VIMTA LABS LTD (NSE: VIMTALABS) Q4 2025 Earnings Call dated Apr. 28, 2025
Corporate Participants:
Unidentified Speaker
Vishal Manchanda — Investor Relations
Harita Vasireddi — Managing Director
Analysts:
Raheel Shah — Analyst
Ajay Surya — Analyst
Vignesh Iyer — Analyst
Ankit Gupta — Analyst
Kiran — Analyst
Kaushal Sharma — Analyst
Kevin Dastardi — Analyst
Dhwanil — Analyst
Umesh Matkar — Analyst
Biral Bhansali — Analyst
Ajay Surya — Analyst
William — Analyst
Sanjeevora — Analyst
Pratik Dedha — Analyst
Presentation:
operator
Ladies and gentlemen, good day and welcome to The Vimta Labs Limited Q4FY25 earnings conference call hosted by Systematics Group. As a reminder, all participant lines will be in the listen only mode and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during this conference call, please signal an operator by pressing then zero on your touchstone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Vishal Mansura from Systematics Group. Thank you. And over to you sir.
Vishal Manchanda — Investor Relations
Thank you, Navya. Good evening everyone. On behalf of Systematics Institutional Equities, I welcome you to the Q4FY25 earnings call of Wimta Labs. We thank the Wimta Labs management for giving us an opportunity to host the call. We have with us the senior management of the company represented by Ms. Haritha Vasi Reddy, Managing Director, Mr. Satya Srinivas Nirukonda, Executive Director, Mr. Siva Ramakrishna, Chief Financial Officer and Ms. Sujani Vasi Reddy, Company Secretary. I’ll now hand over the call to Advait Bhadekar from ENY for the cautionary statement. Thank you. Vishal sir. Good evening and a warm welcome everyone to Q4 and FY25 earnings call of Vimta Labs Limited.
Please note, investor presentation and the financial results are available on the company website and the stock exchanges. Also, anything said on this call which reflects the outlook for the future or which could be construed as a forward looking statement must be reviewed in conjunction with the risk that the company faces. The conference call is being recorded and the transcript along with the audio of the team will be made available on the website of the company as well as on the exchanges. Please also note that the audio of the conference call is the copyright material of Finta Labs Ltd.
And cannot be copied, rebroadcasted or attributed in press or media without any specific and written consent of the company. Now I would request Ms. Haritha Vasileti, Managing Director of Vintal Apps Limited to provide you with the update for the quarter and year ended 31st March 2025. Thank you. And over to you, Ma’am.
Harita Vasireddi — Managing Director
Thank you, Adrian. Good evening everyone. Thank you all for joining our Q4 and FY 2025 earnings call today. The financial year 2025 went well for us as the business saw good growth during the year. Despite the market uncertainties in financial year 2025, the global economy showed Signs of Recovery despite geopolitical tensions and tight monetary conditions both in the US and key Asian markets, India’s economy remained resilient, driven by robust domestic demand, strong manufacturing output and government led infrastructure spending. GBC grew forward around 7%, supported by easing inflation and improving overall consumption. The healthcare sector saw increased investment reflecting growing focus on preventive care and research.
The global testing, inspection and certification market experienced steady growth, continuing to be fueled by regulatory standards, the globalization of supply chain and a heightened focus on product quality and safety. Asia Pacific, particularly India played a key role in this momentum. Rapid industrialization, infrastructure development and the expansion of sectors such as pharmaceuticals, automotive and medical devices contributed significantly. Technological advances also shaped the industry with increased adoption of digital tools such as AI, IoT and and blockchain, enhancing accuracy and efficiency in testing and certification process. These innovations are enabling service providers to deliver faster, more reliable results, reinforcing customer trust and regulatory alignment.
The sector remains resilient and well positioned for sustained growth in the evolving global quality assurance landscape. Before moving on to the quarter and yearly updates, I’m delighted to share that Winter has embarked on an exciting new chapter with foray into Biologics contract research and development services. This strategic move is a significant milestone in our growth journey and further strengthens our commitment to supporting the evolving needs of the biopharmaceutical sector. Our new service line will focus on the development of novel biologic entities, biosimilars and peptide based therapy, leveraging both microbial and mammalian platforms. We are building comprehensive capabilities covering clone development, process development, biosimilarity assessment and preclinical scale up.
Infrastructure development will be initiated in this quarter with equipment procurement and qualifications targeted for completion by Q3 of FY2026. We anticipate revenue generation to begin from Q1 of FY37. With this initiative, VIMSA is positioning itself at the forefront of biologic innovation, enhancing our value proposition as an integrated high quality R and D partner. Now coming to the quarter and yearly update, Vinta Labs has witnessed substantial year on year growth of 19.1% with revenue at Rupees 3482 million. This was primarily driven by the pharmaceutical services. We are experiencing this traction across all the services we provide and we would like to highlight that our new life sciences facility is commercialized.
We had successful BCC regulatory audits by the Ministry of Health of the Republic of South Africa and CGMP audit by female European Medicines Agency for Human Health Products coming to the food testing services. Overall performance has been flat but the momentum is being seen now compared to the first half of FY25. Recently the food Division was conferred with Outstanding Laboratory performance award of 2024 by CII for the second consecutive year showcasing the Division’s consistent excellence in quality, technical competencies and customer focused service delivery. The electrical and electronics testing services experience growth and I’m happy that we are coming up with a second chamber to double the capacity on the environmental testing services.
We are currently focusing on the post Project Monitoring segment and have been able to grow this segment well during FY25. Looking ahead, we remain optimistic about the performance across all our service lines. Before moving ahead with the financial highlights, I would like to take a moment to introduce a new addition to the Wimpa family, Mr. Toramakrishna Kambampati who has joined us as our new CFO and will be based at our registered office. He is a seasoned finance professional with Strong at the MIT Foundation. He has over 16 years of experience in engineering and pharmaceutical industries and in his new role, Mr.
Siva will play a pivotal role in driving our growth strategy. With this I would like to hand over the call to Mr. Shivakam Patti to discuss the financials over to you.
Unidentified Speaker
Thank you Mr. Eta. A very good afternoon to all and thank you for joining us on our Q4 and FY25 earnings conference call. I would like you to walk you through the financial performance for the quarter and year ended 31st March 2025, after which we can open the floor for question answers. Before I start discussing the financials, I would like to highlight that the previous period figures for clinical items have been reduced to ensure compatibility with the current period, which is the announcement of scale of diagnostics and Pathological services business on 30 August 2024. Now I’ll start with the financial highlights for the quarter.
The total income for E4FY25 today 961 million rupees as compared to 731 million in Q4FY24 up by 31.4% year on year. EBITDA stood at Rs. 347 million in Q4FY25 has compared to Rs. 263 million in Q4FY24 up of 31.9% year on year. EBITDA margin for the quarter is at 36.1% profit after tax in Q4FY25 stood at rupees 183 million as compared to Rs. 140 million in Q4FY24 a growth of 31.2% year on year. Fast margins for the quarter stood at 19.1%. Moving on to the full year performance. Revenue from operations for FY25 to debt Rs.
3,482 million as compared to Rs. 2,923 million in FY24 up by 19.1% year on year. EBITDA is at rupees 1,262 million in FY25 as compared to Rs. 978 million in FY24. A growth of 29.1% year on year translating into EBITDA margin of 36.2%. Profit after tax in FY25 stood at rupees 668 million as compared to Rs. 488 million in FY 24. A growth of 36.8% year on year translating into steady tax margin of 19.2%. On the balance sheet side, we continue to have net debt free balance sheet with cash and cash equivalent including other bank deposits of Rs.
329 million. Our total debt stands at Rs. 85 million as of 30th March 2025 with a debt to equity ratio of 0.02. Capex for the year predates Rs. 791 million. Capex guidance for FY26 will be around Rupees 900 million. With that we can now open the floor for Q and A. Thank you.
Questions and Answers:
operator
Thank you very much. We will now begin the question and answer session. Anyone who wishes to ask a question may press star n1 on their touch tone telephone. If you wish to remove yourself from the question queue, you may press star N2. Participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles participants. You may press Star and one to ask a question. The first question is from the line of Ajay Surya from Niversay. You may go ahead sir.
Ajay Surya
Congratulations for the performance. My question is if I look at our overall CapEx. So previously there was a quarter delay in our new Capex and also in past for the food testing division there was some revenue which went away because of shifting of the food division in Nashville. So I wanted to know for the current quarter if there was such any internal or external factor which impacted our performance. So my broader question on the same is because our potential post our complete capex is 600 to 700 crore and also we aspire to reach 500 crore mark by 2025 26.
So sir my question is like when do we expect the CAPEX which has recently completed to stabilize and when do we anticipate to achieve the run rate of like maybe 120, 125 odd crore quarterly run rate.
Harita Vasireddi
We are expecting to achieve a run rate of 125 crores per quarter by end of this financial year. And CAPEX that we put in during last year was to build additional capacity for our life sciences facility so that facility can support growth for at least the next 56 years.
Ajay Surya
And there was no such internal or external factor for the current quarter which impacted maybe our revenue. Like I wanted to know like how fast can that ramp up can come in because of the capex?
Harita Vasireddi
The CAPEX is provided for us capacities as a three dimensional one is the laboratory space, the other one is equipment and third one is manpower. So the CAPEX that we spent in building new facilities I.e. with a long term use to support our long term growth and the return will come over a period of these many years and Nothing in the Q4 has really impacted other than maybe some departments were shifting into the new facility but we have done it very consciously, slowly so as to have minimal impact on revenues so nothing significant.
Ajay Surya
Got it?
Ajay Surya
My next question, my next question is so now we have decided to expand into the biologics and peptide CDMO and if you can highlight more on the opportunity and what type of services will we be offering and different is different from the existing services of analytical or pre clinical which we offer as you can identify highlight more on what type of services and will the margin profile be similar or because even the CDM of peptides is a high margin business for companies so will our margin profile be on similar higher numbers or if.
Harita Vasireddi
You can find us on the margins allow me to comment on them specifically in the upcoming quarter I would just like to in brief share what the services will be. So these are contract research and development services for biologists wherein we will be offering turnkey solutions for product development right from clone development up to development and optimization of upstream downstream formulation processes. We can also provide standalone services such as biosimilarity assessment and then qualification of characterization method etc. Etc. So on a high level we’ll be having capabilities to work on novel biologics, biosimilar and peptides.
So these are the services.
Harita Vasireddi
So for the CAPEX guidance of this year of 90 crore, 50 crore will be on the biologic CDMO as understanding.
Unidentified Speaker
Correct, no that 90 crores is excluding this new investment here we’ll be investing about 40 crores in two years. First year we may spend around 25 crores and the next year around 15 and odd crore.
Unidentified Speaker
Okay and one more question. On the previous con call we expected a new chamber for the electronics testing division to come by maybe Q4 and or Q1 beginning. So wanted to know the update on the same.
Harita Vasireddi
Yeah, it is right now under installation. We will finish its qualification before end of this quarter.
Ajay Surya
Got it. Okay, I’ll join back in queue.
Ajay Surya
Thank you.
operator
Thank you. Participants you may press star and one to ask a question. Ladies and gentlemen you may press star and one on your touchtone phone to ask a question. Next question is from the line of Vignesh Iyer from frequent investments. Please go ahead.
Vignesh Iyer
Thank you for the opportunity. So my first question is if I heard it right earlier participant would ask you a question. You had said we’ll reach the 125crore run rate by end of financial year. Right. Hello. Hello.
Vishal Manchanda
We can hear you. Please continue.
Vignesh Iyer
Yeah. Yeah. So as I was going through your qpp slide number 31 and the key growth driver where you aspire to reach 500 crores revenue by end of FY26 that itself is a 125 crore run rate starting from, I don’t know on an average from Q1. So I mean reaching that 125 crores by end of financial year is it more of a conservative thing or how should we understand it?
Vishal Manchanda
So 2/4 ago I had made. I had made a correction to that information saying that we are hiding off diagnostic business. And when we hit this target of 500 crores we were expecting diagnostic business to be one of the prime drivers towards reaching these numbers. But now since we don’t have that business unit we said we are still going to step up and try and hit that 500 number as a run rate in Q4 of this year. So that’s the correction that I had given almost about 2/4.
Harita Vasireddi
Okay. More like a cue for exit revenue is something is what we are having. Hello.
Vishal Manchanda
Yes.
Harita Vasireddi
Yeah because the PPT still, you know still there. So I was. I thank you for pointing that out.
Harita Vasireddi
We update.
Vignesh Iyer
Got it. Got it sir. Also I mean on this the capex that we have planned on the you know contract biologic contract research. So this is done, you know in an existing land parcel we have or is it a new land parcel that we are seeing for expanding into or pouring into this new business.
Harita Vasireddi
It is within the existing facilities. Nothing new will be built Specifically for this we would have to renovate a little space which we will now initiate in this quarter.
Vignesh Iyer
Okay, got it, Got it. That’s all from my. Thank you.
operator
Thank you. Next question is from the line of Raheel Shah from Crown Capital. Please go ahead.
Raheel Shah
Hello. Hi, can you hear me? Yes, hi. So my question was on the margins, you’ve been really well in financial year 25 as compared to previous years. So firstly, what led to this increment in margins and what can we expect going ahead? If you can provide an outlook on quarterly basis, that would be helpful. Otherwise for the full year. FY26.
Harita Vasireddi
Last quarter saw even slightly better margin and I answered this question. The margins can be expected to be around what it is right now, plus or minus. Our endeavor will be to maintain and further better it. But there is a possibility that it could be plus, minus this 2%, this current number. And what has led to the implement of margins is one, our diagnostic business was not doing very well and it was dragging. It was having a dragging effect on our margins which is now removed. And also we have improved our operational efficiency in our other services as well.
So multiple factors are at play here.
Raheel Shah
Okay. And with regards to growth in the business, which particular vertical services you’re offering is going to be, you know, one of the key drivers ahead. And if you can, like you said, 125 crores per quarter year end rate you wish to achieve by end of this financial year. But overall, can you guide certain percentage growth they’re expecting?
Harita Vasireddi
Broadly, as I’ve shared already, 70% of our business comes from pharma now and about 20% from food put together, we’re almost 90% of our business and these two will drive our growth during the year.
Raheel Shah
Would you like to, you know, give a certain percentage of growth expecting in FY26?
Harita Vasireddi
We don’t normally give a growth outlook like that.
Raheel Shah
Okay. But it’s definitely going to be much better than the previous year in the past.
Harita Vasireddi
I think this year will give a very good growth rate and I hope to maintain the same growth rate at least.
Raheel Shah
Okay, got it. Okay, thank you and all the best.
operator
Thank you. Next question is from the line of Ankit Gupta from Bamboo Capital. Please go ahead.
Ankit Gupta
Yeah, thanks for the opportunity and congratulations for a good set of numbers. I just wanted to check on the capex that we are doing of 90 crore for this financial for next financial year. So we’ve just completed the expansion in a new building at our existing facility and we are yet to fully not even reach 40, 50% capacity. Utilization. So can you talk about the rational for doing this 90 crore capex this year and how will this expand our capacity and if you can highlight, you know, in which all areas will you be deploying the 90 crore capex?
Harita Vasireddi
Sure. As I already mentioned our capacity is three dimensional. One is the laboratory space, one is the equipment and the other one is manpower. Now what we have created with previous years capex is additional laboratory space. Now to propel growth. We would continue to be investing in adding more equipment and also adding people. So Capex for purchasing equipment is a routine activity of the company. And since this year again we’ll be targeting a good growth we will have to expand on Capex as well.
Vishal Manchanda
Sure, sure. Okay. And on the, this on the biologic side the capex that they have announced for 50 crore. Talk about, you know is this just an extension of the services that we are providing on the small molecules. Right. That we have expanded into biology. So we’ll also be doing something different that we don’t do on the small, small molecule side.
Vishal Manchanda
Can you please repeat? Your voice was very blurred.
Ankit Gupta
So I was asking about you know the, the, you know we are doing 50 crore capex for the biologics and the peptide side. So is this the extension of the services that we are providing for small molecules or like we’ll also be doing some additional services here and if you can also talk about, you know like this will be catering to the generic side or will be targeting innovators also.
Harita Vasireddi
We will have capabilities to support both innovative and generic. But given the landscape, especially the domestic landscape, I think we’ll be targeting mostly the biosimilar market in terms of business development initially and service wise. This is a backward integration of the services that we already have. You may know that we already provide biopharma services, analytical biopharma services, we provide pre clinical services. We also provide clinical services. So this is a backward integration where we now work with our customer partners to help them in their formulation development also and can help them take it through and through some formulation development up to preclinical and even clinical research.
Ankit Gupta
So that helps. Thank you. Mishod. Next.
operator
Thank you. Next question is from the line of Kiran from Table 3 Capital. Please go ahead.
Kiran
Good afternoon ma’am. Many congratulations on a 20% growth in a very difficult year. I think it’s commitment to your. A couple of questions. A lot of other pharma companies are getting or are picking up dedicated capex for specific clients, US clients and other clients. US clients as well. So are we putting up Any analytic services or any Seattle services specifically for any foreign clients or this is just the entire capex is for normal growth across our bunch of customers is the normal case.
Harita Vasireddi
We have been having dedicated customer specific contact labs for the last 20 years and as a part of that continued service we continue to invest in our fund. Customer gets the contract lab. So we have investments that we’ll be doing this year. We have done it last year. I would say this is routine part of business.
Kiran
Got it sir. Got it. Okay. The second question ma’am is on the CRO front a lot of MNCs and a lot of even Indian companies are calling for headwinds because US borrow funding has kind of slowed down and so on and so forth. Are we seeing. We have a lot of scope to grow but in terms of how we see the landscape for our company do we see any headwinds from a CRO perspective?
Harita Vasireddi
We have seen headwinds in this sector but we have been able to counter them well. There have also been price pressures in the market but still we have been able to build efficiencies and we have been able to penetrate more into the market, get in touch with more newer clients. So those efforts are going on well. So next we are able to do better despite the headwind.
Kiran
Super, Super. One, one last question from my side. If you need a percentage, rough percentage, I’m not exact percentage. How much of a turnover might be coming from clinical trial for animal testing? Rough percentage, again not exact numbers.
Harita Vasireddi
We don’t do it. We don’t share such kind of percentage.
Vishal Manchanda
The only reason why we are asking is there may be some regulations and so on to. So that’s why we are just a little curious.
Harita Vasireddi
Last year we have done just one clinical trial. It was our maiden year and we have just done one.
Kiran
Thank you so much.
operator
Thank you. Next question is from the line of Kaushal Sharma from Equinox Capital Ventures Private limited. Please go ahead.
Kaushal Sharma
Hi ma’am. Very good evening. Am I audible?
Harita Vasireddi
Hello.
Kaushal Sharma
Am I audible Hello.
Harita Vasireddi
Yes sir.
Harita Vasireddi
Yeah.
Kaushal Sharma
So my question is on your capex side that you are. You said that our guideline, our guidance of Jing 90 crores to financial and we have started guidance around 40 crores out of this 25 cr for financial 26. So the 90 crore that you were talking around for financial 26 is it included? 25 crore for bio.
Harita Vasireddi
Sorry, can you please repeat? I think we got offline for a little while there. Can you repeat your question from the.
Kaushal Sharma
Yeah. So. Yes ma’am. Shauna, so my question is on Your CAPEX guidance that. You said that our guidance for the financial 26 is around 90 crore. And we have the separate guidance for biological segment around 25 crore for financial 26. So these 90 crore figures include this 35 crore.
Harita Vasireddi
No, I’ve clarified already. The 25 is not a part of this 90. It is over and above.
Kaushal Sharma
Okay. And my question is on your laboratory facility that re call you said that new license facility in Hyderabad is being commercialized from Q3. So what is the status of this laboratory?
Harita Vasireddi
We have commercialized this new facility. Now 70% is already capitalized and remainder will be capitalized in this quarter. Because one division has already moved in and the second division is in the process of moving in and doing their qualifications which will be completed in this quarter.
Kaushal Sharma
There is additional capacity that will like EMI EMC Chamber for electronic testing that would be installed by Q4 or early next year. So what is the state of this?
Harita Vasireddi
The new chamber is under installation right now. We will complete its qualification during this quarter.
Kaushal Sharma
Okay. And then what is our asset? And in our business so that we can understand everything.
Harita Vasireddi
Can you please repeat?
Kaushal Sharma
Turnover ratio.
Harita Vasireddi
Asset turnover ratio.
Kaushal Sharma
Yeah.
Harita Vasireddi
For us we look at a one is to one return when we are investing in capex. And more or less our investments have yielded this average.
Kaushal Sharma
Okay, one is to one data. And I have a senior receivable days as well. It’s been stretched over the period. So what is the reason and what is the normalized? Since you were talking about business, your.
Harita Vasireddi
Voice is very muffled. Sorry.
Kaushal Sharma
Yeah.
Kaushal Sharma
Now.
Kaushal Sharma
Now is it good?
Kaushal Sharma
Hello. Hello.
Kaushal Sharma
Am I audible?
operator
We’ll try again. Please go ahead. Yeah, yeah.
Kaushal Sharma
So ma’am, I was talking about your receivable days. So it’s been stretch out. So what is the normal receivable date in our business? What is the normal receivable date? Receivable date. Receivable date.
Harita Vasireddi
Our DSO is currently around 110 days.
Kaushal Sharma
Yeah.
Harita Vasireddi
Yeah. So this is what it is. Over the years the DSOs have been increasing. But that’s been the trend of the industry. Okay.
Kaushal Sharma
So in industry the receivable days around 100 to 110 days. Is it right?
Harita Vasireddi
Yeah. Our various sectors have various DSOs. But average DSO for the organization stands around 110 days right now.
Kaushal Sharma
Okay, thank you for answering my question.
operator
Thank you. Next question is from the line of Kevin Dastardi from Siddharth Partners. Please go ahead.
Kevin Dastardi
Thank you for this opportunity. Am I audible?
Harita Vasireddi
Yes, you are.
Kevin Dastardi
Okay. So firstly congratulations on the good set of numbers. And I just have two questions. First out of this revenue that we have, I think 70% from pharma and probably 20% food. Can you help me understanding what percentage of this would be from say us? And second question, with respect to some headwinds that you mentioned, you have been able to sort of minimize the impact but do we see any headwind in terms of our business which could impact directly maybe in next one or two years. Thank you.
Harita Vasireddi
Just to answer your first question. Overall our export revenue has been around 36% but most of our exports is through our pharma services. And coming to headwinds, very difficult to say. I think the whole world right now is going through some uncertainties. We will have to wait and see. Maybe we’ll get a better idea in the next quarter or so.
Kevin Dastardi
Sure, sure. Just can you elaborate on this first question? 36% is export. Yeah, I didn’t understand when you said it is through.
Harita Vasireddi
Overall at the company level, 36% of our revenues come from overseas. And I was just trying to clarify that the export revenues are mostly through our pharmaceutical services.
Kevin Dastardi
Pharmaceutical services. But any bulk around what would be sort of exposure to us. Among.
Harita Vasireddi
Exposure about 60% of these revenues are from us.
Kevin Dastardi
Okay, that’s helpful. Thank you.
operator
Thank you. Next question is from the line of Dhwanil from I Wealth Fund. Please go ahead.
Dhwanil
Hello ma’am. Congratulations from a good side of numbers. Am I audible? Yeah, just. Just wanted to check on the capex again. Sorry to to repeat this but earlier ma’am, when we had said that we had put up close to 2 lakh additional square feet for a capex of 80 crores. Right. So in that the equipments are already included. Correct.
Harita Vasireddi
That was only on the building.
Dhwanil
Okay, so that 780 cr, 775 cr was only for the building.
Harita Vasireddi
Last year the sum that you’re talking was on the building. It was not for equipment. Now this year we are saying we will be having additional capex spend. This will be mostly for equipment.
Dhwanil
Got it, Got it. And then currently the new unit or the new facility which we have commercialized. So that already has equipment in place, right?
Harita Vasireddi
No, that is this laboratory space that we have created. We’ll be buying an equipment as and when we need those additional capacities.
Dhwanil
Okay, okay. So once we buy that post that our revenue recognition should equipment we won’t be able to do anything.
Harita Vasireddi
Yes, yes. Yeah, that’s correct. As and when we are, you know, growing we will have to add more resources and for us the resources will be equipment and people.
Dhwanil
Got it. And then just wanted to check on our Overall expense. So if I’m seeing this quarter 94, 95 odd crores of sale. Right. And there was sequential 5 crores of total expense which had increased. If you could just help us understand where there was this and going ahead, how should we see this? Because I think employee cost was 4 crores increase and and other extent also entered that. Yeah. So to answer your question on employee cost, yes, there is an increase that is for two reasons. One is the regular, you know, the increase from the previous year in terms of increasing manpower and also the increments in addition to that from in current year.
What has happened is we had to make some additional actual valuation related to Grady and EOF valuations. So this has contributed to the increased manpower cost in current quarter. Okay. And on the other expense employ. Okay, so other expenses, see as a percentage of total revenue. So that the component of other expense is relatively lower. But then the other expenses include the travel and facility cost. So that varies depending on the requirement of entering these expenditures in terms of travel.
Harita Vasireddi
And also there is a new facility under operation now which is yet to be fully occupied and utilized. So the new facility also our operational cost will go up a little bit.
Dhwanil
Got it, ma’am. And ma’am, overall on the demand side, because we are making earlier also when we had spoken, so just on that incrementally the sales has been little bit slower in terms of growth. So just on the demand side, man, how are you seeing going ahead? We got the overall guidance but just on the demand, man. And between the two segments, pharma and food, how is the overall opportunity shooting up for us?
Harita Vasireddi
Demand side for pharma is pretty healthy especially for the scale of activities that we do and the growth opportunities that we are looking at. Demand for now is quite healthy. So we are also optimistic about growing in this year and the coming year. Food, we saw significant headwind in the first half of last year and that has normalized after the first half. Q4 also tends to be typically a high quarter for food because there is seasonal business involved. But Q1 also, again it doesn’t look, it looks much better than what we saw last year in Q1 and Q2.
Dhwanil
And this last question, ma’am, can you give us the quarter number for pharma and food strategy? What we did?
Harita Vasireddi
No, we don’t do that.
Dhwanil
Okay. Okay now thank you so much.
Harita Vasireddi
Thank you.
operator
Thank you. Next question is from the line of Umesh Matkar from Sushil Financial Services. Please go ahead.
Umesh Matkar
Yeah, madam, thank you for giving us our questioning opportunity and Also congratulations on great set of results in this uncertain environment. So my question was on clinical trial front, how things are going on. We had signed first deal a few quarters back, so just wanted to get a sense on this. So are we seeing extension of it or added any clients?
Harita Vasireddi
Clinical science. We are seeing traction in our RFPs. Too early to comment on anything more than that for now. I just want to say that the first trial that we started last year is near to completion and we have successfully done that to the satisfaction of our customers. And we are looking forward to onboard some more trials during the year.
Umesh Matkar
Okay, that would be good. Thank you very much, ma’am.
operator
Thank you. Next question is from the line of Biral Bhansali from Pearl Investment. Please go ahead.
Biral Bhansali
Yeah. Hi team. Congratulations on a good set of numbers. Most of my questions got answered. Just one last bit, ma’am. What is the quantum like the size of the orders? A typical size of orders in the contract. The clinical trial. Sorry, I’m talking clinical trial segment. What is the typical size like? Just ballpark number of each order.
Harita Vasireddi
Clinical trial order sizes can vary depending on the therapeutic area, depending on the protocol design, whether it is, you know, 60 patients or 400 patients. So n number of factors dictate the size. And we have seen that this could be as low as 30, 40 lakhs to as high as, you know, tens and tens of crores. So it’s quite wide and varied.
Biral Bhansali
You mean in rupees, right?
Harita Vasireddi
Sorry?
Biral Bhansali
You mean in rupees?
Harita Vasireddi
Yes, yes, yes.
Biral Bhansali
Okay. So I mean, can the size of these orders grow as we develop a niche for ourselves in this space?
Harita Vasireddi
Not necessarily. Any CT providers would be open to do all kinds of clinical trials. Sometimes if you’re offering a trial to a nutraceutical customer, the trial value could be much lower when compared to a pharmaceutical. There’s no specific bandwidth for this.
Biral Bhansali
So how are we placed as compared to Vida in the same space?
Harita Vasireddi
We are a new entrant. I would say we are not comparable with them yet.
Biral Bhansali
But are we in the position to offer the same scale of services that Veda is currently offering?
Harita Vasireddi
Ct? There is no scale issue as well because these are most patient trials. Right. We’ll be doing these trials at hospitals. There’s no scale issue here.
Biral Bhansali
Okay. So it’s more about having a lot of such work done. So the experience gives you more orders, more such orders in the future. Am I right?
Harita Vasireddi
Yes, that is there. Yes.
Biral Bhansali
Okay. So how is the clinical trial landscape looking at. Looking to you like, how much can we scale up like can we reach a revenue of say 10, 20, 30% of our total revenues from clinical trial states? Considering it’s a big field, it’s a big stage, this is really worse. When we say clinical research at winter, it is two essential parts of it. One is the healthy volunteer trials for which we have been the pioneer in the country and we continue to do that service for the last 30 years. Our main markets are US, Europe and India.
So there we have 180 beds and here we are one of the top five players in the country doing the clinical transfer, generic molecules, PK studies or VAB studies, what you would generally call them, coming to clinical trials. As Haritha mentioned, we are a new entrant into it. It’s only been two years, the landscape is big. It’s a global requirement now with the growing complex products which are coming in, the peptides or biologics, biosimilars and complex generics, this requirement is going to grow again. The west is looking back at India for getting some of their multi country trials done.
So that also gives us a leverage. So we have entered into it, we have the experience, we have all the setup which is needed for it. And the good part of clinical trials is there is no capacity constraint because this is done at hospital sites and India with the population based and the number of hospitals, all the key segments, disease segments, patients are available in India to enroll. So it’s just about reaching out and exploring more such trials. Go on Sudhu. So if you look at the global reports on clinical trials, I mean it’s an essential requirement of any pharmaceutical, biotech or medical device.
This new biosimilar foray, the biologics foray that we are making would essentially be a part of the clinical trials segment. The one we have announced today is mainly on the process and product development support for our clients in the space of biologics. Our clinical trials already is, I mean equipped to do trial for balance. Okay, so it’s a holistic thing and clinical trials will be one segment of the entire biological testing space. Biologic testing space. Yes. Thank you so much.
operator
Thank you. Next question is from the line of Ajay Surya from Nivishai. Please go ahead.
Ajay Surya
This question is again on the capex. We mentioned that 75 crore was for building and now a majority of this 90 crore will be deployed into equipment and this will also be done as and when needed. So ma’am, can you please highlight what would be the current capacity utilization of the existing equipment put in at the new facility and also on the 90 crore. If you can help us on the deployment part like how much do we plan to deploy and maybe the first half or the second half. If you can break this up that will be really helpful.
Harita Vasireddi
That nitty gritty. Please excuse me, I will not go into it because I don’t think very relevant. We will keep investing in capex or capacities as and when we need it across various bus. So how each BU will move will depend on how revenues or pipelines are moving for us. But I just want to explain the new facility a little bit for you. When we invested 75 crores it was in building an infrastructure. We did not buy any equipment and put there. What we did is we moved some of our existing services from the legacy building into the new building.
This created more space in the legacy building which we are going to use entirely for pharmaceutical services. Earlier it was housing food, it was housing electronics testing. Now what we have done is we have created a new space for food testing, a different space for electronic testing and we have also created more space for preclinical testing. What this has done is it has opened up a few quadrants to expand our analytical services for small molecules and large molecules and we are using these spaces to create facilities for expansion not only for the analytical but also we will be now setting up the development labs in these vacated space.
So that’s how we are going to do. There is no new equipment that has been brought and kept idling anywhere. We buy equipment as and when we need additional capacities because the lead time for most of these equipment is around one to two months only.
Ajay Surya
Okay ma’am, that helps. And my next question is on the pharma analytical side we saw almost like the top 20 pharma companies and I would like to know like what would be our market share in this division across the whole industry. And again if you can clarify, like we also mentioned about maybe facing some headwinds and then there was also some comment on there is healthy demand and we also aim to maintain the margins. So I’m unable to understand the industry level situation which is currently. So if you can maybe clarify, like the headwind is mainly on the pricing front or is it on the demand and even in the demand is it between the small molecules or the large molecules which we deal in?
Harita Vasireddi
Okay, two things are happening simultaneously here. One is the market dynamics which we are not where we do not have control. So there we are seeing that companies are going slow in their pipelines. So that’s one aspect that is external. We have no Control on it. There is an internal aspect where we are continuously putting business development efforts. We are going out more into us, more into Europe. So when we are doing that we are able to connect with more prospects and convert them as our customers. Both of these are happening. So that’s why I said next there has been a growth.
Ajay Surya
Okay.
Ajay Surya
And on the market share like what would be our market share on the pharma analytical side.
Harita Vasireddi
Very difficult to quantify. On a global scale it’s quite negligible. And India it is difficult to know get a figure on this because there’s not enough research out there.
Ajay Surya
Maybe ma’am, if you can then share on the repeat customer rate for both or maybe the pharma analytical side and the pre clinical side because the clinical just recently started. So maybe on the repeat customer rate if you can maybe highlight.
Harita Vasireddi
Our repeat business is very strong, it is upwards of 90% but again that is the number of clients who are coming back to us year after year. It’s not necessarily comparable revenues from each client. Today somebody might spend a certain amount on our services. They would have spent another amount in the previous year. What we see is are they coming back to us repeatedly for these services or not? So in that context our repeat business or our customer retention is upwards of 90%.
Ajay Surya
Okay, again one last question. We also increase the borrowing power to 300 crores and this board meeting, so this new capex which maybe that sums up to more than 120 odd crore for this year. So are we going to use any external funding for this?
Harita Vasireddi
No, not as a cost. The borrowing power that we are increasing is just as a placeholder. But the current capex requirement, whatever is there, that will be invested through internal accruals and little debt. For the biologic segment, 25 crores probably that we’ll be meeting by raising a small debt but mostly through internal.
Ajay Surya
Okay, okay, that’s it from my friend.
Ajay Surya
All the very best.
operator
Thank you. Next question is from the line of William, who’s an individual investor, please go ahead.
William
Congratulations on a good set of numbers and thanks for the opportunity man and the entire team just again on the revenue guidance as you have articulated views and the overall target that the company aims. So if I understand correctly, barring something, you know, global headwinds, we are on a target to achieve 125 crore exit run rate in the Q4 and that would place us a better revenue growth compared to last year. Obviously to the caveat that any unforeseen global event happens. Is that the correct summary then?
Harita Vasireddi
That’s the correct summit.
William
Okay. And also the last question is on the capex. So this 90 crore capex that will be irrespective of the demand environment or that is a flexible number. Depending on the demand environment that number may change a bit.
Harita Vasireddi
That number will certainly depend on our growth.
William
Understood ma’am. Thanks a lot.
operator
Thank you. Next question is from the line of Sanjeevora who’s an individual investor. Please go ahead. I would request you to please unmute and speak. Due to no response we’ll be moving to the next question to the next participant. Next question is from the line of V. Rajesh Vadera from Navasia Investment advisors. Please go ahead.
Sanjeevora
Good afternoon. I want most of my questions were asked so I wanted to ask around.
Harita Vasireddi
Competitor side in pharma analytical and clinical and preclinical.
Sanjeevora
As of now like Veda clinicals have their lower margins. So could you comment on the competitive side?
Harita Vasireddi
We can’t comment on competitor’s lower margins. We don’t have enough information to comment on that.
William
Okay.
Sanjeevora
And pricing side and all. So like competitive power running our prices are competitive in the market. That’s all I can say. Okay. Is there any intensity in competition or.
Harita Vasireddi
There are few players are like.
William
Yes.
William
Yes.
Harita Vasireddi
There’s a lot of number of laboratories have come up in the recent past. So there is definitely going to be a continued price pressure.
William
Okay, thank you.
operator
Thank you. Next question is from the line of Pratik Dedha who is an individual investor. Please go ahead.
Pratik Dedha
Am I audible?
operator
Yes.
Pratik Dedha
So most of my questions have been answered so I don’t have any questions.
operator
Thank you. Next question is from the line of Kiran from Tabletree capital. Please go ahead.
Kiran
Yeah, sorry, last question from my side. The 300 crore borrowing is a very huge number. I mean we’ve known vinta for about 10, 15 years. We’re looking at numbers. We’ve never had debt of more than 40 crore 50 crore and obviously we have decent cash for capex. So it’s not an approval for 100 crore or 50 crore or 150 crore. It’s a for 300 crore. So are you seeing any major shift in customer buying patterns? Are you seeing any major capex that you’re going to foresee in the next year or two for getting an approval on such a huge number.
I mean I could understand as a permission 100 crore but 300 crore is a big number for income management. So I’m just wondering. It’s completely away from our nature so just wanted to get clarification on that. Just to correct, sir, as of now our overall borrowing power is increased to 300. Earlier it was 175 crores. Now there is an increase of 125 crores per only. That makes the overall borrowing power to 300 crores. It is not that we have increased the borrowing power of 300 crores now that is understood, sir. I’m just saying. I mean that is a significant increase.
I mean it’s not. I mean from whatever little we know about the company, it’s not in the company’s DNA to get such a huge borrowing approval. So that’s why I’m asking why. Yeah. If you see, based on our earlier discussions the overall capex spend guidance for current year 2526 will be around 115 crores including 25 crores of investment in biologics. Okay. So although we are not this requirement today there could be the requirement of borrowing for this purpose around probably 30 to 50 crores. We need to have a placeholder and the borrowing enough borrowing limits with us to be able to meet the requirement.
We cannot go to our shareholders and request for increasing borrowing power as and when needed. So that is why we had got this increased as a placeholder whenever there is a requirement. Accordingly we will take the necessary approvals and invest. Thank you.
operator
Thank you. Next question is from the line of Kevin Daftari from Siddhant Partners. Please go ahead.
Kevin Dastardi
Thank you for this second opportunity. Just two questions. One, is there any plans in terms of inorganic growth that company is looking at? And my second question is should we connect for more detail offline with the new CFO or is there any dedicated ir? Thank you.
Harita Vasireddi
CFO is always available to answer any specific queries that we couldn’t discuss on this call. And the question inorganic is definitely a strategy and it will happen when opportunities concretize for us. But as of now it is nothing concrete, is there?
Kevin Dastardi
Thank you.
operator
Thank you ladies and gentlemen. That was the last question. I would now like to hand the conference over to the management for closing comments.
Harita Vasireddi
I wish to thank everyone for joining us on this call today. All of you have congratulated us very much. Appreciate the congratulations. And I want to also thank Vishal from Systematics Advice for being on this call. Thank you. Bye.
operator
On behalf of Systematics group, that concludes this conference. Thank you for joining us. And you may now disconnect your lines.