Ladies and gentlemen, good day and welcome to the Acutaas Chemicals Limited Q4 FY26 earnings conference call hosted by 360 ONE Capital. 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 star then zero on your touchtone phone. I now hand the conference over to Mr. Rohit Nagraj from 360 ONE Capital. Thank you and over to you, sir. Please proceed
Thanks, Alendra. Good evening, everyone, and thank you for joining us on Acutaas Chemicals', Q4 FY 2026 earnings conference call. We thank the management for providing us the opportunity to hold this call. Today we have with us Acutaas Chemicals management, represented by Mr. Naresh Bhai Patel, Chairman and Managing Director, Mr. Abhishek Bhai Patel, Vice President, Strategy, and Mr. Bhavin Bhai Shah, Chief Financial Officer. I would like to invite Mr. Bhavin Shah to initiate the proceedings now. Over to you, sir. Thank you.
Thank you, Rohit. Good evening, everyone. We are pleased to welcome you all to our earnings conference call to discuss Q4 FY 2026 financials. Please note that a copy of our disclosure is available on the investor section of our website, as well as on the stock exchanges. Please do note that anything said on this call, which reflects our outlook towards the future or which could be construed as forward-looking statement must be reviewed in conjunction with the risk that the company faces. The conference call is being recorded and the transcript along with the audio of the same will be made available on the website of the company and exchanges.
This call will be recorded.
Please also note that the audio on the conference call is the copyright material of Acutaas Chemicals and cannot be copied, rebroadcasted, or attributed in press or media without specific and written consent of the company. I would like to hand over the floor to our Chairman and Managing Director, Mr. Naresh Patel, for his opening statement. Over to you, sir.
Thank you, Bhavin. Good evening, everyone. I hope you are all doing well. I will provide an overview of industry and about our future strategies before handing over to Abhishek for detailed business updates. The chemical industry has once again navigated turbulent conditions driven by the ongoing conflict in the Gulf region, which has disrupted supply chain for key feedstocks and consequently pushed raw material prices higher. PP ratios and vessel availability have also been affected. We are closely monitoring how the situation evolves. On our part, our procurement and operations teams have acted swiftly, and we do not anticipate any raw material shortage that would impact our production continuity. On the demand side, momentum remains strong. New product inquiries continue to come in at a healthy pace, while demand for existing products remain robust.
We are working closely with our customers to ensure on-time delivery and uninterrupted supply through each period of market uncertainty. Turning to our strategic initiatives, I'm pleased to say that we are making strong progress on our journey to build a diversified multi-vertical chemicals company. In our battery chemical business, the foundation is firmly in place. We have successfully commercialized our first two products and have a healthy pipeline of new products in development. We expect to bring two additional products to commercial scale in FY 2027, further strengthening our revenue visibility, backed by long-term customer contracts. In our semiconductor business, the product expansion strategy at BFC is clearly gaining traction.
New products other than uncertain products are expected to be a meaningful contributor to growth in the coming year, and we will continue building on this momentum to establish BFC as sizable business over the medium term. On Indichem, our South Korea joint venture, while Abhishek will walk you through the CapEx details, I am pleased to share that the R&D center is up and running. We have already started sending samples to prospective customers, a critical step that we expect will significantly reduce our times to market. On the CDMO front, we continue to build a strong and differentiated pipeline. While commercialization in this business takes time, the ramp-up on initiative tends to be steep and sustained. Overall, I believe that by FY 2028. Sorry.
By FY 2028, our both businesses verticals which are in investment phase now, Battery Chemicals and Semiconductors, will have evolved into independent self-sustaining growth engines, each contributing meaningful to our top line along with pharmaceutical intermediate business. This multi-vertical model is central to our vision of building a truly diversified chemicals company. Turning to our financial performance for the year, I am pleased to report that we have continued our strong growth trajectory, closing the year with revenue of INR 1,339 crore and our highest ever PAT of INR 356 crore. These results reflect the strength of our business model and the disciplined execution of our teams. I will request Bhavin to take you through the detailed financial sort.
To conclude, we enter FY 2027 from a position of strength with a clear strategy, a strong pipeline across all three verticals, and a proven track record of execution. I am confident of delivering 28% revenue growth in FY 2027. With that, I would now like to hand over to our Vice President, Strategy, Abhishek Patel, who will walk you through the detailed business update. Over to you, Abhishek.
Thank you, Naresh Bhai. Good evening, everyone. Let me take this opportunity to share further insight into our business performance for the quarter. Starting with Advanced Pharmaceutical Intermediates segment. This segment continued robust performance with revenue of INR 392.4 crores in Q4 FY 2026, reflecting a strong year on year growth of 43.9%. Growth was primarily driven by CDMO business, complemented by steady contribution from our core Advanced Pharmaceutical Intermediates segment. Here, I would like to mention that our process of reshuffling portfolio was mostly over during first nine months, and we have seen healthy growth in this business sequentially. Moving on to the Specialty Chemical segment. Revenue for this segment stood at INR 40.3 crore during the quarter, registering a steady year on year growth of 12.3%.
Our commodity chemical segment subsegment recorded decline during the quarter, which was offset by strong recovery in BFC business. Turning to a capital expenditure. CapEx for FY 2026 stood at INR 195 crore, primarily directed towards the Jagadia site for battery chemical project and then pilot plant at Sachin site and maintenance CapEx. Let me provide some additional updates on our key projects. Regarding the electrolyte additive CapEx at Jagadia, the first phase of electrolyte CapEx is completed. The second phase of CapEx is currently ongoing and expected to get completed by Q1 FY 2027. Pilot plant CapEx is slightly delayed due to delay in equipment arrival. It is now expected to get completed by Q2 FY 2027. Apart from this, another major cash outlay during the year was our investment in South Korea joint venture in Indichem Inc.
We have invested INR 190 crore in this JV during the year FY 2026. Turning to our strategic infrastructure update. While Naresh Bhai has covered our key growth drivers in detail, I would like to focus on the infrastructure that will support and enable growth in the years ahead. Our existing infrastructure is well-positioned to support our growth through FY 2028. However, looking further ahead, we have already begun laying a groundwork for the next phase of infrastructure development, which will underpin our growth over the next five to 10 years. As immediate priority, we are embarking on ambitious expansion of our R&D center, one that will elevate it into world-class internationally renowned facility, purpose-built to meet the demand of tomorrow's industry. With planned 10x capacity expansion, the new center will feature dedicated sections spanning pharmaceuticals, battery chemicals, semiconductor, electronics, and cosmetic, et cetera.
Each housed as a distinct division under one roof, bringing together deep specialization and power of cross-disciplinary innovations. This is a defining investment for our future, designed to sustain our innovation pipeline and fuel long-term growth in the years ahead. We are actively evaluating land acquisition opportunities to develop new infrastructure that will support our long-term growth ambitions. Alongside physical infrastructure, a key pillar of strategy is deliberate migration of our portfolio towards higher-value products. The first step of strategic reshuffling of our core advanced pharmaceutical portfolio has been completed. The next phase involves the systematic replacement of commodity chemical product with a higher-value differentiated offerings. We'll begin phasing out select commodity products this year, replacing them with a new product using same infrastructure with slight modification in calibrated phased manner. As Naresh Bhai outlined, we are guiding 25% revenue growth in FY 2027.
On margins, while we remain mindful of the near-term cost pressures stemming from global supply chain disruption, we are confident in our ability to maintain EBITDA margin at a similar level in the coming year, underpin our product portfolio upgrade strategy and improving business mix. I also want to highlight a key trend driven by our business cycle. Q1 is typically our weakest quarter, with revenue steadily increasing sequentially till Q4, which is always the strongest quarter. This pattern results in H1 contributing around 40% of our top line, while H2 accounts for generally around 60%. I will now hand over our floor to our Chief Financial Officer, Bhavin Shah, who will walk you through the detailed financial update. Over to you, Bhavin Bhai.
Thank you, Abhishek Bhai. I would like to briefly highlight the key performance metrics for the quarter and FY 2026 before we open the floor for questions. Let me start with quarterly performance. Revenue from operations for the quarter reached INR 432.8 crore, representing 40.3% growth YoY. Gross profit for the quarter was INR 268.3 crore, reflecting 83.8% increase compared to the same period last year. The gross margin expanded by 1,416 basis points YoY to 62%. Gross margin was driven by improved product mix. EBITDA for the quarter was INR 183.5 crore, which represent more than twofold increase compared to the EBITDA of same period last year. EBITDA margins were at 42.4%, up 1,487 basis points YoY. EBITDA margin was driven by expansion in gross margin as well as operating leverage.
PAT for the quarter was INR 134.3 crore, up 114.1% YoY. PAT margin for the quarter was 31%, which show an expansion of 1,070 basis points YoY. Moving on the FY26 performance. Revenue from operations for FY26 reached INR 1,339.4 crore, representing 33% increase, you know, YoY. EBITDA for the FY26 was INR 480.4 crore, which is 2x compared to the same period last year. PAT for FY26 is at INR 356.4 crore, which more than double compared to the same period last year. Moving on to the balance sheet item. Net cash and cash equivalent were at INR 198.3 crore as on 31st March 2026.
Our working capital for the year increased to 120 days from 114 days. There was some improvement in debtor and inventory days, which was offset by lower payable days. With that, I request moderator to open the floor for questions. Thank you.
Thank you very much. We will now begin the question and answer session. We have first question from Rikin Shah from Baring AMC. Please go ahead.
Hi team. Congratulations on a fantastic set of results. I would just like first a little bit if y'all can expand on the R&D center that y'all mentioned and, you know, what is the idea behind that going ahead?
Thank you, Rikin Bhai. The R&D center which we are doing is for upgrading and enhancing our capability and capacity with our existing R&D center, because our existing R&D center is having a capacity which can cater all the requirement. We are expecting lot more inquiries and more traction towards the new molecule. We don't want to be remain out of capacity when it came. That's why we decided to have a new expanded R&D center, and this R&D center will be facilitating all the vertical in the chemical sector, which we are catering right now. It is designed in a single complex with all multiple outlets in the chemical sector.
Got it, sir. Thank you so much for that. Another question. Naturally, you know, if I see our SpecChem business is not relatively grown as quickly as our advanced intermediates business. Thanks to our marquee CDMO project, the differential is far higher at this point. Going forward even within advanced intermediates per se, we have spoken about churning out lower margin products in Q3. What is the base business looking like today, and do we have any growth plans for the same for the next two financial years? Thanks.
Basically, as we mentioned, we had some portfolio reshuffling for our pharma intermediate business ex of CDMO, and that has yielded us good in terms of margin expansion. I have already mentioned during my commentary that after nine months of FY 2026, it has grown sequentially in Q4 FY 2026 and expected to grow further in FY 2027 as well. The volume-wise, that business has grown despite of being a flat in terms of revenue. Obviously, going forward it, we are expecting good kind of revenue expectation from our ex CDMO CMO business also. Coming to your question related to intermedie, sorry, SpecChem business.
We have to understand that the initially what the business we acquired through an acquisition of size, that business has grown in the range of 12%-15% despite of some price reduction. Now this segment is expected to grow with additional revenue coming in from battery electrolyte additive space.
The plant has already been constructed and the production has started. This year we will have a very good exponential growth coming in from Spec Chem business as well.
Got it, sir. Within that, let's say in Battery Chem, we had sent samples, and now we've completed our first leg of capacity expansion. In terms of contributing, you know, a little bit meaningfully to FY 2027, maybe if we cannot give a number on today. Do we have that sort of target or understanding inside that, you know, this that this segment will contribute meaningfully this year? I understand you have that sort of a longer-term vision of scaling this as a big business. In FY 2027, does this seem like a decent contribution?
Yeah. Definitely, in FY 2027 it will have a meaningful revenue contribution. It will start slowly with Q1 and till Q4 it will keep on ramping. At the end of complete financial year, FY 2027, we will definitely have a meaningful revenue contribution. I will not put it any number to it as of now because there are many variables, but it will be a meaningful contribution.
Sure. Thanks. Are we taking any sort of contribution from the two new electrolytes we have added, or this is just the, you know, two products we have discussed before?
So as I mentioned-
Okay
... the CapEx is already going on for the third, electrolyte additive product, and which is getting completed by Q1 FY 2027. Once that gets completed, it will also start contributing in the revenue. The fourth, product, we are in the phase of business development.
Got it. Within the CDMO piece, we have now I think, a basket of five products other than, you know, the keep project that is going on today. We have been in the process of validation and approval with the innovators and originators. Yeah, the longer-term INR 1,000 crore guidance in CDMO for FY28 is intact. Within that, obviously for FY27, do these four to five products also contribute something?
Yes, definitely. As you mentioned, those are all validated product and we are building it as good revenue expectation from these four products all as well, apart from the first product.
All right. Last question from my side.
Sir, Rikin Shah sir, please, two questions per participant, sir.
I join the queue.
get back into the queue, sir. Thank you.
Yeah. Yeah.
Ladies and gentlemen, in order to ensure that the management is able to address questions from all participants in the conference, please limit your questions to two, one or two per participants. Should you have a follow-up question, we would request you to rejoin the queue. We have next question from Bharat Shah from BCS Capital Idea Center. Please go ahead, sir.
Hearty congratulations, Naresh Bhai, and the entire Acutaas team. Once again, very, very robust delivery. I had only one suggestion to make, and which is in general the feature of Indian corporate sector per se. You see, lot of businesses which have been successful over a period of time, but remain under-invested in building the future by under-investing into the innovation pipeline, under-investment into research and development capability. In short, building the future. Software services businesses is an example of that, where huge cash flows, but very limited investment into building the future technology and therefore, the struggle is evident as we have seen.
Similarly, we have seen in consumer businesses in India, which have been very successful, but under-invested in the new consumer-facing technology and the way of delivering. Even our lot of banks are under-invested in technology to build it in the contemporary manner. Therefore, Acutaas which has displayed remarkable capability in a relatively smaller size of our operation, I don't think we should remain limited in ambition by our current size. If we want to build the future, I think meaningfully, intelligently, kind of planned within our balance sheet capability, but sustained investment in building future is absolutely vital, especially in our chemical business like this, because otherwise the business will get commoditized at some stage.
To kind of summarize, if we don't want the business to be commoditized, investing into the future to build it is an absolutely very vital one. We've done very well by taking up intelligent bets and we have to consolidate. I think we shouldn't get deterred by our current size in order to build our future, which can be very exciting. I thought I'll just put in that word, Naresh Bhai. Once again, hearty congratulations.
I mean delightful results, and the entire team, deserves the credit. Congratulations.
Thank you, Bharat Shah. It's a good advice, and it is coming from the veteran. It's really meaning to us. If you remember, if you in my commentary, I said that we are going to be put up a new R&D center which will be versatile. It is not a conventional R&D center, but it is a versatile R&D center which will be cater the across the sector of, say, semiconductor, electronics, electrical, battery, pharma, agro and the cosmetic. It's a versatile R&D center with a different segment. You are rightly says that we need to invest into the innovation, and we this is what we do continuously. Initially, we started with the conventional chemistry, continuous flow chemistry, which is successfully imparted and now commercialized.
We enter first in India in the electrolyte, then in Telecom. We continuously making ourself learning and then putting into the system and then executing it. We've taken serious note on that, what you suggested. In future, we will keep in mind when we do any new things. Thank you very much, Bharat Shah.
No, absolutely pleased, and once again, hearty congratulations.
Thank you, sir.
Thank you. Next question is from Garvit Goyal from Serene Alpha. Please go ahead, sir.
Hi. Am I audible?
Yes, you are.
Good evening, sir, and congrats for a good set of numbers. My first question is on the goodwill. Can you please elaborate on this increase in the goodwill happened in April 2026 over April 2025? Specifically, if this pertains to the Indichem, which is a newly incorporated entity. I would like to understand what is the rationale for goodwill at this stage. Further, can you also give some clarity on the basis for which the management is showing the confidence on the recoverability of this total goodwill of INR 104 crore? That's my first question, sir.
When you talk about INR 104 crore, it has two parts. One, goodwill is, which was created in the past, that was towards the acquisition of our BFC business. For the year, there is an addition of around INR 48 crore in the goodwill. When we have made an investment of INR 190 crore in Indichem, the partner has brought in the capital that was at par value only. For 25%, which is there for our partner. Whatever we have paid INR 190 crore, out of that 25%, is going towards the goodwill in our books of account.
Now, since this is the investment we have made, and we are very much confident that this business in coming years is going to do excellently well. There is a valuation also attached to it, basis the future projection. This has been correctly account as per the accounting standard, guided by ICAI.
Regarding your partner with this JV, what is the background of that partner? Like, what kind of expertise they are bringing in? Because this JV is not having any revenue so far, so booking the goodwill means something which I'm not able to understand. Maybe they are bringing some tech. Can you please elaborate on that part?
First, about the background of our partner. He has been working in this space for more than 30 years. He's a veteran in this business, understand the Korean ecosystem well, apart from the international customer outside Korea, like Taiwan and Japan. He has assembled a good team of people coming from the production and R&D and regulatory side. This is how we have joined hand with our partner. Your question related to goodwill. As Bharat Shah has mentioned, for this JV, all the investment, financial investment has been done by Acutaas, and we have given the 25% equity to the partner. That's the reason we have to account 25% of those investment in the goodwill as per accounting standard.
This is how it is going. As we mentioned, we have a good confidence on our business with the projection going on. We see that definitely the goodwill is recoverable in future.
Got it. Got it. Sir, your revenue contribution from Baba Fine Chemicals has remained limited, and now we are doing this JV with Indichem. Just wanted to understand from you, how do the product offerings of Indichem and Baba Fine Chemicals complement each other? Are there any clear synergies in the terms of products, in the terms of customers, or maybe in the terms of end application, sir?
Hello. We mentioned previously also for our semiconductor business, we have two different stream of revenue. One is our Baba Fine Chem business. In Korea it is advanced stage product than what we offer in BFC. These are complete, and which is different from what BFC is manufacturing for years. These are a more value-added product and a different stream of revenue.
Okay. What kind of peak revenue are we anticipating, maybe from this status of INR 200 CR in Indichem?
We are expecting around 1x kind of revenue from this plant.
What kind of margin, sir?
It is very premature to say as of now because it's, it is in construction phase. Generally you can expect a good margin from semiconductor business as an industry you study.
Maybe, in line with your specialty.
Garvit Goyal , sir. Please return to the queue, sir.
Just one last, just to follow up only. Maybe in line with the specialty chemicals, sir?
No, no. Obviously not in line of this, traditional specialty. It should be in line with of the BFC business.
Okay. Okay. Thank you, sir. Thank you very much and all the best for the future. Thank you.
Thank you.
Thank you. The next question is from the line of Sanil Jain from Ambit Capital. Please go ahead.
Hi, sir. Am I audible?
Yes.
Congratulations on a good set of numbers. I just have two questions. The first question from my side is, can you give us some developments on the new CDMO products under progress other than the Fermion contract, and what can be the potential opportunity size of it?
Okay. Obviously we have a long pipeline of CDMO products, but we have announced validation of four more products after the first one. When we say validation, it's a commercialized product already submitted to the customer, and now it's a process of getting regulatory approval from those customers. Once that gets completed, it will keep on going on large quantity. In terms of revenue potential, we are expecting those product to be between INR 50 crore-INR 100 crore each at a peak level.
That's INR 50-INR 100 crores each, right?
Each, right.
Okay. The second question is that we have reported excellent EBITDA margins of 42%. Can you tell us, okay, what was the EBITDA margin for specialty chemicals and advanced intermediates separately also?
Okay. For our pharma business, for this quarter, EBITDA margin is around 44%, and for specialty it is around 13%.
28%.
13%.
29%.
Understood.
Sorry.
Sorry. For pharma it is 44% and for specialty it is 29%.
Right.
29%. Okay. Just one more, that are we planning to expand our Fermion capacity given the improved outlook by the innovators?
As we earlier also said that we have got a good visibility for the from this particular CDMO contract, and we have already built our capacity which can suffice those production requirements.
Understood. Understood. Thank you. That's it from my side.
Thank you. The next question is from the line of Nikunj Gupta from AK Investment. Please go ahead.
Yeah. Hello, am I audible?
Yes, sir.
Yeah.
Yeah. Hi, team. Congratulations for the great set of numbers. My first question is previously we had talked about semiconductor chemical shipment to Japanese and Korean customers. Has it already been started?
Yes.
Okay. My next question is, what is the revenue potential from the semiconductor chemicals and battery chemicals business over the next three to five years? Also if you can put some light on EBITDA margins as well, that would be very helpful.
For electrolyte additive business, it's a function of capacity what we have built in. As of now, the capacity for electrolyte additive is 2,000 metric ton for VC and FEC. Based on that, you can see the revenue potential coming in from that business. Related to semiconductor business, that business has been going through some difficult phase in last financial year, but now it has recovered from Q4 onwards, and it will continue to ramp up in future also.
Okay. Yeah. Thanks, team, and all the best for the future.
Thank you. The next question is from the line of Sai Kumar from Family Fund. Please go ahead.
Yeah. Hi, sir. Congratulations on a great set of numbers. My question is on this, sir. This year you have consolidated yearly EBITDA margins around 34.5%, somewhere around 35%. For the FY 2027, what kind of range you are expecting?
As I mentioned during my commentary also, we are expecting similar kind of margin in FY 2027 also. For us, the margin is a function of product mix, and we expect similar kind of product mix in FY 2027. That's the reason we see that it should be in a similar range only.
Okay. Yeah. Got it, sir. Regarding this Indichem JV, you said like around end of FY 2026 you are going to commercialize the plant. When can we expect supplies? And do we need to go any validation phase for that molecules? And when can we expect the commercial revenue from that Indichem JV?
As soon as the plan gets constructed, we will have a commercial production going on from that plant. As Naresh Bhai mentioned during his commentary, that we have already started our R&D center in Indichem, and we have already started supplying the samples to the customer. Parallelly, by the time the CapEx complete, we should have some customer onboarding happening, so it can make our process faster in terms of commercial production ramp up.
Okay. Yeah. Got it, sir. One last question. I see. I mean, in China, for the BYD shifting more of their battery, like from lithium to sodium-ion. So what is the risk you see for that shift coming for sodium-ion batteries? Or else do you supply the molecules eligible for sodium-ion battery technology as well?
See, the sodium-ion battery is not new. It started inventing seven to eight years back, and it was. Now it is slowly maturing. Whereas lithium battery has still potential of next 10-15 years. It's not that 100% replacement of sodium-ion battery with lithium. We are in. Whatever that we are targeting is even not a 1% of the demand, so for us it's not an impact. Contrarily, whatever the new molecule which is coming into the electrolyte segment, there are some which is also going in this kind of area, but we can't disclose based on our contract. It's a confidential for us. But yes, whatever the segments are working in electrolyte battery area, either it's a sodium or lithium or solid-state battery, we are there, we are trying to resupply our molecule in that segment.
Okay?
Yeah. Yeah. Got it, sir. One last question, sir.
Thank you, sir.
Okay. Yeah, I'll come back.
Please limit your questions, Sai Kumar, for fairness to all.
Yeah. Thank you.
Thank you. The next question is from the line of Jason Soans from IDBI Capital. Please go ahead.
Yeah, sir. Thank you so much for taking my question. First question, just wanted to know the capacity utilization for the Sachin plant, the Jagadia plant and the Ankleshwar facility.
For this quarter under review, Q4, utilization at Sachin plant is 75%. Unit 2, Ankleshwar, is 31%. Unit 3, Jagadia, is 50%.
Jagadia is 50%. Okay. Right. Sir, just wanted to also understand in terms of this. You said the EBITDA margin for specialty chemicals in this quarter is 29%, right? Now, generally the margins are quite low, I mean 15%-20%, that is the kind of margins we clock. Just wanted to know, what is the reason for this jump?
Jason, we need to understand that chemical segment includes our traditional product as well as the semiconductor and electronic business.
Mm-hmm.
For the quarter, we have seen a very good growth in the BFC business, which has a very high EBITDA margin, and which is recovering from Q4 onwards.
Mm-hmm. Mm-hmm.
Because of this, we have seen a better margin in chemical segment.
Basically that's a mix of both traditional SpecChem margin as well as the BFC product margin.
Okay. Battery chemicals also will be a part of this only, right? The specialty chemicals.
Yes, it is part of this business only.
It is a part of this business. Okay. Just one quick question, if I may just add on. I mean, I understand 2,000 tons of the both products in the battery chemicals, electrolyte additive segment. Just wanted to understand, sir, what utilization are we looking at? I mean, you have those bound by long-term contract, so you would have some idea. If you could give some color, whatever possible, of what revenue we can look at in FY 2027. Yeah.
Yeah. We have 2000 metric capacity for both-
Mm-hmm.
Which capacity each. As we mentioned during last commentary also that this plant is fully covered, backed by the customer contracts for all the capacities in next three years' time.
Mm-hmm.
I will not put in any figure around the capacity utilization expected in this financial year. As I mentioned during our first Q&A, production has already started, and it will keep on adding quarter by quarter from first quarter to fourth quarter, and it will definitely have a meaningful contribution from electrolyte additive space.
Sure. Thanks. I'll join back with you. Thank you so much.
Thank you. The next question is from the line of Raj Agrawal from [Niveshaay.com]. Please go ahead.
Hello.
Yes, sir. You are audible, sir.
Yeah. Yes, sir. Thank you so much for the opportunity and conversation, sir. Great set of
Got it, sir. Got it. On the margin side, so this CDMO business as a whole has a relatively higher margin, right? So-
This battery chemical business and our specialty chemical business, on the other hand, does not have that kind of margin profile. Will it be difficult to maintain the current margin profile in FY 2027 or we will be able to do it with the current mix?
As I mentioned during my commentary also, we are expecting similar kind of margin in FY 2027 because as I said, the margin is a function of product mix, and we are expecting similar kind of margin in FY 2027 as well. As I mentioned, there will be some meaningful contribution coming from electrolyte additive space, but there is an additional data coming from CDMO business also. That's the reason that we are expecting similar kind of margin.
Just one last thing on this. If you can just explain what do you mean by the mix will remain the same? Because the mix will change, right? Because you have new business that is entering this mix.
As I said, there is some portion of additional revenue coming from the SpecChem business because of battery additive, electrolyte additive segment. There is a CDMO additional revenue also coming. Percentage-wise it looks similar.
Got it, sir. Got it. Thank you so much, sir. Those are my questions.
Thank you. The next question is from [Mehul Panchwani from Forty Cents]. Please go ahead.
Hello, sir. Congratulations on the great set of numbers. My first question is what proportion of our growth in FY 2027, 2028 is backed by confirmed orders and long-term contracts across CDMO and the battery segment, battery chemical segment?
For CDMO business, as I mentioned, for this customer, first customer, we have long-term supply contract already in place for 10 years. So that's backed by good visibility from the customer. On the electrolyte additive space also, as I just mentioned, we have already got customer contract in place and already signed.
Right. Sir, can you throw some light on it because I'm new in tracking our company. You mentioned in one of the responses that we have a partner who is having 30 years of experience. Is it a firm or is it individual or can you just elaborate on the contract which we have signed with the entity?
The contract which we have entered is a proprietary firm, and the experience of that partner, which I just mentioned, during our Indichem business partner profile.
Okay. Thank you so much, yeah. Thanks. All the best.
Thank you, sir. The next question is from the line of Krishan Parwani from SBI Mutual Fund. Please go ahead.
Yes. Hi, sir. Many congratulations on once again a great set of numbers. Just two questions. First, on the CDMO pipeline, I believe you know we had certain products in the validation phases in the last quarter, and we expected them to commercialize in the first half of FY 2027. Wanted to know, has there been any update on these new products? Have we commercialized it? Yeah, so that's the question I have.
These are already commercialized products because it is validation. Lab validation batches are already supplied. Now it's not in our hand or customer's hand because it's a regulatory approval and we have already got some projection from the customer. That's the reason I'm saying in FY 2027 we will definitely have a revenue coming from other four CDMO as well.
four CDMO.
Right. Apart from the first one.
Okay. The ramp-up of those will be majorly seen in FY 2028, correct?
Yes. Yes.
Okay. That's great, sir. Secondly, on the margins, I believe, Abhishek Bhai, you mentioned margins at a similar level. Similar level as Q4 or similar level to FY 2026?
Similar level as FY 2026.
Yeah.
Q4 is too ambiguous.
Ambiguous and good, but okay, no problem. I mean, 36% is also great. Just lastly, if I may squeeze one more. This Baba Fine Chemicals, I think Naresh Bhai in his opening remarks mentioned that there is a strong pickup that you expect over the next two to three years for the Baba Fine Chemicals. You know, are the things really picking up pace right now or what stage are we? Just some insights on that would be helpful. Thank you.
Just we mentioned that, in Q4, the SpecChem EBITDA was 29%, driven by the very good recovery in business of Baba FineChem in Q4.
Mm-hmm.
That's a sign of already recovered business for BFC, and we have similar kind of visibility for FY 2027 as well.
Okay. I believe you don't need to do a large CapEx for the BFC because I think you didn't mention in the plan. Is that correct?
Yes, that's correct.
Okay, sir. Okay. Thank you so much for patiently answering my question and wish you all the best. Thank you so much, sir.
Thanks.
Thank you. The next question is from the line of Hemant as individual. Please go ahead.
Sir, thank you for providing me the opportunity, and congratulations on a very good set of numbers. Sir, what I understand is that, since you have guided for 25% kind of revenue growth in FY 2027, so I think the main contributor will be the electrolyte additive division, right? If I take a little longer view, maybe from FY 2028 and all, what can be the growth drivers for the company, sir?
It's not only electrolyte additive which would be driving the growth for FY27. Both our pharma intermediate business is also, it's also growing very fast, and that is the biggest engine for us for the growth. Slowly, slowly, this additive business is also taking charge of our growth. We have a semiconductor business picking up. First started with BFC and then, maybe in next two to three years' time, it should be from Indichem Inc. as well. There are three different growth engine which is driving our growth for next three years.
Can we expect a similar kind of run rate, sir? I think, you had earlier mentioned that 25% kind of revenue growth till FY 2028, I guess in, one of the previous con calls. Can we expect the same?
Yes, we have always guided, that we are growing, 25% growth. That's our history for more than a decade, and this how we guide the market also going forward also.
Any other major CapEx lined up, what is the contribution from CDMOs, CDMO side? Because I think we have a guidance of INR 1,000 crores of revenue from CDMO by FY 2028.
Yes, that is the guidance. Correct. On the CapEx side, I've already mentioned that, for next year, our CapEx will be the sum of the spillover of FY 2026 CapEx, which is around INR 50 crore and around INR 40 crore will be from maintenance CapEx. Then there will be CapEx around the R&D center and land. The figures are yet to get finalized. We will update at a relevant time.
Sir, no major growth CapEx, right?
Yes. Mr. Hemant, we'll get back to you, sir. Thank you. We have follow-up question from Mr. Soans from IDBI Capital. Please go ahead.
Sir, thank you for taking my question again. Right. So I just wanted to, you know, ask you on the this Indichem acquisition. Sorry, the Indichem investment has been done and. Earlier in the last con call you had guided for that the facility will be on stream by the start of CY 2027. Is that plan on or has it been delayed or something like that?
No, it is. Plan is on. In fact, it will be even earlier than what it was guided. As I said, it should get completed in second half of calendar year 2026.
Okay. Sure. Sir, over the CapEx you just mentioned, some spillover CapEx of this year. Basically, probably around INR 100 crore odd number for 2027 CapEx should be fair. After that, for the R&D center, I know you would need to firm up those numbers. INR 100 crore odd for 2027 would be okay? That would be a good figure?
That is already planned CapEx.
Mm-hmm.
As I mentioned, the R&D and any other CapEx, we will update as and when it gets finalized.
Okay. Sir, just lastly, wanted to know, so this. Of course, we know the Fermion contract is doing very well. Sir, I mean, the numbers are there, $5 billion kind of peak revenue potential by the next three to four years. Just on the ground, how do you see this contract ramping up? Just wanted to get some color on from your side, how is it doing label extensions, et cetera. How do you see the contract ramping up for you?
Those things are already available.
Mm-hmm.
In the presentation of Bayer as well as.
Mm-hmm.
Fermion contract. Sorry, for Orion presentation. They have also guided the market about the growth of those products. I think being their primary supplier, we should be the beneficiary of those business. We have already guided the market that how the business is going on and further expected to ramp up in FY 2027 and going forward as well.
Thank you, sir. Thanks. Thank you so much, sir, for answering all those questions. Thank you so much.
Thank you. The next question is from Dhara Ganatra from ValueQuest. Please go ahead.
Thank you for taking my question, sir. Just a follow-up on the previous participant. You mentioned that there is an INR 50 crore spillover of CapEx that will be done in FY 2027. What is this INR 50 crore spillover, sir? What is this CapEx used for?
It is related to CapEx of electrolyte additive and the pilot plant.
Additive and pilot plant. Okay. Thank you, sir.
Thank you. The next question is from the line of [Mr. Ankit Mittal], Individual Investor. Please go ahead.
Yes, sir. Thank you for the opportunity, and congratulations for a great set.
Thanks.
Mr. Ankit Mittal, we are unable to hear you.
Yes. Can you hear me now?
Yes, you are audible. Please go ahead.
Yeah. I was asking for the first question, and that is regards to the revenue growth guidance. As you mentioned in the last question's reply, we already know about the Fermion project and the growth guidance given by Bayer, which is for 50% growth in calendar year 2026. Given that, we have that outlook from Bayer, and also we have this electrolyte business coming up in this financial year. Wanted to know if we are being conservative in giving this 25% revenue growth guidance for this year, and would there be...
Like if all the things remain in good condition with respect to this Fermion project, we might have an opportunity to revise this guidance later in this year?
We have always guided the market about 25% growth CAGR, and that has been our history. We would be happy to revise our guidance if that business potential goes beyond those 25% at a relevant stage of this financial year.
Secondly, on the seasonality of the business which you mentioned in the introductory remarks, which is 40% in the first half and 60% in second half. With this Fermion contract this year, which is already being ramped up to a decent size, do you think that that seasonality will reduce this year? I mean, the QOQ decline which we usually see in the first quarter, that might be limited this year given that the kind of growth we are seeing in that Fermion project.
Yes, that is also expected in FY 2027 as well.
Expected meaning in Q1, I mean, wanted to check if, I mean, the usual seasonality was there because usually we see 20%-30% revenue decline Q-on-Q in Q1. But given that, the significant ramp-up of Fermion project.
See, in fact the Fermion contract was there in FY 2024 and FY 2025 and FY 2026 as well. The both year has shown the similar kind of revenue trajectory Q1 to Q4.
Mm-hmm. Okay.
That's our history for more than that.
Okay. Any particular reasons why we see it? Because we don't see similar, I mean, seasonality when we look at the numbers from Orion or Bayer. Any particular reasons why we see it at Acutaas level?
Sir, this is my company. History is that we have always Q1 is lower than Q2 is lower than Q3 is lower. In the last 15 years is like that. We are not only dealing with Fermion, we have more than 600 customers. So each customer has different requirement, different time, and we have more than 100 products. So it's my company's seasonality and working like that. I'm not representing Fermion.
Sure. Thank you. Thank you, and all the best. Thank you.
Thank you. Ladies and gentlemen, due to time constraint, we will take this as a last question. I now hand the conference over to management for closing comments. Over to you, sir.
Thank you, 360 ONE Capital team for hosting our conference call. We appreciate everyone's questions and hope we have addressed most of your queries. If we missed any of your questions, please reach out to our investor relations team and we will get back to you. Once again, thank you very much and good evening to all of you.
Thank you. On behalf of Acutaas Chemicals Limited, that concludes this conference. Thank you for joining us, and you may now disconnect your lines. Thank you.