Ladies and gentlemen, good day and welcome to Jubilant Ingrevia's Q4 and FY 2026 earnings conference call. As a reminder, all participant lines will be in the listen only mode, and there'll be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during this conference call, please signal an operator by pressing star then zero on your touchtone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Pavleen Taneja, Head of Investor Relations at Jubilant Ingrevia Limited. Thank you, and over to you, sir.
Thank you, Anil. Good evening, everyone. Thank you for joining the fourth quarter financial year 2026 earnings conference call of Jubilant Ingrevia Limited. I would like to remind you that some of the statements made on the call today could be forward-looking in nature, and a detailed disclaimer in this regard has been included in the press release and results presentation that has been shared on our website. On the call today, we have Mr. Shyam Bhartia, Chairman, Mr. Deepak Jain, CEO and Managing Director.
Sir, sorry to interrupt you. Sir, may I request to come a little closer towards the speaker and talk?
On the call today, we have Mr. Shyam Bhartia, Chairman, Mr. Deepak Jain, CEO and Managing Director, and Mr. Varun Gupta, CFO, Jubilant Ingrevia Limited. I now invite Mr. Shyam Bhartia to share his comments.
Thank you, Pavleen. A very good evening to all of you. We are pleased to report a healthy performance in Q4 and FY 2026. We had the highest quarterly revenue and EBITDA in Q4 FY 2026 when compared with last 14 quarters, with healthy double-digit growth in both top line and bottom line, reflecting our strong execution. Specialty chemicals had the best quarterly revenue at INR 516 crores. A key highlight for the quarter was our effective handling of the Middle East crisis with no force majeure and zero production loss. The other highlights include successful dispatch of our newly constructed agro CDMO facility and the acquisition of Remidex to accelerate the growth of our human nutrition business.
The board has recommended a final dividend of INR 2.5 per share, 250%, and taking a total FY 2026 dividend to INR five per share, 500%.
Sir, sorry to interrupt you. We are losing your audio.
With a total cash outflow of INR 79.8 crores. Let me take you through an update on the markets we operate in. Overall, chemical industries demand remains resilient despite Middle East disruptions. Volumes continue to grow while the pricing has firmed up due to higher crude link costs and effective passthrough to customers. Pharmaceuticals continue to anchor growth with strong volumes and consistent demand. Agrochemicals saw strong growth with robust export visibility and successful price increases, especially in second half of the quarter. Nutrition and personal care markets witnessed volume and price-led growth driven by niacinamide with strong demand in feed and cosmetics. Let me share a few details on our future outlook. Early outcomes of our Pinnacle Journey are clearly visible in our performance. With strong EBITDA growth and improving.
Sir, sorry to interrupt you. We are again losing your audio a little bit.
Can you hear us now?
Yes.
Now let me share a few details on our future outlook. Early outcomes of our Pinnacle Journey are clearly visible in our performance with strong EBITDA growth and improving portfolio mix, enhanced customer relationship and a robust opportunity pipeline, more efficient cost structure and balance sheet. With improving volume demand and escalated pricing, we are confident of sustained growth going forward across our segments. For FY 2027, we expect growth to be led by specialty chemicals and nutrition, along with recovery in acetyls. We are expecting a sequential growth in revenue and EBITDA in coming quarters starting from Q1 FY 2027 itself. We continue to invest further in our business. The construction of the Gajraula MPP plant is progressing well. This will further strengthen our CDMO growth roadmap. With this, I hand over to Deepak Jain. Thank you.
Thank you, Chairman. Thank you everyone for joining. We appreciate your participation in the Q4 FY 2026 investor call. Over the past year, we have made a strong progress across all strategic pillars, building long-term growth while managing global challenges effectively. Despite Middle East disruptions impacting supply and prices, our diversified sourcing and agility ensure minimal disruption with effective cost passthroughs. Strong customer engagement and timely renegotiations have strengthened resilience, reflected in improved performance in Q4. Let me first share the overall business update for Q4 and FY 2026. Q4 recorded highest revenue in 14 quarters at INR 1,179 crore, up 12% year-on-year, driven by 10% volume growth. EBITDA stood at INR 172 crores, up 11% year-on-year and 26% quarter-on-quarter. PAT was INR 86 crore, up 17% year-on-year and 84% quarter-on-quarter. Net Debt to EBITDA improved to 0.99x.
Our net debt have reduced by 11% in 2026. In Specialty Chemicals, revenue stood at INR 516 crore, rose 6% year-on-year and 13% quarter-on-quarter. EBITDA stood at INR 139 crore with margins at 27%, which we have maintained for last six quarters. FY 2026 revenues stood at INR 1,937 crore, up 7%. EBITDA stood at INR 510 crore, up 21%. During the quarter, Specialty Chemicals showed strong momentum driven by volume recovery despite stable pricing, with margins rising above 27%, reflecting robust fundamentals and resilience. Our pyridine and derivatives showed strong volume growth. Our fine chemicals and picoline derivatives recorded steady quarter-on-quarter and strong year-on-year growth. Our CDMO business progressed well with higher realizations and commencement of a large agro contract, reflecting a shift towards value-added products.
In Nutrition business, segment's revenue stood at INR 230 crore, up 21% year-on-year and 15% quarter-on-quarter. Segment EBITDA stood at INR 32 crore, up by 42% quarter-on-quarter, and margin stood at 14%. FY 2026 revenue stood at INR 790 crore and EBITDA at INR 100 crore. In our Nutrition and Health Solution business, we witnessed a strong recovery during the quarter, with growth driven predominantly by volume across segments. Growth was led by niacinamide, supported by cosmetic demand. Choline health also improved with surge in exports in Europe. We completed acquisition of Remidex Pharma, expanding presence in human nutrition and premix solutions. In Chemical Intermediate business, revenue stood at INR 433 crore, up 15% year-on-year and 10% quarter-on-quarter. Segment EBITDA improvement supported by cost passthrough.
In our Chemical Intermediate business, domestic volumes improved on the back of strong agrochemical and paracetamol demand. We remain optimistic about recovery supported by European force majeure events and plant closures. While Middle East disruptions firm up input costs, rising acetic acid prices have set the stage for a favorable pricing outlook for the segment going forward. Let me just give a quick update on Pinnacle journey as well. We launched our Pinnacle journey almost two years back. I'm glad to share that we have made significant progress across all pillars of the journey, leading to the creation of a strong foundation for future growth. A few highlights. Number one, across businesses, we delivered strong volume growth. Nutrition saw highest B3 volumes in eight quarters and steady choline growth.
Acetyls improved volumes and pricing with market share gains in Europe. Specialty continued momentum in pyridine, fine chemicals and CDMO shipments. Number two, driven by our customer-centric approach, we now have 100-plus opportunities with almost INR 3,500 crore potential, with 20-plus confirmed molecules and additional pipeline of 10-plus advanced stage molecules, which have peak potential of INR 1,100 crore. From an operations and ESG perspective, we achieved INR 120 crore lean savings and glad to share that we achieved 97th percentile in S&P Global CSA ranking. We also successfully commissioned Bharuch CDMO plant in record 14 months, reflecting strong execution. award and successful U.S. FDA audit of our Bharuch site are testament to the world-class infrastructure we are creating at our plants.
From a people and organization perspective, we strengthen leadership with key senior hires in almost every department of our organization, such as supply chain, manufacturing, HR, businesses, design and technology, and so on. We transitioned to a vertical structure to drive focused growth across Nutrition, Pharma, Agro, Cosmetics, Industrial and Silicon segments. We invested heavily in our R&D and technical teams in last two years. From an awards and recognition perspective, we were certified as a great place to work and ranked among the top 50 companies in the country in manufacturing sector. We were also recognized with the Golden Peacock Award and a British safety distinction. On the M&A front, we completed the acquisition of Remidex Pharma to strengthen our human nutrition premixes portfolio.
The early results from these initiatives have already started to show in our financial results in the last two years. For instance, our EBITDA has grown by almost 33% in last two years despite tough market demand and declining prices. Our Q4 FY 2026 run rate EBITDA is 70% plus higher than Q4 FY 2024 EBITDA, signaling the pace of improvements we could showcase in last two years. Portfolio mix moving in favor of specialty and nutrition, contributing almost 85% plus of overall EBITDA. Specialty EBITDA almost doubling in last two years. Improved networking capital at 59 days, leading to a more efficient balance sheet and a net debt to EBITDA ratio of 0.99. This strong foundation and early results give us the confidence that our Pinnacle strategy is working well.
FY 2027 is a pivotal year in this journey where we are hoping to accelerate our growth, starting with Q1 FY 2027 itself. We'll now be happy to address any question that you may have.
Thank you very much. We'll now begin with the question and answer session. Anyone who wishes to ask a question may press star and one on their touchtone 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 will wait for a moment while the question queue assembles. Participants you may press star and one to ask the question. First question is from the line of Siddharth Gadekar from Equirus Securities. Please go ahead.
Hi, sir. First question is on the chemical intermediates business. How should one think about the spread in 1Q, given that we have seen a very sharp improvement in both ethyl acetate and acetic anhydride spreads globally. Beyond 1Q also, how should we think, given that now We have entered into a falling environment, should we expect an inventory also beyond 1Q?
That's a good question, Siddharth. As I think most of us have seen different cycles in the acetyls business, particularly in acetic anhydride. You're absolutely right. When the war began in late February, we saw a sudden escalation in the raw material prices. Given our typical approach of having raw material inventory and locking in the raw material at the right price at the right time in an agile way, we started to see some benefits of that coming in last quarter itself, as reflected in the acetyls business results for Q4 FY 2026. We are hopeful that those benefits will continue in Q1 as well in a strong way. Besides that, a lot depends on what happens to pricing in coming months.
You rightly said, we are already seeing acetic acid prices coming down. We have been very thoughtful in the way we have purchased inventory and the kind of stocks we maintained when the prices were at their peak. We are hopeful that whatever inventory impact has to come, we'll be able to nullify within this quarter or at best in the early part of next quarter, and hence minimize any negative impact coming from that in Q2.
Okay. That is very helpful. Secondly, on the CDMO business. What was our revenue from CDMO for FY 2026? The entire was classified under specialty chemicals, or there was some part of it in the nutrition business also?
No. Our CDMO business currently, all the revenues are recognized within the specialty business itself. As I have mentioned in the past also, our business, we never disclose the exact number or exact size of the CDMO business, but it has been growing very healthy, at a very healthy rate, almost 30%-40% every year. Even last year, we have seen that kind of growth. With the advent of some of the big contracts and other opportunities that we have won, we are hoping it will start to accelerate its growth in FY 2027 further.
Given that we have highlighted the number of projects that we are in discussion with, are any projects in the early stage or late stages, and can we expect any closures in FY 2027?
Yeah. I think if you saw our announcement in the investor presentation also, even in the last quarter, we added eight new molecules to the 50-odd molecules that I had announced in the last quarter. Every quarter we are securing new molecules. Of course, not every molecule is a scale molecule or commercialized molecule to start with, and there's a ramp-up period to the scale-up. The full impact of these opportunities will start to reflect in the P&L in coming quarters. To your precise question, yes, we do have couple of late-stage opportunities in the hopper which we are hoping to convert, and particularly one of them is reasonably sized. As and when that gets secured, we will of course come back and announce to the market.
Sir, this last question on the nutrition acquisition. Can you just speak about what benefits could we have from that and what is our strategy going ahead with that acquisition?
Yeah. I think as we announced even in our presentation last year in Investor Day, human nutrition is a vertical which we are trying to create within our broader nutrition vertical. We already have couple of products in our portfolio which go into human nutrition segment, such as vitamin B3 and vitamin B4, which is choline salts. We already have access to all the customers. Our customers have been asking us if we can also start to do premixes and specialty products for them. The idea of acquiring this business is to forward integrate into that segment and leverage both our strength in the straight molecules and the customer relationships that we already have and provide them an integrated solution. The traction that we are getting with the customers is actually quite strong.
Of course, we didn't have the capacity. With this acquisition, we have the capacity as well as some existing customer relationships. That, topped up with the strengths we already have in our nutrition business with all those customer relationships and the molecules, we are hoping we'll be able to scale up that business pretty rapidly.
Okay. Thank you, sir. Thank you so much.
Okay.
Thank you. Next question is from the line of Abhijit Akella from Kotak Securities. Please go ahead.
Yeah, good evening. Thank you so much for taking my questions. First, with regard to the outlook for the sequential growth in EBITDA every quarter going forward, coming year, would it be possible to offer any form of quantification regarding what sort of growth we should expect for the quarter ahead and for the full year ahead?
Yeah, Abhijit. I think we've been pretty consistent in saying that if we take our EBITDA, we aspire to get at least 20% year-on-year growth on EBITDA on the full year basis. I think the challenge in giving quarterly growth rates is because one contract moving up and down by a few weeks can make things look very staggered. That's why we don't give that guidance. We will stick to our overall guidance of achieving at least 20% growth in EBITDA through the year. If you just take a linear trajectory to that, hopefully we'll be able to get that on a quarterly basis as well.
Got it. Thank you. Of these, of the CDMO order book you have assembled now, how much of a contribution should we expect from the $300 million contract in the upcoming year? Also the remaining part of the INR 1,500 crore order book, how should we expect these to contribute during the upcoming year?
I think, see the big contract, and a quick update on that, I think I've been giving it in every investor call. The project actually started in March, as we had promised to all of you, and we started shipping the material also in March, and then currently we are shipping the material to the customer. We are discussing with them about various volume scenarios for rest of the year. Once we have that firm plan with them, we'll be able to give any guidance on that. That does form a main pillar of the overall growth projections for this year, as we have communicated in the past. On your broader question on the pipeline of opportunities, these are opportunities which are in different stages.
Some of them are, let's say, if I take some of the pharma sector opportunities, these are phase II, phase III opportunities. Hence in the beginning, they will be relatively small. As they scale up, as the customers move forward in their overall development journey, we should be able to scale up those products, while some others are to start with will be, let's say, INR 10 crore, INR 20 crore, INR 30 crore kind of opportunities. There's a mixed bag there. As I mentioned, I think in the last investor call also, generally the trend at the overall portfolio level for these new opportunities, what we expect is, in the first year, they give at least 20%-25% of their peak revenue.
By second year, they give 50%-60%, by third year, they give 80% plus revenue. While each opportunity will have its own life cycle, but at a portfolio level also, I think we should be able to mirror that trend to gain incremental growth in our portfolio.
Thank you. That's helpful. Just one last one from my side. The capital work in progress on the balance sheet seems to have come down to about INR 150 crores. In light of that, what is the CapEx number we should work with for fiscal 2027?
Hi, Abhijit. Varun here. See, capital work in progress, it came down because we have capitalized our CDMO plant now in March. To your question, in 2027, as we have indicated earlier, we'll continue with the range of INR 400 crore-INR 500 crore of our yearly CapEx to contin ue to invest behind our growth. A big CapEx is comi ng into Gajraula MPP, which we have announced earlier, which will be finished this year and will commence production in quarter four.
Got it. Yeah. Thank you so much. I'll come back in the queue for any more.
Thank you. Next question is from the line of Harsh Shah from [audio distortion] . Please go ahead.
Yeah, thank you for the opportunity. My question is, under the from here on, we have to achieve the same objectives, that is three times revenue and four times EBITDA, but now in the next four years. What specific growth levers, business drivers, or strategic initiatives gives the management confidence that such aggressive targets are still achievable?
Yeah. That is a good question. Like I said, if I just talk in terms of EBITDA, if we are able to achieve our, let's say, between 20%-25% growth every year, we'll be largely on track. There was some growth we had as sumed coming inorganically in that Pinnacle growth journey as we announced even in our Investor Day. We still feel confident th at by FY 2030, we should be able to take our EBITDA organically to the ranges that we announced in the Investor Day. Obviously one big assumption, which I keep calling out is the pricing, which has surprised all of us. Now with the recent disruptions, we have seen pricing coming back in some segments. We are hopeful that at least part of that will stay.
If that happens, then we feel confident that we should be able to track back on the journey that we have planned and the vision that we have planned at Pinnacle.
Sure. My next question is, the company had signed the $300 million contract during October 2024, while the commercial deliveries have begun just now from March onwards. At the time of signing, the US dollar to INR exchange was at around INR 84 per dollar, whereas the rupee has now depreciated significantly, and it is around INR 96 per dollar. Could the management elaborate on whether the company stands to benefit to higher rupee revenues?
See, that if you've seen on a standalone basis, that I don't think is the right way of looking at it. First of all, you have to appreciate that at an overall company level, we have a huge amount of imports which come in. In fact, our dollar-based import bill is as big as our exports in the last fiscal year. We are naturally hedged at a company level. Number two, in the context of the specific contract you talked about, we h ave a bunch of raw materials we'll be sourcing from different geographies, which will also come on dollar. Obviously, as we were constructing the plant, some equipment were also imported.
If you take all of those into account, we still feel there will be some positive impact, but it will not be just as linear as you said that INR 84 becoming INR 95, and what is the benefit coming into the P&L.
All right, sir. On the semiconductor side, when can we expect the revenues coming to us, sir?
We already have some revenues coming in, but very, very small. As I have been very explicit about it, semiconductor chemicals, we are focusing from a long-term growth journey perspective. We do have almost a dozen different subjects, which we are working on, and we have also supplied commercial volumes in small quantities to the customers. We are getting good traction from the customer, but at the same time, customers in this segment, as you will appreciate, like to move slowly and they want to get absolute level of comfort that they can start using materials supplied by any supplier, including ourselves, to their customer and without creating any disruption, because even an iota of deviation can have huge implications. We expect a slow ramp-up in that segment, but our number of opportunities are definitely increasing.
The traction, I just came back about two weeks back from Japan. The number of new opportunities we could add has only increased, and there are more number of international semiconductor chemical companies which are looking for partners in India, and we are in touch with a couple of them, and having some healthy discussions. Of course, these things are taking longer than what normally any other sector in chemicals world will take, because it's a very sensitive segment which moves slowly and in a calibrated manner.
All right, sir. One final question from my side. The company has been highlighting CDMO as a key long-term growth driver, particularly in the agrochemicals segment. Could the management provide an update on where the company currently stands in terms of securing CDMO contracts from global agrochemical majors, apart from the two that we have already secured?
We have given the update on that in every investor call. Agro is a key segment for us. Almost 20% of our business comes from agro segment at an overall company level also. The two molecules we won, and we have executed both of them successfully first time right and in record time. That has been hugely acknowledged and appreciated, not just by those two customers, but also by the broader agrochemical industry, including some of our peers. On the back of that, the traction we are getting with all five or six top innovators is actually at the highest level that we ever had. As we speak, there are at least more than half a dozen molecules that we are in various stages of discussions with the customers.
The challenge in agrochemical industry, as I think most of you already know, has been that it has been moving very slowly, and there are massive cost pressures coming from China as well. As a result, while things are moving in the right direction, they have been slower than what, let's say, in normal times they would have been. Having said that, we are getting traction with the customer even now. Like I said, there are at leastActually, more than six to eight different opportunities that are in various stages of discussions with the agro customer. I think just stepping back, our CDMO opportunity is broader than that, as our pipeline also shows. While agro is one part of it, the pharma side, we have made a meaningful progress with our pipeline becoming almost 3x of what it was one and a half, two years back.
On the personal care side also, we are getting some exciting opportunities and we are working on them. We have won a couple of them, and we are in the process of advanced stage of discussions with a few of them. That CDMO story is broader than just agro, but we do have a good number of opportunities in agro as well that we are discussing with the customers.
All right. Thank you for answering all my questions. Thank you, and wish you all the best.
Thank you very much. Next question is from the line of Archit Joshi from Nuvama. Please go ahead.
Hi, sir. Good evening. Thanks a lot for taking my question, and congrats on a good set of numbers. First one, prying a bit on the previous issue discussed by an earlier participant. What would be the building blocks for growth? Not looking at it from a quarterly perspective, but on a yearly basis, since there have been deliberations regarding the innovator contract with regards to their position in the global market. What is it that we fetch from them? Do we really have a clear path of recouping volumes if there's been a loss or a delay that we have seen in the beginning of the quarter? Maybe because it started towards the end of March. Do we see that we might be able to execute the INR 60 million yearly trade with them in terms of revenues?
That would be the first one. Second one, I'll just club it up. We've written that our pipeline in the pharma piece within the CDMO segment has gone up by three times in two years. This is with innovator and Tier 1 CDMOs. Is there a scope of entrenching into some pharma majors also? If there are any opportunities or other tangible opportunities that you might want to highlight to us so that we can pencil in that kind of growth for FY 2027 within CDMO. That would be it, sir. Thank you.
Thank you, Archit. All good questions. Let me just take them one by one. I think your first question was, what are the multi-year growth drivers? I think they remain same as what we announced in the investor day. There's no change in our strategy. Bulk of the incremental growth in our business is supposed to come, number one, from our fine chemicals business, where we have pyridine derivatives, piperidine derivatives, and we are launching several other new molecules, including some of the cosmetic-grade molecules. Number two, the CDMO opportunities, which as I was just explaining as a response to the previous question, across agro, pharma, semiconductor, and increasingly now in personal care space as well. Number three, our nutrition portfolio, where both on animal nutrition and human nutrition, we are taking both organic and inorganic moves.
These three will be the fundamental drivers of both growth and profitability going forward. On top of that, as we saw recently, and I explained as a response to one of the questions, if acetyls come back and stay where it is right now, that will also give us some lift. These four building blocks essentially should help us accelerate our growth journey. FY 2027 being the middle year of our, or let's say the third year of our Pinnacle Journey, we see this as a pivotal year in which if these four things come together, we should be able to show the acceleration that you're talking about. That's part one. The part two of your question was about the big agro contract.
Of course, the customer is going through some tough times, and we are in constant touch with them. We have an excellent relationship with them. They have been very supportive of us, and so are we, very supportive of whatever is happening there. So far, they gave us the visibility for first quarter of volumes, which is what we are serving in this quarter as per the plan and agreement with them. For future volume visibility, they are building their scenarios and the market has been very dynamic as well. It is taking a little bit of time. We do have an understanding as well as commitment from them, that just in case there is any shortfall in volumes, they will make us whole as per the contractual agreement.
Which is where we are fully covered, and we will go as per the projections that we have committed to the markets in terms of bottom line. The part three of your question was about pharma. Sorry, just repeat the question. What was the third question on pharma?
Yeah. I was just wanting to know the pipeline that you've built over the last two years. You've mentioned in the PPT that it's gone up by three times, so three X rather. With innovators and tier one CDMOs. Just wanted a better elaboration of that, whether this is something that is newly blowing up as a growth opportunity for us, pharma CDMO particularly because we have seen a few peers who are doing extremely well in the pharma intermediate side making disproportionate margins. Are we taking up that track over there, or is it the same piece of pyridine business that used to cater to some of the large pharma guys? How do we think about this? If you can help us understand.
That's again a good question. On the pharma one, obviously, if you track pharma CDMO, particularly on the intermediate side, you would appreciate that if you are focusing on phase II, phase III opportunities, it takes at least four, five, six years before the opportunity gets to a commercial scale. Point number one, most of the intermediates opportunities we are focusing on currently are in phase II, phase III. The scale-up will happen gradually with time as the customer also scale up those molecules. Number two, to your question on whether these are just pyridine-based or more broad-based, these are broad-based opportunities, more linked to the kind of chemistries we have strength in. Only 25%-30% of this pipeline we have created in pharma is pyridine-based, 70% is non-pyridine.
Customers are recognizing our broad-based capabilities, beyond just pyridine as a molecule in the broader chemistries, and we have 30-plus chemistries where we operate. In our discussions, we have educated the customers, and we are still doing it every time we go and meet them. On the back of it, we are getting good traction with them. Thirdly, obviously, given that we were not promoting our pharma CDMO as actively until a few years back, and we have started this journey only a couple of years back. Customers are internalizing that, and hence, even the quality of the portfolio and these leads is also improving.
That's why we have mentioned explicitly now we have opportunities coming from innovators as well, which is a good point for us because of the pipeline we have, I think almost one third or close to 40% will be coming from innovators now, which augurs well for future years. On the back of it, we will not only start working with them on these phase II, phase III opportunities, but as we gain their credibility, we are hopeful we'll be able to get into some already commercialized opportunities, which can give us step change kind of scale and growth in coming years.
By and large, if I just look at even You mentioned some of the players in industry are doing well. You need to track the history and see that they took a few years before they established themselves as a credible CDMO player, and then only they started to scale up. We are in the second or third year of that journey, but we are getting good traction, and we'll start scaling up, hopefully starting this year itself, and then some of the opportunities that we are currently tracking can give us nonlinear growth in the outer years of this Pinnacle journey.
Right, sir. Of course. As you rightly mentioned, it takes some bit of time to develop that pipeline. The only understanding that I wanted was, since you mentioned phase II, phase III, and we have seen a lot of lumpiness in those kind of revenues with other companies, because sometimes you kind of hit the wall when it comes to synthesizing a particular molecule, and then you have to go back to pavilion and to rework things and try to find newer opportunities. I just wanted to know or rather understand if we are embarking upon that journey, wherein we are pegged to certain innovator APIs which are in the development phase, and once in the light of the day, we hopefully get in their supply chain. Would that be a correct understanding, let's say, six months down the line?
No, that is the correct understanding. All the molecules which we have currently or recently received from the innovators, they feed into some APIs which the innovators are developing. To your point, it can play either ways, right? If the molecule is successful, goes through the whole journey, it can scale up in a big way, and because we'll be one of the early ones to enter that value chain, hopefully we'll scale up with them. At the same time, there will be some natural mortality rate to these molecules. At this stage, it is difficult to predict. The only thing we can do from our side is just keep the funnel wide enough so that even if we adjust it for the probability of any kind of mortality.
The rest of the portfolio still has a good number of opportunities for us to scale up the pharma CDMO, which I think we have announced, and we presented even in our investor day presentation that the pharma CDMO business, we want to take it to at least three to four x of its current size. The pipeline that we are working on and the pace at which we are adding new molecules, which now we have started to announce in the last two quarters, gives you a sense at which we want to scale up so that the funnel is wide enough to take care of any kind of mortality, which anyway happens in this business in a natural way.
Sure, sir. That's great. Thanks for the answer. Just one last, the CapEx that we should build in for FY 2027, if you could help us with that, and thanks, and all the best.
Thank you. Hi, Archit, Varun here. On the CapEx, I've mentioned to Abhijit also just on the call. We are looking into range of INR 500 crore of the CapEx next year, and it is in line with what we have given the indication to the market during our investor day, that we'll continue to invest behind our growth.
Sure. Thanks, and all the best. Thank you.
Thank you. Next question is from the line of Srishti Jain from Monarch Networth Capital. Please go ahead.
Thank you for the opportunity. Sir, can you share thoughts on the demand-supply scenario in the pyridine side and the possible reasons for muted pricing there?
Yeah. First of all, I'm happy that the question on pyridine is coming 45 minutes into the call given the change in focus of our portfolio. Thank you for asking that question. Pyridine is an old molecule, and we are global leaders in that. We are world's biggest in terms of sales. We have a capacity of about 50,000 tonnes for pyridine and picolines, and we run our plants at 90% plus utilization levels. The rest of the capacity in pyridine is in China, which is, to the best of our understanding, about 2.5 lakh to 3 lakh tonnes. The plants in China typically run at 30%, 40% utilization levels, while obviously our plant, as I just mentioned, is running at 90% plus utilization. There are two factors which help us in pyridine business.
One is, given our long history and extreme focus on that business, we have been able to optimize our cost structure to have a level of competitiveness which is better than even the Chinese. Number two is, obviously, the world is seeing China Plus One trend very strongly, and hence anybody who wants to buy pyridine, picoline or any of their derivatives, they do want to have at least one more partner or supplier outside of China. I hope I answered your question, but let me know.
Yeah. Sir, this 30%-40% utilization of the Chinese facilities, is there any change in that? The question was that is there a reason for the muted pricing, or you expect any changes in the pricing scenario?
You see the pyridine and picoline pricing, if you track back last 10, 15, 20 years, you'll always see some volatility in that. Particularly the two main products, pyridine and beta picoline. They go hand in glove together. If one goes up, second comes down. If second goes up, first comes down. If you look at the average pricing, it hovers between two and a half dollars to three and a half, four dollars, if you just take a multi-month average and then plot it on the curve. Right now, as we speak, for pyridine prices, they are very low. In fact, at the rock bottom right now. While the beta picoline prices are at the highest level, higher than what at least I have seen even in the last six years.
I t's very hard to predict when one goes up, other comes down. They kind of balance things out, that is how at least we have been able to manage the volatility in that business and still make margins on that product because it's very core for us. It impacts not just the building block, but also all the downstream products which you look in our fine chemicals.
Yes, sir. That's perfect. Sir, one on our revenues in the rest of the world has seen strong growth. Are there any new geographies that we are focusing on, and do you want to probably throw some light there?
We have Japan, we have Southeast Asia, and particularly in our nutrition and personal care businesses, we are getting good traction from Japan, Korea, and Southeast Asian markets. That is one factor which is showing the sudden rise of rest of the world.
Absolutely. sir, in this inflationary environment, our specialty chemical EBITDA margins are at about 26.5%. What do you think is the sustainable margin here?
We've been pretty consistent in saying for the last six quarters now that the sustainable margin for our specialty chemical portfolio as a whole should be between 23%-25% post adjustment of the corporate overheads. This 27%, when you adjust for that, lands at around 25%, which is what we have been maintaining for the last, I think five or six quarters now. We are confident of maintaining the EBITDA margin in specialty chemical at that level going forward as well. Obviously, there will be some positive forces, some negative forces. Positive is the fast growth of CDMO business within that. While on the negative side, of course, there could be some pressure on pyridine costs and some other derivatives that we do. These forces kind of balance out each other.
We keep focusing on the cost optimization as well to ensure that that business remains 25% plus EBITDA margin.
Perfect, sir. Thank you.
Thank you very much. Ladies and gentlemen, this is the last question from the line of Nitesh Dhoot from Anand Rathi. Please go ahead.
Hi, team. Good evening. Congratulations on a decent set of numbers. A few clarifications. First, on the smaller agri contract that we executed last year. Or do we have any sense on the scale-up approximately there? I mean, how much can the execution be in FY 2027 from that molecule? You had earlier indicated on a larger order versus last year that's coming up in H2 FY 2027.
Yeah. We, of course, are having those conversations with the customer. The three to four-year outlook they had given us was showing us a path to take it to 4 to 5x of what we did last year. For this year, we are still discussing with them various scenarios. Given the volatility in the agro world, all this disruption, they haven't confirmed the final volumes yet. We do hope that we'll get at least as much as we got last year, but hopefully we should be able to top it up with something more.
All right. Second on the human-grade B3 plant. If you could just give out the utilization numbers currently and the customer qualification status for the expanded portfolio there, and what would be the time to full utilization there?
So that we had planned to use that plant for two different products. One was personal care grade, PC grade niacinamide, and second was niacin, which goes into food and feed, both applications, roughly 50/50 each. On the PC grade niacinamide, which we launched first last year, the scale-up is very, very fast, and I think we are already doing almost 50% of what we had estimated in terms of volume. On the niacin side, because we started it late, the ramp-up is gradual. At this stage, I would say we are probably projecting for this year getting to at least 30%-40% of, in fact, more probably 40%-50% of the volume that we have assumed to come from that plant at the peak level.
Just one last. Your presentation mentions some European force majeure events, some plant closures. Which competitors or what capacity has come out of the market, and is it permanent or temporary? If you could just help us with some color there.
In the acetyl business, there were some announcements from European competitors for force majeure for a few weeks because of at least the official reason quoted was mechanical failures. I think that is still going on. We will know how long it would be in coming days or weeks. If you do a quick search, you will find which competitor has announced force majeure.
Okay. Thank you so much.
What is more important, just on the last point, is that on the back of that, we are able to, and especially with all the hard work our sales team has done to get our product qualified with almost every customer in Europe. We are hopeful that in this year we will gain volumes in Europe, showing a very healthy growth, and we'll gain market share as well in European market.
All right. That's good to know. Thank you. Thank you so much, and wish you all the best for the coming quarters.
Thank you.
Thank you very much. With this, I now hand the conference over to the management for closing comments.
Thank you all for joining this call today. We hope we have been able to address your queries. For further clarification, I would request you to get in touch with me. Thank you once again for your interest in Jubilant Ingrevia Limited.
Thank you very much. On behalf of Jubilant Ingrevia Limited, that concludes this conference. Thank you for joining us, and you may now disconnect your lines. Thank you.