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Communication Details • Date: August 13, 2024 • Event: Transcript of Q1 FY24-25 conference call held on August 9, 2024 • Moderated by: Runjhun Jain from E&Y IR • Key Management: • Mr. Keshav Bhutada (Executive Director) • Mr. Alpesh Dalal (CFO)
Financial Performance Highlights • Revenue: Rs. 302 crores (15% YoY growth) • Gross Profit: Rs. 200 crores (68% margin) • EBITDA: Rs. 83 crores (66% increase, 28% margin) • API Business: Rs. 173 crores (4% increase) • Formulations Segment: Rs. 104 crores (13% growth) • Net Debt: Reduced to Rs. 514 crores from Rs. 912 crores • CAPEX: Rs. 58 crores for Albumin facility
Business Segment Updates
API Segment
• Progress in oncology with two NDA molecules nearing regulatory filings. • European CEP received for Ursodeoxycholic Acid. • Focus on complex and import substitute molecules.
CDMO Segment
• Successful preclinical supplies and advancement to Phase-I/II and Phase-III studies. • New client engagements in specialty polymers and peptides.
Formulations Segment
• Approval of NDA molecule Pemetrexed; upcoming launches in US and Europe. • Expansion of Transdermal Patch portfolio.
Biologics Business
• Review for FDA appointment expected by Q3 FY25. • Approval of Adalimumab in Morocco; scaling up Aflibercept for Phase-III studies. • Successful GMP audit confirming Shilpa as a primary supplier for a Korean client.
Q&A Session Insights • Discussion on market opportunities for Liraglutide, emphasizing global market readiness. • Updates on competitive landscape for Albumin and plans for OTC approval of Dr. Clot. • Clarifications on revenue discrepancies and debt repayment plans. • Confirmation of ongoing collaborations and future product launches.
Future Outlook • Focus on building a differentiated and complex portfolio for sustainable growth. • Optimism about maintaining growth momentum and operational efficiency. • Plans for further actions in regulatory efforts and product development.
Date and Communication • Date of Call: July 8, 2024 • Communication: Update sent to BSE and NSE on July 12, 2024
Key Participants • Management Present: • Vishnukant Bhutada (Managing Director) • Alpesh Dalal (CFO)
Major Highlights • Contract Development and Manufacturing Organization (CDMO) Milestone: • Collaboration with Unicycive Therapeutics on Oxylanthanum Carbonate (OLC) for treating hyperphosphatemia in kidney patients. • Completion of drug master files and formulations, passing human clinical studies.
• New Drug Application (NDA): • Unicycive plans to file NDA soon. • Binding contract for supply of 20 million tablets over four years. • Initial milestone payment of $10 million.
Financial Projections • Contract Value: Exceeds $1 billion. • Initial Orders: • 5 million tablets starting in June. • Additional 15 million by December. • Revenue Expectations: • Multi-million dollar volumes annually. • Cumulative milestone fees of $10 million expected before NDA approval (mid-2025). • Projected EBITDA margin above 50%.
Future Developments • New Chemical Entity (NCE): • Five years of exclusivity upon FDA approval. • Four-year exclusive global manufacturing agreement. • Initial binding purchase commitment for 20 million units.
• New Plant: • Funded entirely by Unicycive, dedicated to API production. • Expected to meet supply needs for the next two to three years.
Commitment • Shilpa Medicare's dedication to delivering complex molecules in the future.
Conference Call Overview • Date: May 24, 2024 • Submission to: BSE and NSE on May 28, 2024 • Key Participants: • Mr. Omprakash Inani (Chairman) • Mr. Alpesh Dalal (CFO) • Mr. Vishnukant Bhutada (Managing Director)
Operational Highlights • Focus on API business advancements: • New molecules and capacity enhancements • Progress in oncology APIs • Successful U.S. product launches • Ongoing clinical trials for innovative products • Expansion into emerging markets
Financial Performance • Q4 FY24 Results: • Consolidated revenues: Rs. 294 crores (11% YoY growth) • EBITDA: Rs. 72.5 crores (up from Rs. 40 crores) • PAT: Rs. 24.5 crores (recovery from loss of Rs. 8.1 crores) • Full Year Results: • Revenues: Rs. 1,160 crores (9% growth) • EBITDA: Rs. 252.7 crores (more than doubled) • Fundraising: Rs. 500 crores through QIP for balance sheet strengthening
Product Development and Strategy • Pemetrexed injection launched in the U.S. and Europe • Competitive pricing strategy for recombinant albumin: • Aimed to be lower than blood-derived alternatives • Targeting both India and ROW markets
Market and Regulatory Insights • Ongoing litigation for Lenvatinib in the U.S. • Investment in biologics: Rs. 450 crores gross block • Focus on FDA compliance and risk mitigation
Licensing and Revenue Generation • Various licensing agreements tailored to products and partners • Anticipated revenue from licensing fees as a consistent income source • Clarification on accounting of licensing and service income
Future Outlook • Timeline for new albumin facility operational expenses and revenue expectations • Estimated timelines for GLP-1 product launches (1-1.5 years) • Plans for CAPEX investment of Rs. 25 crores for Tranexamic acid production capacity enhancement
Closing Remarks • Emphasis on operational efficiencies and profitability improvements • Invitation for further inquiries from participants
Conference Call Overview • Date: February 12, 2024 • Submitted Transcript: February 15, 2024 • Key Management: • Chairman: Mr. Omprakash Inani • Promoter: Mr. Keshav Bhutada • CFO: Mr. Alpesh Dalal • Purpose: Discuss Q3 performance and strategic initiatives • Forward-looking statements disclaimer included
Operational Performance Highlights • API Segment: • Focus on complex and import substitute products, especially in oncology. • Growth in non-oncology API business (e.g., Ursodeoxycholic acid). • Investment in CDMO, polymer, and peptide businesses.
• Formulation Segment: • FDA approval for Pemetrexed; partnership with Amneal. • Advancements in products like Bortezomib and prucalopride. • Development of transdermal patches and orally disintegrating strips.
• Regulatory Challenges: • Addressing 10 observations from a US FDA inspection. • Facility under Official Action Indicated (OAI) status.
• Biologics Segment: • Positive EBITDA reported for the first time in several quarters. • Launch of Adalimumab in India; partnership with Sun Pharma. • Phase III study preparations for Eylea and recombinant human albumin project.
Financial Performance • Q3 Results: • Consolidated revenues: INR 289 crores (9% YoY growth). • EBITDA: INR 68 crores (sequential increase). • PAT: INR 4.7 crores (significant increase from previous quarter).
• Nine-Month Results: • Revenues: INR 866 crores (8% increase). • EBITDA: INR 80 crores (127% growth). • Net debt: INR 874 crores; capex: INR 146 crores.
Q&A Session Highlights • FDA Inspection: • Facility remains in OAI status; awaiting updates from FDA.
• Revenue Growth: • Shift from oncology to non-oncology products due to supplier issues.
• Albumin Project: • Plans to file Drug Master File for excipient grade; revenue expected in FY '26.
• Capex and Capacity Utilization: • Most capex directed towards albumin project; available capacity in biologics.
• Licensing Strategy: • Licensing out at least two products quarterly; over 30 generic products in pipeline.
• Debt Reduction: • Aim to become debt-free within 2 to 3 years.
Closing Remarks • Mr. Alpesh Dalal expressed gratitude for participation and engagement. • Encouraged further inquiries and thanked attendees for their support.
Conference Call Details • Date: November 11, 2023 • Moderated by: Siddharth Rangnekar, CDR India • Key Management Present: • Omprakash Inani (Chairman) • Vishnukant Bhutada (Managing Director) • Alpesh Dalal (CFO) • Transcript Submission: Sent to BSE and NSE for regulatory compliance.
Financial Performance • Consolidated Revenues: INR 315 crore • Growth: 20% sequential, 18% year-on-year • EBITDA: INR 62 crore • Profit After Tax (PAT): INR 1.6 crore (compared to a loss last year) • Operating Cash Flow: Positive INR 91 crore
Strategic Initiatives • API Segment Expansion: Focus on non-oncology products and peptide business. • GMP Inspection: Successful completion for Raichur facility. • Product Launches: Preparing for U.S. market launches, including Pemetrexed injection and SML NUD07. • Regulatory Approvals: Received for various international markets.
Key Inquiries and Responses • USFDA Inspection: • 10 observations noted; no data integrity issues. • Compliance report due within 15 working days. • De-merger Status: • Shilpa Biological Limited and Shilpa Pharma Life Sciences remain 100% subsidiaries; no further de-merger plans. • Licensing Strategies: • Focus on differentiated and complex products; visibility for licensing revenue in upcoming quarters. • Albumin Development: • Phase 1 trials underway; filing for excipient grade Albumin by March. • Topical Lotion for Alopecia: • Phase 1 and 2 trials completed; Phase 3 trials to start soon.
Financial Management • Increased Finance Costs: • Raised Non-Convertible Debentures (NCDs) and restructured debt. • Plans to utilize cash flows for debt pre-payment. • Out-Licensing Strategy: • Occurs at various product development stages; revenue expected over 3-7 years.
Product Development Updates • Peptide Developments: • Not involved in semaglutide project. • Green Tea Film Products: • Successfully launched in the U.S.; limited availability in India.
Conclusion • Management expressed gratitude for participants' interest and extended festive wishes.
Communication Details • Date of communication: August 17, 2023 • Transcript provided to National Stock Exchange of India and BSE Limited • Conference call held on August 11, 2023 • Key management present: Chairman Om Prakash Innani and Managing Director Vishnukant Bhutada
Company Performance Overview • Discussion of Q1 results for FY 23-24, ending June 30, 2023 • Emphasis on operational progress and strategic initiatives • Forward-looking statements with disclaimers noted
Key Updates • Completion of facility enhancements for API services (peptides and polymers) • Growth in CDMO business with new contracts and project deliveries • Filing of two new DMFs to replace imports with domestic production
Product Developments • FDA approval for Pemetrexed injections; U.S. commercialization preparation • Filings for Nilotinib capsules in Europe • Ongoing studies for SML NUD07 targeting non-alcoholic fatty liver disease • Advancements in transdermal patches and dietary supplements
Financial Highlights • Consolidated revenues: INR 262 crores (stable from previous quarter) • EBITDA: INR 50 crores (74% YoY increase, 23% sequentially) • Positive profit after tax (PAT) • Net debt reduced to INR 745 crores from INR 764 crores • Capital expenditures: INR 30 crores for albumin facility • Issuance of INR 450 crores in non-convertible debentures (NCDs) for debt restructuring
Strategic Focus • Launching new products to enhance cash flows and margins • Optimizing R&D spending while maintaining operational cash flows (INR 70 crores for the quarter)
Q&A Session Insights • Licensing fees and product development charges explained • Sustainability of licensing revenue linked to new product development • Clarification on recent debt issuance and strategy for future deleveraging • Positive outlook on cash flow and performance improvements • Confirmation of expected sales for recombinant human albumin this year
Conclusion • Management expressed optimism about future performance and ongoing stakeholder communication.
Call Overview • Date: May 31, 2023 • Moderated by: Siddharth Rangnekar • Key Management: • Omprakash Inani (Chairman) • Vishnukant Bhutada (Managing Director) • Alpesh Dalal (CFO) • Focus: Quarterly and annual performance, strategic initiatives, forward-looking statements.
Key Achievements • Approval of Pemetrexed RTU for US launch with Amneal. • Initiation of Phase-1 trials for recombinant Albumin. • Starting Phase-3 trials for Aflibercept. • Awaiting clearance for high-concentration Adalimumab in India.
Financial Performance • Q4 Revenues: Rs. 266 crore (flat). • Q4 EBITDA: Rs. 40 crore (up from Rs. 34 crore). • Full Year Revenues: Rs. 1,068 crore (down 8%). • Positive operating cash flow: Over Rs. 250 crore (up from Rs. 140 crore). • No dividends recommended to conserve cash.
Strategic Focus • Emphasis on cash flow generation and operational efficiencies. • Plans for Adalimumab launch in India targeting Rs. 20-25 crore in revenues. • Significant global market potential for Albumin ($9 billion) and Pemetrexed RTU ($50-80 million).
Q&A Highlights • Licensing revenue from Pemetrexed confirmed by CFO. • Clarification on Albumin product being recombinant, not plasma-derived. • Confidence in double-digit growth in oncology API segment. • Nearly complete remediation efforts related to FDA compliance. • Future CAPEX plans: Rs. 75 crore investment in Biocare facility.
Future Outlook • Focus on growth in high-margin segments and new product approvals. • Ongoing communication with stakeholders emphasized. • Uncertainty regarding the impact of US FDA observations on revenue.
Conference Call Overview • Date: February 15, 2023 • Submitted transcript to BSE and NSE on February 21, 2023 • Key participants: • Omprakash Inani (Chairman) • Vishnukant Bhutada (Managing Director) • Alpesh Dalal (CFO)
Company Performance Highlights • Diverse presence in APIs, formulations, and biologics, with a focus on oncology. • Filed 224 Drug Master Files globally; expanding non-oncology offerings. • Key developments: • New molecules introduced. • Successful validations in the peptide segment.
Formulations and Product Launches • Launching innovative products, including a unique haemostatic spray. • Received GMP approval from Health Canada. • Advancements in ODF and transdermal segments; plans for U.S. nutraceutical products.
Biologics Segment • Preparing to launch Adalimumab in India; received necessary approvals. • Management's commitment to enhancing oncology niche and product portfolio for higher margins.
Financial Performance • Q3 FY23 consolidated revenues: Rs. 265 crore (slight decline). • Gross margins improved from 56% to 60%. • EBITDA increased to Rs. 34 crore (12.8% margin). • Nine-month revenues: Rs. 802 crore (down from Rs. 814 crore); EBITDA at Rs. 79 crore (9.9% margin). • CAPEX investment: Rs. 53 crore, mainly in Albumin facility.
Future Outlook • Potential in Shilpa Biologics with a pipeline of products, including Adalimumab. • Challenges in biologics but exploring contract manufacturing opportunities. • Aim to maintain/improve margins through operational efficiencies and complex product introductions. • Targeting revenue doubling in the next few years.
Concerns Raised • Badri Vishal from Bajaj questioned declining margins, flat revenue, and effectiveness of the Board. • Emphasized need for a thorough SWOT analysis and better risk management.
Management's Response • Bhutada defended efforts to address USFDA compliance issues; no data integrity problems reported. • Acknowledged challenges in the Biologics sector but expressed optimism for future growth. • Dalal highlighted the Board's experience in guiding the company through challenges.
Shareholder Commitment • Bhutada emphasized commitment to rewarding shareholders and restoring trust. • Net debt as of December 2022: Rs. 775 crore. • Expected product launches by March or April 2023; Phase 1 trials for Albumin to begin next financial year.
Conclusion • Management expressed gratitude for shareholder support and reiterated focus on operational improvements. • Call concluded with thanks to participants and a note on potential transcription errors.