Two long write ups which throw light on this topic, in case it helps anyone.

Company acquired One Of US Limited, UK based VFX company by 70% shares, however value is not disclosed.
Turnover as of 31 Dec 2023 was 29.42 Million GBP, EBIDTA -2.2 Million GBP.
https://nsearchives.nseindia.com/corporate/BASILIC_29072024181105_DisclosureasperRegulation30Signed.pdf
Looks like distress sale as company was in loss, if turnaround, can be good asset, as they have 300 seats and access to industry.

One of US Limited:
We are a visual effects studio with a focus on design and collaboration, founded in London in 2004 by co-directors Rachael Penfold, Dominic Parker and Tom Debenham. Working across film and TV, and with experience in all stages of production, from concept through planning, photography and post-production, One of Us is an essential studio for visual effects and related work. With approved vendor status, capacity and infrastructure for 300 artists, we are expanding into ever more ambitious and exciting projects.

D: Invested

Q1FY25 Concall Summary

Business Updates

• The decline in revenues is due to lower realizations and subdued API demand in export markets
• The greenfield project for intermediates and specialty chemicals at Gujarat will start from Q2 onwards
• The company incurred capex of Rs 52 crores during the quarter and total capex for full year will be Rs 200 crores funded through term loan and internal accruals

Participants

Dolat Capital

Axis Securities

Unifi Investment Management

Yogya Capital

DSP Small Cap

QnA

• The domestic volume was not impacted but in exports volumes got impacted negatively by 8% yoy and mainly the antibiotic category got impacted
• The export demand still seems slower and this should pickup from Q3 onwards and as far as FY25 is concerned H1 will see a negative rate variance while in H2 this variance will go away due to the lower base of last year and thus growth will be visible with new products from dermatology also coming in
• Specialty chemicals will see business doing well from H2 onwards and for full year can see a good growth of 50% in H2 on a yoy basis
• Since the export order book is more than 2.5 months there was an impact of price decline while in India the order book is around a month so price variance impact was not seen
• In many export markets the business happens on government tenders and there are many regime changes happening in global governments which could also lead to an impact on export volumes
• In the next 3-4 years the target is to achieve revenue run rate upwards of Rs 4000 crores with an annual EBITDA margins of 14-15%
• In terms of formulations working on 15 products across cardiology and oncology and these will be launched over the next 2-3 years
• Majority of the sales from oncology formulations will start from FY27 onwards
• When the API prices are lower the gross contribution margin should be higher and that is a function of lower prices and company has a target to achieve 35% gross contribution margins
• There are many challenges in the export business on availability of container and also cost of freight so export momentum should be lower in Q2 as well
• One reason why impact on margins is lower is lower contribution from exports which has come down from around 38% to 31% and generally the gross contribution margin in exports is higher

Yes. Are you sure the margins will continue to increase ?