Ladies and gentlemen, good day and welcome to Emcure Pharmaceuticals Limited Q2 FY2026 Earnings Call. As a reminder, all participant lines will be in 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. I now hand the conference over to Mr. Piyush Nahar. Thank you, and over to you, sir.
Thank you, Danish. Good afternoon, everyone. Earlier today, we released our financials for the second quarter of fiscal 2026, along with the press release. These are also posted on our website. We hope you all had the opportunity to review it. I'd like to bring to everyone's notice that this call is being recorded, and the recording and transcripts will be available on our website. To discuss the business performance and outlook, we have on the call our Group CEO, Mr. Satish Mehta, our CFO, Tajuddin Shaikh, Executive Director, Samit Mehta, and President, Corporate Development Strategy and Finance, Vikas Thapar. Before we begin, I want to remind everyone about the safe harbor related to today's investor call.
Today's discussion may include certain forward-looking statements, which must be viewed in conjunction with the risks that our business faces, that could cause our future results, performance, or achievements to differ significantly from what is expressed or implied by such forward-looking statements. At the end of the call, if any of your queries remain unanswered, please feel free to contact us. I will now request Mr. Satish Mehta to provide the opening remarks. Thank you, and over to you, sir.
Thank you, Piyush. Good afternoon, all. This is Satish Mehta. It's a pleasure to speak to you post our second quarter FY2026 results. During the quarter, we saw sustained momentum in all our businesses, which helped us to deliver overall revenue growth of 13% year-on-year and our highest quarterly profits of INR 251 crore, representing a 25% PAT growth, 25% PAT growth with highest quarterly profits of INR 251 crore. We remain on track to deliver the high-level guidance we had given at the start of the year. As I've been communicating all along, partnerships with best-in-class MNCs to complement our base business and internal R&D efforts will continue to be an important part of our growth strategy. You would have seen our announcement yesterday that we have partnered with Novo Nordisk to build a second brand of Semaglutide. Poviztra is a step in that direction.
This, indeed, is a key initiative for us. We have been talking about how we see significant potential in the GLP market, given the fact that India has 250 million obese overweight population. 250 million is the obese overweight population in India. The partnership gives us an early entry into the obesity market versus the rest of the competition and positions Emcure to shape it. Now, let me provide you with key business updates for the quarter. Overall, we continue to execute on our strategy of growing in teams and improving base margins. We continue to invest in top-class people, processes, and products. Coming to the domestic business, we continue to see good traction in the business. We are executing well on our strategy.
The benefits of this are reflecting in our growth with the business growing higher than the industry at 11% in the quarter, higher than the industry. We saw growth in all our key segments, namely gynec and cardio. Our new areas of derma, consumer, and diabetes continue to do well, and we are ramping up as per our expectations. We have now completed the purchase of the minority stake in Zuventus. This allows us to fully consolidate the business. We also expect some synergies on the back end going forward. We remain confident that we will continue to grow above industry going forward. Now, I would like to move to the international segment. Our international segment grew strong at 16% plus with all geographies seeing strong traction.
Europe saw a very strong growth of 22% in the quarter, led by a ramp-up of Amphotericin B and some benefits of brands that we acquired, about which we spoke to you in the past. We expect Amphotericin B to see launches across Europe by year-end. Our Canada business continues to see strong growth and grew 17%, led by market share gains and new launches. Our rest of the world business growth was led largely by a non-ARV segment, which grew in teens. We have a strong product pipeline and are very positive on the growth going forward. Let me conclude by saying, overall, we are progressing well in our five-year plan to make Emcure from good to great. With these remarks, I would now pass on the call to Mr.
Taj, my CFO, to share the financial details of the last quarter with you before we open the floor for question and answer. Thank you very much.
Good afternoon, everyone. Thank you for joining us today. I will take you through some of the key financial highlights for the second quarter. Revenue from operations for the quarter grew 13.4% year-over-year to INR 2,270 crore, up from INR 2,200 crore in quarter two of fiscal year 2025. The domestic business grew by 10.6% year-over-year to INR 1,031 crore, driven by strong performance across all key territories. International markets maintained strong growth momentum, growing 15.8% year-over-year to INR 1,238 crore. Europe saw a strong growth of 22.7% year-over-year, reaching INR 444 crore. Canada reported a healthy 17.5% growth to INR 348 crore. In emerging markets, grew 8.6% year-over-year to INR 446 crore, with strong contributions from non-ARV portfolio. Gross margins for the quarter stood at 60.8% versus 60.6% in Q2 of fiscal year 2025. Change was driven largely by product and business needs. EBITDA, excluding other income, grew 15.2% year-over-year to INR 439 crore.
EBITDA margins stood at 19.3% versus 19% in Q2 FY25 and 19.2% in Q1 to Q26, supported by operating leverage and productivity gains. Depreciation and amortization for the quarter was at INR 105 crore. Interest cost was INR 33 crore. The effective tax rate stood at 26%. Profit after tax came in at INR 250 crore to INR 251 crore, showing strong growth of 24% YOY. Net debt for the quarter was at INR 837 crore. The debt has increased primarily due to partial payout of legislative stake purchase. With that, I will open the floor for questions.
Thank you very much, sir. Ladies and gentlemen, we'll now begin with the question and answer session. Anyone who wishes to ask a question may press star and one on their touch-tone telephone. If you wish to remove 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'll wait for a moment while the question queue assembles. Our first question comes from the line of Foram Parikh from Bank of Baroda Capital Markets. Please go ahead. Foram, you may please proceed ahead with the question.
Yeah. Am I audible now?
Yes, you're audible now.
Yeah. Thank you for the opportunity and congratulations on the good set of numbers. My first question is on the Novo Nordisk deal that we have announced yesterday. I see that we are the exclusive distributor for this Novo Nordisk thing, Semaglutide. So how big do we see this opportunity to be? Can it be bigger than the Sanofi's enlightened portfolio? Some color that if you can just share, how big do you see this opportunity?
Yeah. Hi, this is Vikas. I'll take this question. Obviously, in terms of potential, as the CEO mentioned, there's more than 250 million people living in India with generalized obesity. If you add abdominal obesity, the population is as high as 350 million. Obviously, the scale of this challenge of obesity or people being overweight is very, very large. While we don't want to put a number to how large the opportunity could be, we believe that it has certainly a large potential. Obviously, we're excited about the partnership with Novo to handle the brand because we feel that having an early mover advantage and an opportunity to shape this market will allow us to fully capture our chunk of that potential in this market that'll play out over time.
Yeah. Thanks. That's helpful. I was just looking out in a chronology, we have to do it. Sanofi's in-licensed portfolio could be around INR 200 crore for us. Do you expect this opportunity to be bigger than the Sanofi opportunity?
Madam, if you allow me to say, as far as Sanofi is concerned, we got the portfolio, which was already existing. The sales were known. They have been promoting these products for a very long time. This product will be launching, and we're going to various segments for the first time. Let it play out over a period of time, and we'll keep you posted on a quarterly basis about the progress that we are making.
Sure. That's helpful. My second question is on the margins front. I see EBITDA margin is around 19% for a couple of quarters now, 8-10 quarters in a row. So would it be fair to assume that our EBITDA margin would be stable around 19%, or do we expect it to increase going forward?
Foram, I think what we have even guided at the start of the year, we expect the margins to go up. This quarter is 19.3% odd that you're seeing. That includes the new Sanofi in-licensing that we did. I think what we have guided for is we expect this year the base margins to improve by about 150 basis points. I think we'll be on track for that.
Sure. Okay. My last question is on the debt side. I think a couple of quarters back, we had alluded to becoming debt-free in FY2026, but this quarter, in this H1 balance sheet, I see debt increasing. Are we on track to become debt-free by this FY2026?
No. Foram, when we had guided for FY26, that was without any acquisitions or this thing. As you have noticed, in this quarter and basically in the last few months, we have acquired the remaining stage of . The debt increase that you are seeing is because of that. I think with post-that acquisition, we expect now to be debt-free by end of next year. It'll take about 18-24 months.
Okay. That's helpful. Thank you.
Thank you.
Thank you. Our next question comes from the line of Tushar Manudhane from Motilal Oswal Financial Services. Please go ahead.
Thanks for the opportunity. Firstly, on Poviztra, there are patent expiries sort of in March 2026 anticipated. From that perspective, how does this deal help? In which case, we are not going to use Innovitas brand. Do we have area demarcation in terms of certain regions or areas where there will be sort of exclusivity for Emcure or certain areas where Novo Nordisk will only be selling? If you can clarify these two points.
Yeah. I think if you look at the construct of this deal, obviously, post-LOE, we anticipate a very crowded market in India. The ability to partner with Novo and launch this brand ahead of the competition and allowing ourselves to shape the market and have brand recall versus being lost in the crowd probably four or five months down the line is something that we feel strongly will allow us to succeed in terms of our aspirations for the market share and what we think the potential of the brand is. In terms of the market, obviously, one of the rationales for Novo to look to partner this product is based on Emcure's strength, not only in terms of our distribution network across India, but our more than 5,000 field force covering various specialties.
We think that this is a brand that obviously has comorbidity issues and can be prescribed by a number of different specialists. Novo is very excited about partnering with a company like Emcure, where we can take this brand to the nook and corner of India, as well as some of the specialties, particularly where Emcure is already very strong.
Let me add something, Tushar, for you, that as far as this particular product is concerned at the global level, it has been used by almost 40 million people. The other thing, as far as Novo is concerned, they have an enormous amount of clinical data. They have a lot of phase four data and also the real data. To that extent, what really happens in terms of science, I think it will be of tremendous help in shaping the market.
Because as far as this particular product is concerned, this is being termed as biological injectable, not a biosimilar, not even a chemical entity. To that extent, having this knowledge and shaping the market will go a long way because we'll be going with an enormous amount of scientific data when we go to the doctors.
Got it. Great. And so secondly, just in terms of, is there any area demarcation or certain areas only to be addressed by Emcure, or we will be sort of able to sell even where Novo Nordisk audit is selling is possible?
Yeah. We'll be able to sell wherever Novo is also selling.
Got it. Secondly, just on the balance sheet side, there is a reasonable increase in the inventory for the past six months. Is this to do with certain product launches for exports or for the India market? If you could just further clarify on that aspect.
Inventory has gone up.
Yeah. What's happened is that for the European market, we are anticipating some new launches in the Canadian market, and that's where the inventory has gone up. This inventory is based on the forecast for the H2. The H2 forecast is a bit higher. On that basis, inventory has been accommodated for that. Over the next six months, we'll see inventory normalizing.
Got it. Thank you. That is all.
Thank you, sir. Our next question comes from the line of Sudarshan Padmanabhan from ASK Capital. Please go ahead.
Yeah. Thank you for taking my question. Sir Kangaraj, one quick set of numbers. My question is, when we look at the last three to four quarters, we have done very well in terms of penetrating into the chronic space, cardio diabetes, whether it is through acquisition or in-licensing. If I look at probably the way things are moving forward with the TAIAC, with Novo Nordisk audit, this seems to be gathering well. Some color with respect to how do we see the chronic portion of the business improving from here and also on the newer therapies. The second part of the question is partly you answered about the MR productivity earlier, but we are one of the very few companies who have built a fair amount of manufacturing capabilities as well.
As these manufacturing capabilities come into the fore in terms of complex launches globally, I'm looking more of a longer term. How do we see the business moving towards, say, 25%, and where do we see the recovery issues?
Kamil, you can question out a little bit.
No. As far as chronic is concerned, of course, our association with Sanofi or even for that matter, the products the company has launched in terms of cardiology and others. I'm also inclined to take, as far as kinetics is concerned, it is sub-chronic. That will keep on getting traction as we go along. Semaglutide will also come in the same category because as far as Semaglutide is concerned, we are going to possibly have a trip over a period of six to eight months, as far as I understand. Chronic business going forward will keep on getting traction.
I think on the second part of your question regarding the margin expansion and the in-house manufacturing capabilities, I think directionally, that's absolutely correct that if you look at our pipeline, we have a very exciting mix of some complex injectable, some of the biosimilars we want to take to the emerging markets. Some of these products, obviously, having control of the supply chain and the manufacturing in-house is going to bode well in terms of launching these in various markets internationally. I think we have guided all along that over the next three to four-year horizon, as the product mix changes and also in the domestic market with some of the addition of the chronic portfolio ramping up, we do think that the margin expansion happens along with the MR productivity going up as well.
Having said that, I would also just urge you to think about, as we highlighted that an important pillar of our growth will continue to be in-licensing opportunities with some of the leading MNCs. Obviously, to that extent, those margins have to be sort of looked at in conjunction with those opportunities. Obviously, those opportunities tend to be very ROCE lucrative. To that extent, if you look at the base business and the product mix of that, we're very, very bullish in terms of expanding our margins as we have guided. Of course, we also will continue to look for these types of layering on opportunities of in-licensing arrangements that will still be very cash flow positive and ROCE positive into the whole mix.
Sure. Do we have any targets in mind with respect to how much of chronic are we targeting, say, in two, three years and how much margin should we be looking at?
I think for us, the focus will be to grow the chronic, but also the other pillar for us, a big pillar is the women's health, right, which effectively gets classified as acute. There also, we see a lot of opportunities. It is not going to be very significant because we see both of the pillars going quite well.
Sure. One final question before I join back with you is, as we scale up and as the profitability improves, our ability to generate cash also improves quite drastically. How do we look at deploying the cash? I mean, would our target be more so towards domestic? If so, what are we looking at? Or if it is export markets, what are we looking at over there?
Certainly, I think we have stated in the past as well that M&A will continue to be an important part of our growth strategy. To that extent, the domestic market, which is our single largest market, we will definitely be active in looking for M&A opportunities there. There will obviously be a combination of there are certain segments where we're barely present or not present today. If we have an opportunity for a portfolio that allows us entry or more meaningful entry into a segment, that's something we would certainly evaluate. Segments where we're already strong, obviously, we want to build on our strengths there. If we have a complementary portfolio that we can add in the segments where we're strong and present is another area we would certainly be aggressive at looking at for the domestic market.
Outside of that, in the rest of world markets, there's probably a dozen or so key markets where we think that has a bright future. We're obviously already strong in Canada, in the U.K., and other parts of Europe. If we have bolt-on acquisition opportunities to add to what we already have there and a team that already is handling the front end in those markets, certainly, we would look at M&A opportunities like we did, for example, with the Max portfolio recently, earlier this year in the U.K. market. I would say these are the key areas that we would focus on in terms of deploying some of that cash that we're able to generate.
Sure. Thanks a lot, Aisan.
Thank you. Our next question comes from the line of Utkarsh Kirloskar from BFS. Please go ahead.
Thank you so much for the opportunity. I actually wanted to ask how the new drugs of Poviztra is different from Mounjaro and can it reach the growth levels of Mounjaro in India?
Yeah. The two molecules, they are different. Obviously, Poviztra is Semaglutide. It's the second brand of Wegovy, which is Semaglutide. Mounjaro is tirzepatide. That is the difference between the two. We strongly believe that the kind of success that Lilly is seeing with Mounjaro can be replicated even with this product, given that there is much more extensive data and some additional indications that this has approval for.
Sir, and also one more question. Can you please throw some light on the biosimilar space, how it is progressing as of right now?
Sure. On the biosimilar space, from our existing portfolio, we are seeing more approvals in the emerging markets for Tenecteplase, both for the myocardial infarction indication as well as the acute ischemic stroke indication. As far as the pipeline goes, we have completed our phase three of bevacizumab. We believe it's gone up very well, and we should be submitting our file for evaluation by the SEC and subsequent approval by the regulators in the next few weeks.
Okay, sir. Thank you so much. That answers my questions.
Thank you.
Thank you, sir. Our next question comes from the line of Alankar Garude from Kotak Institutional Equities. Please go ahead.
Hi. Good afternoon, everyone. Sir, is there now any restriction on Emcure launching the generic versions of Ozempic or Wegovy in international markets?
No. This agreement with Novo is specifically for the Indian territory. No restrictions for outside of India.
Okay. So basically, our plan for Pfizer in Canada by the end of this fiscal will continue as planned.
That's correct.
Okay. The second question is, can you talk about the performance of the Sanofi portfolios more in detail, both the cardiac ones as well as the diabetes one? Because last year, we had seen, after the restructuring exercise, some erosion in sales in the cardiac portfolio. If you can just maybe, if not quantitatively, qualitatively comment on how has been the growth in cardiac as well as diabetes.
Yeah, Alankar, I think the cardiac portfolio is now back starting in line with the industry growth. There, I think we are seeing, as we had even last quarter mentioned out there, we are seeing normalization out. I think there, as we mentioned out there, the one idea for taking over the portfolio is going our own brand. That synergy effect now we are seeing reflecting out. The last few months, we have seen some of our own products, which go as co-prescription. There we are seeing a significant uptake, which is helping drive the cardio portfolio overall. Diabetes, it's been two to three months. Initially, they're tracking very well. I think Sanofi, if you look at historically, they have not been focusing on this portfolio. With us now actually promoting it out, we are seeing healthy growth out there in that portfolio.
It's tracking, in fact, better than what we had even targeted out.
Got it. The other question is, we spoke about licensing earlier as well, and then we announced this deal yesterday. Given the focus on licensing, is there any threshold you have in mind at which you want to keep the contribution of the in-license portfolio in India?
Yeah. I mean, I think in aggregate, our mindset is that if we can do deals that are somewhere in the ballpark of mid-teens EBITDA margins and then has a rub-off effect on our entire portfolio, I think that would be sort of a high-level threshold. Obviously, each deal and each product category will have its own dynamics at play, which may deviate slightly up or down from that. Broadly speaking, I think that's the threshold that we would try to solve for as an aggregate for all the in-licensing deals.
My question was more around the sales contribution of the licensing portfolio, the in-license portfolio for the domestic market. Is there any threshold you have in mind around the sales contribution for that?
It's again difficult to say the threshold or what is the % because as far as we are concerned, while building the company, there are three areas which are very close to our heart. Number one, that we should keep on building on the big brands that we have. That's one area on which we'll be focusing. Second area, as far as our R&D is concerned, is probably best in class. So we are very strong. One of the rare companies which is strong in biologics and chemistry and very good front end in terms of formulation. The third area is in-licensing. To that extent, as we go for in-licensing, number one and number two, as in building our own brands. Apart from that, the second one coming from our R&D, that also is going to play an important role.
To that extent, the bias will always be in terms of ensuring that we do not become disproportionately, what I would say, dependent on the in-licensing deals. Our endeavor will obviously get products from our R&D and make our brands bigger.
I think it's also a function of we have a number of divisions across different specialties with our field force calling on specialists across. Wherever we think that there's in-licensing opportunity along with either an existing team or a team that comes with that opportunity where we think we could do justice to it and it's going to be accretive to our overall profitability, we wouldn't certainly rule it out. There's no threshold as such. What the CEO said is, I think the first preference is obviously going to be to keep building our own portfolio. Where we can complement it with in-licensing and it meets those aspects, we will certainly continue to look for more and more of those opportunities.
Yeah. Just to add to what Ricky is saying, say, for example, the diabetology portfolio that we got from Sanofi. I also mentioned in my last meeting that as far as diabetology is concerned we need to do a lot of work. With this particular portfolio and a few of the Sanofi people also joining post their retirement or whatever in Sanofi, it is obviously helping our products as well. That is also going to play an important role as we go along.
Got it. That's helpful. The other question was on the international markets. Firstly, on ARV pricing, how has been the pricing over the last few tenders? Say for instance, we had the South African tender recently. Broadly, can you comment on the outlook for the ARV business, especially out of India?
Alankar, the pricing has been largely stable. I think even in the new South Africa tenders and all, we have not seen much impact on the pricing. That has been stable. I think from our perspective, we have quite a good healthy order book. We have visibility for the current year and even the next year. Samit, if you want.
Yeah. We have really visible outlook for the very recently of the major tender of South Africa has gone over the way. Not only current year, but at the same time, we are also covered for the next year. That is going on well.
Of course, Lenacapavir, we are getting closer. We should start applying for submission and approval across different countries. That should drive, we are also in talks with a few of the other innovator companies for the novel molecules. The pipeline looks very healthy in terms of whatever the upcoming treatment regimens are.
Got it. One final clarification. Ben Piyush, you talk about margin expansion of 150 basis points, base margins, you said. You are excluding the Sanofi diabetes as well as the Novo deal, right?
Yeah, so that, yeah.
Understood. Yeah, that's it from my side. Thank you.
Thank you. Our next question comes from the line of Rajkumar Vaidyanathan from RK Investments. Please go ahead.
Yeah. Thanks for the opportunity. So my question is on the Sanofi portfolio. The first question is, do you expect given that these brands have a less or low penetration tier two and tier three cities, do you expect the growth from this portfolio to be better than the other domestic pharma segment?
I think the Sanofi portfolio, if you look at, these are all quite old molecules, right? They have a brand recall even in the smaller market. I think where the business has been done well is they have not been promoted for the last many years. We do expect it to see revival. I think what we are targeting is to grow more in line with the industry.
Okay. Okay. The second question is, currently, you have a distribution and whatever the marketing agreement. I do not know whether these products are produced by Sanofi's own factory or if they use the CMOs to do it. If so, is there an opportunity to kind of get back these also over a longer period of time?
As of now, these are mostly produced by Sanofi.
Okay. So you're looking at leveraging this partnership further or it will kind of stay here for the medium term?
Very difficult to say as of now.
Yeah. I think in terms of looking at Emcure playing a role in the manufacturing, it's something that obviously, if it would make sense to both sides, it's something that is a conversation that we could have from time to time. That is not a priority in terms of the sales and distribution aspect of the partnership.
Okay. Lastly, Sanofi has kind of stopped the R&D on the diabetes segment for a long time before. I just wonder if at some point of time, if they want to diversify the portfolio, will Emcure be interested to acquire those brands?
Yeah. Sanofi and Vaidyanathan.
Oh, that's speculation, we'll see. Of course, having said that, one thing that as far as we are concerned, we want to play a bigger role in metabolics. To that extent, any opportunity comes our way, we'll be more than happy to look at it favorably.
Okay, sir. Thank you so much.
Thank you. Ladies and gentlemen, anyone who wishes to ask a question may press star and one on their touchscreen telephone. Our next question comes from the line of Rahul Jeewani from IIFL Capital Service Limited. Please go ahead, sir.
Yeah. Thanks for taking my question. Sir, on this domestic business growth of 10.5%, which we have seen during the quarter, can you comment in terms of what was the organic growth for the portfolio excluding the Sanofi oral antidiabetes brands?
Yeah. Except that, it will have been at 8.5-9%.
Okay. Sure. This quarter, you would have seen the, let's say, contribution from that diabetes portfolio to the extent of two months?
Yeah. Roughly about one and a half months.
One and a half months.
Okay. Sure, sir. And so 8-8.5% growth on the organic side?
Yes.
Sure, sir. Sir, obviously, last year or let's say last few years, we got impacted in terms of organic growth in the India business because of patent expiry for HCM. Now, given that HCM patent expiry is also in the base, when do you think that this organic growth for us, let's say, starts moving to a double-digit kind of a number?
If you look at last quarter, we were at, in Q1, we were at the double digit. I think last quarter, as you have noticed, across the industry, there was some impact that we had because of the GST changes. I think going forward, we should be at that double-digit growth level.
I think what we've continued to guide is that organically, we would look to be at industry growth rate plus 100-200 basis points.
Okay. Sure, sir. And sir, on the Semaglutide opportunity, can you also talk about the manufacturing strategy for the product? I would assume that till the patent expiry, you might be importing the product into India. Once the patent goes off, is there an option to manufacture the product locally here in India?
In fact, this is their global product. They will continue to be importing the product for us to market and distribute in India and no plans to locally manufacture. In fact, obviously, having the global product for access to the Indian market, we think is going to be a huge benefit in terms of giving access to patients to a product that has, like the CEO said, been used by millions of patients worldwide, the exact product.
Okay. Sure, sir. Those were the two questions from my side. Thank you.
Thank you. Ladies and gentlemen, gentle reminder, anyone who wishes to ask a question may press star and one on their touchscreen telephone. Our next question comes from the line of Gagan Thareja from Groww Mutual Fund. Please go ahead.
Yes. Good afternoon. I hope I'm okay.
You're audible. However, your voice is low.
Okay. All right. So the first question is on Semaglutide. I think in the past, you indicated you are vertically integrated and you want to get into the Indian market for Semaglutide. So while the deal is for one segment of Semaglutide brand and prescriptions, would you be launching your own generic version of Ozempic in the market in India?
No. For the Indian market, I think while we were pursuing our own development, I think in light of this deal, which we believe for Emcure, partnering with Novo is a much more lucrative opportunity to really grab market share and shape the market. For the Indian context, basically, we'll be relying on our deal with Novo for promoting this second brand of Sema.
Okay. The Zuventus balance share that you acquired, will it be effective from the coming quarter? Will it basically show up in the minority interest being reduced?
That's correct. In fact, it was completely completed in the first week of October itself. You will get the benefit of that for pretty much the entire quarter going forward.
Right. On the ROW piece, while this quarter, you indicated ARV-related sales perhaps were not very strong and the sales were driven by excess ARV. How do you see the balance of the year for both ROW, Europe and Canada, if you could give some idea?
Europe and India, I think, is being good pressure out there. So, unquote, as I said, we should get in all the markets in the second half of the year. We expect to continue doing well there. Similarly, Canada, I think, continues to grow at teams for us, and we do not see any trend there. I think on the rest of the world, especially the ARV, there is lumpiness in quarters that we see. What we have, I think, Ali also mentioned, is that we have a good, healthy order book, so we have quite good visibility for the current year and even a large part of next year out there. Yeah.
Non-ARV continues to grow faster than ARV.
Non-ARV continues to grow much better than the ARV. On the back of what I would say, of course, we are getting from the various regulatory agencies.
Right. And the final one on the operating margins, while there's an improvement year- on- year adjusted for FX, as you've yourself shown in your numbers, it's around 20 basis points. While the full-year guidance is around 150 basis points, I think on one edge, we would have improved, but not to that extent. Is it then reasonable to infer that second half operating margins year- on- year improvement would be substantial? Second half last year, I think, was relatively weaker than first half.
Yes, that is correct. I think given some of the launches and what we're seeing in the domestic side, we do expect the second half to be much better versus last year, what we saw.
Okay. Thank you.
Thank you. Our next question comes from the line of Alankar Garude from Kotak Institutional Equities. Please go ahead, sir.
Hi. Thank you for the follow-up. Sir, on Amphotericin, the virtual markets, have we launched in Europe currently, and which are the other markets you are looking to add by the end of this fiscal?
We've launched it in Italy at present. The launch will be probably later during this quarter. Italy is where we've launched the product right now. U.K., we launched last year. I think in the other European countries, Italy, we have recently launched. And some.
We should have launches in some of the other Western European countries like France, Germany, in the remaining part of this financial year.
Okay. U.K. and Italy is done, and then the others will be in the second half.
The U.K. was launched last year, and the others will be in the second half of the year.
Yeah. Okay. The second one is, can you just take us through the progress of T enecteplase for the stroke indication across markets? How's the acceptance being? Maybe if you can talk about India as well. However, being the registrations ongoing, is there any resistance to the acceptance of this product or any highlights there? When should we see a meaningful upside from the stroke indication for Emcure across markets?
Yeah. In India, I think the acceptance is pretty strong. In terms of the other markets, the focus is more on the myocardial infarction indication. There are a few markets in which we have got some doctor-initiated demand without registration for the stroke indication. From whatever we have heard from those case studies, the results are positive, which is now becoming a little bit of a precursor for formally initiating the registration process in those countries as well. Currently, most of the approvals that we are getting in the emerging markets is for the original myocardial infarction.
Understood. Yeah. I think that's it from my side. Thank you.
Thank you. Ladies and gentlemen, anyone who wishes to ask a question may press star and one on their touchscreen telephone. Our next question comes from the line of Bhavish, an individual investor. Please go ahead.
Good afternoon, team. All my questions have been answered. Just wanted to thank Satish Ji and his Derma team for an upgraded line of the Derma product, especially the Urea Dump, which I tried recently, and it's an amazing product. The packaging itself is quite premium, perfectly targeting the Gen Z. Quite thankful for it. That's it from my side, and all the best.
That's great to hear and appreciate the compliments. In fact, it's a Canadian product, and we are very excited about the launch and the repackaging, and I'm glad to hear that you're having a good experience with it.
Thank you. Gentle reminder, ladies and gentlemen, anyone who wishes to ask a question may press star and one on their touchscreen telephone. We will wait for a moment while the question queue assembles. Ladies and gentlemen, since there are no further questions from the participants, I now hand the conference over to Mr. Piyush Nahar for the closing comments. Thank you, and over to you, sir.
Thank you. Thank you all for joining today's investor call. If any of your queries still remain unanswered, please feel free to get in touch with us. Thank you.
Thank you, sir. Ladies and gentlemen, on behalf of Emcure Pharmaceuticals Limited, that concludes this conference. Thank you for joining us, and you may now disconnect your lines.