Dishman Carbogen Amcis Limited — Q4 FY25 earnings call

Call held 22 May 2025

Management summary

Dishman Carbogen Amcis reported a strong Q4 FY25, marking the third consecutive quarter of improving performance, driven by robust growth in its CRAMS segments and effective cost control measures. The company achieved a 17.4% EBITDA margin for FY25 and 21.4% for Q4, exceeding expectations. Strategic operational milestones, including the full operationalization of the French facility and regulatory approvals in China, are expected to fuel future growth and margin expansion, with a target of 12-15% CAGR and 20% EBITDA margin for FY26.

Highlights

  • Full year FY25 revenue grew 3.7% to INR 2,711 crores, with Q4 FY25 revenue up 9.4% YoY.

  • FY25 EBITDA stood at INR 472 crores, with a margin of 17.4%. Q4 FY25 EBITDA was INR 153 crores, achieving a 21.4% margin.

  • Profit Before Tax (PBT) for Q4 FY25 was INR 27.7 crores, and for the full year FY25, it was INR 19.3 crores.

  • Carbogen Amcis CRAMS segment reported a strong Q4 FY25 EBITDA margin of 25%, and FY25 margin of 19.7%.

  • India CRAMS business grew 35% in FY25, with Q4 FY25 EBITDA margin at 17.3% (vs 5.2% Q4 FY24).

  • Net debt reduced to INR 157 million as of March 31, 2025, from INR 163 million a year ago.

  • French facility is fully operational with GMP certificate, and Chinese site received drug manufacturing license.

  • Company targets a 12-15% CAGR over the next 3-5 years and 20% EBITDA margin for FY26.

Key financials

2 periods

Q4 FY25

  • Revenue
    —
    YoY +9.4%
  • EBITDA
    ₹153 Cr
  • EBITDA Margin
    21.4%
  • Profit Before Tax
    ₹27.7 Cr
  • Depreciation & Amortization
    ₹79 Cr
  • Finance Cost
    ₹42 Cr

FY25

  • Revenue
    ₹2,711 Cr
    YoY +3.7%
  • EBITDA
    ₹472 Cr
  • EBITDA Margin
    17.4%
  • Profit Before Tax
    ₹19.3 Cr

What they filed

Q1 FY27: revenue down 4.2%, net profit down 352.2% against the same quarter last year.

₹ Cr · quarterly
Line itemQ2 FY25Q3 FY25Q4 FY25Q1 FY26Q2 FY26Q3 FY26Q4 FY26Q1 FY27
Revenue789 682 716 708 653 −17%720 +6%851 +19%678 −4%
EBITDA147 140 153 141 149 +1%113 −19%163 +7%60 −57%
Net profit33 5 43 23 65 +97%-13 −360%22 −49%-58 −352%
How to read this

₹ crore, as filed. The percentage beside a figure is the change against the same quarter a year earlier — never the quarter before, which would make every seasonal business look like it collapses and booms each year.

Segment breakdown

SegmentRevenue (FY25)EBITDA Margin (FY25)Revenue (Q4 FY25)EBITDA Margin (Q4 FY25)
Carbogen Amcis CRAMS₹2,003 Cr19.7%₹489 Cr25%
Cholesterol and Vitamin D analogues₹305 Cr10.3%₹121 Cr—
India CRAMS₹290 Cr13%₹80 Cr17.3%
Quats and Generics₹113 Cr7%—8.4%
French Entity₹8.6 Cr———

Capital allocation

high confidence
  • Capex ₹250 Cr
    • Maintenance CAPEX ₹170 Cr
    • Growth CAPEX and Digital Transformation
    So the maintenance CAPEX would be close to about INR 170 crores to INR 180 crores of the entities together. And the rest would be for the growth CAPEX, which also includes our digital transformation initiative.
  • Debt Net ₹157 Mn
    where now the net debt stands at about INR 157 million spend as compared to INR 163 million as of March 31, '24.

Guidance & targets

Revenue

  • Overall Company CAGR Revenue · next 3 to 5 years · High confidence 12-15%
    Yes. Based upon the current business plan that we have, we do expect that over the next 3 to 5 years, we should achieve a CAGR of anywhere between 12% to 15%.

    — Harshil Dalal

  • French Entity Revenue Revenue · FY26 · High confidence double

    From EUR 8.6 million today

    we expect that the revenue should double in the Financial Year of '26 based upon the current business plan that we have.

    — Harshil Dalal

  • India CRAMS Business Growth Revenue · next financial year · High confidence 15-20%
    And with that, the India CRAMS business, we do expect close to about 15% to 20% of growth

    — Harshil Dalal

  • Quats and Generics Business Growth Revenue · next financial year · High confidence 5-10%
    and the Quats and Generics business should be anywhere between 5% to 10%.

    — Harshil Dalal

  • India Assets Peak Revenue Potential Revenue · next 2 to 3 years · Medium confidence INR 800 crores
    We could possibly achieve our total revenue of close to about INR 800 crores with all the plants or all the units up and running. So that is the potential opportunity for the India assets.

    — Harshil Dalal

  • Overall Revenue Growth Revenue · FY26 · High confidence low double digits
    We are targeting low double digits.

    — Harshil Dalal

Profitability

  • Overall Company EBITDA Margin Profitability · FY26 · High confidence 20%
    FY '26, we should be closer to the 20% mark.

    — Harshil Dalal

  • EBITDA Profitability · FY26 · High confidence INR 550-570 crores
    Yes, that is something that should be achievable.

    — Harshil Dalal

  • French Entity Breakeven Revenue Profitability · FY26 · High confidence EUR 18 million
    So the breakeven point for us is close to about EUR 18 million of revenue.

    — Harshil Dalal

  • India CRAMS EBITDA Margin Profitability · future · Medium confidence 20-25%
    we do expect that the margin should move towards the 20%, 25% mark.

    — Harshil Dalal

  • Cholesterol and Vitamin D Business Margin Profitability · FY26 · Medium confidence 15-20%
    I wouldn't say it's difficult to achieve, but yes, here between 15% to 20% is what we can aim for.

    — Harshil Dalal

Debt

  • Net Debt Reduction Debt · every year · High confidence INR 100-200 crores
    So what we expect is that the net debt should come down by close to about INR 100 crores to INR 200 crores every year.

    — Harshil Dalal

  • Net Debt Reduction (CHF) Debt · annually · High confidence CHF 10-20 million
    So from a CHF perspective, we are pretty confident to reduce it by anywhere between CHF 10 million to CHF 20 million.

    — Harshil Dalal

Capex

  • Capex Capex · FY26 · High confidence INR 250-300 crores
    No, no. Not INR 1500 crores. That would be close to about EUR 25 million, EUR 25 million to EUR 30 million, so about INR 250 crores to INR 300 crores.

    — Harshil Dalal

Finance Cost

  • Finance Cost Reduction Finance Cost · FY26 · High confidence 10-15% lower
    What we expected in the full financial year of '26, we should be at least 10% to 15% lower than what we reported for the full Financial Year '25.

    — Harshil Dalal

Market context

  • Return on Capital Employed (ROCE) Profitability · next 2 to 3 years · Medium confidence double-digit
    All of these factors put together, we should definitely see a double-digit ROCE.

    — Harshil Dalal

What to watch in Q1 FY26

French Entity Revenue & Breakeven

FY26
Current EUR 8.6 million revenue, EUR 6.5 million EBITDA loss (FY25)
Target Double revenue (to ~EUR 17.2 million) and move towards breakeven (EUR 18 million target)

Why it matters

The French entity is a key investment area, and its turnaround is crucial for overall profitability and tax rate improvement.

The French entity generated a revenue of close to about EUR 8.6 million for the full financial year, and we expect that the revenue should double in the Financial Year of '26 based upon the current business plan that we have. ... So the breakeven point for us is close to about EUR 18 million of revenue.

Risks & concerns

  • French entity being loss-making

    medium

    The French entity is currently a loss-making entity, impacting the overall tax rate and PAT. Management expects it to turn around and contribute to profit in the future.

    Management acknowledged

  • FX fluctuation impact on costs

    medium

    Appreciation of the Swiss Franc against the INR (5% in FY25) directly impacts the cost base, especially employee costs, which are denominated in CHF, potentially increasing costs when translated to INR.

    Management acknowledged

  • Patent expiry for commercial products

    medium

    On the Carbogen side, there is a risk of patent expiry for mature commercial products, which could lead clients to seek more cost-effective production methods.

    Management acknowledged

  • High employee costs due to R&D nature

    low

    Employee costs are not expected to come down significantly as they are related to development work requiring scientists and R&D chemists, which are crucial for delivering customer requirements.

    Management acknowledged

  • Late-phase projects dropping off

    low

    It is a normal business development for late-phase projects to drop off due to client recalculations or market outlook, which is part of the inherent variability in the business.

    Management acknowledged

Q&A highlights

8 direct
Decline in India NCE API and Intermediates business Direct
So this quarter revenue stood at about INR 80 crores. So if you see the full financial year, we closed with about INR 290 crores, INR 300 crores was what we were expecting for the full year. So that's very much in line with our expectations. As we have been saying even earlier, quarter-over-quarter there could be swings in the revenue. But as far as the trend is concerned, that is something which is very much established.

Analyst questioned a decline in a key segment, management clarified it was a quarterly swing but full-year targets were met, indicating stability in the overall trend.

Asked by Subrata Sarkar

Low margins in India Quats and Generics business Direct
The Quats and Generics business, that business is basically the traditional business with which Dishman actually started and more or less, we don't expect a huge margin improvement in that particular business. It's a steady-state business for us, both in terms of revenues and the margin. So at max, maybe we can get to, say, close to about 10% to 12% as the margins.

Analyst inquired about persistent low margins in a segment, management explained it's a mature, steady-state business with limited margin upside, setting realistic expectations.

Asked by Subrata Sarkar

Peak revenue potential from India assets and timeline Direct
We could possibly achieve our total revenue of close to about INR 800 crores with all the plants or all the units up and running. So that is the potential opportunity for the India assets. ... in terms of time line to get to that kind of number, if we are able to get more and more projects into India, quickly, though it takes time, because it's not an overnight thing. But overall, we believe that it should be possible in the next 2 to 3 years' time.

Analyst sought clarity on the long-term potential of India operations, management provided a specific revenue target and a timeline, indicating significant growth opportunities.

Asked by Subrata Sarkar

EBITDA and PBT loss for the French entity Direct
Yes, the EBITDA loss was about EUR 6.5 million. And on the PBT, that was close to about EUR 9 million. ... So the breakeven point for us is close to about EUR 18 million of revenue. So the breakeven in terms of breaking even at an operating level, So that is what we are aiming for. At a worst case, we should be closer to the EUR 15 million to EUR 16 million in terms of revenue.

Analyst asked for specific loss figures for the French entity, management provided detailed numbers and a clear breakeven target, offering transparency on a key investment area.

Asked by Satish Bhatt

Japanese customer co-investment and value addition Direct
Yes. If I understand correct, you asked me if we are investing into this project as well. So, while in the investment of the infrastructure, it's a core investment, meaning the client pay for it, and we deliver all products. Once everything is finished, we deliver the product at a certain price, until we reach their agreed final amount. Finally, the co-investment is about 50%.

Analyst questioned the nature of a significant co-investment, management clarified the funding structure and the strategic importance of the project (complex molecule/ADC), highlighting client trust and long-term partnership.

Asked by Satish Bhatt

Decline in Phase III late-stage projects Direct
So, it's a normal development that our flexibility and variability that the late phase are acquired but also dropping off. We have 1 or 2 examples where the late-phase projects dropped off on last minute, because the client made a recalculation. And that's why we finally also lost this project, which has not been extraordinary. It's part of the business where we are in.

Analyst noted a reduction in Phase III projects, management explained it as a normal business occurrence due to client recalculations, not a reflection of company performance, providing context on pipeline dynamics.

Asked by Sajal Kapoor

Low Return on Capital Employed (ROCE) and improvement plan Direct
No, definitely it is possible. I think in the next 2 to 3 years, once we start seeing profits being generated from the French entity, the India business ramping up and margin improvement in Netherlands, with all of these factors put together. And the Swiss business, obviously, performing the way it has been. All of these factors put together, we should definitely see a double-digit ROCE.

Analyst challenged the low ROCE, management acknowledged it and outlined a clear path to double-digit ROCE within 2-3 years, linking it to performance improvements across key segments.

Asked by Ankur Agarwal

Reasons for increased trade receivables Direct
Yes, that's largely on account of the higher shipments that were done in the last month that was in March, and that is the reason why at the end of the year, the receivables are quite high.

Analyst pointed out a significant increase in trade receivables, management provided a direct explanation attributing it to strong sales in the last month of the quarter, indicating operational rather than structural issues.

Asked by Shubrojeet Tripati

3 min read 6 chapters

Detailed narrative

Q4 and Full Year FY25 Financial Performance Overview

Dishman Carbogen Amcis delivered a strong Q4 FY25, with revenue growing 9.4% year-on-year. For the full fiscal year 2025, revenue increased by 3.7% to INR 2,711 crores. The company achieved an EBITDA of INR 472 crores for FY25, translating to a 17.4% margin, significantly higher than the reported INR 296 crores in FY24. Q4 FY25 saw an EBITDA of INR 153 crores and a robust margin of 21.4%, driven by effective cost control measures. Profit Before Tax for Q4 FY25 was INR 27.7 crores, and for the full year, it stood at INR 19.3 crores.

Segmental Performance Highlights

The Carbogen Amcis CRAMS segment was a key driver, with Q4 FY25 revenue growing 9% to INR 489 crores and achieving a strong 25% EBITDA margin. For the full year, this segment contributed INR 2,003 crores in revenue with a 19.7% EBITDA margin. The India CRAMS business demonstrated significant turnaround, growing 35% in FY25 to INR 290 crores, and achieving a 17.3% EBITDA margin in Q4 FY25, a substantial improvement from 5.2% in Q4 FY24. The Cholesterol and Vitamin D analogues business recorded INR 305 crores in FY25, with Q4 revenue at INR 121 crores, and management expects margin improvement in FY26. The Quats and Generics business remained stable at INR 113 crores for FY25 with a 7% margin.

Strategic Initiatives and Operational Milestones

The company achieved several strategic milestones, including the full operationalization of its French facility, which now has two filling lines for high-quality compounds and high-potent API solutions, backed by a GMP certificate. The Chinese site in Shanghai also received its drug manufacturing license from the Chinese FDA, opening avenues for future GMP production in the Chinese market. A significant co-investment of over CHF 25 million with a Japanese customer in Switzerland for complex molecule capabilities and capacity expansion was highlighted, with the client covering 50% of the investment. These initiatives are expected to drive future growth and enhance capabilities.

Cost Control and Margin Improvement Efforts

Management emphasized strong focus on cost control, particularly in raw material procurement. Successful negotiation of lower prices for wool grease, a key raw material for the Dutch subsidiary, is expected to lead to higher profitability. The company aims to improve margins across segments, targeting 20-25% for India CRAMS and 15-20% for the Cholesterol and Vitamin D business in FY26. Overall, the company targets a 20% EBITDA margin for FY26, reflecting the benefits of these cost management strategies.

Capital Allocation and Debt Management

The company's net debt reduced to INR 157 million as of March 31, 2025, from INR 163 million a year prior. Management aims to reduce net debt by INR 100-200 crores (or CHF 10-20 million) annually. Finance costs are projected to decrease by 10-15% in FY26 compared to FY25. CAPEX for FY26 is guided at INR 250-300 crores, with INR 170-180 crores allocated for maintenance and the remainder for growth and digital transformation. The company is focused on generating free cash flow and ensuring CAPEX is tied to strong business cases and customer commitments.

Outlook and Future Growth Drivers

Dishman Carbogen Amcis projects a 12-15% CAGR over the next 3-5 years, with a target EBITDA of INR 550-570 crores and an overall EBITDA margin of 20% for FY26. The French entity's revenue is expected to double in FY26, with a breakeven point at EUR 18 million. India CRAMS is anticipated to grow 15-20%, and the India assets have a peak revenue potential of INR 800 crores within 2-3 years. The company is focused on expanding its development pipeline, acquiring more projects from early to late-phase clinical cases, and leveraging synergies between its Carbogen Amcis and Indian operations to drive growth and profitability.

This is an AI-generated summary of a publicly available earnings call transcript.
View original transcript

More Healthcare earnings calls