chrome-extension://efaidnbmnnnibpcajpcglclefindmkaj/https://www.bseindia.com/xml-data/corpfiling/AttachLive/1a703611-41b0-4d78-b6a1-2a6144e89f43.pdf

Due to ~1 month worker’s strike in the factory Indo Tech’s 1QFY25 revenues at Rs 82.2 crs declined 12% YoY (worker’s strike from April 29 to May 24, 2024)

However despite this EBITDA at Rs 8.2 crs was up 35% YoY (Clearly orders in the backlog are higher margin orders)

EBITDA margins at 10% increased to 1QFY25 from 6.5% in 1QFY24

PAT at Rs 5.9 crs was up 67% YoY.

Does not make sense to do QoQ comparisons. Usually 1Q is the smallest quarter in the year and 4Q is the largest (for example 1QFY24 was only 18% of FY24 revenues and 1QFY23 was only 15% of FY23 revenues)

Overall a decent quarter. 2Q, 3Q and 4Q will be even better.

If you listen their last 2 con calls they cleared informed that 2025 is very nominal growth or slow growth, we can expect good numbers from 2026 onwards

Well, licensing business will have better CF.

Q1 2025 Concall Highlights:
Opening Remarks:
Xanthine derivates contributed 54% in Q1 2025 revenue. See strong potential from segment.
Regulated market 55%, Rest of World 35 %, Non Regulated market 10%.o
CDMO/CMO is lower, fluctuation is part of business as products are multi stage. RD centre have good pipeline.
Revenue growth 21% YoY.
EBIDTA growth 14% YoY.
PAT growth 18% YoY.

Expansion:
Xanthine Expansion will complete in Beginning of FY2026. Total capacity will from 5000 to 9000 MTA. CAPEX of 150 cr.
Atali project will complete in Q4 2025.Focused on CDMO/CMO. CAPEX of 375 cr.
Vapi will be operationalized in Q2 2025. Volume will be 30/40 KL. It will not add much revenue but accelerate pipeline.
Solar power plant at Maharashtra is expected to available in this quarter, will be 1/3 of power requirement. CAPEX of 90 cr.

CDMO/CMO:
Increased projects from 40 to 53.
Seeing Large traction to India from China.
Among three business verticals, CDMO/CMO has highest margins.
27 commercial projects, half of them are at still at early stage, potential will grow significantly.
All are patented projects. They are only intermediates.
50/50 projects are under development/commercialize.
170 cr in FY2024, Guidance given was 25 to 30% in CDMO/CMO. It will be not quarter to quarter increase.
Do not see any capacity constrain.

Pollution Control Notice:
Received in Dombivali site (filed to exchange) which was resolved in 7 days, and get 30 to 35 days to approval. Now it is under operational. It was impacted many company in this region. As it was only 2% revenue, it does not materialize.

Bio secure act of US:
Bio secure act of US forcing innovators to move away from China and Aarti Pharmalab is benefiting from that.
Added two more customers. And more projects from existing customers.

Xanthine derivatives:
Revenue from 180 cr. To 210 cr, due to more volumes.
China aggression continue.
Prices are falling by 15 to 20% from last year, and raw material also falling. Able to maintain overall margin. Expect to stabilize price or move up, unless raw material prices fall down further.

• Gross Margin reduced due to CDMO/CMO lost contribution. It depends on number of stages. Q to Q will be up and down in margins due to CDMO/CMO.
• Gross Margin for Aarti Pharmalabs should be look at standalone, because consolidated number have trading business, which will be stopped at end of this quarter hopefully.
Last year was 200cr in revenue, margin was 1 or 2%. No impact on margin.
• Pricing pressure is there in API segment.
• Utilization at 85% and new projects will add 30 to 35%.

Concall Audio:

D: Invested and reviewing

this is just part of the problem – farmers (across mills not triveni) are not replanting after uprooting as sugarcane is longer duration crop and payment from mills have been delayed a lot… Cash is very important for farmers.

Delay in payment to farmers can lead to lower acreage in UP this year. Govt tried to control prices this year – next year prices will be much higher and could lead to import of sugar. ethanol ban may continue and mills will have to use maize (at high price) instead of cane.