Viyash Scientific Ltd

Ladies and gentlemen, good day and welcome to Q3 FY'26 Viyash Scientific Limited Earnings Conference Call.

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 the conference call, please signal an operator by pressing ‘*’ then ‘0’ on a touchtone phone. Please note that this conference has been recorded.

I now hand the conference over to Ms. Zarna. Thank you and over to you ma'am.

Thank you, moderator. A very good evening to all of you and thank you for joining us today for Viyash Scientific Limited Earnings Conference Call for the 3rd Quarter and 9-months ended financial year 2026.

Today we have with us Dr. Hari Babu – Managing Director and Group CEO; Mr. Rajaram – Executive Director and CEO (Animal Health) and Mr. Ramakant – CFO of the Company to share the highlights of the business and financials of the quarter.

I hope you have gone through our results released and the quarterly investor presentation which have been uploaded on our website as well as the stock exchange website. The transcript of this call will be available in a week's time on the Company website.

Please note that today's discussion may be forward-looking in nature and must be viewed in relation to risks pertaining to our business.

After the end of this call, in case you have any further questions, please feel free to reach out to the investor relations team. I now hand over the call to Dr. Hari Babu to make his opening remarks.

Thank you so much. Good morning and good afternoon, everyone. Welcome to Viyash Scientific Investor Call. Thank you for taking the time to join us today.

Let me structure my opening remarks around three broad themes which I believe capture both what we have delivered and how we are thinking about the future. The number one, combined growth balance sheet and this is now a well-scaled company with all the right ingredients.

Page 3 of 16 by 64% year-over-year with an EBITDA margin of 21% and expansion of 390 basis points. Net debt-to-EBITDA has reduced to less than 4x, a significant strengthening versus the previous year. On a 9-month basis, the momentum is consistent. 9-month FY'26 revenue was INR 2,500 crores with 12% growth year-on-year and adjusted EBITDA was INR 500 plus crores with 58% growth year-on-year. And most important, our margins for 9 months maintained at 20% plus.

Of course, we incurred one-time exceptional items largely related to merger execution this quarter around INR 41 crores, which includes stamp duty as well as payment for advisors and consultants.

In addition to INR 41 crores and recently government announced a tax regime change, we are trying to convert our old tax regime to new tax regime which impacted around INR 7.7 crores.

Altogether it's one time it's gone up to INR 48 crores-INR 49 crores. If we combine this one time with the PAT what we have shown, it's a big growth quarter-on-quarter this quarter. So, what gives me confidence is that this performance is not narrow-based. So, we are seeing broad participation across segments and geographies. We are truly working as a one team. That's most important for the group. Equally important, the balance sheet is now a strategic asset. Over the past few quarters, we have consistently spoken about strengthening the financial base to create the headroom for sustained investment. The business has moved beyond consolidation and post- correction into a phase of accelerated growth. As we look at the budget platform today, the transformation is visible in the combined numbers and in the optionality the balance sheet gives us. We will use a stronger balance sheet to unlock both organic investment as well as selective mergers and acquisitions.

Coming to number 2.2, now I would like to take you through how we have improved our margins:

You can see quarter-on-quarter improvement margins last 8-9 quarters. How we have improved with key actions in last 12 months-18 months. The formulation Animal Health, Europe, as you know we have a strong foundation in Spain, manufacturing as well as front end. So, last 12 months-18 months we have taken many steps to improve business in Europe. Few of those are expansion of markets with direct field force in Spain and few countries like Benelux, Sweden and also we add a few distribution agreements for other countries. And other few areas like we reinitiated development and promoting company and animal business which is growing fast in Europe and geo-expansion for all our products since our site is approved by Europe, located in Spain and also the site located in Turkey is approved by Europe. We are able to extend the products to Europe. We started commercializing, it's reflecting the numbers. And most important, established few more partnerships with other companies to distribute their products.

As you know we distribute few products even for innovators, we distribute few products at sales for specialty companies.

Page 4 of 16 So, Turkey and Brazil are the key market for us. Turkey turnaround last couple of years and you can see the large volume growth this year. That shows our capability of expansion of Turkey.

And Turkey also as you know it's a GMP approved by Europe. We started filing and started shipping to Europe. And Brazil shown strong performance this quarter. It's continuously showing strong performance. We are trying to expand from Brazil to Mexico and other related countries where we can do. With the Turkey and Brazil GMP facilities now we are able to focus to expand markets like Mexico, Southeast Asia and other few other focus markets where we can do business from there.

Animal Health formulation we expect that field force last year up to 200 and we started resulting the numbers. We started growing and this is a one of the key segments to grow further for Animal Health in India especially farm animals.

US formulation basically human health. Last two three years post COVID as I explained earlier also, initially post COVID there is a lot of stock build up. There is a lot of competition coming from India. That's initially we struggled a little bit on competing the cost from US side. The last two years we tried to change our strategy moving all matured products to India and also started developing new products with a little more complex where we can differentiate. And also most important factor to sustain US business today is a fully vertical or backward integrated for all our key products. We are done for almost all our key products 45% of our volume products we are done. Commercialization is just started. These are the few things sure to show the sustainable growth on US business.

As you know API is our strongest core area for us and we do continuous new products and I think we are the one of the fastest companies to do product development as well as launch. And most important our efficiency levels in operations are very good compared to market. So, few things like network optimization when we acquired few companies where there is a strategic direction, we try to shut down few companies and the continuous focus on the cost improvements with the focus team on the process as well as optimization at plant level. And since we have fully backed internet sites which are approved by FDA, we are able to integrate most of the products backward integration that's where it can show substantial improvement on the margins.

And of course, the markets also we try to move from low-end markets like India, Bangladesh, Pakistan. We started focusing more on expanding developed markets and other new area last year we initiated CDMO it started working well so that's continuously to grow on that because all our assets infrastructure and resources are pretty well suitable for CDMO business which can do with innovators. We have a great experience build now and that momentum is growing up now. These initiatives worked out very well for us and contributed both improvement on the

Page 5 of 16 gross margins and EBITDA margins. And of course, these are the continuous activities to sustain the margins both the gross margin as well as EBITDA.

Then third most important after reaching reasonable base with sustainable growth, so where do you want to grow? How do you want to grow? I want to touch upon what we are doing next and how we intend to compound this momentum. Our strategy is focused on two clear growth sectors. One of the sectors as I explained last call also companion animal. This is the one of the most attractive long-term opportunities for us supported by increasing pet ownership and also the genericization runway in Animal Health. If you can read our presentation the few slides on companion animals, it clearly shows this is the fastest growing area both in developed markets as well as developing markets. And most important today if you see genericization happened only 15% whereas comparatively a little more on farm animals and big on human health 85-90 percent. That's where we see the opportunity next couple of years since the volume and markets are growing, we are pretty confident the genericization will improve that's where we can it can bring opportunity for us. And as you know, we have already signed an exclusive distribution agreement with the Boehringer Ingelheim, which is one of the innovator companies. I think it's a number three top company in Animal Health. We signed exclusive agreement with them to distribute products in India. We are going to start distributing sometime in February and this is a one opportunity for expand to entire companion animal business in India. That's one of the key focus area for us to expand companion animal business in India. Of course we are focusing other countries but India is going to the one of the key markets for us.

And other markets opening markets and we are evaluating partnerships which includes of course selective mergers and acquisition companion animals. We are exploring few things while also building infrastructure in India over time. This is most important and critical part for the companion animals. We see there is a large opportunity to grow if you have capability to India both R&D and manufacturing. That's where we see the differentiating factor for us.

Farm animals, we have very strong position in few countries like as I said Spain and Turkey, we want to expand as much as possible from these countries to Europe and we have clear plan. We started filing last two years. We started commercializing. That's a continuous focus and we have large portfolio in farm animal business today and we are also looking at whatever are the gaps to fill the pipeline to compete more and grow that.

And the third area farm animals there are few markets important markets like Southeast Asia, Africa to expand as there is a large opportunities. We are exploring those thing. This is the future, next five years target for that. Human health formulation as I explained we already started leveraging India manufacturing for matured products. Our strategy is to maintain leverage India low cost manufacturing for large volume or matured products while keeping India sides to launch new products since we are going little more complex products and new small high value products and also keep open for to generate government business as much as possible.

Page 6 of 16 It's a continuous focus. There is a meaningful opportunity at both API. API patent clip and a growing CDMO market. You can go through our investor deck, also CDMO business is growing.

Of course there is a competition also is growing. We are going to differentiate based on the quality of the assets, quality of the resources. Our focus is to pursue CDMO opportunities. We are exploring both while expanding internally. We are also looking at some M&A opportunities if we get.

At the core of all of these actions in our one R&D platform and a scale innovation engine. We are an R&D first organization to launch new products that is genuinely scaled and capable.

Roughly we have 200 plus scientists including 20 plus doctorates and we have dedicated support team for CDMO and also CMO partners and having specialized capabilities such as cytotoxic handling and process safety infrastructure. This is consistent with what we have emphasized earlier as well that our core strengths are anchored in R&D manufacture and intellectual property. And that this is what allows us to move the portfolio up to the value curve. Across all of this our actions and capital allocation approach remains clear. Prioritize synergy capture and integration discipline over the next 12 months, maintain balance sheet strength which is very important of course. Invest in growth opportunities that fit into our strategic direction and return thresholds. This is consistent with what we have said previously. A stronger balance sheet provides the headroom to invest in portfolio expansion especially companion animals while continuing improving the returns.

So, as you know all legal procedural things we completed now except working with the clients to work with the regulatory external regulatory bodies. So, that may take a couple of months but other than that all India legal statutory actions completed. We are able to integrate fully now.

Even though we are not done official as I explained a last call also, last 12 months, when we announced we started working as one team like few things R&D already, R&D fully integrated as one R&D both Animal Health and human health of course. And a couple of new products already developed in Animal Health. We validated last 12 months, 4 new products for Animal Health and validated. And a couple of projects cost improvements have taken and it's working well. It's we filed regulatory. Some of those things started getting approval next few months but as I explained last call also, it takes 4 months to 18 months. We are in fully on track on that.

Manufacturing again we relooked at network optimization. How can we utilize efficiently complete infrastructure. Whatever products we are trying to we are getting from outside companies we move to internal. That's basically to improve the capacity utilization. It is also to provide more comfort to the clients actually for the supply reliability. Six of the intermediates already we completed and one of the most important area, we completed one of the new production line to accommodate. This is basically Albendazole product. You know Albendazole goes for human health as well as Animal Health. Everything till today we were manufacturing at one site. We are trying to segregate into two sites. So, we segregated human health and build new site at Viyash. It's validated and we filed the regulatory. Fortunately, one of the approval

Page 7 of 16 Europe which is very important for the product, we received approval in 30 days. That shows our strength of regulatory. Other approvals we are waiting but most of the market goes from Europe. Now we are working with the customers. How can we commercialize quickly on that.

Of course few markets where we are able to do immediately we started doing. And incidentally we are seeing the huge volume growth of Albendazole. You can see the good growth this year.

And one of the things I would like to highlight, you must have seen SeQuent API business last maybe 5-6 years. I think this is the first year after 2022 we are crossing INR 400 crores. It's a great teamwork both Viyash and SeQuent contributed. I think it's so quick doing this INR 100 crores per quarter. We were struggling last 2-3 years now. It's streamlined established at INR 100 crores minimum base. And you can see a FY'27 first year after a long time it's going to grow double digit. And with the good profitability with all our actions. And sales, as I said it's a cross selling both. We started interacting last 12 months. A few things are getting materialized. But the products, you know the regulatory scenario takes its own time, 18 months 24 months. But we see the positive momentum on that.

And coming to the corporate functions or shared service whatever, we have fully integrated:

We have a clear plan. We are going to do what, which function is going to move here or there.

But all are established. It's working as one team. We see that. And also one of the things we mentioned one of the site we are going to divest. That's at Mangalore. We completed the transaction. That's a basically testing site for internal as well as external clients. We are able to close on December 31st. Moved all activities internal. That's where we are going to save at least a million dollars in next year. That's one of the strategic initiative.

With that. Now I will now hand over to Ramakant – our CFO to take you through the detailed financials. After that, we will be happy to open the floor for any questions and answers. Thank you. I will hand it over to Ramakant.

Thank you, Doctor. Good evening, everyone. And thanks for joining us. Pleasure to share insights on our strong Q3 and 9-month FY'26 financial performance.

Starting with Q3 FY'26 financial highlights:

Total revenue reached 8.5 billion up 10.9% year-on-year. Formulations revenue grew 20% to 4.8 billion. While API revenue rose 2.9% to 3.6 billion. Gross margins improved 316 basis points to 54.5% from 51.3%. Adjusted EBITDA surged 64.4% to 1.8 billion. And margins expanded

Page 8 of 16 700 basis points to 21.6%. Profit before tax for the quarter is at 731 million. And this is after accounting for one-time merger related expenses of 413 million. This shows a multifold improvement compared to 245 million in Q3 FY'25. Profit after tax for the quarter of 485 million. This is again after accounting for one-time merger expenses of 413 million and a one- time charge on account of MAT credit reversal of 77 million. Profit after tax in Q3 FY'25 was 420 million which actually included a tax benefit accounted for certain accumulated losses in erstwhile Viyash subsidiaries. Consistent performance in the last few quarters demonstrates strength and stability of our revenues as well as earnings.

Now I move on to the 9-month FY'26 performance:

Total revenue climbed 11.9% to 25 billion. Formulations revenue expanded 14.5% to 13.6 billion and API revenue grew 9.6% to 11 billion. Gross margins rose 350 basis points to 54% from 50.5% in the previous year. Adjusted EBITDA jumped 58% to 5 billion. Margins up 580 basis points to 20.1%. Profit before tax clocked 3.5x increase from 498 million to 2.2 billion on account of strong operational performance. Profit after tax more than tripled to 1.5 billion from 480 million in the previous year same period. Our focus on product and service mix expanding geographically and enhancing operational efficiency has driven higher margins and a stronger financial performance. The merged entity financial position provides solid stability with low debt levels and improved efficiency in leveraging assets for stronger returns. Looking ahead we continue to prioritize realizing merger synergies, maintaining steady profitability, further reducing debt and maximizing cash flow generation.

With this I end my opening remarks. Thank you for your attention. I now request the moderator to open the forum for Q&A session.

Thank you very much. We will now begin the question-and-answer session. First question is from the line of Krisha, an individual investor. Please go ahead.

Hi. Sir, congratulations for a good set of results. Now that this is a merged result, have the synergies been fully captured or is there much more to come? Is this EBITDA margin of 20% sustainable? Secondly, this quarter there seems to be some exceptional items. Are these one- time or could you please explain a bit more on these? And thirdly, the ESOP costs, are these going to continue? How should we look at it for the future?

Okay, thanks for your questions, Krisha. First one is this 20% margins are going to sustain? Yes, it's going to 100% sustain because now you see we have four segments. So, even if there is small issue in one segment, other segment is able to absorb those things. We are very confident to sustain these things. Earlier we indicated of course FY'27 we are going to achieve close to 20% but because of our initiatives last 3-4 quarters we are able to achieve now and we are very confident to maintain that 20%. And also you mentioned that synergies. Synergies are not factored much at this level. Okay, as I said, synergies mostly takes 18 months-24 months. There is operational synergies which requires regulatory approvals. The few things like when I say we

Page 9 of 16 shut down one analytical site which is going to give synergies around INR 7 crores. That's going to reflect slightly this quarter but mostly from next quarter onwards. So, most of these synergies are not at all factored but it's going to come in '27. Then the one-time costs, there are three one- time costs. One is this merger related asset transfer stamp duty. That's a purely one time. There is no change on that to the INR 29 crores. Then the second one is advisors and success fee consultant, was purely merger related, the INR 10 crores-INR 11 crores. That's a purely one time. The third thing is the tax. Tax returns are INR 7.7 crores MAT credit, whatever we return.

So, recently government has issued during the budget they come up with something. That's also purely one-time but we may have positive next quarter if they change the government policy.

Next quarter it may end up positive on that. So, purely all these are one-time. There is no chance of coming to that.

Coming to ESOP, there are two ESOPs thing. One existing ESOPs you must have seen come down this quarter. It's going to continue next few quarters and yesterday board approved new ESOP scheme for old VR scheme convert into new scheme. That we are working out the numbers but that's going to continue next 1-2 years on that. Other than these things we don't see any one time expenses. Hope I clarified all three questions what you asked.

Yes sir. Thanks a lot for your detailed answer.

Thank you. The next question is from the line of Ishika, an individual investor. Please go ahead.

Hi. Hope I am audible. First of all congratulations on the great set of numbers. I have a couple of questions. Going ahead, what are the shifts that the Company will do to keep the growth going? Could you please share a bit on the future priorities?

Okay. Thank you, Ishika. Future of course I explained few segments where we are going to focus. Companion animal is the big segment to grow and other things CDMO and also integrated play for merger entity. These are the things we are looking for both organic as well as inorganic growth. Since our balance sheet is very strong now, we can leverage the balance sheet. We are working on few areas to grow on that.

Okay, I understood. That was really helpful. Also you had indicated CDMO opportunities. Is it for human or Animal Health as well? And where will we see these materializing?

It's both. In fact, Animal Health 80% we do business with innovators. It's a kind of CDMO even though we didn't define that. But we are accelerating that growth in Animal Health based on last 6-8 months our performance with them. Now we are getting new enquiries, new RFQs for the new products. And we see the momentum growing Animal Health future. That's where we see the good opportunity. That's one of the reason I also mentioned this year after 4-5 years, Animal Health API is going to grow. CDMO focus is that. And second human health we focused last 1

Page 10 of 16 year and we have done reasonably well of course it's a material and it's going to continue. So, both Animal Health as well as human health API is going to continue CDMO. And we can see it's a reasonable number even today also if I put all together. But it's going to grow maybe after 2-3 years, big number.

Okay I understood. Just one last one. You had given a guidance of INR 4,000 crore and 20% EBITDA in 2028. Would you still be achieving these targets?

So, if you see our current run rate, you know the answer. So, when we say INR 185 crores this quarter, INR 187 crores last quarter, and also the topline is going to close to INR 900 crores, INR 860 odd crores or even if you take 15% growth we are pretty comfortable to reach that level, not even FY'28, in FY'27 that one, whatever. Of course, this pre-ESOP or all those things.

But we are comfortable to achieve that. We are very confident to maintain the 20% EBITDA levels now.

Okay I understood. Thank you so much. I will just rejoin the queue for the next question.

Thank you. The next question is from the line of Sahil Sanghvi from Monarch Networth Capital. Please go ahead.

Good evening and congratulations for a good set of numbers. First question is, first and foremost, a very good presentation. It was really quite in detail to understand what has been achieved and what is the focus going ahead. Second sir, I would like to understand this quarter the growth on the API side has been low single digits. So, is there anything to read over here or is it just a one- off quarter kind of thing?

Thank you for your comments and questions. API, one of the reason is a little bit timing issue.

Last quarter we had a few CDMO contracts. Okay that's pushed to next quarter. This quarter it was less but it's a simple timing issue. But we are growing constantly on that. We don't see anything. It's only quarter small timing issue.

Right, sir. Secondly sir, on the CDMO like the previous participant also said, is it possible to give a number as to what percent it would be of total revenue?

So, maybe I can give a rough math. This year whatever we initiate because there is the three segments on CDMO. One is Animal Health what we are doing out of INR 400 crores, 80% goes to innovator. We can consider CDMO or innovator business. Purely what we initiated we as CDMO last 12 months, this year we will end up doing 70 crores to 90 crores on CDMO. It's either CDMO or CMO for big players. This year it's going to go INR 70 crores-INR 90 crores.

And few projects whatever we supplied validation with innovators. It's going to start commercialize next year. These are the life cycle management products with innovators. Few products we are working. Those products are going to start commercialization next year. This

Page 11 of 16 year whatever we supplied these are the launches is coming to mostly 2030 onwards. So, that's it today INR 70 crores-INR 90 crores and we see growing continuously from next year onwards.

Okay, so should we expect this part of the business as in the CDMO side to be growing much more faster than the overall growth in the business?

But that will go much faster of 3 years I can say. So, these things will take 3-4 years. One is once you supply validation, innovator generally whatever product even life cycle management it takes 3 years to 4 years to get it commercialized. One of the products we initiated 1.5 year back. The first commercial supply is going to start after 2.5 years-3 years. Full commercialization will come from 4th year. So, since we initiated 12 months but both if we are lucky we can get something next 1-2 years substantial but most of this growth will come from maybe after 2-3 years. Till that time next 2 years our existing business growth will continue and most important year you should note Animal Health APIs are going to grow very fast next year. Whatever we set up infrastructure, what we did, process improvements and improved credibility to the current clients it's going to improve drastically. Okay, you can see the very good growth next year.

Sure, sir. Thank you, sir and I will come back in the queue if I have more questions.

Thank you. The next question is from the line of Sajal Kapoor from Antifragile Thinking. Please go ahead.

Yes, thank you for the opportunity and good to see sustaining healthy gross margins, Dr. Hari Babu and that's a very welcome sign and I have got few questions. In an increasingly crowded CDMO market, what are the 2-3 capabilities you believe are genuinely hard to replicate by others and which CDMO segments or technologies you have explicitly chosen not to pursue?

CDMO, as explained last call also there are few areas. One is a few companies to do for innovators for the new product and see products that's where they start developing for at Phase 1 or Phase 3 level once the innovative product approach they continue commercialization at this Company. Second thing is lot of innovative companies if you see even next 3 years, many blockbuster products are coming out of patents from innovators. So, last 3-4 years innovators started looking at alternate low-cost area to improve their life cycle management. That's the second one. That's where we are focusing. We are doing good, both Animal Health and also human health whatever we started targeting life cycle management, but this requires two areas very strong. One is EHS sustainability and the second is quality credibility. And we believe, since we focus from beginning of the establishment, always top focus on EHS and quality and also most important it's tested by various innovators. We have proven we are much capable to do business with them all ethical things, be it sustainability and all, it's pretty established with innovators that's where we see and most important we are very efficient and speed is very fast compared to whoever is actually large CDMO players. One of the innovator company we are

Page 12 of 16 working with additional site recently for all vendors, normally they take 2-3 years even to initiate and do that and when they see our new site and capability, EHS status they want to do more than what we anticipated. We thought it takes 18 months-24 months, they are going to close in four months. So, the life cycle management we see the good growth opportunity for us next 2-3 years.

The first thing we are not, that's where we are building new products next 2-3 years, that's what I said building separate CDMO infrastructure and also people. The third thing is where the companies are looking at, there are large number of specialty companies especially in Europe and also there is big generic companies. They are able to develop new products, complex products but they are not able to scale up internally. That's where they are looking at the quality manufacturers which sustain the compliance and we see the largest number of opportunities, you see, last 12 months-18 months whatever we generated INR 70 crores-INR 80 crores revenue that's come from many complex new products especially Onco facility, you know Onco very few quality facilities are available in India. That's, we are the first choice it looks, like many products are coming every month it comes out. These are the most of the products are first-to- file where day one launch happens. Either they get exclusivity, even if they get 10%-20% exclusivity that's good enough for us. And most important is locking with the customer. When they work with us, tech transfer and content manufacturing with some optimization so they locked with us, they cannot go with others. So, we see these three opportunities second and third we are very active and with our speed, quality, EHS we are able to differentiate. First one, where the new products like Laurus or Divi’s, they do NCE products we are gearing up for future. It's all differentiation is basically speed, quality, EHS. Those are the differentiating factors and for my experience, hardly we can see very few companies capable to do that. Of course everybody climbs CDMO, CMO even solvent recovery guys but we see very few companies are able to do that.

Absolutely, thank you for detailing all of that. Just one clarification, so today we are not ignoring NCE or our patent protected CDMO but we will look we will go after that space maybe more aggressively in another 2-3 years because at the moment the lifecycle management, our relationship with the innovators is giving us a lot to chew already. Is that correct?

Yes, we are building what is required what is to differentiate now. We are starting this year, this year if you ask me to focus FY'27, the top focus is companion animals. Entire world is looking at, so we surprised few data points when I started looking at. USA will surprise. There are 9.4 crores of dogs and 9.2 crores cats and when I visited Italy last month when I was looking at the data they said when I was talking how it can possible the dogs and cats. It's a completely different word, you can see Italy cats at least one is to one of the people. So, that kind of market we are talking and most important that market is started genericizing because once the growth starts volume grows up, growth, everybody looks for cost efficient things. That a great opportunity we see. These are the two top focus areas for us.

Yes. And the generic penetration in animal companion animal that is only about 15%-16% today versus human. So, that gives us a lot of headroom to grow the animal companion, the cats and dogs?

Page 13 of 16 That's where we are going to invest both R&D and also one of the manufacturing infrastructure either acquisition or organic in India and expanding front end with products where the markets are strong like Europe, there are 4-5 markets like Italy, Germany, France and UK other than Spain, Spain we have very strong presence these are the markets we are exploring, how fast we can penetrate either through organic or looking for some acquisitions. And India it's a fast- growing market since middle class is moving to above middle class everybody started liking pet this also the highest focus area through BI. This is where we had opportunity to build very strong presence in India. And companion animals if you ask me today API, we are the largest portfolio companion animal API. Okay, we have almost 60% of the total portfolio and we started developing products even the patent expiry for 2032-34 thing, that's exactly similar to how we used to do for human. These are the things we see we can grow long term reasonable equity. Thank you for that one.

Just one last if I can squeeze. On the distribution side, we are very active on the distribution not only in India but even outside India, right? So, we have got active presence in Brazil and other economies even in Europe that should also help us scale up faster in companion animal right?

So, yes, we are very strong distribution chain in few countries like Spain we are very strong, we distribute many other companies, innovators, even for others also. Benelux we have our own distribution channel now Turkey we have very strong field force, Brazil we started building few other countries thing, Italy we started building field force for companion animals and also more than companion animals since we have production animals approved by Europe we are extending those distribution chains also for other countries. So, we have experience of distributing even innovator for us like India, we do distribute with Zoetis long term now with BI and Spain we do, so we have a very strong distribution chain on that, that can accelerate. Very helpful, thank you.

Thank you. The next question is from the line of Kaustav from BMSPL Capital. Please go ahead.

Thanks for taking my question. Correct me if I am wrong, but before the merger the Animal Health business did not have SeQuent which did not have any exposure on the formulation side to North America. So, now post this merger, is there a case for SeQuent business, the Animal Health business growing its formulation business in North America since that's a big market?

Again thanks for the question. We are exploring. We are going step-by-step, first midterm where we want to grow like emerging markets and Europe since we have established distribution. We have full understanding on the products we want to target first phase to grow these markets. The next phase is definitely yes, US also we are exploring. We are exploring two options whether organic or inorganic. US, one important thing required still, supply chain. Maturing supply chain, it may take some time. We are studying the supply chain, how it works compared to

Page 14 of 16 human health. And Europe markets we know very well supply chain Animal Health. US still we are studying. The two things are required supply chain strength and also the basket of products which takes some time to develop or improve. So, parallelly we are looking at alternate to is there any M&A available for that. So, we are open to that, but the first top priority is how fast we can grow for emerging markets which includes India and Europe for these things. Yes, we are going to explore and we will be there, only timing still we have not yet decided.

Okay, great. Thank you so much.

Thank you. The next question is from the line of Bharat Sheth from Quest Investment Advisors Private Limited. Please go ahead.

Hi Hari Babu and Rajaram. Thank you very much for excellent number and opportunity to be with our Company. Sir, since I understand that our CDMO lever will start playing out bigger way after 2-3 years but meanwhile we are expanding the way geographically as well as product basket, either our own or distribution as well as API and now that will also require good amount of investment, so if I have to build I mean, how do we really want to play growth sustaining the margin? Is there other room for improving some margin say INR 4,000 crore is taken, I mean FY'27. Beyond that, how do we think about it and what is our aspiration?

Okay, thank you. So, it's a detailed question, let me try what our best. So, you know our actions last 2-3 years. First action is how to build a sustainable company, the balance sheet should be strong, whatever our actions are, few years we reached to that. We never focused on the only topline-topline, we could have grown topline much more than that, but we never thought of that.

Most important is right balance sheet, right margin, sustainable. So, that where you can take it to next level. So, after 2-3 years both companies that most important last 12 months understanding both companies each other, now you reach to the scale at sustainable level. You can see the jump from INR 120 odd crores to INR 180 odd crores EBITDA base. Now we are focusing on 2-3 things areas. So, you ask the question actually how we are going to support these expansions of that. You see that our debt has come down drastically… And of course I mean growing at a better speed than whatever we have done.

We are going to generate good free cash flow next year, looking at our current debt INR 200 odd crores is nothing actually for this Company. Then even if you look at it INR 800 crores EBITDA there is a lot of free cash generates, we don't need much CAPEX for existing business whatever API. So, that can take care of some extent and also there will be something comes up warrants, it's going to come. I put a money, 25% remaining, I am going to do 12 months, so all this going is going to come. It's a reasonable size to do entire organic and also some acquisitions.

And most important, when you reach to INR 4,000 crores-INR 800 crores odd crores EBITDA, however you can leverage actually data also, to do is there any good acquisition. So, all things, whether to leverage the debt somewhere some extent if required or we can do something share swap, whatever it is, but it's all purely based on the long term sustainable. We don't do just to

Page 15 of 16 show topline numbers. So, we are very comfortable with this current debt position, free cash, whatever we are looking for cash generation next 12 months-18 months we can do a lot. That's what we are doing. But we don't want to do everything overnight, that's the thing. It's not the case… No, I do understand. What are the aspirations for improving further lever? Some of the points you say that looks like that will also help us in going beyond 20% EBITDA margin?

Okay, great. And wish you all the best sir.

Thank you. The next question is from the line of Aditya from Sowilo Investment Managers. Please go ahead.

Thank you so much for the opportunity. I had a couple of questions. One is, now that you know the merger is completed, so what kind of KPIs do you, I mean internally also would you be tracking to see whether the synergies that you are expecting from this merger, whether you are able to achieve that and what kind of CAPEX would you want to commit for this merged entity?

So, a few things will depend integration activities of course, R&D synergies it may not reflect directly but there is a lot of improvement on the business expansion and improvement. That quantification will take a couple of years of that. When it comes to network synergies, that's one of the key thing. We also explained 50 crores-60 crores it takes 12 months-18 months, it's tracking very well, that 50 crores-60 crores, 18 months start from maybe now 3 months over another 15 months. We are well track on that 50 crores-60 crores synergies and network operations which includes of course corporate functions restructure, so our intention is not to reduce people. Our intention is more improve the business. And third thing is, since the debt is going to go down drastically in addition to 50 crores-60 crores, we can see the improvement on interest payment. Already we started repaying a little bit high debt loan but definitely you can see good improvement on the interest burden. The other thing is since we are very strong R&D, so this is the differentiating Animal Health new products that's going to be a great improvement next 3-4 years. So, coming to the straight point, 50 odd crores-60 odd crores 12-15-18 months

Page 16 of 16 it's going to happen. So, that's first phase. Second phase is going to be the long-term synergies that can show the good growth in the both topline and bottomline on that.

Understood. And then like if you look at a 3 to 5 years kind of a timeline, so what kind of target revenue mix you will be seeing between say Animal Health and API CDM or like what kind of, ideally where you would want, how would you want your business to…?

Today we see our mix close to 55 formulation and 45 around API. I am just telling you guys rough figures, okay? But going forward we see we will maintain same ratio because we have intention, aspiration to grow a lot in the Animal Health formulation business, formulation also complex thing. We see going forward including CDMO it will maintain the same ratio. API, regular APIs after reaching to certain level grow from there, it's not easy like formulation. But since that is going to compensate by CDMO we can expect the similar growth from both areas.

Got it. And just a final question. There is a small clarification, like last year in around September, there was this news item that in especially in India that there was some kind of ban on antibiotics and antiprotozoals for treatment of livestock. I just wanted to understand would that have any impact on us?

It's not a general ban across all antibiotics and protozoals, there were 1 or 2 products very specifically which were identified by the government and those are products which almost everybody had but for us it was a very small amount and it doesn't sort of impact us. I think the other thing for us is that the antibiotics more and more internationally are being delivered in the injectable format rather and that is one thing which we have because for veterinarian prescriptions injectables are required. And we have a fast growing injectable operation in most of the Animal Health products which we make out of Turkey. So, to that extent I think we are well covered of that. But having said that there are continuously new products which are getting launched and those are available to our, they are getting generalized and we are sort of launching them as well. Thank you so much.

Thank you. Ladies and gentlemen, due to the time constraint as that was the last question, I would now hand the conference over to the management for closing comments. Over to you, sir.

Thank you, guys. First of all, thank you everyone supporting us for this merger. So, we will do whatever best, but we are very transparent and we are very open whoever want to understand better you can reach out to the people mentioned in the investor presentation and if anybody want to have a different discussions with me also, I am always available. So, we run very transparent, very compliant way. Thank you so much for your support. Thank you.

Thank you. On behalf of Viyash Scientific Limited, that concludes this conference. Thank you for joining us and you may now disconnect your lines. Thank you.