Q3 20/21

Feb 5, 2021

Quarterly report

Good day and welcome to the Itcall about Greece Q3 FY21 Earnings Conference Call hosted by Dam Capital Advisors Limited. As a reminder, all participant lines will be in the listen only mode I would now like to hand the conference over to Mr. Nitin Agarwal from DAMP Capital Advisors. Thank you and over to you, sir. Thanks, Janice. Good morning, everyone. A very warm welcome to one earnings call hosted by Dan Kapoorweiler. From the Avtar management, we have today Mr. A. K. Jain, Joint Managing Director and Mr. Harish Kama, Senior Corporate Counsel. I'll hand over Mr. Jain to make some opening comments and then we will now open the floor for question and answer. Please go ahead, sir. Thanks, Nikin. Good morning, Paul, and thanks for taking our time and joining us on Q3 FY twenty twenty one Earnings Call. Today's phone call and discussions and answers given may include some forward looking statements based on current business expectations that must be viewed in conjunction with the risks that our business faces. Our actual future financial performance may differ from what they projected and purchased. You may use your own judgment on the information given during the conference. I'd like to inform you that the company's business and financial performance in Q3 FY21 has been strong despite the same times on account of global COVID pandemic. We have used our integrated business capabilities to in the prevalence of our global drug foundations and API business. Business and margin growth in Q3 FY 'twenty one in comparison with Q3 FY 'twenty are largely driven by domestic formulation business and had a revival in this quarter. We recorded an 8% business growth for the domestic formulation business. The business of anti malarial wear anti bacterial co CD assessment continued to show decline. Growth. Are now found positive in Q3 quarter. The reduced selling costs and marketing costs as well in margin expansion, API businesses continued to record an overall 33% business has been done. Institutional business for the top nine months of financial year has been around $3.00 9 crores, as of this 136 crores in our financial year. It has exited in fact our annual projection for the full of the financial year. The upside, these are side based on exchange are set off offset by the NEIS benefits are now not available. In the NEIS, we need to get around 12 kilos of NEIS benefits per quarter. So that income is not there right now. And rodebt rates are assumed to be announced. There are material costs and certain key ingredients and availability to distributors that also some impact during the quarter. The higher cost of freight almost by around 30%, thirty five % that has gone up also impacting the overall margin. So overall, the EBITDA installed out all that is consolidated around 26.98% as a result, 24.6% in last financial year, increase of almost around 3.5%. Thank you very much. Ladies and gentlemen, we will now begin the question and answer session. The first question is from the line of Siong Mukherjee from Nomura. Please go ahead. Thank you. Siong, just your comments on the margins, particularly the raw material price and freight prices going up. I mean, can you comment on the outlook on this? Is this something which has happened through the quarter and we have even higher impact in 4Q going forward? Any color if you can give how the trend is evolving with respect to these costs? I'll just read it the phase because of sudden the student has also during the Least Time reference in China largely on the delivery side because of financial debt crisis. So there are certain availability like say, I'd say for example like professional prices used to be R350 rupees a year. Okay. Okay. That's helpful. And so my second question, if you can give some color on the API business, I mean, this year has been very strong. And I mean, is there any component that you can call out, which has driven the numbers? And how should we generally think about it for next year and Q4? API business, during the overall nine months has been very, very strong and largely it has also helped by your Agassi Clarity and Southern Clarity related business of Sony. So that exception was actually there during this period. And overall, company as a whole, I think in first quarter we did a lot around exceptional business of around 3,000,060 crores or so. And some businesses that nature continues, but maybe broadly maybe up to now maybe around exceptional business maybe around 3,000,050 crores, This I'm taking put together and not API, it's all foundations and API management put together, domestic tender and management. So that has been the exceptional business. But otherwise, let's say, high capacity utilization and overall the business penetration has been good for us and I hope that our patent business has done very well and continues to do well. So that will certainly help the overall This is knowing exceptional business, I know that Q1 was very strong, but just for this quarter, you mentioned about the institution business where you have a INR 34 crores income there. Any other which you think is exceptional or rather COVID related which is there in this? Nothing right rather than that. And just one more thing if I can, so the chart ons, it's still holding on. I mean, what is the how has it trended through the quarters and how are we now in chart on some of the pricing volume, if you can close some light? And how large it is in our overall theme of things in API, sir? One of the key initiatives which is used in all patents are just starting materials. They are priced and that has come down to half the level. And that is also resulting in overall reduction in the patent prices in the market because whatever cost reduction is received by companies that is being passed into the consumer, to the customers. So that's mainly right. The overall price trend is down because of the significant reduction in the earnings impact. So that's the overall change impact. Okay. But now you'd say it is stable, sir, if intermediate prices are now stable? Now intermediate prices are stable, yes. Okay. Thank you, The next question is from the line of Venkian Tanay from HSBC. Please go ahead. Hello. Hi. This is Vamianti. Thank you for the opportunity. So my question is on the export formation business. On the unique side, we continue to see good momentum. So can you update us on recovery on the nuclear release? And on the direct promotional market, why we are seeing a big softer trend? What are the things to use Other markets like Australia and New Zealand has also grown by 13%. Canada has grown by 37%. And there is some reduction in the business on account of South Africa there. Last year there was some kind of tender award and all that They are yet to decide in this year. So that business is little lower by from Crores last year to around Crores, Crores, Crores, so there is some reduction. So overall, Genet business has run by around 13% for the purpose of that. And put together with the institutions, it's almost around 39% growth profile. As far as your branded promotional businesses are concerned, let's say your CRS found market more particularly Russia was impacted by COVID. And you'll recall that in softwaddle, we had a significant amount of shipments which were to go in March and subsequently back end. There are the COVID uptick in that market was distributed was less because of COVID. So in second quarter, shipment significantly reduced in CIRS and we further reduced the shipment in this quarter. I think Q3 last year was almost around 62 crores of shipment. This year in Q3 we have done a very minimum shipment of almost around 16 crores. So that has impacted because of COVID and we have shifted the inventories in that market. We saw it likely that overall branded commercial business, full of the year to be mature around 10% kind of vessel business in Magnaust Africa, your West Africa, all that are doing very well. I think West Africa is growing by 20%. Your Middle East Africa is growing by around 46. Asia is more or less at the same level at the last year's level. And Latin America is more or less about 5% to 6% decline in there. That's likely to get covered up in the first quarter of the currency. So that's only the PIS where the COVID impact was very high. So this year, I guess, was another one from our first quarter of Mexico onwards. Business growth now is very good. Overall, it started returning to margins. Whatever shipments are made in the which were planned in the month of March, they were because of lockdown, all that happened in first quarter. So that time shipments were very high. On the front, 70 crore shipment and they are fixed. And those inventory remained in the system and because of COVID. And in this quarter, we have completely controlled the overall inventories on that market. Okay. That's helpful. So following the delays part, so you mentioned pickup has been good across market. So I'll just quickly ask you how has it been picked up on the equity market in last quarter? That is not. Okay. My second question is, can you provide us update on some of the key CapEx from the Vodvar? So how are things moving up on the CapEx front? On CapEx side, the major one API plant we are further constructing at Epsilon and that project is going very well. There are some delays because of again COVID because of your civil construction part, all machines are all landed at the plant. And probably in the month of March, we will start overall commissioning work and by May or so the flat will be completely ready for the renovations and all. So maybe since the second quarter of the year where we will start the commercial production plan. That's That's one. So that's the one. And I think overall that investment year round and it's clear there. But as the last plant is concerned, we have already started the Civil West, the three plants there. And September, October, the entire installation should be over and by March of next financial year, the plant should be ready for the implementation. So these are the three projects currently happening. In addition to that, we have done some kind of one tentative plant at the leading some immediate pricing setup at Rangabang. That giant is still be commissioned and I'd say because of again because of COVID, a lot of installations, deliveries of equipment were delayed and now there was a effort in there maybe around the second quarter of the year, but significantly delayed in that. And now the plant is commissioned and working well now. And we will looking at maybe at item one more month's results, we will further set up another plant there at all maybe around 50 times such as still up for a change in that net 30% to the next financial. Okay. And so budget for next quarter, earlier you indicated 300 to $3.50 crores. That was your case or you have planted greens? Lovely, the capacity is going to remain in that range. Okay, sir. That's helpful. I'll get back in the queue. Thank you for your response. Thank you. The next question is from the line of Abdul Pranwala from Anand Ravi. Please go ahead. Hi. Thank you for the opportunity. So my first question is with relation to the India business. So any color you'd like to call back to how would the growth outlook for FY 2022? And how do we see this promotional cost panning out in the next six to eight months or whether it would be scaled up to the previous level or maybe some cost savings which would be possible considering we would be moving to the calendar still anything as well? Ladies and gentlemen, we just lost the amount for the management requesting you all to please stay on line while we disconnect the management back to the call. Thank you. Ladies and gentlemen, thank you for patiently holding. We have the management reconnected. So the question is the line of Mr. Abdul Uranwalap. You may please go ahead. So, Shailesh, repeat my question. Oh, no, I didn't hear you. Yeah. So my question was with regards to the India business. First of all, you would like to know what will be the growth outlook for FY '20 '20? And the second part of the question was in relation to the promotional cost for which as you mentioned in the opening remarks there was some benefits seen in the quarter as well. So going ahead, how do we see this cost rising up? Would it be back to the pre COVID levels or there might be some cost savings which will be possible? Okay. Since I'm normalizing in the year and if the second wave of COVID doesn't happen, we should record almost around 13% to 17% kind of growth in the rest of market in next financial year. And the business will then be accelerating online. As far as cost is concerned, there will be some amount of savings will continue on account of whatever this continuous medical education and conferences part of the company. Those activities will continue to be on electronic mode and it's actually the medical professions and companies are realizing the benefit of that the travel, I think, the amount of time and the kind of conferences to save their time because they can participate taking from their clinics or whatever it is. So those kind of costs will have a significant reduction, but all of the costs may get us start to get normalized in the next financial year. The travel cost, both international and domestic in this year was like high end, I think payroll we mix, I said, Amnestrant and Hikari in the context based on that level. Once things get normalized, there is no substitute for travel because but it may not have something that an extent. Some cost reductions compared to the 05/20 will continue to be there, but the cost definitely will be lower. Lower. And then the second question is with regards to the API business and just your follow-up on the figures. Before, I mean, I have to understand on the strategy. When what will be the current capacity and what will be your operating? Would that be sufficient to drive the growth guiding in the last one call as well? So will that be still be achievable in effect in the queue? So let's say, assuming the exceptional business that we have done, that kind of growth is possible and absolutely there are no reason that why it should not be there. So we are continuing to have that kind of growth, but certainly we are done, those business might not be there in next financial year. So overall growth depends on that we are continuously de optimizing and creating capacities within the existing infrastructure and also now started settling at the Plumban plant is under setting up right now, construction and now. And two plants here at Dewar. So hopefully next year additional capacity will also be there. So that will drive us overall future growth in the coming years. Yes, sir. That will be all for me. Thank you for answering my question. Thank you. The next question is from the line of Kanal from MK Global. Please go ahead. Thank you for taking my question. So the first question is on the one last segment that we have done in this year till now. So we are very pleased with peak growth. So if I recollected, I think So, also, more relating to the CQH news which are there in COVID and also chloroquine news in COVID and initial period. So in those businesses, both APIs are there and also formulation businesses are also there as well. And lastly, what we had, we had given I think in first quarter almost around $2.60 crores number. That was exceptional. And in that part, we are not busy and this CIS business is exceptional because those shipments just shifted here and there, that's the normal business model. So only the business only relating to chloroquine and hydroxychloroquine, whatever we have done. Additional business on the conduct of COVID, that is the number which I have given that I have seen now, it's almost around $3.56 crores. Okay. So that's the value of API. It's also there of domination. It's also there of domestic sector and all that. Yes. The Foundations in general, it's foundations, it fails everywhere. So that's the overall addition of it. Yes, but now that we are seeing that the API within that, also we have started a certain safety has kind of deflated significantly. So just want to understand what would be a good success rate to be made next year. So overall, we are a budget charmed Okay. And second on the next slide, so how much next revenue will be very less and will be done way there for us when we are expecting to a non unreasonable? I think we have around, I guess, now around INR $3.60 crores in the net credit available. As of which I think in current financial year we'll be using around 100 crores. And next year some benefit on account of this 15 plants will go away. So next year we may be utilizing almost around 160 crores or calculations as well. So thereafter there will be ideally max credit that may be around the kind of net credit in that side, so we will decide which is what's up quickly beneficial in that side. Okay. And then the last question, Ethan, I think I mixed some of your starting some end some sort of time there. But can you just say quantify what will be the effect of any IS and then the mix shift towards the institutional business because we are doing exceptional business there. And is there any pressure in our core business? What would be the sustainable gross margin level that we should start kind of this segment? I think overall gross margin levels, material cost ratio will be almost around 31% or so practically in the next financial year also. The next question is from the line of Gerard Padel from Adrienne Machej. Please go ahead. As there is no response from the current participant, We proceed to the next question from Zena Deshpadak from Golubzak. I think Q4 will be quite a bit growth rate because it's a low base and later date growth has not been there. So is that a current time? Yes. So, for the Q4 domestic business also, if you can give some guidance, I think last quarter's call, you have mentioned that we might see local growth, I think, is that possible in Q2? I think overall this quarter we have achieved around 8% kind of growth and some of the businesses have now started the same growth. There is also the businesses that we have suffered from the the growth can be around 8% to 10% in third quarter. And next financial year, it could be around 13% to 13%. Okay. Just to confirm the CapEx number, so if you are a plant CapEx is 100 crores, which we'll commission in Q3 and the device was a 300 crores CapEx, which we'll commission in Q4 of FY 'twenty two. Yes, but some of the expenditure will be done with the civil constructions in Malawi then. Right, right. The next question is from the line of Suri Patra from Delek Capital. Just on the expansion, you can want to protect whether Right now, what we are talking in terms of broadly, let's say, Germany and sports is because Germany will also have an intermediate side. And it's related by the right now so only one small plant on piloting from 10 ton basis, 10 ton plant we have picked up at Ndala. That is a position I will be showing a good results now. Based on whatever learnings that we have, we will be setting up another plant in next and then software will shut and ground. So maybe very large, a small amount of CapEx may happen in the next financial year. Maybe we'll happen year thereafter to set up the and there the major integration for the gateway side will progress. Okay. And did you basically expect that the trade, are you seeing the rate of deceleration? Okay. We don't sell KSNs. KSNs' cell numbers are not there. And by and large, the KSNs are our main products, major products we produce ourselves. Returns are from R and D. So something we record, but I can't say definitely when that will come. It's there closed. Thank you. Before we take the next question, a reminder to the participants, please limit your question to two for participants only. The next question is from the line of Roshni Sanjayati from INGRED Research. Please go ahead. Yes. Thanks for the opportunity. So just on institutional business, if you can share that this exceptional income is related to which products and which tenders, this in time ex exceptional business currently which are the products on injectables and the tablets which we are supplying and which tenders? Binance, this is an anti material business, largely anti material business that we are doing. And that's basically your I think it's a little painting, it's in the two forms are there, one is the conventional and also in the there are three products there in the RLE pipelines and some of the buyers are cleared and then the links will happen in next year. That will also add to the overall to the Bastrop which is not currently in the production for a slightly less. So these are the three products which are there on the middle and major businesses. I saw that almost around 95% of institutional businesses are SMM on these three products. Okay. And so And by and large, this business is of three types. One is a global fund related business. Another is related to U. S. Donations to the level developing the world mainly Africa and other countries. And third is relating to country tenders. And normally we don't give bifurcations that they are not looking to start working. But we have competitors also, we have businesses relating to global fund and we have relations to the other African market. So all the three fit together the businesses. Only out of the retail businesses, almost around INR 3.9 crores what we have done in the current financial year, only INR 33 crores of business, which is not out of these three products, but again of MD Malerian product is done in this quarter and that is exceptional business, one time business and that's why I said that that is a purely fairly exceptional business. Nothing to be with these three products because Okay, sir. And sir, on your subsidiary sales, this quarter after three muted quarters, we have given a strong growth. So this activity is leading that growth and what is happening on the bottom line of all the subsidiaries, if you can give a little picture on it? I see. So, really, while we have measured 1,000,000 of almost around INR 17 crores, INR 18 crores overall profit in the current year. Then we have acquired a front end in U. S. Called this year and that is by and large because we don't we are not there currently in US, our operations are not getting sold. So basically they do some kind of trading of some tie up with third parties and their products are being sold. And there this quarter the profit has been very good, almost around I think 19 core of profit generation. Overall for plus nine months, there is a six core of profit, there are some large loss there as well. So overall, that's better. Apart from that, we have another facility called PIXGRAP and that's for the overall for API type. And that subsidy has given the losses and because of the continuing FE issues and all, we are not able to commercialize those APIs and then continue with that. So once the integrations in the AirPods, I think that's absolutely we expect that maybe current year and next financial year they may continue to incur the losses, but thereafter it start making money. So these are the major three subsidiaries. Other than that is we have associate company called Traffic Wellness, best marketing the nutraaceuticals in India and we have around, I think, 20% shareholding in that company. And that company is doing very well. They are generating almost around this year, they will generate almost around INR 100 crores kind of business and overall profit after tax of almost around INR 20 crores. So I'm doing very well at the marketplace and business is also growing very good. And apart from that, we have Kratz as another associate where some kind of fermentations and some synthetic products are there. That company currently is in losses, but hopefully we should turn it around in the next financial year. Okay, sir. Thank you. That's it from my side and wish you all the best. Thank you. Reminder to the participants again, please limit your question to two per participant only. The next question is from the line of Rahul Sharma from Cardway Capital. Please go ahead. I just wanted clarity on any update on the U. S. FDA inspection of our plants? We are in touch with them. Whatever required by them is being supplied and I think because of COVID, they are not able to do the reinspection. I think we had normalized the inspections would happen. Beyond that, we can't say because when and how and how long it will take is difficult to answer. So, Anant Singh, could you share the numbers of branded and generics region wise, sir, for three months and nine months? Overall, I think on Q3, we had done around INR 77.5 crores of promotional business as against 112.98 crores last year. Out of it, I think CS business was around 15.85 crores. Southeast Asia was almost 15 crores. Middle East Africa was 12.5 crores. Then Latin America was 10.3 crores. West Africa was almost around 24 crores. So that's the broad break up there of that. And in generic business, EU, we had done around 113 crores as against 75 crores in last year. Austria, New Zealand is 52 crores as against INR 46 crores last year. And Canada, we have done almost around INR 45 crores as against INR 26 crores in last financial year. South Africa, the business around INR 16.5 crores as against INR 43 crores in last financial year in Q3. So that's the Q3 breakup overall of that. So how much you did for Southeast Asia? I wish that number in promotional markets. Southeast Asia is around INR 15 crores. Last year was also 15 crores, so more or less same number. Okay. And 10.3 crores over Middle East? Latin America. Latin America is 10.3 crores and last year was also close to 10. So maybe around 3% growth is there. Okay, sir. Are you seeing some recovery in the CIS space now, sir? Yes, business is good currently. The whole situation is in control there and business has again started revising there. And in order to control inventory, we have not done much of shipment in Q3. I think Q4 since we have much head rate business is almost around 167 crores, last year we did. And so two months practically, the inventories are controlled there and hopefully the fourth quarter will be again a normal quarter. Thank you. Thank you. The next question is from the line of Kati Ratty from Perpetuity Investment. Please go ahead. Hi. Thanks for taking my question. Can you share what is the net cash number as of December? I think overall, I think cash holding as of now is almost around INR $8.50 crores. Okay. And my second question is that in our domestic business, Zerodol brand, which includes Zerodol CSP is a pretty significant size. So how is the growth in FY 2021? And how are we seeing that brand in the next two, three years? Actually, we don't give brand wise number. I have broadly given you a number of pain management. But we had done almost around $2.66 crores of pain management business as against $2.29 crores. So in Q3, we had grown by almost around 16% on pain management. So pain management continue to do well and hopefully next year also it will continue to it will have almost around 20% kind of growth in pain. Paint. Paint will continue to be significantly driving the world. The next question is from the line of Sameer Asiwala from Morgan Stanley. Please go ahead. Thank you. Good morning, everyone. Most of my questions were answered, a couple of them. So one is, what's the margin outlook for next two to five quarters as we go forward? So currently we've done lot of exceptional business, so margin levels are high. But overall we share 25% to 26% kind of EBITDA margins are maintainable kind of thing next year also. Okay. And second is on this China plus one strategy or other trend. So are you seeing this on the ground or this is a bit more in terms of sentiments, etcetera, but not on the ground? And second to that is, do you expect Chinese companies to fight back at some point in time, drop prices? So some real anecdotes or some insights from you would be great. I think that's happening at marketplace. People are definitely looking at to broaden their overall supply chain to add some kind of more so that their business doesn't get disturbed. But currently, we are not there in U. S. And therefore that advantage to us has not come to a great extent. In Europe, anyway, we were doing business. Part of our business is distributed across geographies, except zero business in U. S. So it's medically Latin we have business. We have business in Africa. We have started doing good business in China of API and Chinese business of ours will have particularly significant growth in next two, three years. So currently, I think we did almost Q3 around 25 crores. It now become almost around 100 crores in next two years or so. So that's the kind of prospect also there in China. So overall, it's a broad business we have in Africa or that's not happening in CIS, that's not happening to that extent in LATAM. We are not right now we are in our business. So we have not got that kind of advantage of that. But yes, for industry that's happening. Okay, great. Thank you very much. Thank you. The next question is from the line of Suresh Pathak from Goldman Sachs. Please go ahead. Thank you. What was the NEIS reduction this quarter? Overall, around INR 12 crores last year we got an increase higher business which could have been more. And from second quarter, I fell because government is not disturbing disbusting the NEIS in current year till now, they have not started even though it was there for up to certain period. But so we have not made provision in books. We will make whatever any IS which will receive, actually receive that will be provided because lot of uncertainties are there. They have yet not opened their BGS peers yet not opened their window to file the application. So in this Q3, there is no NEIS income recorded and in Q3 of this year, there was 12 crores. Is that correct? Q2 also, we are not provided for in books. Q2 also, there was nothing. Okay. But this quarter impact is almost around 12 crores. Crores. What is the base quarter last year? Yes, compared to this. Last year, it was almost around 12 crores. Okay. So then, actually, in the past year? We will get certain NAS once the government opens because Q2 also there are some NAS view. But as and when it will come, we will recognize as income. So right now they have not even opened the window. Okay. So just to understand the reduction gross margin sequentially from Q2 of FY 2021 to Q3, so one is the mix which is the higher tender business. The other is you said some higher raw material and sales and prices, but it is not to do with NEIS. It is those two effects. NEIS was also there in the part because 12 crores is not there. But let's say we were holding certain intermediates of certain that are higher prices because prices has come down, whereas the market prices are corrected. So those higher rate inputs are consumed in this quarter. So that's why the overall margin levels are low plus certain products like say normal products like perhaps some also from $3.50 level, it has almost gone to around 600, 5 50 to 600 level. That's the pricing currently present. Certain intermediates because of again winters and China, certain disturbances are there because certain chlorination compounds and all that they produce less in this and more go for the pesticide industry rather than for intermediates for pharma because there may be so those disturbances are there and maybe let's say you are to get those intermediate by air and additional costs and all. So those are the some disturbances are there at market. Even there are some disturbances also because of China, because certain PNCB production is disturbed. And but they say it's a quarter's impact. It's not by first quarter of the even in the end Q4 also it will start getting normal. And so on that realized scheme, which was also related to the paracetamol intermediate, Have you I think you had applied for some, I don't know whether you applied for that or not. Can you just give me update on the GLI scheme if you applied for anything on the other one? We have made two applications for Saturns only and for which for one, they have asked your plant is already under construction and one we have applied for our Gujarat plant, Vanu plant. So there are two applications made and they are only for certain. We have not made any application for Pera or others. So that's not our line of view. Understood. So when you're saying raw material cost could be 31%, so gross margin guidance of 59%, so that is much higher. So that is based on the backward integration and that you're doing and what is the consequence on that gross margin guidance? Basically, what will happen that your domestic business where we have higher margins, branded business where we have higher margins, those all business will start becoming normalized in the next year. So we get some sort of higher margins and there are some costs will also move up. So taking everything into account, it's a broad number and I think our budgeting exercise is currently going on. So maybe fourth quarter we will give you the exact guidelines for everything in terms of growth outlook, in terms of margins and everything. Okay, sir. Thank you. Thank you. The next question is from the line of Surya Bhatra from Philip Capital. Please go ahead. Yes. Thanks for the follow-up. I just wanted to Yes. You are not audible too, yes. Okay. Is it audible, sir? Yes. Now it is better, yes. About the Noble, it's working the capacity additions what we are planning. So whether it would be a kind of phase by phase multiple unit kind of restriction that we need. Yes, Jain has already explained, this land parcel what we got because of this NCLT order, we will be using for manufacturing intermediates, correct? Correct. Currently, our environmental applications are in the stage of being processed. It will take certain time. So any investment in this facility will happen in the later half of the next financial year. So it is only for we will be initially using that land parcel only for manufacturing intermediates. Subject to necessary environmental clearances. That would be multiple unit kind of setup or it would be Yes, every APA intermediate facility, it will be all multiple unit type. Okay, okay. Fine. For example, in Vatlam, we had about 25 plus APA manufacturing blocks. We call it manufacturing blocks. Okay, okay. Fine. My second question is, just can you provide some update on the PLA thing? Mr. Jain has already said that we have made application for two products. So far there is no outcome of that. Maybe by end of this month, something will come. Okay. Okay. Yes. Yes. Thank you, sir. Yes. Thank you, Sotepa. Thank you. Well, ladies and gentlemen, that was the last question for today. I would now like to hand the conference back to the management for their closing comments. Over to you all. Thank you all for participating and I think that overall COVID situation being in control since domestic and branded markets will again start reviving. And hopefully, I think as COVID situation gets normalized, our inspection should happen and that will further open up our future years' business. Thank you. Thank you. On behalf of DAMP Capital Advisors, we conclude today's conference. Thank you all for joining. You may now disconnect your lines.