Please note that this conference is being recorded. I now hand the conference over to Mr. Rishabh Shah from CDR India. Thank you, and over to you, sir.
Good day, everyone, and thank you for joining us on this call to discuss the Q1 FY24 earnings for Suven Pharmaceuticals. We have with us Mr. Venkat Jasti, the Managing Director, Mr. Venkat Ramansunder, Vice President, Corporate Affairs, and Mr. Subbarao, CFO of the company. Before we begin, I would like to mention that some statements made in today's discussion may be forward-looking in nature and may involve risks and uncertainties. Documents relating to the company's performance have been emailed to you earlier. I would now like to request Mr. Jasti to share his perspectives on the performance and outlook. Over to you, sir.
Thank you. Thank you, everyone, for tuning in this afternoon for the conference call on the results of the Q1 FY24. As you could see, I mean, the results, we it was notified, and, the, the results came out better. It is driven by mainly the strong growth in the CDMO and also with the better profit, profitability. The commercial pharma, innovator, and developmental projects are doing very good, with a good growth. As you know, the specialty chemical has a, a muted performance this quarter, and, I expect this to continue this, soft performance for this, current quarter also.
As we know, globally, these specialty chemicals and agrochemicals are having a destocking of their inventories, and especially in our case, because of the drought situation, some other areas, the delays in the ship- not shipments, I mean, requirement is deferred, very well. Hence, you will be seeing a soft quarter for the current quarter. Otherwise, based on the forecast and all that stuff, both for the pharma and the specialty chemicals, it is looking good. We see multiple levels of growth that is going to happen because we are discussing with the customers on many aspects, and likely success happens sooner than later. As I was telling, after the last year's CPHI, there was a COVID-related activities dying down and drug discovery activity in the new molecules are coming up.
This quarter, we see the largest number of inquiries quoted in our history. You know, to become a product, a project out of that, it will take time, but things are going very well. I think it's better for me to answer your questions. In general, looking good, but there will be some kind of a gap because of the specialty chemicals not being up to the mark and is muted performance and various reasons, which everybody knows. Hence. Otherwise, it's looking good in the long term for the year and the next year. I'll open for discussion.
Thank you very much. We'll now begin the question and answer session. Anyone who wishes to ask a question, may press star and 1 on their touchtone telephone. If you wish to remove yourself from the question queue, you may press star and 2. Participants are requested to use handsets while asking a question. Ladies and gentlemen, we'll wait for a moment while the question queue assembles. Participants, you may press star and 1 to ask a question. The first question is from the line of Abdulkader Puranwala from ICICI Securities. Please go ahead.
Yeah, hi, sir. Thank you for this opportunity. Just to understand your comments on the CDMO Pharma seeming to be better, and, when you said the inquiries are better, current quarter, would it be fair to assume that, you know, the traction which is being seen is more from the molecules and the development, and while the commercial side would also have done little better?
No, it is mainly from the new developmental molecules, that means very early stage molecules. It will take time for us to get this thing into inquiries becoming an RFQ, RFP, becoming a product, I mean, a very good project, and as you know, takes time. Not on the commercial side. Commercial side is as usual, like last year, and nothing in this case three, I don't see anything indication as of today that it is moving into the commercial yet.
All right, sir. Understood. On the Spectrum side, so we had one molecule which could go commercial in next calendar year. Is that, you know, any timeline change in that, or it's moving as per schedule?
Yeah, that one, next calendar year, the product, a new product, no change in the timeline as of today.
Mm-hmm. All right. Lastly, on the stake sale, so the earlier guidelines, which was, I know communicated, it was supposed to, I think get completed in somewhere in August. Any revision in that aspect, or have we got all the necessary approvals for, for that to happen?
If the necessary approvals are on place, in place, it would have been done, sir, because the timeline is up to August 26. We expect the course of this monsoon session of the parliament, I think hopefully we'll be getting all the approvals. It's in the final stages of the regulatory approvals.
Got it, sir. Thank you. I'll join back with you.
Thank you.
Thank you. Next question is from the line of Foram, Foram Parekh from B&K Securities. Please go ahead. Foram, may I request to unmute your line and go to the question, please?
Hello, am I audible?
Yes, you are.
Yes, please. Yes, yes.
Sir, I just wanted to understand in specialty chemical side, you said that there is drought trend situation. Also, can you just elaborate, like, is it a deferment for just one or two quarters, or, you know, do you see the entire year being noted on the specialty chemical side?
It's not a year, entire year, but it's a quarter on quarter basis. As you know, something is less this quarter, and current quarter also is within the same mode, soft, very soft. After the September time frame, I mean, in September, we'll be knowing about the next quarters. That usually after summer in Europe and USA, they'll come back with the next year's requirements and all that stuff, which we need to supply in the third quarter, starting from the third quarter itself. As of now, as per the projections, looks similar to last year, these 2 quarters are getting affected. 1 quarter, already in the quarter, first quarter got affected a little bit, the second quarter also getting affected a little bit. It is a softness in the specialty chemicals for both the quarters.
Okay. So I just wanted to ask, like, on the commercial, molecules, are we still on 3, or, you know, has that increased for specialty chemicals?
3, 1, as I was telling earlier, is, the launching will be sometime in the calendar 2024. As of now, that remains to be seen, same. No changes in that.
Okay. Sir, my second question is, we are seeing that margins, or EBITDA margin has increased mostly because of other expense rationalization, as gross margin has declined, you know, year-over-year. Will this cost rationalization here to stay? I mean, should we take, you know, manufacturing and other expenses at the same run rate that we have in Q1, or do we see, you know, it normalizing?
The cost, costs are good. I mean, manufacturing expenses, are you talking?
Yeah, manufacturing and other expenses.
It will remain the same.
For the entire FY 2024.
For the entire year-
Contribution.
It is difficult, it difficult, depends on the mix also, no? Because we'll not be knowing, ahead, eight months ahead of time. It's only 4-5 months ahead of time, I can tell you, but other than that, I cannot tell you. Because it keep changing our mix, that makes the profitability.
Okay, no problem. I'll join back with you. Thank you.
Thanks. Thanks a lot.
Thank you. Next question is from the line of Hussain Kagzi from Ambit. Please go ahead.
Hi. Hi, good afternoon, sir. Thank you for taking my question. My first question was with regards to uncertain. Now, you mentioned that there's a lot of inventory restocking which is happening. My think was that usually generic molecules would be much more vulnerable to this type of a scenario compared to innovator molecules. Just wanted to understand that, because our, our innovator molecules shouldn't be that impacted, right?
In the specialty chemicals last year itself, I told you, one of the molecule became a generic, in the sense, in the two of the territories, and naturally, that's what it is. But, in, in our case, see, in general, that is what's happening. In our, in our case, there's also there is a drought situation in one of the territories. Hence, there is a deferment into the shipments based on the forecast.
Okay, okay, understood. Thank you. Sir, one thing was with regards to the acquisition. Here, like you mentioned, that the approval, of course, it's not in your hand, but should things delay from August onwards, have you planned anything from there on? Because I think our long stop date is towards August, right? Just wanted to get some clarity on that.
I mean, as of now, we are expecting the things to happen before the long stop date itself. Because, as you know, CCI has approved long time ago, and the other things are going through. I think because of the monsoon, I mean, this parliament session, I think the meetings are not happening. When the meeting starts taking place, it should take place anytime soon, and we should get resolved.
Okay, okay, got it. Thank you. That's it from my side.
Thank you. Next question is from the line of Pratik Kothari from Unique PMS. Please go ahead.
Hi, good afternoon, sir, and thank you. My first question is on Casper. If you can update us in terms of how many products did you launch? What is in the pipeline that you have recorded anything? Just on the Casper part, please.
Yeah, Casper, I mean, as I said, there is only 3- 2 products that are launched, and 3, 4 are expected to be launched within the next 6 months. About another 8 are where in the pipeline to be approved, I mean, to be filed. As far as the Cas-Casper is concerned, we said it takes 12 to 18 months for us to get the breakeven time. I think we are in the same, same range.
Right. In terms of these 2 products, which we have launched, I mean, the commercialization of that has started. I mean, you have started supplying.
Yeah, it's a small, it's a small volume, products.
Right.
Small value products as of now.
Right. Got it. Once all of these products are launched, let's say, 2, done 3 in near future and 8 after that, what can be the potential that if, if you have to look at, say, next year, what, what can this be?
I think these are very dynamic in the generic business. Unlike the CDMO business, which I could tell some kind of certainty, but in this, if I say something, it may not work out the way it is, because by the time how many number of cases will be coming up, by the time we get the approvals, we don't know. What is the potential at that time and all that stuff. I mean, as I said, it will be positive only after the after 12 months later. That means, it's not that it's not a big amount that we are talking about it. It may be about INR 150 crore or something like that.
Okay, correct. Sure. Sir, my second question is on the CapEx. These are, I think, our Suryapet facility is coming up. We were doing something at-
Yeah, other than those things, we have not done any new activity because there is no change in the location for the, what do you call the, farm, I mean, R&D center, because the regulation has not come into picture. We're not put up any new facility, which if needed, we want to put it at Pashamylaram, that is also not started yet. As and when the success of the molecule happens, then we can start working on that. So other than the Suryapet facility, which will be up and running in the third quarter, in the second quarter, third quarter, and nothing else is running other than the replacement CapEx, which is normal.
Correct. We had earlier said that it might take us about two years to even set up this, the Pashamylaram facility. That, that work still has not started, I mean?
No, everything. Well, we have everything ready, but what I'm saying is, unless you see the success in the molecule, there is no need. No, because we can manage with the existing capacities here. What happened is some of these thing activities are also being parallelly done in Vizag, where we can also move the same products back up kind of things, and 3 of the customers have already approved this site as intermediates. There is no rush to do this unless it's purely regulatory purposes, we need to have it. Right now, that's not the case. That means some of these products which we are now making at the Pashamylaram, if there is a regulatory requirement comes, that can be moved to Vizag, and the regulatory product can be done at Pashamylaram. There is no immediate requirement. When some other couple of products which are in the Phase III matures, and then we need to have a capacity, then, that is the time we need to put the capacities.
Sure. Great. Thank you, sir. All the best.
Thank you.
Thank you. Next question is from the line of Saurabh Kapadia from Sundaram Mutual Fund. Please go ahead.
Yeah. Thank you for the opportunity. If you can talk about the margins in this quarter, we have seen a better margins and those higher our mix range out of power. Should we continue to see a higher margins?
Sir, this question I've been answering for the last four years. It all depends on the, the mix sell products. One quarter, it may be high-value products, and one quarter it may be volume growth only, but not the high value. We keep changing it, but that's why, but we never say that it's going to go up. When it comes positive, it's good, because we always say it is plus 40% margin, a plus 40% EBITDA, but it's always above that. We, we don't know, because we don't have a regular product day in day out, I can tell you, yes, there is a possibility to increase because of the other reduction in the gas and all that stuff. This is a product mix, and every quarter it keeps changing it, I cannot tell.
Oh, okay. Sure. Second is on the, you know, the correction in new RFQ. In last quarter, you mentioned there is, between... It's, slower. How has been the, you know, correction in this quarter? Is it picking up in terms of new RFQ you are getting?
Oh, yeah. As I was telling you, I mean, this is the first quarter, we are seeing a lot of new inquiries for the new products which are under development. There's a very early stage product. We're all working on putting all those things and see how many of those things will mature. I mean, see, what happens is when after the COVID, everybody is now focusing on the regular. There was a lull between before, that is not there. Now, more users are coming, and, but, sometimes, they'll be going two or three products for the same indication, and then they'll finalize one of them. The request, request will come for all of them. We keep quoting them and see what it lasts to. It's a very early stage products. It's not a volume driven, but they eventually it will give you good growth potential when it matures.
Okay. Lastly, you know, in terms of the, the filings, so, how many filings we have right now, and, and how many, you know, like, we expect to get approved this year?
No, no. You see, the projects has no meaning. What are the contributors is the one that counts, because sometimes now the project stays there as active, but it will be 2 to 3 years before you see any big business. We have discussed here with telling how many projects are there, because it doesn't give you any indication.
Okay. sir, how many, you know, molecules are there in phase III? Last time we mentioned about five molecules.
Five. Five, five.
Sure.
Yes, yes.
Okay.
I tell... There's no indication as of now of how, when is the results are coming, and should we prepare for a large quantity or anything like that? Nothing is evident as of today, and that is visible rather far.
Oh, okay, sir. Just last one on the, you know, just open up for attention. Is it stuck at the CCA, or is it at a semi level?
No, I think, CCEA.
Mm. Okay. Okay, fine.
Okay.
Yeah. Thank you.
Thank you.
Thank you. Next question is from the line of Rushabh Shah from O3 Securities. Please go ahead.
Hello, I'm on the line.
Your voice is coming very muffled. Can you please speak through the handset?
Hello again, ma'am.
Yes, very well.
Yeah. I have a question. The business, the CDMO business, is a bit lumpy. The business nature is very lumpiness. How do you manage that lumpiness about not getting future bidding orders, like, for 2 years or so?
You don't manage lumpiness because this is the way the business is structured, and one quarter it may be less, the one quarter it may be more. One quarter is a less value product. Let me say, more early stage products. One quarter it may be more long-term projects. Sometimes it can double when I think when something is launched. I mean, it is, the... Not only us, anybody who's in this business, that so they expect a normal growth of 10%-15% on average, unless there is a success of the molecule, moving from one stage to the other stage. Really, there is not a management. We cannot manage anything like changing it to some generic or anything like that. It has to be the, the basket that is available and, wherein we supply the products.
As you say, it's very difficult to predict, like, until phase IV. How do you have the visibility, like, for the next 24 months or so?
I think you have heard us. We don't have a visibility of more than 6 months. Not only me, neither my customer has a more than a 6-month visibility. Unless the results of the clinical trial comes in, they cannot tell us. This is the part of the business problem we have, and we are managing that way, as a mindset management rather than any physical management.
Okay. so if you would give me the opportunity size in this business, and then how ahead of, are you, ahead of, of your competitors, sir?
I don't have a competitor because I'm purely a CDMO for the innovator products. You see, the product, if I'm supplying to a customer, is not supplied by any other in this country, so that way I'm not a competitor. We don't look in that way. This is as a different sense, and you have to see our track record and how it is going. It can be up and down, but at the same time, by the year end, it is averaging it out. Sometimes it will be maybe 1% or 2% less, sometimes maybe 1% or 2% more only. Sometimes it will go, but like you see, last 4, 5 years, it's about 20% year, year.
Right, sir. You said going ahead, the opportunity side for the business is tremendous. Like, we can see a 20% growth over the coming years also.
Right now, I cannot say not having the visibility, but, the track record says so.
Thank you, sir. Thank you so much.
Thank you.
Thank you. Next question is from the line of Gokul Maheshwari from Awriga Capital. Please go ahead.
Yeah. Hi, sir. My question is that the CapEx plan of INR 600 crore, which we had planned. I'm aware that we have not done the shifting of the R&D facility. How much of that INR 600 crore we've already executed?
It's about 30. Out of the three buckets, the INR 600 crore was INR 200 for the replacement at the Suryapet site, the new block. One, the second one is INR 200 for the what you call, at shifting the R&D center as needed, from inside the ring roads to outside ring road. INR 200, INR 152 for Pashamylaram additional block, if needed. We have not started anything else. We have only started the Suryapet thing, which we have concluded about INR 170 crore.
Okay. Is that already done or it's under execution?
It's, INR 130 crore already, spent, and, it's under execution, and, in the 3rd quarter, the, what you call, the production will start.
Okay. Secondly, is on the, Casper facility, when we made the acquisition, it was... I understand it is primarily for ANDAs, but is there any other plan to use this facility for your customers in terms of offering them formulations also?
Yes, yes, if required, we can offer them, but right now it is only a CDMO facility. We can use using only for the ANDA, but we have not started any formulations to any our regular customers, innovator products. That is a part of the integration in the future when we go to the APIs and hopefully for the what do you call the when they require, because most of the innovator products, they don't take the formulations.
Okay. Right now we are not either speaking to our clients or not executing any such projects. It's primarily ANDA facility right now?
Yeah, it is ANDA facility. Yes.
Okay.
Yes.
Lastly, just on the CRAMS, you mentioned about the inquiries have been very strong, and it's still early stages, but just purely based on your experience, I understand that it is, you might have still quite a few balls in the air, but, how much time does it take to really eventually this to be converted into meaningful business? I'm not talking from a quarter sense, but more like more a longer term perspective.
Yeah, because you see, in the early stage, the revenues are very minuscule, like for 5 to 10 kilos or 15 kilos, whatever it is. If it matures and it goes into the phase II level itself, that means it takes 24 to 35 or 36 months before you see any tangible results.
Okay, great. Okay, great. Thank you so much, and all the best, sir.
Thank you, sir.
Thank you. Next question is from the line of Cyndrella Carvalho from JM Financial. Please go ahead.
For the opportunity. Am I audible, sir?
We can hear you, but your voice is slightly breaking.
Is this any better?
Yes, go ahead.
Yeah. Just to ask on the margin side, the logistical cost benefit and the raw material side benefit should stay with us going ahead, right? Given that, there has been a comfortable ease on both of these cost accounts.
Yes.
Irrespective of the product mix? I'm just trying to understand that.
Yeah, that will be more or less stable, stable.
Right. If we look at our positioning from a China Plus One perspective, do you see anything changing here right now? Any commentary on the earlier discussion that we had on the some funding winter that industry was experiencing in the in the northern part of the world. So what is the sense over there? If, if you can highlight any of, like, you know, your thoughts on the two things.
I mean, China Plus One mainly concerns to the generics and, and special, I mean, what do you call the chemical businesses and all that stuff, and some APIs, but we are not in that sector. We are in the pure CDMO intermediate sector. The lull that happened last one, one and a half, two years is because of the COVID. The, the focus was more on COVID rather than new drug development. As I was telling you, since last CPHI, some changes in the mindset, people who want to come to India rather than to China. Of course, China is not much in the CDMO side of the NCE players, but still, based on the number of inquiries we got this quarter, we feel that there's also some change, slight change in the thinking, even for the innovator products also.
That's what we are seeing here. Other than that, it is not applicable for us for as far as the China Plus One is concerned, only for the, that is for the chemicals and regularly APIs and all that stuff.
The funding winter thing also, you see it settling now?
What is it again?
The funding winter, that also you see is behind us now, or you see some improvement coming?
We are little bit. Again, you properly means? I couldn't hear, figure out the question.
I'll, I'll join back with you. I'll join back with you.
Okay.
Thank you. Next question is from the line of Vishvesh Krishna, individual investor. Please go ahead.
Hello, am I audible?
Yes, sir.
Yeah. I just wanted to know on the Casper facility, we bought it only for formulation and, and innovation and R&D, correct?
It's for formulations only.
Only. Okay, can you shed some light on that? Do you have anybody?
Huh?
Can you shed some light on what's happening with respect to the Casper facility? I joined a call little late.
Yeah, Casper facility for the NDAs, and we have 2 of them already, being supplied with small volumes, and 3 are under approval from the FDA, and 8 more are under filings. We expect the break-even point in 12 to 18 months.
Okay. All right, perfect. Thank you so much.
Thank you.
Thank you very much. Ladies and gentlemen, you must press star and 1 to ask a question. A reminder to all the participants, you must press star and 1 to ask the question. Next question is from the line of Rushabh Shah from O3 Capital. Please go ahead.
Hi, sir. Thanks for the follow-up. Sir, my question was, on the, on the call, you had said there are some shipment delays and due to day in, day out supplies, such thing, such that everything happens and come into a single quarter, and the rest of the quarters are all stagnant. Is there any way to tackle those things, or we have to live with it because the nature of the business?
It's not the shipment delays. What was happening is, globally, the majors are destocking, and that means they are deferring the requirements, even though projections are there. The other part I said is, it's because of the one drought situation, the requirement is deferred. It's not a delay, deferred to other... As of now, for the next year, the projections are given, and they're all good. We'll be knowing, as I said, last quarter, and this quarter has affected because we did not supply those quantities. We'll now the for the third and fourth quarters, we'll be knowing in the September time frame, how it is, it is going through.
The softness will be there for a temporary period, but in long run, it will because once the destocking takes place, the requirement is there, their projections are still similar. There is only the global people, especially specialty chemicals, that is what's happening, but that is shortly what we feel.
You said, that's before that, there is, there is no competition for you in this business.
Sorry, but your voice is coming very muffled. Can you please speak through the handset?
Yeah. Now it is... Now am I all right? Am I audible now?
Yes, sir. Thank you, sir.
Yeah. You said the that you don't have any competition in this business, as you told me. If a new player comes into, into your segment, so what, what challenges he might face to like to come up to your level? And what challenges are you facing currently, sir, in your business?
I cannot tell what challenges the new players are going to face. My challenges are when we take up a project, whether it is going to go to the next level or not, it is going to be successful in the physical, I mean, clinical trial setting or not, we don't know. This is an uncertainty, not only from my point of view, from the innovator point of view also. When I said there is no competitor means, the competitor means for the actual, there are competitors, we are not worried about. Once you get a product, same product is not given to second person in this country. That's what, what I mean to say.
Okay. What are your top three priorities going for next two to three years?
What is it again?
What are your, what are your top, 3, top 2, top 3 priorities going next 2 to 3 years?
There is nothing like top two, three priorities. There's only one priority, getting business and new business, and hopefully, the business will be successful in the clinical trial, which will in turn will give us. This is only one way. There's nothing other, because we are not into generic, we are not into stock and sale items. We are all clear, I mean, depending on the customer's success.
Right.
That's the only way we look at it.
Okay. Thank you so much, sir. Thank you for the answers.
Thank you.
Thank you. Next question is from the line of Darshit Shah from Nirvana Capital. Please go ahead.
Yeah, thanks for the opportunity. Sir, when you are saying that we have received the kind of inquiries that we haven't seen in our history of operation, we mainly like to understand, is it due to the kind of pent-up demand where, you know, most of the innovators were occupied with the COVID molecules, that has kind of come up after that, or, you know, what, what is your sense on that?
Sense is that the discovery and development of new molecules is delayed, I mean, deferred during the COVID situation because they are all focusing on developing various alternatives for the COVID. Now all those things are coming. That's why the requirements of those early stage requirements are being asked for, because we are long-term players with the customers which we are working with. These are all the, the new activities they have started with a gap. You know, it's a cycle now, or something like that happens. Sometimes now they stop the activity and which happened because of the COVID. Now the activity started full scale, and now they are looking at, like, this is a very, very early stage requirement they're talking about it.
Right. Sir, in this, in terms of our CapEx, where we kind of, deferred the R&D and the Pashamylaram facility, is that anything to do with, the deal with Advent, where they have also few of the facilities which can be used when we kind of, merge all this together? Has that thing to play a role in this?
Nothing, nothing. It has nothing to do with it, because if the government says you have to move out of this thing, I have no choice what to do. This thing we have done 2.5 years ago, not 6 months ago. I could have started earlier itself. Whenever there's a requirement, we take it. It is not a money we don't have to borrow also, it is existing. Only we have taken the permission from the board at that time. It's not just because of the deal. It has nothing to do with the deal.
Sir, on the migration from, intermediates to API, what's the, status there, if you could throw some light?
Yeah, they were telling you because of the COVID, it has got delayed, the audits, audit, audits and all that stuff. Now it's started. We're already discussing with two customers, they are planning to send their department, I mean, those audit people sometime in this third quarter or something like that. I think it's going in the right direction.
Sure. The last one is, on this, long stop date, that's 26th August, if, you know, in the worst case, if we don't get the CCA approval, would this deal get extended, as per the agreement?
This is, 26th August is the long stop date, and after that, we have the... I mean, it is a mutual, consent to be given each other if for, if, regulatory things have not come by that time. The only thing one pending is CCA, which we expect after the monsoon session should get, organized the meetings, and, hopefully it should be over.
Sure, sir. Thank you.
Thank you.
Thank you. Next question is from the line of Saurabh Kapadia from Sundaram Mutual Fund. Please go ahead.
Yeah, thanks for the follow-up. I see your manufacturing cost has gone down in this quarter, so is it because of mix or the overall cost has come down?
What? I didn't understand the question. What-
Yeah, I'm referring to the manufacturing cost that has come down if you compare it to last 4, 5 quarters. Is there any, you know, reduction?
As you know, some specialty chemicals were not manufactured. These are variable costs, all those things. Naturally, it will come down. Even the fixed costs are there, but the variable costs will come down now, naturally, when the production is not there.
Okay. Okay. Thank you.
Thank you.
Thank you. A reminder to all the participants, you may press star and one to ask a question. Next question is from the line of Satish Bhatt from Anvil Shares and Stock. Please go ahead.
Good afternoon, sir. Congratulations on the good results. Sir, I just wanted to know whether you will give some update on your 2 molecules, which are, you are planning to take to phase II trials, you know. How we are you projecting when, which molecules are?
Hello?
Go ahead.
Yeah. I just wanted to even know, okay, what type of expenditure we're going to incur for those trials also.
What are you talking, sir? You're talking 2 life sciences here. We're not talking-
I just wanted to know whether I can ask on those, those topics?
I think people will get confused. I think you will can have a separate call on that, sir.
Okay, sir. Thanks. Thanks, sir.
Thank you.
Thank you.
Thank you. I now hand the conference over to the management for closing comments.
Thank you, everyone, for tuning in for this conference call. As discussed earlier, the environment is very tough, especially in the agrochemical sector, but it's as I said, it is a restocking that is taking place and some drought situation somewhere else. We feel that it is transient and weak environment, but it will come back in a big way in the 2024, 2025 time frame. We expect with this softness for this quarter, which we have told you, but based on the number of inquiries that is coming, we see a lot very great potential for this CMO side of the business also. All in all, it looks good for the 24, 25, and this we'll know as the time goes by, how this, as I said, on the long term, I can tell you how it is going on, but for now, it is this quarter is a little soft and hope everything will resolve by the time we speak next time. Thank you. Thanks for tuning in.
Thank you very much. On behalf of Cohance Lifesciences Limited, that concludes this conference. Thank you for joining us. You may now disconnect your line. Thank you.