Solara Active Pharma Sciences Limited (NSE: SOLARA) Q1 2026 Earnings Call dated Jul. 25, 2025
Corporate Participants:
Unidentified Speaker
Abhishek Singhal — Investor Relations Consultant
Arun Kumar — Founder and Non-Executive Director
Sandeep Rao — Managing Director and Chief Executive Officer
Sarat Kumar — Chief Financial Officer
Analysts:
Unidentified Participant
Vishal Avinash Manchanda — Analyst
Jagade Sharma — Analyst
Krisha Mehta — Analyst
Sajal Kapoor — Analyst
Pranav Gandhi — Analyst
Dhiraj Shah — Analyst
Krisha Kansara — Analyst
Mohammed Patel — Analyst
Gautam Rajesh — Analyst
Abhishek — Analyst
Shashi Kapoor — Analyst
Raghunath — Analyst
Presentation:
operator
Ladies and gentlemen, good day and welcome to Solara Active Pharma Science Limited Q1FY26 earnings conference call. As a reminder, all participant lines will be in 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 touchtone phone. Please note that this call is being recorded with this. I now hand the conference over to Mr. Abhishek Singhal. Thank you. And over to you sir.
Abhishek Singhal — Investor Relations Consultant
Thank you Soumya. A very good afternoon to all of you and thank you for joining us today for Solara Active Pharma Science earnings conference call for the first quarter ended financial year 2026 today. Today we have with us Arun Solara’s Founder and non Executive Director Sandeep Rao, MD and CEO and Sadat Kumar, CFO to share the highlights of the business and financials for the quarter. I hope you’ve gone through our results release and the quarterly investor presentation which have been uploaded on our website as well as stock exchange website. The transcript of this call will be available in a week’s time on the company’s website.
Please note that today’s discussion may be forward looking in nature and must be viewed in relation to risks pertaining to our business. After the end of this call in case you have any further questions, please feel free to reach out to the investigation team. I now hand over the call to Arun to make the opening remarks.
Arun Kumar — Founder and Non-Executive Director
Thank you. Thank you Abhishek. Good afternoon. This is father Solara’s Q1 results call. As Abhishek rightly said, bulk of the meeting will be taken by my colleagues Sandeep and Sharath. But from a promoter standpoint, I just wanted to express my satisfaction for the course correction that Solara is embarked on. There’s been a consistent focus on the quality of the business and a compounding effect of our actions in terms of cost containment. Focusing on high margin business and refocusing the company to be a regulated market player is playing out slowly but surely and we are a lot more confident than what we were last year as we migrate this business to this new management team.
I’m delighted with the performance across the board that the team at Solara has delivered and I now leave it to Sandeep and shout out to give headline numbers and happy to address any questions as they come. Thank you. And Sandeep, over to you.
Sandeep Rao — Managing Director and Chief Executive Officer
Thank you Arun, Good morning, good afternoon and good evening and thank you all for joining today’s Q1 26 earnings call. I sincerely appreciate your time and your participation in this call. If you recap the last call, we had said three things. One, we had said that FY26 was a reset year at Solara. The primary focus was margin expansion and debt reduction, establishing and maintaining a good governance. Second thing I said was that we want to re pivot this company to what we call as growth, which is profitable with our continued focus on market expansion. And the third thing I said is that we expect our business to grow top line by around 10% and EBITDA by around 15 to 20%.
In line with that, I’m happy to say that we started FY26 with what I think is on a right note with a strong Q1. The revenue has grown quarter and quarter by about 15% delivering the INR 320 crores gross margin is at a healthy 54%. At an absolute gross margin of INR 173 crores reflecting growth at around 8%. On a QoQ basis, the business has delivered EBITDA of 57 crores which reflects QoQ growth of 13%. This is our highest path in the last 12 quarters. And the key feature which is the contribution from our developed markets continues to be at a very strong 77% of overall sales, in my opinion.
I would like to believe that these are the first green shoots of growth over the next few quarters. Me and the entire team at Solara is going to be working extremely diligently to build on this foundation and to continue our focus on gross margin growth and EBITDA growth alongside our continued efforts on cost control, OPEX leverage, debt reduction and network optimization. The plan, as I said, is to re pivot the organization from reset to what we call sustainable, scalable, reliable and profitable growth. And lastly, I would like to thank all of you for your trust, your confidence and your support to Solara.
With this I’d like to hand over the floor to our cfo Sarath Kumar. Sandeep.
Sarat Kumar — Chief Financial Officer
Thank you, good morning, good afternoon and good evening ladies and gentlemen. And first of all, thank you for joining in today’s Q1FY26 call for Solara as shared by Arun and Sandeep. We are glad to inform you that we are observing green shoots in the. Entire business. As we continue to pivot the organization towards a growth phase in FY26 from the reset phase in FY25. And I believe we have started this journey with a strong Q1. Solara as a business has delivered Positive Q on Q growth on top line with a healthy margin profile of close to 54% and hence clocking EBITDA margin of 18% with an absolute value of INR 57 crores which reflects of 13% and 36% year on year growth as compared to Q1 of FY25. From a PAC perspective as Sandeep mentioned we have clogged in 105 million of pact which is highest across our across last 12 plus quarters which has also resulted in as we continue to focus our efforts on operating cost leverage and margin expansion, we would also continue to chase incremental business at a healthier margin profile in our journey towards a healthier healthier balance sheet.
I’m actually glad to share with you that we have been able to reduce roughly 143 crores of debt which 18% reduction in the opening debt what we had started FY26 with. Out of that roughly 113 crores coming in from the first call money of the rights issue which we had got in May 26 and the balance close to 31 crores came from the operations of operational cash flows which eventually brings our net debt to EBITDA ratio to close to 2.6. If I take my Q1 as we shared earlier that by Q1 of FY27 we will bring our debt to sub 450 course level which will reflect.
Net. Debt to ebitda ratio of 1.5x and as we shared earlier one stop subject to the statutory approvals once we push down 200 crores of debt to the newly formed CRAMS company Solara’s net debt to EBITDA ratio should be less than 1 as shared by Sandeep and Arun. We as an organization continue to work on improving profitability through our continuous cost improvement programs as well as operations cost optimization and also focus on debt reduction as well as working capital optimization as we want to focus entirely on repurposing the organization from a reset to growth. Thank you once again for your time and now we are happy to take your questions.
Can we open up the Q and A please?
Questions and Answers:
operator
Thank you very much. We will now begin the question and answer session. Anyone who wishes to ask a question may press Star and one on the Touchstone telephone. If you wish to remove yourself from the question queue you may press star and 2. Participants are requested to use handsets while asking a question. Ladies and gentlemen, we’ll wait for a moment while the question queue assembles. The first question comes from the line of Vishal from Systematic Group Please go ahead.
Vishal Avinash Manchanda
Hi, good evening everyone and thanks for the opportunity with respect to your crams business. Could you share what was the top line this quarter? So wanted to know the top line for your crams business. Crams and polymer business which is going to get demerged.
Arun Kumar
The run rate Vishal, for that business as we when we announced the crams carve out is just about a hundred crores. So we are 100 crores on an annualized basis. So currently the run rate is within that range. Quarterly run rate.
Vishal Avinash Manchanda
Okay. And any guidance you would want to give for the year for this business like last year it was 100 crores. So would this be around the same level for the full year or maybe we take a strong improvement.
Arun Kumar
So to be. To be honest with you, we have to make some significant investments to build out the cramps division in terms of repurposing the Vizag plant which is what we are in the process of getting our redesign done. So I think this year will also be quite a tepid year for that division. And then we start onboarding customers in the second half of this year and it probably will take at least two to three years for it to be a meaningful business to give you more granular information.
Vishal Avinash Manchanda
So right now we have multiple clients in the business or we are dependent on a few clients for our entire revenue. Very few. Right. Okay. And on just some clarity on the polymer business. Is this related to pharmaceuticals or. It is. It is non pharmaceuticals. So would this be complex products by definition polymers in terms of manufacturing?
Arun Kumar
Some extent, yes. There aren’t many players.
Vishal Avinash Manchanda
And so you are targeting generic APIs on the polymer side or you’re targeting innovative APIs?
Arun Kumar
Both.
Vishal Avinash Manchanda
And you have a product in your portfolio on the polymer side or.
Arun Kumar
We do but we don’t give specifics.
Vishal Avinash Manchanda
Right. And so there are, there is a pipeline of polymer products being that are. That are in development.
Arun Kumar
That’s right.
Vishal Avinash Manchanda
Okay. And just to one more clarification. Was Copexon a polymer product? Platinum acetate.
Arun Kumar
Yes. It is not, not necessarily. I think it’s more like a peptide.
Sandeep Rao
If I was not is more of a peptide cocktail. It’s. It doesn’t qualify as a polymer.
Vishal Avinash Manchanda
Okay. Okay. Thank you. That’s all from my side.
Abhishek Singhal
Thanks Vishal.
Vishal Avinash Manchanda
Thank you.
operator
Thank you very much. The next question comes from the line of JGADE Sharma, an investor. Please go ahead.
Jagade Sharma
Hi sir. Congratulations for the margin improvement in this quarter and turnaround in this quarter. I just have two question, broad questions. First one is could you share the contribution of ibuprofen to the overall revenues for the quarter. Also, a quick update on the ibuprofen market would be helpful. And also any pricing trends now. Are the pricing trends now more stable? This is my first question.
Arun Kumar
Sandeep, go ahead.
Sandeep Rao
So ibuprofen as a portfolio, we have close to done roughly 30% of that business entirely from ibuprofen, which includes ibuplane as well as. And on your question, is it a stable business? We have mentioned in the past that we are only going after marquee customers and high quality sticky businesses.
Jagade Sharma
No, no, no, I didn’t ask whether the business is stable. I’m asking whether the pricing print is stable or not.
Sandeep Rao
Yeah, the pricing is stable. The pricing is stable because you’re only working with tier high quality marquee customers in the developed markets.
Jagade Sharma
Overall broad ibuprofen market. Update on the broad ibuprofen market, sir.
Arun Kumar
So this is Sharma, just to give you an indication on the ibuprofen market. There is significant new entrants and significant competition. Solara has a historic relationship with brand owners for more than 25 years. And as Sandeep mentioned, we are focusing only on those customers. The market for the generic supplies is under intense competitive pressure with new entrants at new chemistry, new pricing. We are focusing our energies into derivatives, into more complex programs and using less of capacity to get more dollars, rather than focusing on the generic ibuprofen. So the generic ibuprofen, I believe, still faces intense competition.
But as we pivoted our business and as Sharif mentioned, as we. Ibuprofen used to be almost 50% of our turnover and if it’s now only 30%, it already gives you an indication of what actions we have done in the last 2, 3/4 for. And that’s also another reason why the numbers are pivoted to a better outcome.
Jagade Sharma
Okay, my second question, sir, on the broader API front, the industry has been going through a prolonged pricing correction. Are you seeing any signs of stabilization in the API pricing or do the headwinds still persist?
Arun Kumar
So it’s very selective. It’s not across the industry on specific products. We do see some challenges. But overall, if you look at Solara, we have actually reduced our focus on top line growth, which effectively means that any lines which are not profitable, we are exiting. And we are very focused on getting the right network. Therefore, the kind of business that we want to keep for us and the businesses we keep the 77, 78% regulated market focus is very sticky, is very long term, and they are not opportunistic for us. So to answer your point, there is pricing pressure on specific programs but as long as you work with regulated market players, it’s more sticky from the nature of the business and not necessarily because of the environment of the industry that we are in.
Sandeep Rao
And this is also reflected in our, if you look at our gross margins over the last three quarters, I think we’ve been clocking a very healthy 54, 55% consistently over the last three quarters. So I think that the numbers speak for our ability to hold on to our prices.
Jagade Sharma
Thank you sir. Thank you so much. All the very best.
Arun Kumar
Thank you.
operator
Thank you. The next question comes from the line of Krisha Mehta, an investor. Please go ahead.
Krisha Mehta
Hi sir, I have two questions. Firstly, what would you call the key growth levels for the API business over the next two, three years? And so although we have reduced our dependency on ibuprofen from 50 to 30%, how do you see the portfolio evolving to support a more diversified and de risk growth profile maybe through a broader top 5 or top 10 product mix target going forward?
Arun Kumar
Krisha, I can try and answer that question. First of all, we are in this phase of reset. And in the reset phase we have been focusing on costs, operational efficiency, cost of goods as in our cost of production and our network optimization which effectively another way of saying is that we are focusing on the inefficiencies that are inherent in the business. We believe that once that is solved for that will entail a very significant improvement in our gross margins. And ebitda. That’s our first focus and this is our second quarter where we are delivering on that promise.
We will take four, five quarters to get that sorted out. That doesn’t mean that we are not invested in new programs, new markets, expansions. But in and all of this takes time. So to answer your point, we are in the phase, in the reset phase. We are now in the phase of cost improvements and therefore margin expansion through OPEX leverage. And at the same time we are invested in seeding new markets and new customers. And in the next 8 to 12 quarters you’ll see both playing out. In the next 3 to 4 quarters you’ll see the operational leverage playing out.
So we are currently a legacy player in this business. For more than 35, 40 years we had gone through an over dependence on ibuprofen. We have reset a strategy. So we are in the process of executing that. So your broader question is not very relevant for today’s reset stage. That we are in.
Krisha Mehta
Understood. And secondly, so we have guided for EBITDA growth of around 15 to 20% for FY26 which indicates a 240 to 250 crore range. And with 57 odd crores in Q1, considerably a stronger second half. Is it fair to expect that we would be beating our full year guidance or are there any specific cost or variables that we should keep in mind?
Arun Kumar
We’ll keep a quarter at a time, but for now your mathematical understanding of our EBITDA range is accurate and I think our focus is to be in that range. And at this stage we think it’s a little bit too early to revise any guidance. One or two more quarters is what we will be in a more comfortable situation to make. Address that query of yours.
Krisha Mehta
Got it. Thank you, sir.
operator
Thank you. A reminder to all participants, you may press star and one to ask a question. The next question comes from the line of Sajal Kapoor from antifragile thinking. Please go ahead.
Sajal Kapoor
Yeah, many thanks for the opportunity. Hi Sandeep, Great start to F26. Question is with your strong background in fermentation and biosciences, how do you see these areas fitting into Solara’s current strength and future growth potential?
Sandeep Rao
It’s nice to know that somebody is tracking my background. But look, the simple answer is that we are looking at new growth areas. When I talk of new growth areas, we are talking of different manufacturing capabilities that we want to bring in house, especially to the crams business. So we are evaluating other areas may or may not essentially be fermentation. But over the next few quarters, as we grow our crams business, we’ll come back to you with further details.
Sajal Kapoor
That’s fine, that’s helpful, thank you. And the other question is we are injecting 200 crore of debt into Syntex Global Pharma Solutions which today is a subscale business with weak or maybe negative operating cash flow. So it’s almost certain that an equity infusion will be needed soon to keep the balance sheet healthy. Is that a reasonable, fair assumption?
Arun Kumar
It is. Yeah.
Sajal Kapoor
Well that, that’s helpful, Arun. That’s all. That’s all I have for now. Thank you so much and great show everyone.
Arun Kumar
Thank you.
operator
Thank you. The next question comes from the line of Pranav Gandhi from Lotus. Well, please go ahead.
Pranav Gandhi
Congratulations on the number to the management. I just have one question. You mentioned about the ibokrophy new route which going. Have they received any regulatory approval for the same?
Sandeep Rao
You’re talking of the new rule for ibuprofen?
Pranav Gandhi
Yes.
Sandeep Rao
No, we are. We’re still in the process of implementing it. So we’ve not. We’ve really still in the development process. We haven’t taken it to approval as yet.
Pranav Gandhi
Also, as you mentioned about the equity for the crams business, the fundraising, will it be a pref or like an icu?
Arun Kumar
It’s very early days for now. We will probably have more answers for you in the next call.
Pranav Gandhi
Okay, thank you so much.
operator
Thank you. The next question comes from the line of Dhiraj Shah, an investor. Please go ahead.
Dhiraj Shah
Hi, this is Dhiraj Shah. Thanks for the opportunity. I had a question on gross margins. Our gross margins have come in at 54% during the quarter showing a sequential decline. Could you walk us through the key factors that drove this movement?
Sandeep Rao
If you see. So what we have done is with respect to gross margin profile, we have a certain product mix. So as a business it would not be fair to assume exactly 57% every quarter. So from 57% what we had clogged in Q4, we are down to 54. But if you see in terms of overall for the past five or six quarters, we have gradually scaled that number from a 40s level to a mid-50s kind of a range. And we believe that being in a catalog generics API business, this grass gross margin profile is fairly healthy.
Sandeep Rao
Okay, so in the past 3 to 55%.
operator
Sorry to interrupt, sir, your voice is breaking.
Dhiraj Shah
Now. No, it’s clear.
Sandeep Rao
It’s better now. Go ahead.
operator
It’s better now.
Dhiraj Shah
In the past we have indicated that a 53 to 55% gross margin range is sustainable in catalog API segment. Would it be reasonable to assume that the midpoint of this range would be good base for FY26?
Sandeep Rao
Yes, correct. That’s what we are working for. We are working towards keeping that high quality of business which is reflected in our gross margins. So it is our aim to keep our gross margins at those levels.
Dhiraj Shah
Okay, that’s all from my side. Thank you.
operator
Thank you. The next follow up question comes from the line of Vishal from Systematic Group. Please go ahead.
Vishal Avinash Manchanda
Yeah, hi. Thanks for the follow up on the generic API business. Anything specific that you want to highlight in terms of how would you be approaching the business in terms of building that up?
Sandeep Rao
So I’ll take that question. See, typically when you talk of growth, I see four levers. Okay. There are new products, a pipeline that you need to create. You talk of Ebitda and gross margin go to cost improvement initiatives. The third lever is new markets that you try and get into. And the fourth lever is that you try and create that you try and create more capacity for key products through incremental Capex. And I can tell you that on all these four fronts we are actively involved. So we’re working all these three, four levers to make sure that we can grow the company.
Vishal Avinash Manchanda
Okay, so like where would we be currently in terms of the capacity utilization? So like do we need Capex to grow maybe in the next two, three years or we have enough capacities?
Sandeep Rao
Currently our capacity utilization is in the range of 60 to 65%. But what we are trying to do is we are trying to put incremental and mark the word incremental capex in certain key capacities for our molecules.
Vishal Avinash Manchanda
Okay, okay. And for the kind of use, kind of supply, a differentiated API of ibuprofen or a modified version of ibuprofen API. So is that market growing or that is also like growing like the general generic ibuprofen market?
Sandeep Rao
It is growing. I mean the growth there is a tepid growth. But I think that we are putting a lot of energies behind it and I think hopefully that this market will take over the. Not all, but we are hoping that it will take over at least a sizable portion of the ibuprofen plane market.
Vishal Avinash Manchanda
Okay, thank you. That’s all from my side.
operator
Thank you. The next question comes from the line of Krisha Kansara from Molecule Ventures. Please go ahead.
Krisha Kansara
Hello. Am I audible, sir?
Sandeep Rao
Yes, we can hear.
Krisha Kansara
My first question is on ibuprofen. I think in one of your previous answers you mentioned that you have been facing intense competition in the ibuprofen market. So my question is with regards to the demand supply situation, if you can help us understand the current demand in terms of volume versus the supply that is coming in, let’s say in the next one, two years. And in line with this, if you can give us a number with regards to the current realization of ibuprofen, that would be helpful. This is my first question.
Sandeep Rao
Okay. Okay. I don’t think we can give you product wise realizations or segment wise realizations, but I can tell you that in ibuprofen we’ve taken a conscious decision to focus only on high quality business and customers who give us good gross margin. So in that sense we decide whom we want to supply to. There is demand in the market, but we’ve been extremely picky and choosy about which customers we work with. And that’s the result that we’re working with only high profile, as I said, marquee customers in developed markets. Does that answer your first question?
Krisha Kansara
My question was more on the industry side. So let’s say what is the current industry level demand in terms of volumes and versus what is the supply that is coming in the industry in let’s say next one or two years? I just wanted to understand the demand supply situation of the domestic ibuprofen industry.
Sandeep Rao
I would say that the total demand, that the total supply in the market today is around 50,000 metric tons. That’s my guesstimate global supply. That includes Indian suppliers as well as global suppliers. And I think at this point that capacity is sufficient to meet global requirements for this product class.
Krisha Kansara
Right. So we can expect to further go down as in when the supply comes in the market.
Sandeep Rao
Yeah, but you should look at where we focus on where we are focusing on. In Ivo, we are focusing only on select customers who give us healthy margins. But our biggest focus is on the derivatives and analog which will drive our healthier gross margins on ibuprofen. So we are picking the segments that we want to be in.
Krisha Kansara
Right, right. So my second question is.
operator
Sorry to interrupt. May I request you to join the queue for the follow up question?
Krisha Kansara
Sure, I’ll do that.
operator
Thank you. The next question comes from the line of Mohammed Patel from Edelweiss Public Alternative. Please go ahead.
Mohammed Patel
Am I audible?
operator
Yes sir, you’re audible.
Mohammed Patel
So my first question is we said we are on a reset stage for the next three to four quarters. So how do you tally that with the 10% revenue outlook for 26?
Sandeep Rao
So Mohammed, if I can take that. FY25 was a recent year for us and I said that the focus was on debt reduction, maintaining and establishing good governance and margin expansion. Expansion. But what we realize is that we have to grow the company because once you grow the company on the same OPEX platform, everything flows down into the EBITDA. So FY26 is going to be all about growth. Which is where I come back to my. If you look at our Q4 revenues, we were at roughly 280 crores. From there we have gone to 320. Are we happy? Answer is yes, but we need to grow beyond this foundation.
So this I think is a start of hopefully a good growth story.
Mohammed Patel
And when we say 10% revenue growth and we have earlier mentioned that the ibuprofen business will be more or less flat. So what gives us the confidence of growing the non IBU business at a much faster double digit?
Sandeep Rao
If you look at our total reliance on ibuprofen in FY25, almost 30 to 33% of our business was ibuprofen. But if you look at our internal numbers. This year, around 20% of our business is ibuprofen. So our reliance on the ibuprofen range of businesses have been decreasing consciously because of the choices that we have done. So it’s a remainder business that we have that’s really going to drive growth in FY26.
Mohammed Patel
Okay. And this is, this question is just, you know, confirmation. So we, in earlier calls we have said that the current ibuprofen pricing does not even cover the cost of manufacturing, but we still make good gross margins because of the custom profile.
Sandeep Rao
That’s. That’s right.
Mohammed Patel
And that that does not cover cost of manufacturing is with respect to the current prices.
Sandeep Rao
Correct?
Mohammed Patel
That’s right. I have further question. Yes, the operator allows.
operator
So may I request to join the queue for a follow up question?
Mohammed Patel
Sure, sure.
operator
Thank you. The next question comes from the line of Gautam Rajesh from LEO Capital. Please go ahead.
Gautam Rajesh
Hi sir. Good evening. Thank you for the opportunity. I had two questions. My first question was on the ibuprofen. What would be. As you mentioned, the share is 30%, but you just mentioned 20%. So is it 20% for Q1 or does the estimate you have for FY26 as a whole and what would your percentage currently be for ibuprofen derivatives versus plain ibuprofen? That’s my first question.
Sandeep Rao
When we said 30% overall, that that had both iBuplane at close to 21% plus balance. 9% was from Ibu derivatives.
Sandeep Rao
Okay. This is for Q1, FY26. Yes.
Sandeep Rao
Correct.
Gautam Rajesh
Yeah. And my second question was what would be our share for the top five molecules out of our sales?
Sandeep Rao
Top five molecules out of our total sales.
Gautam Rajesh
Yeah.
Sandeep Rao
So top five, top five molecules will easily give us close to 55, 60% kind of revenue.
Gautam Rajesh
All right, that would be my question. Thank you, sir.
operator
Thank you. The next question comes from the line of Abhishek from Padmaja Investments. Please go ahead.
Abhishek
Yeah. Am I audible, sir?
operator
Yes, sir, you’re audible.
Abhishek
Yeah. Sir, are we done with our cost improvement program? Like that’s my question.
Sandeep Rao
Cost improvement programs are something which we actually work on a kind of a continuous basis. So what we as a company do is every quarter we identify few molecules where we have to work on that cost improvement program and then we keep on improving on that particular pace. As you would know that since we are operating in a generic KPI business, we will always have certain price pressures in certain pockets. So we actually try to kind of mitigate that particular piece with our cost improvement programs. So we can’t say that we have stopped doing that because that will be a continuous feature for us.
Okay.
Abhishek
Okay. My second question is I looked at us DMF database where I am able to see some of your polymer APIs. So are all of them going to be in the demudge entity or some of them are going to be in your catalog API and some of them are going to be in your crimes business. Entity.
Sandeep Rao
Okay. Okay. Okay. Okay.
Sandeep Rao
Yeah.
Abhishek
So. Okay. That’s also. Thanks. Thanks a lot.
operator
Thank you. The next question comes from the line of Shashi Kapoor from dollar Dhar Capital. Please go ahead.
Shashi Kapoor
Yeah. Firstly congratulations Arun, Sharat and Sandeep. You have done an amazing job and congratulations to your entire team. The question is how far is our visa plant utilization and what kind of asset turnover we are operating at. And two, three years down the line. What what kind of asset turns we would be. We are planning to achieve for both APIs as well as CRAMS.
Sandeep Rao
The plant utilization I think we spoke about earlier, the plant utilization currently stands around 60 to 65% across the board. Okay. And what was the second question? Sir?
Shashi Kapoor
Second was so two, three years down the line. What, what kind of, you know asset turnovers we would be approaching?
Sandeep Rao
What kind of turnover you mean? We will actually have close to 1.2 kind of a number. Okay.
Shashi Kapoor
And are there any leadership changes or have you started you know recruitment particularly in our upcoming grams or. We are holding it right now.
Arun Kumar
At this time. We haven’t yet started any recruitments for our grants teams. Like I said earlier to one of your colleagues in the box in the questions. We will have good answers for you next quarter because we expect to start the process, legal process immediately as communicated in our communications and we can give you some more color probably next quarter.
Shashi Kapoor
Thanks a lot team. Best wishes. You have been doing a great job.
Sandeep Rao
Thank you.
operator
Thank you. The next question comes from the line of Raghunath, an investor. Please go ahead.
Raghunath
My question is already answered from one. Of the earlier participants. So I don’t have anything. Thanks.
operator
Thank you. The next question comes from the line of Mohammad Patel from Edelweiss Public Alternative. Please go ahead.
Mohammed Patel
Yeah, I have two questions on the crams business. So can you share some qualitative aspects of that business like what is the nature of business in crams versus polymers? Is it NCE driven how we are different from the peers and you know why There is a limited competition in the polymer segment.
Arun Kumar
So it is a hard chemistry. There aren’t many players in India, not that many other people are not making it. And it requires very special focus in terms of capability and equipment. And that is the reason why we want to specialize, specialize in a very narrow niche to start with so that we can get into a good footing and we have some experience in Solara for many years and we expect that if it’s separated into a separate, separated into a new. To grow it to greater size. Although we are only in pharmaceutical polymers, it does have application in other industries.
At this stage we are evaluating those opportunities. But for now we are staying invested fully in the pharma space.
Sandeep Rao
So how would we be different versus our Indian peers in the crams business in terms of what product do we target versus them?
Arun Kumar
Think this is the forum for us to get into the granularity of your questions. In a crams business nobody gives you the name of customers or the products that we do.
Raghunath
Okay, my last question is. So we have you know, very ambitious targets for this business where we would like to grow this from 100 crore to maybe let’s say 4 or 5x in the next few years. So what will exactly drive that? You know.
Arun Kumar
Everything that requires to get us there. The group has got several businesses which has got scale and scope and we believe that we can apply the same approach to the crams division that’s being carved out. Thank you.
operator
Thank you. The next question comes from the line of Krisha Kansara from Molecule Ventures. Please go ahead.
Krisha Kansara
Yeah, I have a question on our Grams business. So if you could tell us about the Capex plan with respect to this business. Because as far as we are aware for us to be a key player in this industry we might need to invest a significant amount for the CapEx. So any guidance on that? What kind of investments are we planning for this segment? That is the first part. And second, with respect to crams, only if you can break up the business into let’s say. I think one of the earlier participants also asked how how much of 100 crores are we supplying to let’s say generic companies versus how much of it is going to innovate as pharma companies that break up would be helpful.
Thank you.
Arun Kumar
The second point is easier to answer. We can’t provide you that data. It is so too suboptimal a business for us to get there. You’ll have to wait for that. Probably you have not read the notes on the cramps. We are moving out one of the largest plants which has been mothballed in Vizag which has got very large capacities. And as you rightly articulated to be in the crimes business, you need to invest capacities ahead of, ahead of time. And while Solara is focusing on its catalog API business and focusing on operational efficiency, we do not want to be investing heavily on the generic API space.
And that is why this facility, where we have almost one third of our group capacity completely underutilized, is being shifted to the cramps business. New capex will go only to repurpose some of the equipments, not major capex is required consequently. But we think that Capex and loss funding will be in the range of at least 200 crores in the first phase for us to take it to up to a 400, 500 crore grams business. But that’s going to take us quite some time to get there. Three to four years as we said earlier, right?
Krisha Kansara
You mentioned 400, 500 crore business from 200 crores capex. Right?
Arun Kumar
Yeah.
Krisha Kansara
Okay, thank you.
Arun Kumar
Thank you.
operator
Thank you ladies and gentlemen. We’ll take this as the last question for today. I would now like to hand the conference over to the management for closing comments.
Arun Kumar
Sandeep, over to you.
Sandeep Rao
Thank you, Arun. I again would like to thank all of you for being there for Solara, for your continued support and your trust and count on us. This whole team of Solara, including me, are working very hard to make sure that we can grow on this Q1 platform that we created. Thanks again. Thanks to everybody.
operator
Thank you on behalf of Solara Active Pharma Science limited That concludes this conference. Thank you all for joining us and you may now disconnect your lines.
Sandeep Rao
Thank you.