Cohance Lifesciences Ltd

Good evening, everyone. We appreciate you all joining us today to discuss our Q2 and First Half FY26 performance. On the call with me today I have; our Executive Chairman, Vivek Sharma; our Whole- Time Director and Chief Financial Officer, Himanshu Agarwal; our Pharma CDMO CEO, Mr. Yann D'Herve; our Business Head, API Plus, Mr. Gunjan Singh.

Now, it is our request that Vivek share his first perspective on the quarter and then the organizational transition and then Himanshu will walk through the financials and the other leaders will walk through their sections. And once we are done with all this, we will open the floor for Q&A. Now, I will hand it over to Vivek.

Thank you, Cyndrella. Good evening to everyone on the call. Let me start by putting this quarter and the first half of FY26 in context. As we continue our journey of operational consolidation and capability transition for Cohance, we are moving from a phase of integration to a phase of capability amplification, building the organization, science platforms and the governance needed to support our next leg of growth.

Considering the leadership changes, the Board had approved a revised organization structure that is reflecting our multi-business portfolio and expanding global footprint and position because Cohance strongly on its path forward towards the U.S. $1 billion vision.

Over the past year, we had established three distinct business verticals, each led by highly experienced and accomplished industry leaders who bring deep expertise and proven track record in their respective domains and each has full operational ownership and accountability. Today, we also have on the call with us Mr. Yann D'Herve, CEO of Pharma, CDMO of EU, and Mr. Gunjan Singh, who Heads our API block chain.

During the year, we have significantly strengthened our leadership and technical talent base across all three business units, adding senior professionals at Vice President and above levels of top global and Indian pharma companies. R&D operations, quality and business supplement functions have been augmented, supported by a growing pool of scientists who are PhDs, highly experienced, process small molecules, ADCs, and oligonucleotides.

These additions have deepened our execution bandwidth across India, U.S., and Europe, creating a more agile, science-led, customer-centric organization aligned to our long-term growth vision. We continue to be focused on business building both for near-term and mid-term.

Let me highlight some of the progress made across businesses in the year so far; first, on the pipeline and approval. During the quarter, one of our late phase molecules in the respiratory inflammatory segment received U.S. regulatory approval. This is an important milestone for our CDMO platform,

reflecting our ability to support customers end-to-end from early development to late phase, tech transfer and finally into commercialization. Our newly added customer relationship is programmed in- grant with phase 2 orders and higher engagement discussions. We have successfully added three active biotech relationships in Asia.

Second, on customer engagement and market positioning, we had a very active participation at recently concluded CPHI in Frankfurt, where we formally unveiled Cohance's brand identity. Our senior team met with over 340-plus customers, a balance mix of existing partners and new prospects across the U.S., Europe and Japan.

A few themes were very clear. Innovators continue to actively look to deal in supply chains beyond China. This is also evident from RFQs across Cohance, but also across the broader Indian CDMO players. There is a strong and growing interest in high-potent ADCs and oligonucleotide capabilities.

In our positioning as a technology-led global CDMO, integrating small molecules, ADCs, and oligonucleotide capabilities across the U.S. and India is resonating well with innovators worldwide, and several discussions are in progress. While these conversations will start with a small business, we continue to be positive on the potential.

Thirdly, on quality and delivery, we completed four major customer audits across our CDMO facilities successfully. At the same time, we did see some timing-related shipment deferrals, particularly in small molecules, two large commercial molecules, de-stockings and NJ Bio shipment deferrals from early effects of funding winters for a smaller biotech and the Nacharam FDF site shutdown which has weighed on the reported growth.

Stepping back, our macro reach too has not changed materially from Q1. Demand from large innovative customers remains positive. Early-stage biotech segment is still selective, but showing early signs of recovery, and European innovators continue to diversify their supplier base, which aligns well with our capabilities. In parallel, our external advisory board is now fully active and engaged. We have onboarded industry veterans with several of them having past experiences at large global innovators.

The EAB is helping us sharpen our long-term capability roadmap, guiding our customer-centric strategy. From a business standpoint, I believe it is important to highlight the challenges we are currently facing. Pharm de-stocking in some key molecules and delayed reloads of a few Phase II, III molecules affecting near-term growth, Nacharam plant shutdown, awaiting audit clearance to ensure best quality and regulatory practices, order shipment delays for FDF due to plant shutdown. Production has now resumed in phased manner. Slowdown in biotech funding, NJ Bio has seen some project shipments pushed by 2-3 quarters due to extended CMC timelines from partners.

With that backdrop, I will ask Yann to take you through the pharma CDMO performance during the progress at NJ Bio and Sapala, and the latest for its small molecules, EDC and oligonucleotides, followed by Gunjan to give you an overview of API process. Yann, over to you.

Thank you, Vivek, and good evening, everyone. I will cover the performance of our pharma CDMO platform and then comment on visibility as we go ahead. On the small molecule side, performance continues to be anchored by late phase and commercial programs for global innovators.

We are very pleased to see one of our late-stage molecules receive U.S. regulatory approval during the quarter. This milestone is significant, especially because we are delivering four key starting materials for these molecules using preliminary applications. Not only does it reaffirm our ability to support late- phase and launch programs from a regulatory and quality standpoint, but it also opens up a multi-year commercial revenue stream as the product runs post-launch.

Beyond that program, our pipeline continues to broaden and mature. The reasons why clients come to us is our long-track record in high-potent chemistry, complex chemistry and ability to scale and accompany the molecule from Phase I to commercial. We are currently executing nine Phase III molecules of which 4 are expected to transition into commercial supply over the next 12-18 months, and two have already moved into launch-stage delivery.

Many Phase II programs are progressing towards validation and scale-up, many of them across high- potent and complex chemistry. Our on-time delivery rate remains above 95%, underscoring the operational maturity of our team. This was praised by many customers at CPHI.

The RFQ funnel remains strong, with many new proposals received in Q2, spanning Phase 2, Phase 3, and commercial supply. Importantly, the share of late-phase RFQs has nearly doubled in the first half of 2026 versus last year, and many are reloaded from existing large innovators, a strong signal of customers' stickiness and confidence. The remaining share is driven by new biotech and mid-size innovators seeking reliable partners for complex, high-value intermediates.

These are exactly the kind of projects that deepen customer engagement and enhance mid to long-term visibility. We remain focused on ensuring progress across all requisite input metrics to ensure sustained mid to long-term growth, given the lead time in the business. On ADCs, customers come to Cohance and NJ Bio for the science, the know-how, the technology, which enables their IND filing.

We have a large base of loyal customers that is growing. The product offering already used in commercial products, a payload from India, for example, brings confidence that we can scale. In ADC, the ability to develop and to accompany our customers as their drug products move through clinical phase is a strength, and this allows to build a strong business.

All that we do here is based on customer centricity. We are building a conjugation suite to accompany our customers in Phase 2 in USA at NJ Bio. We are executing a complete business continuity plan for s-Trione, a key intermediate used in commercial ADCs. We are offering this key intermediate from a second site with the support of our customers.

We are developing our portfolio of payloads, with three new payloads being launched this fiscal year.

We have opened a new high-potent capability in India up to OEB6 for customer projects, and there is a good response from the market with new projects.

What we can see at the moment is that customers are coming to Cohance and NJ Bio with challenging scientific problems to solve, as they understand better what we can do for them with a combination of NJ Bio and the commercial payload capability.

Across customers, we continue to see healthy traction from both large innovators and biotechs, many of whom are consolidating suppliers and prefer to work with integrated partners capable of managing better linker synthesis, conjugation support, and analytical characterization under one umbrella.

Our India-US model gives us a distinct advantage here, with NJ Bio handling early development, conjugation support, analytical methods development, and our India facilities focused on payload and linker synthesis at scale. We can offer an end-to-end reliability with cost efficiency, something increasingly valued in the ecosystem.

On oligonucleotides, we are still in the early build phase. The progress in FY26 so far has been encouraging. Our larger-scale oligo building blocks, cGMP and non-cGMP facilities has now been inaugurated. We are working on more than 35 active molecules across building blocks and drug subsets.

We have repeat orders from key customers in the US, EU, and Japan, and our first GMP orders from customers are scheduled between October and November 2026.

We have also initiated work on specialized chemistries, including GalNAc and certain modified ligands, which should further differentiate the platform over time. In the broader market, there has been encouraging validation for next-generation oligonucleotide chemistries, particularly tricyclo-DNA- based antisense platforms, which are gaining recognition under industrial-scale initiatives in Europe.

This reinforces the growing relevance of such chemistries in rare and orphaned indications and aligns well in the direction where Cohance has built its own oligo capability.

Let me now specifically talk about NJ Bio and Sapala. At NJ Bio in the US, we have added 17 new biotech customers. We have completed three ADC project conversions, early phase, and we have orders from three large innovator companies scheduled in the second half of this year.

We have successfully completed a GMP conjugation project for an ADC program, validating the site's readiness for commercial execution. At the same time, as we have flagged earlier, a number of projects at NJ Bio have seen shipment timelines move out by two to three quarters, largely due to extended CMC timelines, funding dynamics, and reprioritization on the customer side, given the biotech funding situation. These are timing issues.

In fact, many of these customers are deepening technical engagement, even as their internal timelines shift. We feel very good about the capabilities, customer engagement, and ability to scale. At Sapala in India, we have upgraded the analytical infrastructure with platforms such as supercritical fluid chromatography and high-resolution mass spectroscopy, and we are transferring methods from our U.S. and Hyderabad teams into Sapala to create a seamless early phase and intermediate backbone for the CDMO franchise.

Putting it together, the CDMO portfolio today has deeper late-stage and commercial visibility than a year ago. Even so, some revenues have moved out of FY26 on account of shipment deferrals. This positions us better for 2027 and beyond. With that, I will hand over to Gunjan.

Thank you, Yann, and good evening, everyone. I will begin with the API Plus business, including our FDF operations. The API Plus platform continues to be driven by steady innovative demand and a structured new product development and filing pipeline.

In the first half of FY26, we have completed five regulatory filings, which include DMF and CEP type.

We have added several new products to our active new product development program. We are targeting 10 filings for the full year. We have completed two validations already, and another four are in progress.

Our API site at Jaggaiahpet cleared the U.S. FDA audit and cleared it with zero observations. This plant contributes a larger share of the total revenue. Additionally, we also secured commercial orders from two big pharma customers as part of our product lifecycle management office.

On the FDF side, our Nacharam unit has moved past the most acute phase of disruption. While this had an impact given the shipment delay, we have now resumed production and shipment. The order and shipment cycles are still in the process of normalizing.

We have five launches planned for FY26 and another 10 formulation projects in the pipeline, which we expect to phase in over the next few years. We are adding capabilities of liquid and topical corticosteroid formulations backed by active customer demand. We expect gradual improvement through the second half as remediation work progresses and customer confidence further strengthens. With that, I hand over back to Vivek.

Thank you, Gunjan. This week, I concluded meetings with one of our large AgChem innovator customers. I would like to share a few key takeaways. The sector continues to show long-term structural growth through near-term pressures from access capacity, and Chinese genetics are heightening the need for cost leadership and supply reliability. At Cohance, we are experiencing collaboration with leading innovators, participating in new active ingredient RFQs, and gaining traction with customers across Europe and Japan.

Several promising projects are now at lab scale. While the near-term consolidation is expected, we remain confident of sustaining growth in our specialty chemical segment through innovation-led partnerships and execution.

On the AgChem side, we continue to see the gradual macro recovery as expected. This quarter, we received four RFP projects from a large global innovator. Our innovation challenge program for the leading global agromajor is on track. Recently, we onboarded a new Japanese innovator that has deepened our customer base in this segment. A key molecule in our portfolio has transitioned to a genericized base form while its combination product remains commercially active.

We continue to see price pressures from Chinese competition and are pursuing participation on the active ingredient side. The initiative has experienced temporary delays due to pending innovator registrations, which are expected to normalize in the coming quarter.

On the performance chemistry side, our OLED intermediate portfolio continues to gain momentum. We have deepened our engagement with an established display technology innovator, and we are in active discussions with two new customers for FY27 supply program.

Across both API Plus and specialty chemicals, we are driving value engineering initiatives, including catalyst recovery and solvent recycling, which support our margin profile. From a forward-looking glance, we expect H2 to be better than H1 for these businesses. As different projects, validations, and new launches begin to continue more variably.

With that, let me hand it over to Himanshu to walk you through the financials and our updated outlook.

Thank you, Vivek, and good evening to everyone on the call. Let me walk you through the key financial highlights for Q2 and the first half of FY26, and then I will share details about our updated guidance and scenarios.

On the quarter 2 of FY26 and H1, our revenue per quarter stood at INR5,556 million, a decline of 8% year-on-year, primarily due to deferred shipments at our CDMO and FDF sites, and some key molecular restocking, including planning of certain projects starts, especially at NJ Bio. Adjusting for the restocking, the quarter reported a growth of 14% year-on-year.

The material margin improved to 74.6% compared to around 71.3% in the same quarter last year, driven by both the business mix as well as ongoing efficiencies and yield improvements. The adjusted EBITDA for the quarter was INR1,289 million and adjusted EBITDA margin of 23.2%, reflecting the low volume as well as the upfront investment in employee cost and certain transition and remediation costs.

For H1 FY26, the revenue was INR11,049 million, representing a 1% growth year-on-year. Adjusting for the restocking, the first half reported a growth of 20%. The adjusted EBITDA was INR2,630 million and adjusted EBITDA margin being 23.8%. Adjusted PAT for the first half year was INR1,302 million, translating to a margin of around 12%.

On balance sheet and cash flow, we have maintained discipline on working capital, even with shipment difference in quarter 2. In H1 FY26, free cash flow generated INR1.69 billion during H1. Cash on books stood at INR3.91 billion, maintaining a healthy liquidity position. Our working capital at 121 days showed a significant improvement versus FY25.

Deployed capex of INR1.06 billion has been deployed in a targeted manner, primarily towards high- potent and linked chemistry, oligonucleotide scale-up, and de-bottling and reliable investments in API and specialty chemicals. Our adjusted ROCE stood at 21.7% as of first half of the year, despite our higher investment and consolidation phase of recent acquisitions.

Coming to the guidance and the key drivers, given the development over the last two quarters, we are revising our FY26 guidance basis the current outcome. We now expect our FY26 guidance of revenue to be broadly flattish versus FY25. The key drivers of these revisions are the ongoing challenges, as highlighted by Vivek, some of these being the restocking of our large commercial products that we had discussed earlier, deferral and shipment, and the biotech funding winter impact on NJ Bio.

Temporary impact due to FDF Nacharam unit, consequent to the Nacharam audit, which we have discussed earlier. And finally, the deferral and the agchem, new product approval. Looking ahead, we believe that our H2 will be stronger than H1, driven by execution of deferred shipments, new program activations, and regulatory normalization in key sites.

For our mid-term, or rather near-term FY27, we do expect the growth to come back in FY27. The growth will be backed by new wind and existing business, supported by restocking, as well as reloads on the CDMO side of business, which has been impacted negatively this year. Given the fact that higher visibility on the same should emerge in next one to two quarters, we will provide a more informed guidance by Q3 or Q4 of the current financial year.

We are maintaining our mid-term guidance of US$1 billion, with mid-30s a bigger margin. Given the sharp investments that we have done and the building blocks of our business, coupled with the high-

risk technology, where we believe we have a head advantage. We believe that we will be able to recoup these operating leverages from the upfront investments made over the last 12 to 18 months.

With that, I will hand it back to Cyndrella.

Thank you, Himanshu. And now I request the operator to open the floor for Q&A.

Thank you very much. We will now begin with the question-and-answer session. Our first question comes from the line of Varun Bang from Bandhan Life. Please go ahead.

Hi, thanks for the opportunity. I have some feedback to share. Can I go ahead? Yes, please go ahead.

This organization was on a strong trajectory before. But I think under the current ownership, the execution has clearly derailed. There has been a consistent gap between what was guided and what has actually played out, not just on the delivery front, but also in the areas like timing and communication of the stake sale. And the lack of clarity and follow-through has eroded both the culture of the organization and also the external credibility.

Frankly, the execution discipline seems to have collapsed. And it shows across multiple fronts. I have been tracking this company for many years. Even before Advent’s acquisition, I have not never seen this level of disarray. What is happening now is clearly reflection of Advent’s failure in managing and steering the business.

The nature of the business calls for a steady and patient execution. It moves through cycles and sustainable progress takes time. I think Advent’s approach, however, has been more like running on a treadmill, push for a speed without the corresponding structural readiness. And that is showing in the outcome.

I just have this feedback to share. And that is it. Thanks. I hope the Board and Pankaj will take this in the right spirit. Thanks.

Our next question comes from the line of Ahmed Madha from Unifi Capital. Please go ahead.

Thanks for the opportunity. I just wanted to understand the value chain of ADC business a little better and how is Cohance as a whole participating in it. I have basic understanding. I will try to explain and then you can correct me and explain how you are thinking about the business. In ADC, be it any product, you will have certain key starting material and then few intermediates and then that will go into payload linker and then there will be bio-conjugation.

That is the simplified value chain as far as I understand. Can you explain as of now what part of the value chain we are catering? Is it just the building block or something ahead? And how do we build our capabilities and expand our part of the value chain which we cover?

As you indicated right, ADCs are complex modalities. They are composed of monoclonal antibody, a linker and a payload. Those three elements have to be bio-conjugated. That is how it works here. The way we look at that value chain, where we are participating, and that is the uniqueness of the offering of Cohance and NJ Bio, is the following. We have a product offering.

The product offering is essentially one of payloads and also starting material for payloads. That is a product and the payloads that we have in our portfolio are computation-based, fully back-integrated in India, which means that offering a tremendous supply security for our clients. That is one of the product offering.

The other offering, that we have is based on the intellectual property IP and the know-how that is located in NJ Bio. With this IP, which is essentially the know-how on customization of payloads, customization of payload linkers, proprietary linkers and payload linkers, and know-how in bio-conjugation, we are able to offer R&D services to our clients as well as manufacturing services from pre-IND to commercial.

When we talk about the value chain, where we are participating, we are an IND enabler with more than 100 customers, I would say that buy this service. From these IND enablers, we enable the innovators to develop drugs that are life-saving. The more we enable the innovators, the more we participate in the value of the drugs through the different value pools that I just mentioned. We call these as well the value diamonds. Product, IP, R&D services, manufacturing services, with the ability to scale. I hope that it clarifies the offer and the unique value.

Yes, just one follow-up. When you say you are catering the Airstream building block, for example, say a product like NR2 with Daiichi, and I am fine if you do not explain the productwise but just for a reference, I am taking a product name. For that product, you will be doing a building block and then pass it on to the field linker manufacturer. Is it the right understanding?

I will not comment exactly on the total value chain specifically because it is confidential information, but your understanding is not wrong.

Sure, that is from my side. Thank you so much.

Thank you. Our next question comes from the line of Shreya Chatterjee from Ageless Capital. Please go ahead.

Thanks for taking my question. My question is more from a strategic viewpoint of understanding Cohance’s scientific capabilities and how it translates to its earnings or the revenue growth. If I see the ADC capabilities that Cohance has and it caters to various innovator companies, in the past, for example, historically, if we see, FY23 and '24 had seen some of the ADC molecules perform very well in their self-run, but we did not see the growth coming in, in those years for Cohance. So, what am I exactly missing over there? And also, there are certain indications that some of the ADCs have gone further approval or some of the ADCs have failed some of the first-line trials that have come out recently. So from the investment perspective, how do we see the impact on Cohance sales going forward?

Let me give a broader perspective here. Competition-based payload for commercial drugs, there are two out of the 12 ADCs approved in the world that are using this technology. And as you may imagine, with the offerings that we have, these are essentially products that we are participating into. So that is point number one.

Now, as part of the development and launch of new drugs in the market, I am talking about those two drugs, it is clear that pharmaceutical companies build stock and destock in order to ensure that they

have enough products to manage the upside in their launches. And as a stocking material provider, this is what we are essentially delivering here in that case.

That means that there may be also some destocking elements here, depending on how those drugs are doing in the market, and how optimistic or pessimistic the pharmaceutical companies have been in their supply chain. So that is one element of the answer on the comments related to the sales development.

Now, what is more important, and that is not necessarily seen in the numbers, is the pipeline of customer projects that we are essentially working with at the moment, with the combination of NJ Bio and the combination of the ability to scale in the payload and payload linker with our facility in India. Right?

If I may ask as a follow-up, when do we see the inflection point for the niche technologies in pharma CDMO going forward?

Are you talking specifically about ADC, or in general for the CDMO business?

I am asking for ADCs and all the initiative launches in the CDMO business. When can we expect an inflection point for this pharma CDMO?

We know that we are participating in more and more drugs being developed. One thing we cannot influence is the ones that are going to become commercial, right? I mean, we can influence with our service, but we do not know exactly which one will become commercial. So what I can indicate is we are participating in more and more drugs and our offering with especially the OEB6 capabilities that we have installed in India allow us to essentially participate in the future in the commercial drugs that will come. That is what I can comment.

As indicated as well in my previous answer, we are already part of two payloads that are commercial.

The third aspect is, as I started three months ago, we have increased our business development capabilities, especially in critical locations such as Boston, San Francisco, in order to be able to attract additional customer projects in order to maintain and add these inflection points as quickly as possible. Thank you, sir.

I was explaining a little bit the diamond with the product, the IT, the R&D services and the manufacturing services. One of the aspects is that on each of those elements of the diamond, we are increasing our offering. Example, on the product offering, we are launching three new payloads this year. This will allow us as well to participate in more drugs that are commercial and in development in the pipeline. So, think about it as a platform that we are expanding and that allows us to participate more in the value generated as a product of developing through clinical trials.

Thank you. The next question comes from the line of Abdulkader Puranwala from ICICI Securities. Please go ahead.

Good evening. Just in terms of your FY26 guidance, when we talk about the second half being better than the first half of Fiscal 26, how should we look at this number from second half of Fiscal 25? Is there some bit of a decline we should expect in the guidance we are providing now?

As I said earlier, that we are looking at FY26 to be flattish in comparison with FY25. My sense is it is easy to decipher how the H2 would look like.

Okay. And so, how about margins, previously we were talking about around 30%. First half we are a little lower than that, but on second half, do we expect some kind of a rebound?

Yes, absolutely. There will be a rebound in H2 as some of the operating leverage will come, given that H2 is expected to be better than the H1 from a revenue perspective. We do understand that we have been steadily investing ahead of the curve and the operating leverage will kick in with the higher revenue coming in.

Sure. So, in terms of the commerciality from a 27 perspective, would you highlight a couple of projects on the pharma CDMO side, which could get commercialized, from a one or two-year perspective at least?

We have a healthy pipeline, right? So, I mean, that is starting to delivering, right? Each quarter now in Q1 and now in Q2, we announced that one of the drugs for which we were providing KSM, key starting material or intermediates have been commercialized. So, this is important because that means that we are at the early phase for those products in launch and that allows to expect some ramp-up for volumes moving forward for commercial drugs.

At the same time, we are participating in numerous phase three programs that will also deliver in the next 12 months to 18 months, ramp-up quantities for pre-launch requirements. At the same time also, we are currently seeing an influx of RFPs that are with the late-stage program, phase three and also commercial program as the customers are de-risking some of their supply chain and are orienting RFPs towards India and towards Indian CDMO in the small-molecule space. So, as such, this will help as well in the building and further building of the pipeline.

Sure. And so, just last one from my end. Have we already submitted our replies to the OAI for the Nacharam plant, talking about launching five new products? Is it from the same plant, and is it for the U.S. market? No, this is not from the Nacharam plant.

Okay. That is why in terms of our correspondence with the U.S. FDA, have we filed a reply?

Of course, within the stipulated time, the first response to the U.S. FDA was shared. This was followed by two further submissions, which were additional effort that we had gone over and beyond the commitment there, which was also submitted within the timeframe.

Overall, just to assure you, Nacharam FDF plant contributes a very small share of our total revenue.

And as per the OAI status, we are allowed to ship the commercial products as we have been doing in the past. Those products can continue in the future as well. Got it. Thank you.

Thank you. Our next question comes from the line of Rahul Jeewani from IIFL Securities Limited. Please go ahead.

You indicated that NJ Bio has been impacted because of the muted bio funding environment. Can you also talk about when we had acquired this asset last year, it was analyzing around $32 million of sales.

So, what kind of revenue recognition have we done from NJ Bio in the first half of this year and how do we see NJ playing going into the second half?

The revenue at this stage is looking flattish from a performance perspective. We are expecting that NJ Bio in 2026 will deliver a similar revenue as that of 2025.

While NJ might remain flat this year in FY26, but is there a seasonality for NJ's business? As second half of the year tends to be better than the first half?

That is correct. There is a seasonality in NJ Bio as well. So, H2 will be better than H1.

Can you quantify that in terms of the split between the first half and second half revenues, ballpark?

That would be difficult to communicate, but you have the subsidiary results, which is there. You have the full year number. So, my sense is that it will be easy for you to decipher that.

Sure. And then second, in terms of guidance, while we stated that the overall revenue will remain flattish in FY26, it would be helpful if you could also comment in terms of how do you see the margin trajectory playing out this year, while second half would be better than first half. But in terms of full year margins, our earlier expectations were low 30s. So, some clarity there would also be helpful. Thank you.

As we had guided that our investment continues to be higher. And as both Gunjan as well as Yann have articulated the ailments that we are getting into the business and the way ADC and Oligo both are shaping. So, we have continued to invest into BD. And in fact, we have added BDs both in U.S. as well as in Europe. And we have also added BDs who are specialists in the niche technology area. So, the investment in the business continues, though we are experiencing a headwind from a different perspective as well as inter funding of biotechs, which is impacted NJ Bio.

So, net-net our sense is that with the cost initiatives that we have taken, we would not be able to reach to early 30s EBITDA that we had guided earlier. And we are most likely to be in the range of high 20s as EBITDA margin.

Sure sir. That is it from my side. Thank you.

Thank you. Our next question comes from the line of Chirag Shah from White Pine Investment Management. Please go ahead.

Yes, thanks for the opportunity. Sticking back to the guidance, that is my first question. What kind of confidence do you have in H2 and '27 guidance? Because it appears from the tone that there is more downside risk to the guidance that you are indicating. So, given what has happened in the recent past, you are in better position to take an assessment.

Why I am asking this question? Because if I look at last three - four transcripts, your granular commentary always looks to be very good in terms of molecules, in terms of where we are in the cycle with the Phase 2, Phase 3, etcetera. But the near-term guidance seems to be missing by far. I do not think that this would have been your expectation in any which ways. So, if you can just summarize it and help us understand the confidence that we have in your guidance, that is the first question.

You know, guidance is based on what we are, the traction we are seeing with customers. So, the investments that we have made with commercial teams, the pipeline that we have, the RFPs we are seeing, the meetings we are having with customers, all of those are early indicators for us to get the guidance on. And that is giving us high confidence on what Himanshu just shared with you with the guidance for the second half of this year.

I think that will also reflect, you know how we start thinking about next year. Because all of these things will translate into our guidance for next year. So, overall, we are seeing very positive traction right now.

And to all different businesses, our filings are increasing, our customer traction, as I said, RFPs. So, all these indicators are positive. That is giving us confidence in the second half guidance.

And also, as you know, the CDMO business, you know, normally Q4 is a better quarter generally after the year. And so, that is giving us a positive indication.

Secondly, based on the information that we have today or that you have today as a Board, can we assume F27 would see around the 20%-25% kind of growth, that kind of visibility you have? I understand a lot of things can change. But there is a reasonable confidence, but for the unforeseen events, it is possible given the way the spillovers you have been indicating. So, can we assume say 70%, 80%, 85% kind of confidence that it is possible to achieve 20%-25% kind of growth next year?

I will say it as a yes and no. Okay. And the reason I say yes and no is that see, we are, as Yann mentioned, there is traction in the RFP, both from pay-free as well as commercial. Okay. However, at this stage, we have said that we are expecting growth to come back in FY27.

Now, what you asked me is very specific. And for that, we do need time for our customers to revert and give us better clarity of what we are winning and what we are able to get as reloads. And also, we would want to wait to get a sense of how the biotechs are coming back, because a large part of the business in NJ Bio is biotech dependent.

So, that is why we have said that you have to allow us Q3 & Q4 of the current year to come back and give you more clarity and a better visibility of how we are looking at FY27. At this stage, it would be difficult to say yes or no to the number that you see.

And second question was on the four molecules that you indicated are likely to go into commercial/ launch over the next 12-18 months. So, if you can help us understand that, how should we look at the ramp up of those? If you can get educated on that side, how generally, what are the time frames that one should look once the product gets approval, if you can, because that would be helpful.

And the ramp up part also. You did a year three, year four, that matters. An initial ramp up is generally very low and volatile, or if you can guide us or educate us over there.

Yes, it is a good question. And of course, we always try to model this kind of question as well in our portfolio. So, what I can say, one of the molecules, right, that should launch in 2027 is a molecule that requires quite a large volume as well of key starting materials, for which we have been chosen by the originator.

So, it is very difficult to say when the quantities will be asked, be delivered. Is it still within FY27 or at the beginning of FY28? It really depends on when the originator will actually see the success of their

launch. But we model this, and we are fairly optimistic, I would say, for the launches coming for the small molecule portfolio that we have.

Thank you. Or at least if you can educate us that one respiratory approval that has got approved, the respiratory drug, plus the four new molecules that you are referring to, what is the opportunity size, either at the drug level or at our level, whenever it happens, what could be the potential peak opportunity that is available? I am not asking for each of the drugs, but all five combined, if you can indicate that it would be helpful. It could be year 30, year 31, year 32, it depends.

I will not provide a number here. We see the pipeline becoming better on that end with more commercial drugs that are part of the pipeline that we are delivering. But I will not comment on the exact value here because our clients do not know either at the moment. Okay. Thank you very much.

Thank you. Our next question comes from the line of Shyam Srinivasan from Goldman Sachs. Please go ahead.

Good evening. Thank you for taking my question. Just one, trying to interpolate your guidance for ‘26 versus ‘25, INR2,600 crore last year, we are at INR1,100 crore now. We need to probably do about INR1,400-INR1,500 crore for the second half. When I look at quarter two exit, it is about 550, right?

So, I am just reading out, given deferred shipments from 1H and project wins, we expect 2H to be 1H.

Is there a way to kind of quantify what the deferred shipments amounts could be that is slipping into 2H so that we get some comfort on, what is the ask rate for just the organic part?

There are two aspects to the question that you are seeking. Part one is we do have a FDF Nacharam, which we have taken down, and it is coming and coming online over a period of time. So, that is one difference, which is, as Gunjan articulated that we are fully entitled to continue to supply to our customers.

So, that is one part of it. And the second part that we also experienced is that on one of the commercial molecules of CDMO, the innovators suggested that they would want to wait for the summer to get over for us to send the dispatches to them. So, those are the two deferrals that were being referred to.

Understood and Himanshu you are not quantifying what those deferments are, right? So, just for us to get comfort on the organic part of what we need to grow for the second half?

Yes, you will have to excuse me to not be able to quantify them.

Understood. Okay. Thank you. Just a second question is on material margins. Despite all this decline, we have seen material margins actually improve. Our gross margins are up 200, 250 bps on Q2.

Just if you could double click on what were the drivers, it said product mix, but I thought everything is declining. So, and ag chem has grown. I am just trying to see which part of the product mix was the one that led to the gross margin? Thank you.

So, broadly if you look at it in our portfolio and you understand that, we do have Nishtech, which is a higher margin business for us. A growth there would certainly help us from that perspective. NJ Bio

during the quarter, as well as the other Nishtech contributions have assisted in the margins to be better than what we have experienced in the previous year. Thank you and all the best.

Thank you. Our next question comes from the line of Jash from Dalal & Broacha. Please go ahead.

Yes. A lot of our Indian competitors have been highlighting that they have been seeing biotech funding pressures for quite some time now. And we are highlighting it right now. So, what is it that has changed for us for the NJ Bio business?

This is our understanding of what NJ Bio has experienced. As I said earlier, a large part of NJ Bio's business is biotech funded. And there are orders which have been deferred to next year by the biotech.

And some of the others are large orders for phase two. And our understanding of the engagement with the customer has been that there is this reduction in the NIH funding from a U.S. perspective and some of those subsidies would have flown into the funding of the business that was being given to us. And I think that is what is one of the reasons, not the only reason, but one of the reasons that has been considered at this stage on the slowness that we are experiencing, I would like also to add on to what Himanshu is saying. What we see is a very healthy influx of RFPs showing as well that the demand is improving in that space. And there should be additional spending coming in the upcoming quarter. So, that is what gives us quite a bit of hope in the business related to biotech for NJ Bio.

This is also maybe another element. It is not only the biotech funding here. We have also coming next year our new bioconjugation suite that will allow us as well to have significant revenue stream from customers moving to phase one, phase two with bioconjugation. I would like to highlight.

Okay. Got it. Thank you.

Thank you. Ladies and gentlemen, we will take that as a last question for today. I would now like to hand the conference over to Ms. Cyndrella Carvalho for closing comments.

Thank you, Sagar. And thank you, everyone for joining us today.

Thank you. On behalf of Cohance Lifesciences Limited, that concludes this conference. Thank you for joining us. -----------------------------------------------------------------------------------------------------------------------------------------------

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