Ladies and gentlemen, you have been connected to the Concord Biotech Limited conference call. Please stay connected. The conference will begin shortly. Ladies and gentlemen, good day and welcome to the Concord Biotech Limited Q2 FY2026 earnings conference call hosted by Ambit Capital. As a reminder, all the participants' 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 touch-tone phone. Please note that this conference is being recorded. This conference call may contain forward-looking statements about the company, which are based on the beliefs, opinions, and expectations of the company as of the date of this call.
These statements do not guarantee the future performance of the company, and it may involve risks and uncertainties that are difficult to predict. I now hand the conference over to Mr. Pranav Chawla. Thank you, and over to you, sir.
Welcome to the Q2 FY2026 earnings conference call of Concord Biotech Limited. We thank the management of Concord for providing us the opportunity to host this earnings call. From the company today, we have Mr. Sudhir Vaid, Chairman and Managing Director, Mr. Ankur Vaid, Joint Managing Director and CEO, Mr. Lalit Sethi, CFO, and Mr. Prakash Sajnani, AVP Accounts and Finance. I would now invite Mr. Sudhir Vaid, Chairman and Managing Director of Concord Biotech Limited, to give his opening remarks. Over to you, sir.
Good afternoon, everyone, and thank you for joining us on our Q2 and H1 FY2026 earnings conference call. Revenue for Q2 FY2026 stood at INR 247 crore, while H1 FY2026 revenues were INR 451 crore. The subdued performance is primarily due to delay in return confirmation from CDSCO, deficit of government tenders for the Middle East region, and shift in procurement patterns from US customers on the back of tariff uncertainties. We have experienced such cycles and uncertainties in the past and emerged stronger. We believe that this is just a timing difference and postponement of sales and not loss of business. Based on our discussions and forecasts, we anticipate a stronger performance in H2. On the EBITDA front, the decline was primarily due to the commercialization of our new injectable facility at Valthera, which had a temporary impact on margins. Excluding these initial startup costs, our EBITDA margin stood at 41%.
As the facility ramps up and achieves higher utilization levels, we expect it to start contributing positively to our overall margins in the coming quarters. Despite the challenges, I am pleased to share that the last six months have been quite eventful on the regulatory front. We hosted multiple site inspections across our facilities. Unit 2 went through its emerging market inspections. Unit 3, our largest fermentation facility, successfully completed its first EU inspection. We also had successful inspections at Unit 1, Dholka, from key global regulatory agencies such as US FDA and EU authorities. These successful outcomes give us the confidence and the credentials to enter new markets and secure regular supplies. In addition to the strong regulatory progress over the last six months, we also successfully executed several key strategic initiatives. Notably, we received US FDA approval to market teriflunomide tablets, making another important addition to our portfolio.
We also incorporated Stelon Biotech, which will drive the marketing, distribution, and commercialization of Concord Biotech products in the U.S market. Stelon will manage end-to-end commercial operations while ensuring full regulatory compliance, establishing our direct commercial footprint in the U.S, and advancing our goal of expanding market assets and unlocking greater value across key global markets. We incorporated Concord Lifestyle Limited as a wholly-owned subsidiary to strengthen our domestic marketing, sales, and distribution capabilities. This move will enable us to sharpen our market focus, deepen customer engagement, and enhance our brand presence in India. We have also invested in Celliimune Biotech Limited, which is working on new ways to treat cancer using the body's own immune system. Celliimune is developing advanced therapies like CAR-T cells, which are specially designed to find and destroy cancer cells.
This goal is to move beyond traditional chemotherapy and offer smarter, more personalized options for treatment. Speaking about our CDMO opportunities, we remain actively engaged with clients and remain optimistic on finalizing some of the opportunities in the near term. With our strong product portfolio, requisite regulatory approvals, marquee clientele base, and diversified business opportunities, we remain confident on our long-term strategies to grow. With this, I hand over the call to Mr. Ankur Vaid, Joint Managing Director and CEO of Concord Biotech Limited. Thank you.
Thank you, sir. Good afternoon, ladies and gentlemen. We have reported revenue of INR 247 crore in Q2 FY2026, a growth of 21% compared to last quarter. However, on a year-on-year basis, there has been a dip of 20%. For H1, our revenue stood at INR 451 crore. The subdued revenue performance has been on account of three major reasons impacting the overall growth. First, being the renewal application for written confirmation from CDSCO, New Delhi, a prerequisite for selling products in the European Union. Although the application was submitted in July, processing delays impacted our EU sales, as shipments could not be dispatched without this approval. We received the written confirmation on 4th November, and it is now visible on their website also. Shipments that were on hold have now resumed and contributed to revenues in the current quarter.
In summary, this is not a business loss; this is just a timing difference where we were not able to sell in Q2 but in Q3. The second issue relates to a government supply contract in the Middle East that was being executed through an Indian entity. This contract has been deferred due to regional uncertainties and ongoing conflict. We remain optimistic that the contract will resume soon, allowing us to recover the associated revenue going forward. Lastly, we experienced a temporary shift in the procurement patterns, particularly from U.S customers, driven by the ongoing tariff situation. However, following the clarification in September that these tariffs do not apply to generic drugs, order inflows have now returned to normal levels. Additionally, progress on the second source opportunity had also been slowed due to this uncertainty, but with the tariff clarity, clients have begun responding more quickly.
This positive development positions us to accelerate our second source engagements with multiple customers and capture a larger share of the market. Overall, these are largely timing-related factors rather than structural ones, and we will try to mitigate the impact in H2 for the shift in the business. Having said that, we remain confident about the underlying demand and the strength of our products, which will enable us to capture a larger market share. If we exclude these timing-related issues and the temporary shift in the business, the underlying unit economics remain strong. The deferral of revenues to the following period affected overall margins due to de-operating leverage. However, excluding this impact, both gross margins and EBITDA have remained stable to improving. Additionally, if we adjust for the expenses for our injectable facility, where revenues will occur in the upcoming period, our EBITDA margins stand at a solid 41%.
With higher revenues expected from the injectable facility and the recovery of the deferred revenues in the second half, we are well-positioned to sustain and further strengthen our margins going forward. Now, let me speak about a few positive developments. Over the past six months, we have secured multiple regulatory approvals across our sites, strengthening business continuity and enhancing global market access. Our Dholka facility has received US FDA, EU GMP, and Russia GMP certifications, while our Valthera facility obtained NAFDAC approval from the Nigerian authority for the oral solid dosage facility. Additionally, our Limbassi facility has been granted EU GMP certification. These approvals will help us broaden our customer base across regions and ensure consistent supply. We are also in advanced discussion with innovator companies for generic API supplies and are witnessing strong positive traction on this front.
Furthermore, we have been actively pursuing qualification initiatives for second source opportunities, which are now progressing at an accelerated pace. Once we achieve second source qualification, it will only be a matter of time before we expand our wallet share and potentially transition into a primary supplier over the long term. Speaking about our newly commissioned injectable facility, we are witnessing a strong rise in inquiries and revenue traction. Our products have been successfully validated, and customer acceptance continues to grow. With the increasing interest and improving revenue run rate, we anticipate stronger visibility and sustained growth from this segment going forward. Alongside injectables, our CDMO business continues to progress well and represents a significant long-term growth driver with a large addressable opportunity. We possess both the capability and the capacity to serve this market effectively.
We remain actively engaged with clients and remain optimistic on finalizing some of the opportunities in the near term. Over the years, we have been successfully positioned as a leading supplier of fermentation-based APIs, creating a distinct niche within this space. Our business is built on deep expertise in complex fermentation processes, operational excellence, product development, and R&D capabilities, all of which have enabled us to create strong entry barriers and establish a sustainable competitive advantage. With a diversified portfolio across therapeutic areas, scaled-up manufacturing facilities, flexible plant configuration, robust regulatory approvals, and an impeccable compliance record supported by backward integration, we have emerged as a trusted partner for our global customers. With this, I hand over the call to Lalit Sethi, our Chief Financial Officer for Financial and Operational Performance. Thank you.
Thank you, sir. Let me take you through the financials and operational performance for the quarter. On the revenue front, our revenues for Q2 of financial year 2026 stood at INR 247 crore as compared to INR 310 crore in the same period last year, a degrowth of 20%. However, on quarter-on-quarter basis, revenues have grown by 21%. Our revenue for H1 financial year 2026 stood at INR 451 crore as compared to INR 526 crore in the H1 of the last financial year. Revenue from API business stood at INR 345 crore in H1 of this financial year, against INR 401 crore during the same period last year. Revenue from formulation business in H1 of this year stood at INR 106 crore as compared to INR 125 crore in the same period last year. Revenue from domestic business stood at INR 247 crore in this H1, and from exports stood at INR 204 crore.
Speaking on EBITDA, EBITDA for this quarter stood at INR 88 crore, and for H1 financial year 2026, it stood at INR 150 crore compared to INR 218 crore. EBITDA grew by 44% on a Q-on-Q basis. EBITDA margin stood at 36%, but if we negate the impact of the expenses of injectable facility, the comparable EBITDA stood at 41%. On the profit after tax, profit after tax stood at INR 63 crore for Q2 of financial year 2026, and for H1 2026, it stood at INR 107 crore with a PAT margin of 24%. With this, I shall now leave the floor open for question and answer.
Thank you very much. We will now begin the question and answer session. Anyone who wishes to ask a question may press star and one on their touchstone telephone. If you wish to withdraw yourself from the question queue, you may press star and two. Participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question comes from the line of Chintan Sheth from Girik Capital. Please go ahead.
Thank you for taking my questions. On the results front, if you can quantify the revenue loss for the EU part, just to help us, how much of growth we have anticipated, which resulted, which we could not execute because of the challenges we faced during the quarter. If you can just quantify if those challenges were not in place, how much revenue growth or how much revenue can get spilled over into subsequent quarters would be helpful.
Sure. On account of the written confirmation, the total amount was close to around INR 20-25 crore, which, as I mentioned, has been realized in Q3. On account of the Middle East tender, that amount also stood at around INR 20 crore, where, as I mentioned, we still do not have clarity, and there is a deferment of the tender. Part of it has been realized in Q3. The other part, we are still awaiting clarity from the government on the tender results or when it will be opened up.
Right. That seems the full year guidance will continue to be healthy if we add this back up. We are anyways single digit or slightly lower on a year-by-year basis. Primary facility, the annual run rate or annual growth does not seem to be very much affected because of the weak Q2 in the first half.
No, I mean, as I mentioned, that there had been a temporary shift in the procurement patterns because of the U.S customer U.S tariffs. This has impacted the industry as a whole. As I mentioned, we expect to recover this deferred revenue in the coming quarters, but the exact timing and the quantum is difficult to specify at this stage. That being said, our current visibility for H2 is strong, and we are seeing positive indicators. We anticipate delivering growth in H2 higher compared to what it was in FY 2022 of second half. The magnitude will depend on several factors. We are kind of working towards achieving that growth, but we'll be in a better position to provide clarity only by Q4.
Got it. Got it. On the CDMO opportunity, any color on the ongoing one of the projects we won last quarter? Any color on how it is progressing? You mentioned that the final or confirmed offtake guidelines will be provided next year as the product gets launched and ramped up in the consumer in the market. If you can have that, has been the progress, then it would be helpful.
Yeah. I mean, again, there is no change there. We continue to supply them quantities. They are also in the process of increasing their field force to cater to this new product that they have launched in the U.S. We will be getting the visibility on the forecasting by, as I mentioned earlier, also in our previous discussions, by the next year. We have executed orders. We continue to have orders in place that we will be executing. Our customer will be able to provide a much better visibility by the beginning of next year because by then they would have the field force, and they would have also put the inventory or put the material finished products in the market in all areas.
Right. Last, we turn to the U..S part. I believe last year, full year, the contribution of US to our overall revenue was somewhere around INR 100 crore, 10% of the overall, 10%-12% of the overall revenue. Given the fact that the visibility on the, because of the tariff situation, even though the clarity has come through, the pattern still remains a little blurry for you to provide that at the timing of the reversal of all the shipments which we couldn't deliver this quarter. Do you feel that that portion of the business will face some degrowth this year, or how should we look at it?
No. As I mentioned earlier also, while our direct sales to the U.S was around 10%, we are also supplying material to Indian companies, and they are manufacturing the finished formulation and then supplying to the U.S market.
Those indirect sales to have.
Exactly. Exactly. The impact would also have come through the indirect route, as I mentioned. As I mentioned, our current visibility on H2 stays strong. This deferment of revenue, we will try to mitigate to the extent possible. The magnitude at this point of time, I'll be unable to kind of get through. Definitely, H2 is going to be stronger than H2 of 2025.
Got it. Got it. I'm good. Thank you so much for the explanation. I'll join back in a few other questions. Thank you.
Thank you.
Thank you. The next question comes from the line of Hardik Doshi from White Whale Partners. Please go ahead.
Hi. Just continuing on the previous question. If you add, let's say, even INR 50 crore of revenues from these two one-offs, there is still a slight degrowth on a year-on-year basis for the overall revenue. I think we get to about INR 300 crore versus INR 310 crore last year. I understand that there is this US demand deferment as well that happened. Some of it would have come indirectly, as you mentioned, from the customer. Is there any way to quantify that? The second question is, what happens to the customers in Europe who did not get the orders in time? I mean, do they kind of switch to other suppliers, and then how does this impact your long-term relationship with them?
Sure. It is difficult to quantify because when we supply the API to our domestic formulation customers, they make the formulations and cater to global markets such as U.S, Australia, New Zealand, LatAm, and other markets. How much quantity of that has moved to the U.S, as API manufacturers, we would not know of. We know that we have issued them the letter of access for different markets. We know that their end markets are which all, but what has been the split between those markets, even as API manufacturers, we would not know of. That is to answer your first question. The second question, with respect to the EU, our EU customers also were very worried in terms of this delay of the written confirmation because some of them were at a stockout situation, close to stockout situation.
They were worried that if this thing would have moved on to December, we would be somewhere getting closer to the December holidays for Europe. They were also worried, and there were concerns with them also. In the APIs, and particularly in the fermentation where there are limited players, there is also a lot of stickiness. Our relationship with these customers goes much beyond 10-15 years. Our customers also understand that this is not something that is in the hands of Concord, but we are also relying on third parties. Yeah, they were also a bit jittery in terms of them not able to get the material delivered. Positively, that thing is behind them, and we have not seen any concerns after that once we informed them about the written approval.
Okay. Has this issue happened with CDSCO in the past as well, or is this the first time?
No. So we get the approvals once every three years. The last time, there was no issue as such. It is not an annual thing. Yeah, I mean, for us, such a long duration was first of a first time.
Got it. Got it. The other question I had was we've been talking about kind of diversifying into other areas like away from immunosuppressants and built in the other verticals. Can you maybe give some strength or color in terms of numbers in the sense that what is the proportion last year, where is it now, and what kind of growth rate is happening in immuno versus the rest?
Most of the development that is happening on the new product side is primarily happening in the non-immuno segment. The product like Nystatin that we launched in February, March, and where we have said that we are seeing a lot of second-source conversions also happening, that second-source conversion in Nystatin, we continue to observe. In this case, the quantum of API required is relatively very small. You may not see it in the revenue contributions, but that effect has already started taking place in Nystatin. We are pretty confident that once the product becomes commercial with them, we will see a good market penetration on Nystatin, which is an anti-infective product. The couple of innovators that we said that we are trying to work with, one of them is in the oncology segment. There also, it is in the non-immuno.
As time progresses, and we will see greater market penetrations in the other segments. It is just that immunosuppressant has seen a much longer life cycle, and because of which the contribution levels are higher. It is also, in a way, an added advantage because our innovators see as Concord that you have a good market share with the generics, so why not work with Concord for their supplies as well? It also, in a way, helps us to kind of build business with the innovators on the immunosuppressant. The new products penetration is also happening in the non-immunosuppressant, as I mentioned.
What is the current, what percentage of revenue is coming from immunosuppressants currently?
For the six months, it will be 76%.
76%.
Okay. Let's say two to three years out, I mean, can this come down to like 50%, or it would not be at that stage?
No, no. It won't dip that much because, as I said, newer products will take time to kind of build up, but we anticipate to bring it below 70%.
Got it. Got it. Just one last question is on the we are obviously expanding our formulation business. Just from a customer perspective, I just want to understand, does that create any conflict because we're going to the market and kind of competing with them in certain products?
It's been nine years now that we have been on the market on the finished. We have not seen any concern on that matter.
Okay. Great. Thanks so much.
Thank you.
Thank you. A reminder to all the participants that you may press star and one to ask a question. The next question comes from the line of Alankar Garude from Kotak Institutional Equities. Please go ahead.
Hi. Good afternoon, everyone. Firstly, the delay in EU as well as Middle East, was it for API or formulations or both?
APIs.
What is the reason for the sharp drop in formulation sales on a year-on-year basis?
Sorry, my mistake. Again, I'll stand corrected. The written confirmation is on the API, and the Middle East one is on the formulations, which is through an Indian entity that we have supplied to. I stand corrected, sir.
Okay. Okay. Got it. I'm going to this CDSCO deferral. I mean, it seems a bit uncommon. You explained the issue, but what can we do to avoid such issues in the future?
We all can represent the government that they should move on.
I mean, actually, I'll tell you the reason was that there were certain issues with respect to compliances. We did face that cough syrup issue because when we followed up with the authorities, they mentioned that around that time, this whole cough syrup issue came up, and all the authority people were very occupied with addressing that issue. There was a lot of delay in terms of looking at the documentation because of this matter. I think this delay probably is, to our understanding, because of that. Of course, we don't know the real reasons for that, but what we believe is that it is because of this.
Okay. So other companies, yeah, sorry. Carry on, sir.
Yeah. Yeah. I mean, I'm sure other companies would have also faced similar issues. Because when you go online and you see, we do see that between the time that they've got the approval and the time that they've submitted, the timelines look to be a little bit more stretched out. My sense is it is because of the concerns that they saw from the industry on this whole cough syrup issue. That's what our understanding would be. If you see that our this was a renewal. Our earlier one was getting the previous confirmation was getting expired in July, and we had made the application in June after our US FDA and our EU inspection. We had made the application in June. Expectation was that by July, August or so, we should get the approval.
I think it got delayed by a couple of months because of this issue.
Understood. The second question is, I mean, even if we adjust for the INR 450 million of delayed sales, both the EU aspect as well as the Middle East contract, our first-half sales have still declined by 5%-6% on a year-on-year basis. You spoke about YOI growth in the second half, and we have that 25% long-term guidance also which we are given. Now, the base also is fairly high as far as fourth quarter FY2026 is concerned. So qualitatively, is it possible for you to provide any comments on the extent of growth you are expecting in the second half?
As I mentioned, we anticipate that the growth in H2 is going to be better compared to what it was in FY2025. As I mentioned earlier, the magnitude, we do not know because we depend upon several factors. While we have more visibility on Q3, we know what potentially could come in Q4, but that clarity, we could be in a better position only in Q4 to give. From where we see things right now, our H2 numbers look to be better than last year's H2. As I said, if what has impacted has impacted the US tariff issue, if it has impacted, it has impacted others as well, particularly companies. Concord would be no different there. This is more of a timing thing.
It's not a loss of the business opportunity. We will try to mitigate it to the extent possible. We have to see how much we can in this year. That quantum, we will have to wait and see how that goes. When it comes to the guidance, as I said, I mean, we have spoken at multiple occasions, Alankar, that it is not a guidance. It is basically Concord has all the right ingredients in place to achieve a 25% CAGR, whether it is in terms of the facility, in terms of the product mix, in terms of the new facilities that we have set up, which was not contributing earlier to the overall growth that we have historically seen.
That's where we get the confidence of going to that number as capacities from injectable units start picking up, as CDMO starts picking up. I'll reiterate that we have all the things in place to go to that. Now, there can be dips like these. This is definitely an unusual dip we've also not seen, and I'm sure you people have not seen this kind of volatility in global markets because of the conflicts, because of the uncertainties in the U.S. Many of those things are behind us. I think that's how we are seeing things improving, and what we have also seen is that improvement in the second half of the year.
Fair enough, Ankur. The next one is, can you comment on the pricing of your immunosuppressant portfolio in particular, especially in context of these challenges around the shift in procurement patterns you mentioned earlier?
The shift in the procurement patterns do not really change the pricing. Our pricing, as you see, customers that we have been working with have been fairly stable. If you see that excluding the injectables or excluding the Stellan injectables component, our EBITDA stands at 41%, which is pretty much in line with what you would have seen historically. Pricing with the current customers would not change. Yeah, of course, with certain newer customers who may be bringing in larger volumes, in case there is an expectation on a better pricing, then that is something that in the larger interest, we may look on a case-to-case basis on what could be done. Things have been fairly stable, I would say, with the existing customer base.
Okay. The final bookkeeping one, Baliji, can you share the utilization rates for the three facilities or maybe the injectable one as well?
The injectable has just started. It is very, very, it is not much utilization as far as the capacity is concerned. As far as Unit 1 capacity utilization is concerned, it is around 76% for the H1. For Valthera, it is around 24%. For Limbassi, it is around 52%.
Understood. That's it from my side. Thank you.
Thank you.
Thank you. The next question comes from the line of Hussain Maruchwala from Carnelian Capital. Please go ahead.
Good morning.
Yes.
I just wanted to understand. I think we have already done some contracts on the CDMO part with some of our customers, and I think we have done a few dispatches on that front. Any color on that, basically, how are things shaping up with those customers? Are there further opportunities that are opening up which can build in future revenues for us in the CDMO side? We are in discussion for the second supplier, but the earlier dispatches on those clients, can there be a meaningful sustainable revenue that can be built?
On the CDMO front, is what you're asking?
Yeah.
On the CDMO front, currently, on the commercial side, we have only one project. As I mentioned, sales of that have started, and it's progressing well. By next year is only when we will have more clarity in terms of how the full year looks like. The rest of the projects that we have commercialized, we have a couple of those which have commercialized, but the quantum is relatively small there. Some of them are with the intent to kind of build a larger relationship with that global MNC company. Basically, it's like making inroads into that account. Those are smaller opportunities, and that's why we have not kind of highlighted that. The commercial one is just one right now.
We had been in discussion, as we mentioned in earlier conversations, that we have been in discussion with two of those two potential innovator companies, of which one was put on kind of on hold because of this whole Trump issue. We have again started reaching out to them now that there is clarity that they do not get impacted even if they look at Concord as a potential supplier for their product. Hopefully, we could get some visibility in the coming few quarters in terms of once their confidence level also builds up, that if they do take that step, they will not have any impact. I think we will continue to engage with them with the hope that in the coming quarters, we should hear some positive news from them.
Further on this, I would like to know, the molecules that you're working on with them, are they early-stage molecules? You mean some color or are they late-stage molecules?
No, no. These are.
Any sense of?
No, these are commercial molecules. They are already commercially selling these molecules in the US. So they're not under development, but commercial products.
Got it. Got it. Okay. That's it from my side. Thank you.
Thank you. The next question comes from the line of Kartik from Bajaj Life. Please go ahead.
Thank you for the opportunity to ask. I would like to know about your investment in the CAR-T cell therapy. Which stage is it? How much time would it take to commercialize? What will be the scope of it? Will that be only restricted to India or also in the other geographies like US?
Right now, what we're doing is we are doing the development part in the CAR-T cell therapy. Basically, once we have the prototype ready, we will be targeting multiple indications. I wouldn't name the indications that we will be targeting at this stage because while we do know what we want to, it is a little early to kind of give it out. Right now, the development work is happening. We expect that for the next 12-15 months, we will be focused on the development aspect of it. This is something that we are primarily targeting the India market because this would also require some clinical studies to be done.
As we work on this, this also opens up the opportunity to kind of work with global players or to kind of showcase the capabilities that Concord would develop in these coming six to twelve months in this space. The idea would be to not only cater through what we are doing in this area for the India market, but also to kind of cater as a potential partner when we reach out to global players in this space.
Okay. Thank you. Secondly, if you can split the US and ex-US revenue in the export, how would that be?
That could be in this quarter, it's around 7% to the US. The remaining out of 45 is to the rest of the world. This is direct US, as I said.
Okay. Okay. Okay. So that's 7% of U.S. revenue, 7% of the total revenue is from the U.S., and let's say 38% is from the ex-U.S. of the total revenue.
Yes.
Okay. About the injectable facility, like in the last two quarters, we have put in some cost in the injectable facility, which had turned down to our EBITDA. How long will this cost continue? Will that continue in the third quarter and fourth?
We have been informing our investors on this matter for quite some time that there is this facility which will be getting commercialized. It was to get commercialized in November, December, which did get in March. It does take some amount of time for it to start generating levels for breakevens. For the initial year, we had mentioned that this is going to be primarily targeting the India market, while we will, and after 12-18 months, we will start seeing revenues coming from the emerging markets. In the India market, we have already started doing it under our own branded generics. As informed in our earlier calls as well, once we have the WHO GMP, which we expect that by January or February, we will have it, after that, we will start engaging with companies for outlicensing activities.
In the subsequent, in the next year, we expect the India business to fully pick up by our own branded generic sales as well as manufacturing for third party. The quantum is, again, a little early to say because what we will be focusing on is that we are a backwardly integrated company. With all quality focus right from API to the finish because no other company than Concord makes the API and is integrated to the finish formulation other than Concord. There is an advantage that we will be giving it to our customers. How many customers we work with and at what time frame, that will kind of, it could be in the first quarter, it could be in the second quarter.
It's a little early to say, but the approach is what we can talk about is that the next year is going to be about India. After that, it is going to be the emerging market. Now, this facility can do close to INR 400 crore-INR 600 crore, but the potential market for the products that we are manufacturing or intend to manufacture from this site is over INR 3,000 crore-INR 4,000 crore. Absorbing this facility for the India market itself is not a problem, but we have to see which customers we kind of work with and what's the quantum that we get out of those customers.
Okay. Thank you very much. Thanks a lot.
Thank you. The next question comes from the line of Adityap al from MSA Capital Partners. Please go ahead.
Hello. Am I audible?
Yes.
Yes. Thank you so much for the opportunity. I just wanted to understand from you. In our first call, a couple of years back, we had said that our Dholka facility can do a revenue potential of INR 600 crore and the Limbassi facility has a revenue potential of close to INR 1,600 crore - INR 1,700 crore of revenue at, obviously, 75%-80% capacity utilization. I just wanted a clarification. The Limbassi and Dholka facility, this takes into consideration that some part of the capacity will be manufactured for our Valthera units. Is my understanding correct?
Correct. That's correct. Not only for Valthera, but also for Dholka because it can also be manufacturing certain raw materials, certain intermediates which may be, say, now we may be using it from the Limbassi facility while this facility kind of caters to other products.
Understood. Understood. So it's an also bookkeeping question. If you can give me capacity utilization across our four units.
As I said, that injectable is the new facility which has been commissioned in the month of March. Remaining three units, which is Dholka facility, is operated at around 76% in H1 2026. The Valthera facility, OSD facility, it has worked at around 24.31% in H1 2026. The Limbassi facility has worked at 52% in H1 2026.
Understood. Sir, now that we are targeting CMO opportunities for larger international manufacturers, I wanted to understand from you that the products that we will manufacture for them, the generic APIs part that we will manufacture, will it be more our own existing catalog products or will it be more that non-catalog products because we have a fermentation manufacturing excellence?
The products that we manufacture do not get classified under CMO. They are our proprietary products. They get classified under our API business. Only products where we are working with the third party's IPR and their intellectual document, I mean, their process, that's where we say it is classified under the CMO. Our own manufactured products will be under the API category only.
Will the molecules be different or will the molecules be the same?
No, the molecules will be different because, like say, if I am supplying an API to an innovator, it gets classified in the API sales, not in the CMO sales.
Understood. Yeah, that's about it. Wishing you all the very best. Thank you so much for taking my questions.
Thank you.
Thank you. We take that as the last question for today's conference call. I would now like to hand the conference over to management for closing comments.
Thank you, everyone, for joining on our Q2 and H1 FY2026 earnings call. We hope we have been able to address all your queries. For any further information, please get in touch with us or SG Analytics, our investor relation advisors. Thank you once again. Have a good evening.
Thank you, sir. This brings the conference call to an end. On behalf of Ambit Capital, we thank you all for joining us, and you may now disconnect your lines. Thank you.