Note: This is a preliminary transcript and may contain inaccuracies. It will be updated with a final, fully-reviewed version soon.
Sai Life Sciences Limited (NSE: SAILIFE) Q4 2026 Earnings Call dated May. 15, 2026
Corporate Participants:
Krishna Kanumuri — Managing Director and Chief Executive Officer
Sajal Kapoor — Unidentified Participant
Vilay Rai — Unidentified Participant
Analysts:
Diwakar Pingle — Analyst
Binay Singh — Analyst
Unidentified Participant
Presentation:
Operator
Ladies and gentlemen, good day and welcome to SAI Life Sciences Limited Q4FY26 earnings conference call. As a reminder, all participants will be in the listen only mode and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal an operator by pressing star then zero on a touched on phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Dewakarpingle from ENY.
Thank you and over to you sir.
Diwakar Pingle — Analyst
Thank you Yusuf Good evening to all the participants in this call and good morning if you’re logging in from the West. Before we proceed to the call, let me remind you that the discussion may contain forward looking statements, uncertainty and other factors. It must exist in conjunction with our businesses that could cause future result performance or achievement to differ significantly from what is expressed with implied record looking systems. Please note we have named the results and in the presentation and the frame is available on the company’s website.
In case you want to receive the same you can write to us and we’ll be happy to send the same over to you. So take us through the results and answer your questions. Today we have the top management of PI Licenses represented by Krishna Kannuri, Managing Director and Chief Executive Officer and Shivajit full time Director and Chief Financial Officer. We will start the call with a brief overview of the quarter on the failure then passed which will be followed by Shiva focusing on the financials and then we’ll go over to Q and A Fish.
With that said, I’ll now hand over the call to Krishna Kamandi. Over to you Krishna.
Krishna Kanumuri — Managing Director and Chief Executive Officer
Thank you. Good evening and thank you all for joining us today. We are pleased to report that Sai Life Sciences has delivered a strong performance in FY26 with overall revenue growth of 29%, EBITDA growth of 56% and PAC growth of 109%. Both our CRO and CDMO segments registered healthy growth despite operating in an environment characterized by geoport clumsillarity, supply chain disruptions, evolving regulatory expectations. This performance underscores the strength of our integrated CIDO platform and our increasing relevance to global innovator companies.
A key highlight of our growth continues to be increasing contribution from large Pharma. In FY26 the revenue contribution from our 19 pharma clients went up from 28% FY22 to 49% this FY26 building approval, we are increasingly seeing a trend of large pharma moving to consolidate the full life cycle from early development to commercial manufacturing. Similar to trends witnessed in China, our CDMO strategy remains firmly anchored on deepening engagement with large pharma clients. As you are aware, Sai Life Science today works with 19 of the top 25 global pharma companies.
We believe that this foundation is a strong platform to build our growth on. We continue to build a strong pipeline of commercial molecules with the tally standing at 34 commercial molecules, 11 in phase three pre registration but 155 in earlier stages of development. Importantly, we’re also seeing strong traction in our dedicated development RD team model with Large Pharma, an initiative we started scaling last year. We believe this model will fundamentally shape how we partner with Large Pharma towards larger, more customized and longer duration programs.
On the CRO side, our integrated discovery strategy continues to gain momentum particularly with biotech customers. Our CRO revenue mix between pharma and Biotech stands at 48 to 52% versus 52%. We’re also seeing increasing cross selling opportunities with our CDMO large pharma customers reinforcing the strength of our integrated model. A key differentiator for us is our focus on automation and scale in DMDK and biology enabling us to handle large integrated programs for our clients. At the same time, we are investing in next generation technologies in ADCs where we are seeing significant interest in program info from large pharma.
Let me touch upon a few broader industry trends shaping our strategy. First, evolving radiative landscape, particularly the FDA’s push towards new approach methodologies is expected to reshape discovery workflows over the next several years. While animal testing will continue to remain relevant for complex toxicology and global regulatory environments. We expect increasing demand for biology heavy discovery services including in vitrobiology, human cell based assays and organoids. We view SAIB is well positioned to capitalize on this shift and we’ll continue to invest in these areas.
Second, biotech funding has shown encouraging signs of recovery with year to date funding up 52% year over year and April 2020 starting reaching 10.6 billion up over 4% year over year. IPO activity has also strengthened significantly while funding remains somewhat constant at larger late stage biotech companies. This trend still supports overall CRDMO demand, particularly through increased outsourcing and program progression. Third, we are closely monitoring evolving global trade environment including potential tariff related developments.
Increasingly we are seeing large comma increase lease structured deals in a way that mitigate tariff exposure. We also remain mindful of near term challenges, ongoing GA building technology including Middle east situation are impacting input costs and disrupting logistics and supply chains. Despite this, our customer concentration on this building give us confidence. As we enter FY27, we continue to believe that our growth will be led by pharma driven by increasing outsourcing intensity, movement of biotech assets into pharma pipelines and strategic long term partnerships.
As we scale, a few priorities remain central to our approach. Science led capacity expansion rather than POV reactor led growth, continued product and pipeline densification, especially in CDMO given inherent variability in product life cycles, careful management of customer concentration in FY26 top 10 customers contributed 54%, top 5, 37% and top 112% of revenues. Our top customer engagement spans multiple services, reducing concentration risk at any service level. Given the momentum we have seen through FY26 and the nature of customer discussions underway, we are entering an increasing investment cycle to support future growth opportunities.
Our current estimate for industrial FY27 is in the range of 1100-1300 crores. Importantly, these investments are being undertaken either with clear demand visibility or through active strategic conversation with the large pharma customers. Finally on the Digital AI transformation, we are investing capabilities that improve productivity, speed and prowess across organization. We believe this will be an important lever in enhancing competitiveness and narrowing productive gaps across the industry.
At the same time, adoption of AI within the CI must carefully balance customer confidentiality and data security considerations. Over the next 1824 months we expect AI and digital tools become increasingly embedded not only in enabling function but also for the core science and development workflows. As we enter FY27, long term opportunity for CAS remains very robust and our integrated model with strong pharma relationships, technology investments position us well for sustained growth. We would like to reiterate our stated aspects of maintaining revenue growth of 1520% while maintaining EBITDA margins in the 28 to 30% range over a three year period.
Just a point that given somewhat new capacities and investment progressively coming on during the year, we expect second half of FY27 to be stronger than the first half. With that, I will now hand it over to our CEO Poor Shiva to talk to you. The Financial Performance
Diwakar Pingle — Analyst
Thank you Krishna. Let me begin by reiterating that fiscal 26 has been a year of strong financial performance and disciplined execution. We delivered a revenue growth of 29% and EBITDA growth of FitX percent and the past growth of over 100%. This growth was supported by balanced contributions from both the CRO and the CDMO businesses alongside continued operational efficiencies. The CRO and the CDMO business for the year demonstrated a healthy growth rate, 24% for CRO and 2030% for the CDMO business.
Our revenue contribution from the top 19 out of the 25 global large pharma companies increased for 49% in FY26 as compared to 28% in FY22, demonstrating the steady deepening of our strategic relationship. Our revenue mix continue to evolve in line with strategy with increasing contributions from pharma clients across both sectors. While the overall revenue growth in fiscal 26 was 29% as compared to 16% in FY25, the year fiscal 26 witnessed a relatively even distribution of revenues with the split between H1 and H2 being 48 and 52% respectively as compared to 40 and 60% in fiscal 25.
In addition, Q4 fiscal 25 was skewed at 34% of the total revenues as compared to 27% in fiscal 26. As we’ve often stated, the CRDMO sector is inherently characterized by a degree of quarterly lumpiness, particularly as projects transition across different stages. While this will lead to periodic fluctuations in revenue and margin, as Krishna mentioned, the long term opportunity for the CIGMO sector remains robust and our integrated model with strong pharma relationships and technology investments position us well for sustained growth.
We remain confident in our ability to sustain our long term revenue growth guidance of 15 to 20% and the EBITDA range of 28 to 30%. As we enter fiscal 27. A key focus area for us is to invest in proactive capacity creation aligned with customer demand. In fiscal 26 we incurred a capex of 633 crores and made a budgeted spend of 700 crores. For fiscal 27 we expect capex in the range of 1100 to 1300 crores split between CDMO at 65% and CRO at 35%. We expect to fund the CAPEX through a mix of internal accruals and debt.
Our capex allocation will be split across capacity expansion, capability and technology. 75% of the capex will go towards capacity expansion and the balance towards capability and AI and technology. At the same time, while we put these numbers of 1100-1300 crores, we will continue to calibrate the pace and the pacing of these investments in line with the evolving business environment and closely align the spend with our customers strategic priorities and demand visibility. Importantly, our approach to CAPEX remains time set as Krishna mentioned, rather than capacity heavy, ensuring flexibility and higher long term returns.
During the year, we navigated external headwinds including increases in input costs and higher logistics costs and delays arising from evolving geopolitical environment. At this point, we do expect some short term impact on our cost structure. We have approached our customers for appropriate cost provisions in certain areas. However, we believe that the recovery of these increases may not always be contemporaneous with the incurrence of costs. We continue to manage these challenges through operational efficiencies, strategic sourcing initiatives, disciplined execution, and ongoing engagement with our customers.
In closing, I want to reiterate that we remain committed to disciplined growth, student capital allocation and margin resilience. Our balance sheet remains well positioned to support the next pace of expansion, both in terms of debt and in terms of internal accruals that we are projecting. Near term volatility can persist. Our medium to long term outlook remains strong. With this, we’ll be happy to take your questions.
Questions and Answers:
Operator
Thank you very much sir. We will now begin the question and answer session. Anyone who wishes to ask a question may press Star and one on their Touchstone telephone. If you wish to withdraw yourself from the question queue, you may press Star and two participants are requested to use handset while asking a question. Ladies and gentlemen, we’ll wait for a moment while the question queue assembles. First question is from the line of Bnesing from Morgan Stanley. Please go ahead.
Binay Singh
Hi team, thanks for the opportunity. My first question will be on the Capex announcement that you shared. We’ve seen a very sharp increase in capex from 200 crores or so that we did two years back to now taking it up to 1300 crores. Could you talk a little bit about what is giving us the confidence of this level of jump
Diwakar Pingle
In capex and is there any one off project that you are doing next year which is leading to this for this sort of becomes our new level of capex? Could you share thoughts on these points?
Krishna Kanumuri
So Biny, if you look at what we had indicated at Capex a couple of years back, it was based on what we thought the demand was. But if you look at the last 18 months or so we’ve been getting more involved with customers across the value chain and as we work with them closely they’re giving a better sense of what they would like us to look like and what volume they can potentially come in our direction on the Discovery side and CDMO side. As we are getting into more integrated collaborations, really being development partners, we’re having greater visibility in terms of pipelines rather than waiting for RFPs to come through.
So I think given what customers are telling us, where we have to go in terms of technology, in terms of better visibility of what they have in the pipeline and what potentially can come our way and what they want us to see in terms of other technologies coming in is building next generation technologies, ADC development, for changes in peptide development, in terms of high throughput screening and biology to do more integrated programs and in terms of the level of data exchange they need between us and them and also just the visibility in terms of not only what they are giving us for development and pipeline, we’re seeing a lot more of the program than we have in the past.
And that will give us better sense of what likely will translate probably 12, 15 months down the road to commercial manufacturing. So it’s just better visibility and better engagement with our customers across both diversity of areas to invest in like a new area was. We were not very sure about what formulation would look like. But we’re seeing a greater need for complex developments early on. And so there’s a lot more new things we’re getting from customers as we engage more and more with them.
What is extremely clear is companies want to develop strategic partners in India at this point and they want to see who will be relevant in the next five years and they want to see partners who can understand, work with them and build along with them. And that’s how we are playing this game at this point. So we have a lot of conviction behind these investments.
Unidentified Participant
Thanks for that. You know.
Operator
Sorry to interrupt. Mr. Binet, you are not audible.
Diwakar Pingle
Hi. Sorry. Sorry for that. You know one thing I noticed in your presentation, you added one more large pharma customer. Right. Earlier you were working with 18 of 25, now it is 19. And did I hear you correctly in the opening remarks you said that you are now have a dedicated research sort of a tie up for large pharma because earlier we had it. That’s not what. No, no,
Krishna Kanumuri
No. That’s not what we’re talking. That’s not what we’re talking about. What we’re talking about what pharma has done. So if you look at in the past, pharma never gave us late phase opportunities for outsourcing and process development. They generally used to give us lateral peg transfers. So over the last couple years, several large pharma have started getting into FTE agreements for late stage and mid stage development. It’s not dedicated to anything of that kind. It’s just that These are dedicated FTEs we are running for large pharma between our global Side both in India and Manchester which has greater visibility into doing development assets and that’s what we mean by that as opposed to a dedicated center, the dedicated FTE teams working on development.
I hope that clarifies that.
Diwakar Pingle
Yeah, that’s very clear. And lastly could you comment
Binay Singh
A little bit about where the capacity will go with this capex? That’s it from my side. Thanks
Krishna Kanumuri
Shiva. I’ll let Shiva talk about the capacity ways going.
Diwakar Pingle
So I think the capacities that we are adding today I think our current capacities will take us to around 1160 KL capacity that we had mentioned. As far as the dealer capacity expansion is concerned what we are doing a lot of this is actually going towards one investment in discovery. Second there is investment in development space that is kind of adding to our cost numbers. If you remember last year we had mentioned to you that we had started the plan for going from 700 KL to 1150 KL and we said that the FY26 capex will only take into account capex that will be incurred in that fiscal year.
While both the plants will not get completed a majority of the capex will also fall in this year. So as I mentioned earlier out of the 1100-1300 crore capex direction that we have provided 75% of that will actually go and satisfy capacity requirements. 25% will be for kicksburg. Thanks team. Thanks.
Operator
Thank you. Next question is from the line of Ahmed Chalke from GM Financial. Please go ahead.
Diwakar Pingle
Yeah thank you for giving opportunity and congratulation management. So the first question I have like the CDMO segment have delivered more than 30% growth during FY26 so what will be the outlook for 2728? While concerning that there are two data points from the PPT one is we have added two large pharma customers on the commercial supply side as well as our commercial products have gone up from 30 to 34 from the last quarter. So how these two three opportunities on the commercial side in terms of the scale as well as in
Binay Singh
What areas these commercial opportunities are. Thank you so much.
Diwakar Pingle
Thanks so same. So I think on the CDMO side I think what we have stated is that we stated that there are I think even in the last conference call we had mentioned there are three new products that have actually gone commercial and we’ve added one more product since then which makes it 34. So some of them, at least a couple of them will see production and commercial revenue starting this year. Other question amay you asked about is how is the growth prospect? I think we believe that the CDM as we start the fiscal year, we believe based on the visibility, we believe the growth will be strong and we’re confident about a good financial year at this point in time.
Sure. And the second question I have on the margin front, we have given the guidance that we will aim to maintain margins in 28 to 30% range. But there are two headwinds for the margins. One is the RM cost inflation which could be there next year as well as the capex which is getting commercialized at the end of the year or the second half of the year. So how should we look at the particularly in terms of the margins? Thank you. So our stated or aspirational margin is to remain around the 28 30% and I’ll tell you two reasons for it.
One, with pharma generally there’s an open book pricing and from what we’ve seen, and we’ve seen seen this across the Chinese companies operating at much larger scale, the margins tend to remain between the 25, 30% which is what we’ve seen. And our pricing with Pharma indicates that 28 to 30% is what is much more comfortable from a pharmacy perspective. The second thing I think, will there be an operating leverage as we scale up? Yes, Coming in and there’s going to be some amount of inefficiency as we scale up new capacity which would then add cost into the equation.
So that is also something that we need to take care of. And that’s why we’re giving you an accelerational guidance of 28 to 30%. I know we’ve hit 30% this year, but we still want to leave you with this guidance and this is consistent with what we stated, including last quarter.
Binay Singh
Sure.
Diwakar Pingle
The
Binay Singh
Last question, if I can squeeze
Diwakar Pingle
In on the CRA side, this is the second year I believe where we have delivered 20% plus growth and all these years the large pharma contribution or the big pharma contribution have consistently gone up. So is this contribution going up? Is it incidental because the biotech funding has slowed down or is it also strategic in nature and should we expect this or large big pharma contracts to keep driving our CRO business going ahead? Thank you so much
Krishna Kanumuri
On that. I’ll take this question. So I think they’re actually both at play. Right. One is strategic. I think large pharma is very clear that they want to build India footprint. I think this large pharma business did not exist in India a couple of years ago. There are only 2, 3 large pharma who are Actively doing med chem in India, I would say as close as three years back. But now every large pharma is looking at coming to India to do discovery. So this will be a structural trend for the next few years in terms of LGTQ partners.
But also I think biotech is just going to a little bit of slowdown as well on the new company formation and we expect that to pick up in the next couple of years. So I think secular trend, you will probably see larger pharma coming in and filling the gap for the next couple of years. But biotech will come back in the next 24 months and give us secular growth. I think from that way the industry is well positioned to kind of the short and long term where we are right now. And we also, the early part of this big right people are just coming chemistry.
But eventually the whole goal right now is to be fully integrated. So I think the opportunity is significant for us because our integrated story is something we invested in on the biology and DMPK front, which should probably give us an advantage in terms of being a preferred choice going forward.
Diwakar Pingle
Sure. Thank you so much. I will join.
Operator
Thank you. Next question is from the line of Sajal Kapoor from Anti Fragile Thinking. Please go ahead.
Sajal Kapoor
Yeah. Hi. Thank you for giving me this opportunity. Hi team. In emerging modalities, many outsourcing relationships begin in discovery but don’t necessarily translate into late stage clinical or commercial manufacturing. So I’m alluding to one of your other CRDMO competitors in India, Bangalore based company. What precisely increases the probability that PSI retains a molecule across the life cycle and where do you still see the highest leakage points today? That’s my first question.
Krishna Kanumuri
I think there’s a difference in how we have been built versus other companies. So if you look at where we have been built, from day one we’ve done this. So we actually were discovery company first, but then we took a gap in terms of discovery investment and went very heavy in terms of becoming a preferred commercial partner. And so as we become a preferred commercial partner, we also now in the last few years have become a preferred development partner. So we right now are working with companies in all three areas.
Right. Discovery, development, commercial and what is happening because we’re integrated, there’s a technology thing, right? So essentially what happens is when you’re doing discovery, people are looking at newer technologies like ADCs. First generation ADCs will be very different from next generation ADCs. And so whatever we’re doing discovery, the development teams also are doing development to kind of reflect what their new generation ADCs look like and, and what the technologies are. So because we are partners there as well, and we have partners, it’s much easier for them because we’re qualified by all three departments to work with them.
Whereas other companies have not made the transition. Either they’re very manufacturing heavy or discovery heavy and they overlap a little bit on the discovery side, a little bit on the development side. But we’re the only companies really stitch all these together and we’re approved by all three of these areas. And that’s the strength why we believe that we can retain majority of the molecules. But that said, some molecules definitely leak out of us because either we don’t have specific capacity, people want diversity, or they want to take the molecules in house.
But the chances of us retaining it are higher than most other players at this point. That’s how I would frame it.
Sajal Kapoor
Thank you. Thank you, Krishna. My second question is. And that explains the whole scenario very well, so thank you for that. My second question is, historically many CRDMOs scale revenue faster than organizational capability, which eventually creates execution fragility. So in that context, as TIE increases integration across discovery, development and manufacturing, where do you believe complexity is kind of compounding faster internally or fastest internally? That is complexity is compounding fastest internally.
And what are the leading indicators you monitor before those kind of stresses show up in numbers or financially? Thank you.
Krishna Kanumuri
That’s a very broad question. But again, unfortunately, when. Right now we are at a point right now that we are getting into a very interesting part, right? We’re scaling capacity, we’re scaling technology and we’re getting deeper relationships. So I think what gives us the advantage to understand where the gaps are because we are very deep in relationships and not doing one offs, we get to have a much more visibility in terms of what we are doing from a performance standpoint. I think the key, I think if you ask me where the key gap will be down the road is really figuring out how AI plays a big role in terms of bridging the productivity gap vis a vis India and other geographies, so to speak, and getting the right talent pool who’s next generation ready in terms of working in the digital space.
Because we believe AI is a great equalizer in terms of one is intellectual horsepower in terms of basically knowing what’s going on everywhere, more rapid problem shooting. So I think we are putting all the tools in place so we have a much better view of how to scale up where the gaps are and be proactive in terms of scaling up at this point. And so the idea is there’s no magic bullet here. Rather than having your ears to the ground, talk to customers regularly. And this is a 247 business. It’s about every customer, every bird, one day at a time.
And that’s how we are able to scale up. That’s really how it works. Shiva, you want to add something to this?
Diwakar Pingle
Yeah, I think, I think so. I think to add to what Krishna said, I think the one advantage that is that we’ve seen working with, with these large pharma companies, because you work with them closely, they actually train you, they work with you, they kind of teach you their thought processes. Everything from setting up of a lab, setting up of experiments. How do you kind of train what kind of things to look at, how do you kind of look at a problem? So I think that kind of gives us that ability to understand things and what we are doing to reinforce and kind of strengthen.
We are just taking this as part of our learning. We created our own, what we call an internal chai academy that then reinforces this teaching not just to that team that is kind of involved with this particular, with any particular program to broad basis across the organization. This is now headed by a senior head of research from Alaskana who has now taken this full time as an activity so that this can be a focal point area for us. And that’s how we kind of make sure we keep at technology and science that keeps changing every day
Krishna Kanumuri
And just kind of adding to that. One thing we keep talking about is that we are building a technology led growth. So we really are focused on building the foundation, just not trying to over index in one area because we realize that if you over index one area then you’re really not building the foundation. So we are very, very clear that we want to get the foundation right here and that’s where we’re spending most of the effort. Sorry, go ahead. Another question.
Sajal Kapoor
That’s sensible. Krishna, thank you for that. Just on that AI thing, I mean is it homegrown capability or is it something off the shelf that you know, even the competitor can buy off the shelf? I mean, how do we plan to differentiate AI so that it adds to the real advantage?
Krishna Kanumuri
I think it’s a question of getting the framework ready for using AI and there are a lot of tools coming in. One is obviously one user tools available. And you have to understand we’re going to be restricted in terms of what we can use of customer data. So how much internal data we can use is going to Evolve. Right now we have different external sources but it’s not a question of just integrating AI, it’s a question of what is the long term strategy of how you integrate across the board. It has to be a fundamental shift.
Cannot be. I’m buying a single tool and this is what’s going to work. It’s not a single tool, it’s a complete has to change. And right now we don’t know how it’s going to evolve in terms of internal tools, what customers want from IP standpoint. It’s early days but the idea is to make ourselves digital ready to be able to plug and play different tools as they come in. Our core processes themselves should be data rich to give us the opportunity to evolve as the tools evolve.
Operator
Thank you. Next question is from the line of Girish Bakru from rbmed. Please go ahead.
Diwakar Pingle
Yeah, thanks for bringing my question. Just on the question only actually on the new modalities. Krishna possible to give a ballpark figure your targeting or revenue contribution from new modalities by CFY 30 given their heightened up 10%
Krishna Kanumuri
Right now we’re not in the position to give that information yet at this point. So we’re not that far along to be able to give full prediction of what that will be. But generally what happens. If you really look at the trend of CRO, just to be put in perspective, right, we tend to basically follow whichever way the pharma companies are going. If you look at where pharma is going today, 50% pure small molecule, then the next 30% will be peptides, oligonucleotides and ADCs. So that’s what they consider biologics.
80% is going to be covered there. So over probably a five to seven year from now you see a similar mix purely from not the phi perspective, but anybody who plays in these areas, you tend to follow the customers from that standpoint. If you look at the way the market is, that might flip right in two years people might say useless, we go someplace else. But it’s very hard for us to forecast what it looks like because we are almost like the. We’re almost like we are following the customer and that can switch anytime.
But the important part of being CRO and ROP is to be a fast follower, be close enough to be able to change the trend but not be on the bleeding edge where you left left with the debt investment. So that’s kind of how we look at it.
Diwakar Pingle
Understood. And of course you highlighted four of these key ones. Just one key question there. I Mean there are a lot of low hanging fruits, but where do you think you will potentially take a high market share? Is it more peptides or you’re doing right now fragments, you’re limiting yourself to amytes and oligos. ADT side. Also you said that you’re evaluating clinical conjugation. So which, which area do you think will be a possibly a big focus area of these four and probably easy to do also.
Krishna Kanumuri
What do you have to say at this point? I’d love to come and give you that grant. I can’t really give you the exact sequence, how that’s going to go. Right. It’s, it’s hard right now. Honestly we can’t predict that at this point. What’s that?
Diwakar Pingle
Molecules. So you never really know which one will go ahead, which one will come on. So there’s going to be other things that will kind of influence the number and the revenue. That’s why it’s a little difficult to kind of give you a specific growth rate or a number at the end of a particular period. Understood, Understood. And this last one, this is probably more like an industry wide question. We’ve seen so many companies talking about these new areas but very few investments going to biologic manufacturing.
Do you have any plans for that in future?
Krishna Kanumuri
Look, we evaluate all options and when we’re ready to take a position we’ll kind of communicate. But obviously we’re evaluating every market at this point and there’s obviously we’re looking at all options and even if you look at biologics, you decide where to play. Again, we are constantly talking to customers, seeing where the demand is, where the gap is and as our strategy evolves we’ll definitely inform you guys how we look at it.
Diwakar Pingle
Thank you so much.
Operator
Thank you. Next question is from the line of Siddharth Nidandi from cwc. Please go ahead.
Binay Singh
Hi, thanks for the opportunity. Just wanted a couple of quick clarification. One, you know the new technology revenue salience went down from 7% to 4% which means that in absolute terms also there is likely to have been sort of a decline on a year, on year basis. Was that, you know, if you could explain, you know, what caused that? What caused that? Was there a one off earlier or was there any particular project that did not go through from one stage to the other? If you could give us some color on that.
The second one was you mentioned about some of the capex being on AI. If you could tell us what’s the nature of that AI capex that you are putting up that will be helpful.
Diwakar Pingle
Sure. So I think on the first question, I think we mentioned this even last time when we put up this number. A lot of the work on the new modalities are not commercial from our perspective. They are in clinical pipelines. When you work on clinical pipeline you are going to have a campaign and then you are waiting for another campaign. And so there will always be. And this is the primary reason why CDMO businesses have revenue streams. And so it is primarily that and it’s not about one off this time or one off last year.
The second question on AI, I think Krishna addressed it, but I’ll kind of give you the thought process that we have with respect to AI. So the way we are thinking about AI, we need to look at our productivity, efficiency and kind of, you know, scientific output that can be improved by using AI as technology that can aid and enable a scientist who thinks faster. That’s the whole purpose of this AI definition. There are a few tools that are available from the market, but we’re also building things within our overall system.
We are defining an AI canvas as we speak. This is kind of to make sure that the teams can get as much assistance, automation, analytics, all pulled in one direction, in one set of information that the chemistry, the team leader, the leadership team can actually use at any point in time to kind of look, analyze and kind of present data. We also, with respect to the partnerships that we have with our large pharma, we’re also trying to integrate with their systems and their needs in terms of what data that we will transmit and send out.
So that’s the broader construct of the AI.
Binay Singh
Sure. Sir, you also mentioned about some AI Capex. Is there any particular Capex there or, or did I miss hear that?
Diwakar Pingle
Yeah. So anything that you’re building or your tools that we are buying will be capex and that’s a
Binay Singh
Software and stuff. Got it?
Diwakar Pingle
Yes.
Binay Singh
Right. Thank you. Thanks so much.
Operator
Thank you. Before we move to the next question, ladies and gentlemen, in order to ensure that the management is able to address questions from all the participants in the question queue, please restrict yourself to two questions only. Should you have a follow up question, please rejoin the queue. Next question is from the line of Sanjay Kumar Egwan from I thought PMS. Please go ahead.
Diwakar Pingle
Hi. So first question on the CapEx. So I think 1300 is Yema but next year’s cash flows could be anywhere around 600, 700 crores. So what will be the debt that we are planning and is it only for the. Does this CapEx only include the land 50 KL capacity
Sajal Kapoor
Or we’ll also start work on the greenfield. I think we have mentioned that we have acquired a land for a new greenfield site.
Diwakar Pingle
Sorry, your line is not very clear. Can you repeat your question please?
Sajal Kapoor
So the 1300 crores that we have earmarked for capex but
Diwakar Pingle
Our our cash flows will be somewhere around 607 crores so we not to take debt. So how much debt are we planning to take to fund the capex? And does this 1300 crore capex is it only for the 1150k brownfield expansion or is it also for the greenfield that will
Sajal Kapoor
Be starting in the new land that we have acquired?
Diwakar Pingle
So the 1100k crores to 1300 crores capex I’m not going to give you the debt versus the cash flow numbers because that can then means I am trying to give you a projection. So the result going based on where we see this number ending for fiscal 27 our debt to EBITDA ratio will be fairly healthy. That’s really what I believe. And if I look at the CAPEX spend itself it will be for capacity also including the 1150 KL that we talked about. As we mentioned 225 scale of that 450 KL CAPEX will only get done at the second half of this year.
The other CAPEX is going to be much longer duration. So most of the CAPEX for the plant would actually happen in this year as opposed to last year. Plus we’re also adding capacity on the development side adding capacity in terms of fuel cupboards and analytical and chemistry equipment. They’re also increasing our discovery capability and biology capability both in terms of fuel covered connectors. So this will all be there. There will be slightly smaller capex on the new site. That new site will probably start towards late this fiscal year and early next year is how I see that CAPEX starting to grow.
Sajal Kapoor
Okay, okay. And second question. We’ve added 4 commercial molecules
Diwakar Pingle
Compared to the last quarter and 5 in the phase 3 pre registration phase. Can you highlight some of the high potential ones and the corresponding therapy areas? Do any of them involve new modalities? So not going to. You know I think therapy areas are broad so there are multiple things when I say high potential at least in my belief there are at least three molecules that would show a good progress in this current financial year. We have started manufacturing and delivering or starting to deliver revenue in fiscal 2010 on at least three of the molecules that we have currently added into the pipeline.
Of the four molecules I would say three will have a pretty decent revenue growth in trajectory. The fourth one in our opinion will be a smaller one. But it was a fairly important capability to acquire. And
Sajal Kapoor
Just to follow up then I think Krishna sir had indicated in the media interview that you might even look at acquiring new modalities or acquiring small pharma companies for the tech and for the new modalities, anything that we are looking at.
Diwakar Pingle
So we are open to options all the time. We evaluate deals as and when they get presented from, you know, from the bankers. At this time we don’t have an announcement to make but as I said earlier we continue to evaluate multiple deals all the time.
Operator
Got it. Thank
Sajal Kapoor
You.
Operator
Thank you. Next question is from the line of Vilay Rai from Kamayakya Wealth Management. Please go ahead.
Diwakar Pingle
Congratulations on great set of numbers. So just one clarity. On the CAPEX side you said 25% of capex is in capability.
Vilay Rai
So is it predominantly for our new modalities and which is the key area that we are going to focus on?
Diwakar Pingle
It’s not necessarily new modalities. This could be newer techniques even for small molecules for example. High throughput experimentation is fairly new in terms of how things work. Or a complete automation on the DMP technology which kind of end to end kind of gives you a different ability to kind of do precision biology and handling molecules at scale or volumes at scale. Those are the things it is, it is capabilities in both sides, both small molecule and some new modalities.
Vilay Rai
But this could also include the capex for ADCs and peptides.
Diwakar Pingle
So if you go back to our conference calls in the last year I think we had stated that we are adding development capability on the peptide side. We probably will also add pilot scale. This is coming up this year. So we started the CAPEX last year. So Pestite is definitely included in the CAPEX that we are talking about. This year we are adding some capability on the ADC side but that’s more on the discovery side we have some costs and we are working on the ADC on the development side. We will come back to you, you know as soon as we are able to make a public announcement on that.
Binay Singh
Just the last question. Even in the CRO business we are seeing that pharma
Diwakar Pingle
Is constantly a higher share of revenue compared to biotech companies. So do you see this increasing in the coming years and how has been the pipeline or how is it the development from the biotech companies? Can you repeat your question? Sorry, you might have to understand.
Krishna Kanumuri
I’ll take the question I’ll take the question. I think so. We already answered the early part of the call. Right. It’s just where the market dynamics are right now. I think biotech will always be a significant part of discovery. I think long term, I think the 5050 ratio will hold. Short term there might be an imbalance in terms of pharma, maybe the next couple of years but long term biotech still is the development engine for large pharma. So we do expect that balance to maintain 5050 on the 50 50ish long term on the pharma versus biotech.
It’s just for the short term. You will see pharma probably drive the growth. Longer term biotech will come back but overall the pie should get larger in the next couple of years. Hope that answers your question.
Operator
Thank you. Next question is from the line of Virat Shah from pgim. Please go ahead.
Binay Singh
Hi, thank you for the opportunity. I just have one question. In your presentation you have mentioned 15 to 20% revenue CAGR on a current revenue run rate of 2020200 crores with expected capex of 1100 crores. So fair to assume the asset turn would remain in the similar historical range as it was.
Diwakar Pingle
So I would see a little bit of a dip before it kind of comes back towards year end to we are doubling down on our capex. That’s really what we have stated. So what we have committed and we continue to commit this is that asset turn on a net basis, you know installed capacity will be 1.0 to 1.4 but that’s medium term commitment. We would see some fluctuations but we continue to remain committed to our, you know, the steady state 1.2 to 1.4.
Krishna Kanumuri
Look, I think the important aspect to understand is that no matter what capex you put in it’s going to take a 2, 3 years cycle to get back to that scale. It’s not like you put it, it’s going to be day one that revenues I think as much as we expect that as a long term trend to maintain whatever you’re forecasting but obviously there’ll be a two, three year ramp up period to get there for any capex you put in.
Binay Singh
Understood. That’s it from. Thank you.
Operator
Thank you. Next question is from the line of Akshay from AK Investments. Please go ahead.
Binay Singh
Hi sir, thanks for the opportunity. My first question is generally the quarter four should be the strongest for our kind of business, right? So in this quarter we have seen here on your growth of only let’s say about 4%. So can you put Some light on that and okay then I will ask my follow up question.
Diwakar Pingle
So I think Akshay, I think I answered that question in my opening remarks. What I was mentioning to you was if you look at our fiscal 25 and this has been the general training wind for five we had a 40% in the first six months and a 60% revenue split in the second six months in fiscal while in fiscal 26 even though we delivered close to a 30% growth our revenues actually fell almost even so we were like 48 52. So it’s not about and as we always told you this business cannot be ascertained on a quarter to quarter basis.
So kind of difficult to say when the PO becomes due and when the PO gets delivered because this is not a piece business that you produce in anticipation. You produce only based on what the customer wants. So it just depends on how the PO is.
Binay Singh
Okay sir. And my second question is despite the heavy capex of anticipation of around 1100-1300 crore so are we confident of maintaining 28 to 30% margin in this year, this financial year and going forward?
Diwakar Pingle
So our so ase would be again we set this last year and continue to state this year. So 28% to 30% is our steady state aspiration. Naturally what we committed and we actually committed we’ll get there in two to three years time frame and we’ve got into 30% last year based on how we look at the webcast and I believe that we will continue to aim for that same number.
Operator
Thank you. Next question is from the line of Avikshit Vijay from Global Consult Research. Please go ahead.
Vilay Rai
Yeah hi. Thank you for the opportunity. I had a couple of questions. So first one is we had set aside a amount of 1100-1300 crore of capex. So when do we expect it to come live?
Diwakar Pingle
So a typical plant takes somewhere around 18 months or so to kind of complete construction. So depending on what project. So for example we started the 700 to 1150 KL capacity expansion sometime during the middle of last year. We are expecting 225kl to come this year and 225kl next year. So similarly we had product to double our stock R and D capacity last year. So it will take anything will take around 12 to 15 months time frame in terms of capacity and capex will be incurred in part in one year and maybe the reminder will come in the second year.
These are all brownfield expansion within sites that are already developed. If it’s greenfield sites it’s probably Going to take you 24 to 30.
Vilay Rai
Okay, yeah, that answers my question. And the second one is, is there a possibility that we could name some of our molecules and the end clientele?
Diwakar Pingle
We will not be able to do that due to confidentiality restrictions.
Vilay Rai
Not even the client is possible.
Diwakar Pingle
It is definitely not possible.
Vilay Rai
Okay, yeah. Thank you so much.
Krishna Kanumuri
Thank
Diwakar Pingle
You.
Operator
Thank you. Next question is from the line of Alankar Garude from Kotak Institutional Equities. Please go ahead.
Krishna Kanumuri
Hi. Thank you for the opportunity. The first question, Apart from the four commercial molecules that you added in FY26, you also now have 11 phase three or pre registration molecules. Now this number as of third quarter FY26 was around six. Now assuming there have not been any drop offs or further additions, seems that you have added about 5 incremental opportunities in phase 3 or pre registration. Can you elaborate on which modalities would these be in any technologies that you would like to call out?
Diwakar Pingle
Most of these? Alantar, we’ve identified one that is already there or the new modality which we said is currently undergoing validation. There is probably one more on new modality but the rest of them are all small molecules and some of it is coming from I think what Krishna was talking about, right. This whole integrated CDMO play that pharma wants to consolidate as they kind of look at long term outsourcing partners in India. So customers who are probably not doing a lot of late phase in India are looking to do some of those which is also a result of some of these additions.
Krishna Kanumuri
Got it. And out of these 11 molecules, do you expect any to commercialize in FY28?
Diwakar Pingle
Anantha Price? Not too difficult. Some of them have just moved. Very, very difficult for us to predict. But as soon as we hear something, we definitely come back and provide that information.
Krishna Kanumuri
Fair enough sir. The second question is what is your view on the impact of AI on drug discovery? You spoke
Diwakar Pingle
About the investments, you spoke about the opportunities. Specifically on drug discovery. Do you see that as a threat or an opportunity?
Krishna Kanumuri
So we see it as opportunity. I don’t see a threat. Shiva, go ahead with you
Diwakar Pingle
Finish.
Krishna Kanumuri
Look, I think it’s an opportunity. I think end of the day the synthesis part does not change. And AI mood is much more complex to make than regular synthesis. Yes, you might make fewer molecules, but the resources need to make the molecule more than the past. And plus AI itself helps us be more efficient in terms of route design and better options. I think Net net. I think my view of AI is going to be either you probably won’t drop the R and D dollars, you probably will do more with less targets.
And I think everybody you’ve talked to so far has indicated that the design part is what is going to be affected the most. Not the synthesis part. Census part is going to be an important aspect of it. And I think AI for us is a net positive because the complexity of the molecules are higher and we don’t see R and D dollars dropping in terms of what they wanted on the AI front.
Diwakar Pingle
Fair enough Krishna, thank you and all the best.
Krishna Kanumuri
Thank you.
Operator
Thank you. Next question is from the line of Bharat Seasha from BCS Capital Ideas Ltd. Please go ahead.
Diwakar Pingle
Yeah, I this has come right at the fade and I had another call to catch up in two minutes so I’ll be just brief but I was intrigued by Krishna’s statement about AI in terms of aiding the digital capability. I thought in specifically for pharma, AI probably would be a very potent research resource. I’m from a non science background but whatever I understand pharma drug discovery is much more of saving DPT some hard work and some amount of luck trying out billions of molecules and AI along with quantum computing can tremendously accelerate that process and make the drug discovery process smoother and much much faster and far more efficient.
So I was bit intrigued by AI merely is a digital capability rather than the fundamental core capability of the CDMO CIS organization. So
Krishna Kanumuri
I think maybe make.
Diwakar Pingle
No, I think, I think, I think the way we look at from our perspective, what we presented to you is what we can do without impacting confidentiality and it of our customers, right? That is what we can do within AI. But if you look at AI on the drug discovery side, right? I think if you really look at AI today at generating molecules, it gives you novel binding targets and things like that. But that’s probably the least expensive part of drug discovery, right? If you really look at programs actually succeed or fail and the bottleneck is actually when they move from preclinical to clinical.
There are many things that today these programs, success of a program actually hinge on judgment calls, right? AI will get you efficiency gains in enrollment and all of that stuff. But there is so many things that the model today is not yet trained. I’m not saying five years, 10 years down the road how they will behave. But today it is attacking probably the lower cost piece of the AI and the lower complexity part of AI, right? There is definitely software is giving you great output, workload optimization, etc.
But I think the whole development side of synthesizing the molecule that is kind of super complex because AI is created things without a constraint is creating more work on that side. That’s really what we’re talking about.
Krishna Kanumuri
And I just want to add a little bit to that. I think we’re not saying digitalization but okay, AI. You’re talking about quantum computing just in terms of discovering what molecule develop. But now you’re synthesizing a molecule, scaling up the molecule. AI will help you design the molecule synthesis code itself is better. It’ll give you a better translation from lab to plant. So there’s a lot more AI which goes beyond digital. AI is inbuilt into everything. You have become AI native company. But what I say digital is getting to be enabled to handle AI is as in unless you get the platform right, you won’t able to apply tools across the board.
And AI is just not related to just discovery of new molecules. It’s a question of increasing efficiency, of scaling up every molecule as they go commercial and reducing their timeline. So I hope that is clear. We’re not having digitalization here. We already are a company ahead of the curve. We’re talking about how to take that data and increase your accuracy and speed in terms of scaling it up and what’s the correlation between lab data to plan data and so forth. I hope that gives you more clarity as we’re talking about this.
Operator
Thank you. Next question is from the line of Gaurav Bama from GM Financial. Please go ahead.
Diwakar Pingle
Hello, Am I audible?
Operator
Your voice is very low. Yes, please use your handset.
Diwakar Pingle
Yeah, just a second. Is it better now?
Operator
Yes, please proceed.
Diwakar Pingle
Hello? Is it better now?
Operator
Yes, please go ahead with the question.
Diwakar Pingle
So thank you for the opportunity. First, I would like to begin with congratulating the company on the good side of ML numbers. I had a question regarding the CRO business. It’s a more of a bookkeeping kind of question. So I just wanted to understand how many scientists do we have in
Krishna Kanumuri
The discovery of the CRO business and what was the similar number in FY25?
Diwakar Pingle
We don’t provide discovery CNC scientists. We have sciences across discovery and CNC. I think you know we provided this number as part of our annual disclosure and you will see that number Understood. And on the second question I think you did answer but nonetheless I’ll confirm again. So the one point, the 1100-1300 crore capex outlay, a large part of it is going towards the
Vilay Rai
1150 KL expansion plan, right? The 75% of the this FY27 guidance.
Diwakar Pingle
But it’s not necessarily the 700 to 1150 only. Right. There are also FATX that for discovery, for R and D capability, fume cupboards, all of that stuff included. Understood. Yeah. That is it for myself. Thank you. Thank you.
Operator
Thank you ladies and gentlemen. We will take this as the last question for the day. I now hand the conference over to the management for the closing comments.
Diwakar Pingle
So thank you for for the call. As we mentioned, we believe as we enter fiscal 27, we believe that the trend in terms of outsourcing with respect to the PRDMO remains very robust and we believe we are positioned well to kind of capitalize on this growth. Krishna, you want to add something for closing comments?
Krishna Kanumuri
I think it’s very exciting time I think for I think India in general and the side as well. I think it’s a multi year trend. Nothing has changed dramatically I think. I think India is going to definitely become a very strategic player in terms of the global supply chain over the next five years. So I think the trend is trend is good and we’re well set to benefit from this opportunity at this point.
Operator
Thank you sir, on behalf of SAI Life Sciences limited that concludes this conference. Thank you all for joining us. And you may now disconnect your lines.