, you had seen issues and growth challenges in the first quarter and you’re saying that, you know, things will get eased out in the subsequent quarters. This is because the US had imposed tariff on these different countries and that is the reason it was an indirect impact on India.
Himanshu Baid
I think Europe is, I think, was going through, you know, some financial, you know, let’s say, I would say, you know, restructuring. I think most of these, you know, countries, you know, had, you know, kind of liquidity issues. And I think there was also overstocking and this whole uncertainty around tariffs was actually, you know, where people would have actually reduced the inventory levels. Normally in our industry, people maintain four to five months of inventory because they are constantly supplying the, the, the, the national systems. But what we realized that people went down to two to three months of inventory.
And in fact, in last few months we have, you know, last month, month or so, we have also made few raised freights because they have ran out of inventory with higher consumption. So I think we are seeing the demand coming back from Europe. So I think that’s where we are positive. So and that’s the reason we are saying that, you know, we should end up, you know, closer to 5 to 10% of growth overall in the international business, you know, going forward, you know, for the next three quarters, quarter two to quarter four.
Rashmi Sancheti
And excluding Europe, even rest of the world has seen just 4 to 5%. Have we seen the similar situation over there or. The reason is, I think, yeah, I.
Himanshu Baid
Think we are seeing, you know, so this quarter the growth is coming back and I think in subsequent quarters also, I think we are quite sure that we’ll be in a better space.
Rashmi Sancheti
And one last question. You are saying that you will be adding 100 associates, sales associate in FY26 in domestic market. This will be targeting which regions you mentioned tier 2, tier 3 cities. But exactly which state would it be? Pan India or it would be some dedicated state?
Himanshu Baid
Because today Polymad is a national company. So we are present Pan India. So in fact the focus is to expand more, you know, in, let’s say tier two and tier Three. And in that segment also South India and West India are the core markets we are targeting.
Rashmi Sancheti
Got it, sir. Thank you so much.
Himanshu Baid
Thank you.
operator
Thank you. Before we take the next question, we would like to remind participants you may press star and one to ask a question. The next question comes from the line of Suruchi Parmar from ANNEX Wealth Management. Please go ahead.
Suruchi Parmar
Hello.
Himanshu Baid
Yeah. Please go ahead.
Suruchi Parmar
Yeah, yeah. Good evening sir. I just wanted to ask like you have told that Europe and you have a considerable good share coming from Europe revenue share, but you are saying that exports in this year might see a revenue growth of meager 5% or slow. Yeah, yeah. Lowering, lowering your guidance. So it is just because of us or Europe is also facing some problems, that’s why you are lowering the guidance.
Himanshu Baid
See, Europe is also facing challenges. I think we have seen it since beginning of the year. I think there has been like an inventory correction in Europe and I think there was a disturbance in supply chain also. I think Chinese companies also started dumping product because of their lack of reach to US market. So I think everything kind of got disturbed. But I think now the demand is back, the supply chain is kind of recalibrated. So, so and that’s the reason we are, we are confident that now, you know, we are getting back on the track.
So even with a, you know, let’s say minus 1% growth in international business in quarter one, I think we are already saying that we should be, you know, between 5 to 10% of growth for the whole year international business. So I think, and I think, you know, still things are very fluid, I would say globally. But I think at least we can see from now onwards, as we have seen first four years of this month, of this financial year, first four months, I think we are more confident about the growth, what we can do. And of course we are still conservative.
Things can change a lot. Of course we have adequate capacity to meet additional demands. So. But at least we want to be a little bit more conservative and see how things are panning out in next few months.
Suruchi Parmar
And sir, do we will be benefited from this UK fta?
Himanshu Baid
Definitely. That’s a big one. Sorry I mentioned mention it. Thank you for reminding me. So again, UF FTA also now because earlier duty was around 4 to 5% for UK imports, now it’s getting zero. So I think and, and we see a renewed interest for US companies, sorry, UK companies to, to buy products out of India. So I think after the FTA we have already received, you know, couple of, you know, companies which are willing to expand Their, the business, you know, with us. So I think it’s, it’s very positive for us, at least on the UK FDA side.
Suruchi Parmar
So you, you are like bullish on acquiring more market share there?
Himanshu Baid
Yes, definitely. So we, we are bidding for more products in the UK market and I think hopefully in 2020 because the NHS operates on a cycle every. Because 90 purchasing is done by NHS in the, in the UK so this operates in a cycle. So the new bidding is happening for 2026, basically. So we have now bidded for almost six to seven new product categories.
Suruchi Parmar
So these products will be like in the critical care or vesicle. Vesicular core is vascular, so both will be there.
Himanshu Baid
More vascular is 95%.
Suruchi Parmar
Okay, okay, okay, okay. Okay. Thank you so much, sir.
Himanshu Baid
Thank you.
operator
Thank you. A reminder to all participants, if you wish to ask a question, you may press star and 1. The next question comes from the lion of Keshav Kansal from SVP and Associates. Please go ahead.
Keshav Kansal
Hi, good evening. Am I audible?
Himanshu Baid
Yeah, yeah. Please go ahead, please.
Keshav Kansal
Okay. Okay, so, so my question is particularly on your renal portfolio. So my question is what are Polymed expansion plan in terms of the HDF as well as the PRRT portfolios? As I understand these spaces are less penetrated currently in India. So how is the market overall looking like and what is your take on this? And is Polymer going to do anything about it in terms of taking active steps in terms of either catering to the market or, you know, government advocacy? What exactly is Polymet’s view around this? That is what I wanted to understand.
Himanshu Baid
No, I think there’s a great question, very great technical question, I will say. So basically in India, HDF market is close to around 10% and it’s mostly dominated by large multinationals like Fresenia center and, and Nipro. And 90% is basically the normal market. So what we are, we have plans to launch our first sdf machine in 2026. Okay, so that’s what we are targeting. And so we already under development, you know, for that product and it is under, currently under development. And then we’ll go for clinical testing and the licensing of this product. So we are hopeful that sometime mid to end of 2026 we will launch this new dialysis machine with HDF capabilities and trt.
We have not put so much focus right now, but maybe that could be the next product development, maybe for 27 or 28. But I think HDF is very promising.
Keshav Kansal
Okay, okay, understood. And like, have you.
Himanshu Baid
The only problem with HDF is that the cost of Dialysis that is, goes up. And the government reimbursement is limited to 1800 rupees today under Ayushman Bharat. So whether they will include this under reimbursement or not is something, is a question mark. But at least in the private sector, which is probably like 30, 40%, that is where probably we can see usage of HDFC, even HDF machines. If you see current, currently they only deployed in private centers, not in places we are doing, you know, let’s say, scheme patients.
Keshav Kansal
Correct, correct, correct. Okay, okay. But is polymer also seeing like growth in HD machines and other account archetypes, you know, such as charitable institutions, government hospitals.
Himanshu Baid
No, no, no, no, no, no, no. Again, see, they are very conscious on the cost side of the product, so they don’t want to. And charitable is again so much subsidized so they can’t afford to have a HDF machine. And the cost of the treatment also increases.
Keshav Kansal
Correct, correct. No, no, I was particularly talking about HD also. Hd. HD is there, right? HD machines are penetrated.
Himanshu Baid
Yeah, yeah, yeah, yeah.
Keshav Kansal
Okay. Okay. And just, just one, you know, like follow up question on this. So are you also looking at the development of the SDF machine like in India only you’re going to be manufacturing in India?
Himanshu Baid
In India. In India.
Keshav Kansal
Okay, okay, understood, understood. Thank you, that’s very helpful. Thank you.
Himanshu Baid
Thank you.
operator
Thank you. Ladies and gentlemen, if you wish to ask a question, you may press star and 1. The next question comes from the line of Harsh Kesha from Dalal and Roka. Please go ahead.
Harsh Shah
Yeah, thanks for the opportunity. Just one question from my side. So if you could, you know, a bit of, you know, dwell upon the contract manufacturing, you know, contract that you have, you know, in the products of vascular and pain management. So as you mentioned, right. That these are new products.
Himanshu Baid
S o CDM opportunities.
Harsh Shah
Correct, Correct. Yeah, but so how should one look at, in terms of, you know, the scale up of revenues? When should one expect this to, you know, kind of flow to our, uh, numbers this year, next financial year, some bit of highlights and you know, in terms of how big the scalability, you know, how.
I mean, how scalable is this? I mean in terms of.
Himanshu Baid
Basically, you know, the first thing is to identify the relevant partners and you know, getting into an arrangement. I think this is the first time we have explored this opportunity of cdmo. And in fact, if you remember, couple of calls ago, we were discussing about this, you know, about these opportunities. So now we have, you know, zeroed down. We have signed two contracts, you know, and of course both are very innovative products. Patented devices. Basically these are patented devices. So we are part of the core development of this project and device in terms of its performance and you know, manufacturing.
So you know, these are new devices. So I don’t have a really relevant data to tell you that, you know, you know what kind of scale up is would be there because these are new products will take 2, 3 years, 4 years to scale up to a certain level. But I think the revenue should start kicking in from next financial year because you know we have already started development, manufacturing, development of the devices. So already the initial proof of concept is done. Regulatory approvals are getting in place. The 510k approvals for US market. So these are getting in place.
And also you know these products will be launched in other global markets. So the, the, the, the, the company which owns these devices, they’ve already started that process, you know, based on the initial pilot run. So now we are much. But you know to call out any numbers will be not the right time. Maybe next year this time I’ll be in a better position to answer this question.
Harsh Shah
Right, got it. That’s it. From myself. Thank you.
operator
Thank you, thank you. The next question comes from the line of Part Singhal from Swing Masters Private Limited. Please go ahead.
Unidentified Participant
Hello sir.
Himanshu Baid
Yeah, hi.
Unidentified Participant
Yeah sir, my question is, are. Is the company planning to enter in radiology space by any chance like city scans and MRI machine?
Himanshu Baid
No, no, no, no, no. Not at this moment.
Unidentified Participant
How much revenue do we make in card in cardiology segment by stunt. By selling stunts?
Himanshu Baid
No, we have just launched these devices. See, this is a very first year of operation of this business. So you know, so for example, this year our plan is to deploy around close to 20,000 stands. That is what the number, you know, we have in our mind that we’ll be able to deploy. So that scale up is already happening. So this is the very first year of operation, commercial operation and then launching a lot of new devices. We are waiting for regulatory approvals for a lot of other devices to come from cdseo. So as and when we see receiver, we will start scaling up.
And these are, you know, not easy products to sell. So I think maybe only next year we’ll have full visibility, you know, where we can call out special numbers and say okay, this is like renal. We today we are able to give numbers because we have been working on the project for five years. So I think for cardiology we’ll need some time to really, you know, start giving numbers on how things will pan out in next few years.
Unidentified Participant
And If I ask about dialysis machine, how much rev margin do we make in dialysis machine?
Himanshu Baid
Sir, we don’t give specific product margins.
Unidentified Participant
Okay, thank you so much.
operator
Thank you. The next question comes from the line of Bharat Shah from asking Investment Managers Ltd. Please. What?
Bharat Shah
Yeah, hi man.
Himanshu Baid
Good evening. Good evening.
Bharat Shah
Yeah, good evening. Good evening. Himachu. On the international business, which is the Most significant dominant 2/3 of our total business.
Himanshu Baid
Correct, sir.
Bharat Shah
I mean if you think about your pick, it appeared to us that nothing can go right. Sorry, nothing can go wrong with that business. Strong margins, continuous traction, strong 20 to 25% kind of a growth and new product categories. And it look like as if there is no stopping there. But in less than one year it seems to be a picture which is radically different. Therefore, what do you think this should drive our thought process and planning process. What kind of impact it should legitimately have on that? Because our product plans and I know that you have calendar year by year for product launches each quarter for a specific geography specific category specific and for a period of years ahead.
So what kind of lessons need to be drawn from this in your opinion in terms of our planning process, how we conceive the business opportunity or imponderables, how do we take into account so that the sudden Fay company in a way is presented to us that we witness actually de growth in the European territory which I’m sure would have come as a rude surprise to you. So.
Himanshu Baid
Yes, absolutely. So we saw that.
Bharat Shah
How do you think of all this.
Himanshu Baid
It’s a great question and I think I’ll answer in two, three parts. One is about the market. So the European market has been very flat. The only, you know, market, you know, we were growing. The reason we were growing was we were taking market share from certain customers companies. There market has been very flat. Secondly, what we saw was some kind of an inventory, you know, kind of a de risking by European players. And why it has happened in the beginning of the year because of this whole tariff situation with China, US China thing. Lot of Chinese companies started dumping products in the European market.
And people were confused about the situation that how the situation is panning out. So we also got a shock that how Chinese companies can dump products so pricing so much in the market and you know, where, you know, it’s even sometimes hitting below the belt also in terms of pricing. So that kind of. And then of course, you know, this whole mismatch started happening. But what is happened in last six after this whole mismatch happened in first quarter of the European financial year and Even in the second quarter, what we have seen is now the demand has come back.
I think the inventory mismatch which was there has kind of flattened out and now we are seeing the demand coming back. So I think the most important key development is our UK market where we have seen demand coming back strongly and also in Germany. So these were, you know, Germany was something which was a laggard for us and Germany has actually started, you know, coming back on track. And I think that was very significant for us. And also we have seen a huge growth coming in Italy because Italy, where it was kind of a market where we had a lot of control and lot of tender was getting slowed down because government, you know, the health systems were not granting new tenders and they were delayed.
And now most of these tenders have been awarded and I think now we are, you know, seeing the demand coming back. So overall and some new product offerings, you know, have come out. Because if you see recall, we got our EU approvals only in April, May, if you recall, we had also called out in the last call. Yes, the most of the EU approval which were renewed, the EU MDR and some of the approvals have only come in June. So you can see the record of a certificate on our website basically. So all these approvals have just recently come.
So once these approvals are back in place. So now we are getting back on track and the accelerator is back, you know, on the revenue side. So I think now we are very confident about, you know, the European market, you know, coming back to growth. But what we have lost, we have lost. So we can’t cover it today. What we have lost in the quarter is gone. So now for quarter two, quarter three and quarter four, I think Europe should come back on track.
Bharat Shah
Which means if you look at in the first quarter we have de grown as far as.
Himanshu Baid
Yeah, we’ve grown by minus 6%, 7%.
Bharat Shah
Right. And year in entirety we are saying will grow 5 to 10% which means the remaining nine months should be a period of decent double digit growth rate for.
Himanshu Baid
Absolutely, absolutely. That is the point I am calling out that we should come back to that double digit growth, high double digit growth. And that is what we are also calling out.
Bharat Shah
Also domestic grew in the first quarter by 20% but yet in entirety we are saying we should grow 30%. Yes, that means the nine months we should grow well over 35% to make that happen.
Himanshu Baid
That is already on the card. This is already under the process because we have started two new divisions last year and these two divisions have Become active. So the cardiology and critical care, so they are ramping up. As we have talked about, a stent deployment from 1300, 1400 stents go to 20,000 stands by end of the year. And then critical oncology segment is growing and then our renal segment is growing, is growing at a healthy rate. So all, all in all, you know, domestic, and we are hiring 100 people in domestic market, 22 already been hired in the first quarter.
So as all in all, I think and. But in the private sector, we already grown 25% in quarter one in private sector, which is 90% of our business. So overall the ramp up is already happening.
Bharat Shah
And which means the remaining nine months should represent materially different outcome compared to the first quarter. And given that scale, hopefully margins also should be higher.
Himanshu Baid
Hopefully. Yes, you are right. My math clearly says that, you know, when you do the math, it clearly says because even in the first quarter our gross margins have improved. It’s not that our gross margin has decreased because we decreased our export sales. So we have done a lot of hard work in terms of launching new devices with higher margins. So we continue to, you know, work in the direction where we, you know, maintain a steady margin and, you know, healthy margin. So yes, as the revenue kicks up more, most of the expenses get already absorbed in the initial period.
And I think we should see some margin improvement. But still we are saying we are going to have a muted guidance of 25 to 27%. But definitely the target is to beat that number.
Bharat Shah
And to that extent, Himanshu, would it be fair if one were to say that actually domestic market, we need to regard it bit more than what we have done probably so far.
Himanshu Baid
Totally agree.
Bharat Shah
Disregard it.
Himanshu Baid
I think we have disregarded before COVID we were disregarding this market only after Covid, we realized the true potential of domestic market because then there was a huge push even from the private sector to buy local products because the imported products were not available after Covid. There were export restrictions, there were import restrictions or from different countries. So the industry kind of, you know, carved out out of this whole COVID wave. And you have, you’ve seen the medtech sector has grown phenomenally after the COVID you know, you know, COVID wave. When you look at, you know, few companies, you know, where Apex invested in Healthium or, you know, Merrill has got new investments, you know, especially in their, you know, because of the cardiology and orthopedic business.
So, you know, there is a renewed, I would say, you know, interest from private sector in the local products which are now equally good in quality.
Bharat Shah
So in a way it was probably for at least some time type.
Himanshu Baid
70% Indian companies, 90% imported, 50% orthopedic implants are locally made, 50 to 60% local use or Charlie’s percent imported. If you see the market, the trends are changing and I think that’s our now the real, you know, trajectory which we can see in the domestic market market is not growing at 30%. Market is growing at around 12, 13% healthcare industry, but we are growing much faster than that. That means we are taking market share from, you know, international players.
Bharat Shah
Right. And would what will we say about the next year? Should we expect that European international territory will come back to.
Himanshu Baid
100%? We have 15 new launches planned next year in European market because we have one more cycle of approvals which is happening pending right now, especially for our critical care products which are also better margin products. And also, you know, we are increasing our presence in Italy through manufacturing, you know, so our current, you know, our operations in Italy are also seeing some uptake. So I think Europe will come back strongly, I think and our focus has been European. So I think one or two quarters are not going to make any difference in our long term strategic plan.
Bharat Shah
So will it be fair to say that Europe will chug back to that 20% plus kind of a journey?
Himanshu Baid
It’s very hard to say, you know, Bharat Bhai is very hard to say. I don’t want you to hold my neck for that. But I think we are on track and I think even in the coming quarters you will see the improvement. I’m very sure I and definitely see we have one thing very clear. We will commit, you know, only what we can do. We will not commit something higher and say oh we didn’t do it, you know, there were XYZ reasons, we know and even in the beginning of the year we have called out the international market business is looking slightly different than what it was previous years.
And we have called out earlier and even now we see first quarter we have seen that though there is no impact, significant impact on margin. If you see EBITDA margin only dropped by 70 pips. In spite of India business growing significantly, exports showing almost a flat trajectory still our margin. That means we have done in terms of product improvement, better profitability. So we have done a lot of hard work in the hindsight in the back end. So that is going to give, you know, long term rewards. You know where exports growth come back. India business grows with a higher trajectory.
So all that will show into Numbers in our incoming quarters.
Bharat Shah
Sure. One last question. How do we take into our planning system these new insights so that we are not kind of caught up with a sudden surprise of a kind that we got thrust into in this quarter. The signs of. There were there in the last quarter when you.
Himanshu Baid
Yes, yeah, yeah, there were signs in the last quarter already. See, always you have to recalibrate. So our recalibration was focused more on India. That was our first recalibration. Okay. So then we said, okay, we were recalibrating for the US market. We said we will not be over dependent on one market like Europe. And now you have seen that we have opened a subsidiary in Brazil for our direct presence in Brazil. And B2C category we’ll go. Earlier we were B2B. We are going B2C. So for every market we are strategizing and seeing what the right thing to do. And we are taking long term views on every market. See, Polymade is not for a short term. You know, we have, we have products, manufacturing, ecosystem. So we are taking long.
And today we are still the second largest medtech company after Merrill in India. And Merit operates in a very different segment.
Bharat Shah
Yes. So just allow me one last short one. Therefore, 26, 27, if I have to put a little broad outlook, domestic growth, which you said it has strong 30% which in nine months will mean even higher. Something similar should continue in the year thereafter. Right. With the.
Himanshu Baid
Yeah, domestic market, we are very hopeful that will continue. And there’s a high 25% number. So you know, I’ve not called out a number for next year. So I can’t give you exact precise detail or any guidance. But I think during the year we will form up the guidance for next year. Because we have a very concrete business plan. Bharat Bhai, every year when we give a guidance, we have a very concrete business plan. That is what we will do in each segment. And you rightly said initially for every market we have a very strong plan and what product we will launch, when we will launch, how we will launch.
So it is a very clear path defined.
Bharat Shah
And Europe of course will continue from where we are now beginning to pick up the trade. So if not, should be there.
Himanshu Baid
Yes, we are already seeing the green shoots. Already we have started seeing the green shoots.
Bharat Shah
Thank you. And all the very best.
Himanshu Baid
Thank you, Bharat Bhai. Thank you so much.
operator
Thank you. The next question comes from the line of Shubham Harney from Purnarda Investment Advisors. Please go ahead.
Shubham Harne
Hi sir, just want to know the status of Plants which were building and how much growth is dependent on these plants.
Himanshu Baid
So basically the plant which is coming in Palwal in Haryana, this is for expansion of our renal capacity in in years to come. So with the current capacity we’ll be able to manage up to FY2627. Now going beyond FY2627 we need additional capacity for renal. So that is what we are building there and also in the cardio space. You know, as we build more capacity, we’ll be building. So all these are planned for you know, FY, you know, 27, 28, you know, capacity building. In our core category business which is cardiology, renal care, which are new businesses, that is where we are expanding more.
Shubham Harne
So in we are manufacturing for renal planning to manufacture.
Himanshu Baid
Yeah, that is what we. And also we expanding a transfusion capacity.
Shubham Harne
Okay.
Himanshu Baid
We are also doubling that capacity there.
Shubham Harne
Okay. And other than Palwal.
Himanshu Baid
Other one is in Haridwar. Haridwar will be for domestic expansion. Many, many whatever products we are making for domestic market. That is where we will be continue to expand our capacity in horizon and.
Shubham Harne
By when it can go live.
Himanshu Baid
These are all planned for next year mid of next year.
Shubham Harne
So Palal as well as Haridwar next.
Himanshu Baid
Year, mid of next year already mentioned, I think in our earlier calls also.
Shubham Harne
Okay, got it. Thank you.
operator
Thank you, thank you. The next question comes from the line of Zain from D Capital. Please go ahead.
Zain Gulam Hussain
Hello.
Himanshu Baid
Yeah, please.
Zain Gulam Hussain
Hello, Am I audible?
Himanshu Baid
Yeah, please go ahead. I can hear you.
Zain Gulam Hussain
Yeah, thank you for the opportunity, sir. So just want to ask about dialysis machine. Post installation of dialysis machine, do you receive any services or do you provide any services for those repair or maintenance?
Himanshu Baid
Yes, yes. So we give warranty for three years and after the warranty then these are service contracts.
Zain Gulam Hussain
And can you quantify how much was, how much is the services?
Himanshu Baid
No, we don’t have any significant service revenue so we don’t call that number out.
Zain Gulam Hussain
Okay.
Himanshu Baid
And that’s not part of our core core strategy. I think the important thing is to to sell the machine. Servicing is just part of a maintenance thing. So it is not part of the core business.
Zain Gulam Hussain
Okay. And on second question on other income it was high. So does it include forex or anything?
Himanshu Baid
Treasury mainly treasury mainly Treasury.
Zain Gulam Hussain
Okay, that’s it. Thank you.
Himanshu Baid
Thank you.
operator
Thank you. The last question for the day comes from the line of Harsh from Marcellus. Please go ahead.
Harsh Shah
Yeah, hi sir, just one question on the European side, can you give an update on the Chinese competitive intensity Alluded that It had increased during the first quarters. Are you seeing that the madness sustained during this period as well.
Himanshu Baid
Could you repeat that? Harsh. Sorry. Was not very clear to me.
Harsh Shah
Yeah, hi. Am I audible?
Himanshu Baid
Yeah, you’re audible now. The question was not very clear.
Harsh Shah
So. Yeah, yeah. So the question is, with respect to the Chinese competitive intensity, you alluded that it increased during the first quarter where they were selling at very low pricing. Are you seeing this comparative intensity sustained during the current quarter as well?
Himanshu Baid
No, no. As I said, we are already seeing green shoots and we are already seeing, you know, the market bouncing back. So I think we are pretty confident now that this quarter, Europe will do better than what is done in the past.
Harsh Shah
Okay, got it. Thank you.
operator
Thank you as there are no further questions from the participants. And now hand the conference over to management for closing comments. Thank you. And over to you, sir.
Himanshu Baid
So thank you again, everyone. And I think, yes, it was a tough quarter, but I think we have been very resilient in terms of, you know, the business, you know, the strength. The fundamental strengths of the company are very strong. The R and D pipeline is very, very strong. And the hiring, you know, we have done, you know, significant hiring and we continue to add more people, more head counts in the organization. Of course it’s a cause, but then it helps us to build for future. So I think that’s what we are building. And I think overall, I think we would maintain a similar guidance.
What we have told earlier with India growing 30%, international growing 5 to 10%. But yes, as time progresses, next few months are very critical for global businesses. And I think we are pretty hopeful that certain tariff issues will be resolved soon and that will help us to go stronger in the US Market and maybe also in Europe in the near term. Thank you again very much, everyone, and thank you for being on the call.
operator
Thank you. On behalf of ICICI securities limited that concludes this conference. Thank you for joining us. And you may now disconnect your line. Thank you.
Himanshu Baid
Thank you everyone.