Gufic Biosciences Limited — Q3 FY25 earnings call

Call held 17 Feb 2025

Management summary

Gufic Biosciences reported a stable Q3 FY25 with slight revenue growth but a dip in profitability margins, primarily due to initial expenses from the newly operational Indore facility. The Indore plant, which started production in October 2024, contributed INR 6 crores in its first quarter and is expected to significantly ramp up, targeting INR 150 crores additional revenue in FY26 and breakeven by Q4 FY26. The company highlighted strong traction in new products like Supergraf and Dalbavancin, while acknowledging price erosion in some critical care molecules and short-term margin pressure.

Highlights

  • Q3 FY25 total revenue for operations was INR 207.8 crores, compared to INR 201.8 crores in Q3 FY24.

  • Q3 FY25 EBITDA stood at INR 35.8 crores, with an EBITDA margin of 17.23%.

  • Q3 FY25 Profit After Tax (PAT) was INR 19.4 crores, yielding a PAT margin of 9.34%.

  • The new Indore facility commenced production in October 2024 and contributed INR 6 crores in revenue during Q3 FY25.

  • Management expects Indore to generate around INR 20 crores in Q4 FY25 and a minimum of INR 150 crores additional revenue in FY26.

  • The Indore facility is projected to reach breakeven by Q4 FY26 (4-6 quarters).

  • Supergraf, an ultra highly-purified HMG, is targeted to become an INR 10 crores brand in the next year, with a market share goal of 10-15% in 2-3 years.

  • Dalbavancin, a critical care product, has a potential to reach INR 40-50 crores down the line, currently at INR 3-4 crores/year.

Key financials

2 periods

Q3 FY25

  • Revenue
    ₹207.8 Cr
    YoY +3%
  • EBITDA
    ₹35.8 Cr
    YoY -3%
  • EBITDA Margin
    17.2%
  • PBT
    ₹26.3 Cr
    YoY -11.3%
  • PAT
    ₹19.4 Cr
    YoY -13%

9M FY25

  • Revenue
    ₹614.8 Cr
    YoY -0.31%
  • EBITDA
    ₹111.6 Cr
    YoY -1.1%
  • EBITDA Margin
    18.1%
  • PBT
    ₹83.6 Cr
    YoY -5.6%
  • PAT
    ₹61.9 Cr
    YoY -6.3%

What they filed

Q1 FY27: revenue up 15.0%, net profit up 83.3% against the same quarter last year.

₹ Cr · quarterly
Line itemQ2 FY25Q3 FY25Q4 FY25Q1 FY26Q2 FY26Q3 FY26Q4 FY26Q1 FY27
Revenue204 208 205 227 230 +13%231 +11%252 +23%261 +15%
EBITDA39 34 27 32 36 −8%36 +6%46 +70%47 +47%
Net profit22 19 8 12 15 −32%16 −16%21 +163%22 +83%
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.

Guidance & targets

Capacity

  • Indore Capacity Utilization Capacity · next year · High confidence 25-30%
    So we will foresee growth happening of around 25% to 30% capacity utilization in the next year and then followed by 50% to 60% the year after that.

    — Pranav Choksi – CEO & WHOLE-TIME DIRECTOR

  • Indore Capacity Utilization Capacity · year after next · High confidence 50-60%

    — Pranav Choksi – CEO & WHOLE-TIME DIRECTOR

Revenue

  • Supergraf Brand Revenue Revenue · next year · Medium confidence INR 10 crores
    We feel if Supergraf handled efficiently and done properly, Supergraf can be close to INR10 crores brand in the next year. So that is how we are looking at in step 1.

    — Pranav Choksi – CEO & WHOLE-TIME DIRECTOR

  • Dalbavancin Revenue Potential Revenue · down the line · Medium confidence INR 40-50 crores
    So this has a potential value of a high of at least INR40 crores, INR50 crores down the line, as I talked about.

    — Pranav Choksi – CEO & WHOLE-TIME DIRECTOR

  • Aztreonam-avibactam Revenue Capture Revenue · next 6 months · Medium confidence —
    So that will be -- the revenues will be captured in the next 6 months.

    — Pranav Choksi – CEO & WHOLE-TIME DIRECTOR

  • Indore Facility Revenue Revenue · Q4 FY25 · High confidence around INR 20 crores
    And for Q4, we are expecting that the revenue can come around INR20 crores.

    — Devkinandan Roonghta – CHIEF FINANCIAL OFFICER

  • Indore Facility Additional Revenue Revenue · FY26 onwards · High confidence minimum INR 150 crores
    From '25, '26 onwards, we feel that the revenue should be minimum INR150 crores additional revenue from the Indore plant.

    — Devkinandan Roonghta – CHIEF FINANCIAL OFFICER

  • Indore Facility Revenue (Q4 FY25) Revenue · next quarter · Medium confidence 2x to 3x of Q3 FY25 revenue
    We hope that we can reach at least 2x to 3x that what we did already in this quarter.

    — Pranav Choksi – CEO & WHOLE-TIME DIRECTOR

Market Share

  • Supergraf Market Share Market Share · next 2-3 years · Medium confidence 10-15%
    We hope that we can start to go to at least 10% to 15% of the market share in the next 2 to 3 years.

    — Pranav Choksi – CEO & WHOLE-TIME DIRECTOR

  • Supergraf Market Share Market Share · 2025 and beyond · Medium confidence 10-25%
    So we will see a small use happening and then directly going from 10% to 25% in 25 and beyond.

    — Pranav Choksi – CEO & WHOLE-TIME DIRECTOR

Profitability

  • EBITDA and PAT Margin Profitability · after '26 onwards · High confidence improve
    But after '26, when the capacity utilization of Indore will be picked up, I think that the EBITDA margin and PAT margin is going to improve after '26 onwards.

    — Devkinandan Roonghta – CHIEF FINANCIAL OFFICER

  • Indore Facility Breakeven Profitability · Q4 FY26 · High confidence Q4 FY26
    Breaking even, I think the breaking even will be going to take around 4 to 6 -- 4 to 5 quarters. It will be in the fourth quarter of '25, '26, I think the breakeven will be.

    — Devkinandan Roonghta – CHIEF FINANCIAL OFFICER

Regulatory

  • EU GMP Approval for Indore Regulatory · Q2 or max Q3 2026 · Medium confidence —
    So we are expecting an EU GMP, hopefully, in Q2 or max Q3 2026.

    — Pranav Choksi – CEO & WHOLE-TIME DIRECTOR

Risks & concerns

  • Price erosion in Critical Care products

    medium

    7 molecules in Critical Care faced 60-80% price erosion, though quantities increased by 30%.

    Management acknowledged

  • Short-term pressure on EBITDA and PAT margins

    medium

    Margins are expected to be lower for the next 2-3 quarters due to employee expenses, other expenses, depreciation, and interest costs associated with the Indore facility.

    Management acknowledged

  • Navsari capacity constraints

    medium

    The Navsari facility is struggling with capacity, leading to a revenue plateau and inability to capture all orders, with saturation expected by Q2/Q3 2026.

    Management acknowledged

  • US import tariffs on pharmaceutical business

    low

    Management stated they are too small and have not yet entered the US market to comment meaningfully on potential import tariffs.

    Analyst downplayed

Areas of evasion (1)

  • US import tariffs on pharma (due to lack of direct exposure)

Q&A highlights

2 direct
Indore facility revenue potential and breakeven timeline Direct
The production of Indore has started from October 2024. And the first revenues were captured to the tune of INR6 crores in this quarter. And the total potential loss of Indore, of course, is much higher... for Q4, we are expecting that the revenue can come around INR20 crores. From '25, '26 onwards, we feel that the revenue should be minimum INR150 crores additional revenue from the Indore plant... Breaking even, I think the breaking even will be going to take around 4 to 6 -- 4 to 5 quarters. It will be in the fourth quarter of '25, '26, I think the breakeven will be.

This question provided crucial details on the new Indore plant's initial contribution, future revenue projections, and the expected timeline for profitability, which is a key growth driver for the company.

Asked by Nayan Taparia, Vidit Shah

Impact of new product launches on revenue and margins Direct
Our next product is Supergraf, which is... increasing by almost 8% to 10% month-over-month... Supergraf can be close to INR10 crores brand in the next year... Dalbavancin has a potential of going from INR3 crores to at least INR15 crores, INR20 crores and then eventually more once the positioning and the market acceptance comes up... this has a potential value of a high of at least INR40 crores, INR50 crores down the line.

Analysts sought clarity on the revenue potential of recent product launches. Management provided specific figures and growth rates for key products like Supergraf and Dalbavancin, indicating their contribution to future top-line growth.

Asked by Yogansh Jeswani, Vidit Shah

Strategy for international expansion, particularly for botulinum toxin Partial
Very frankly, right now, our entire bandwidth is very focused on 2, 3 things which are very important, the Indian space... maybe after 1 year, we will definitely look at thinking of the international market where new infrastructure will either have to be created or we might need to outsource it from an existing CMO or something.

This question probed the company's international ambitions for a high-value product like botulinum toxin. Management indicated a strategic delay to prioritize domestic market and Indore ramp-up, suggesting a cautious, phased approach to global expansion.

Asked by Shirish, Yash Tanna

3 min read 6 chapters

Detailed narrative

Q3 FY25 Financial Performance Overview

Gufic Biosciences reported a Q3 FY25 total revenue from operations of INR 207.8 crores, a modest increase from INR 201.8 crores in Q3 FY24. However, profitability saw a decline, with EBITDA at INR 35.8 crores (down from INR 36.9 crores YoY) and PAT at INR 19.4 crores (down from INR 22.3 crores YoY). This resulted in EBITDA and PAT margins of 17.23% and 9.34% respectively, lower than the previous year. For the nine months ending FY25, total revenue was INR 614.8 crores, with PAT at INR 61.9 crores.

Indore Facility Ramp-up and Financial Impact

The new Indore facility commenced production in October 2024, contributing INR 6 crores in revenue during Q3 FY25, primarily from own-brand manufacturing. Management projects a significant ramp-up, expecting INR 20 crores in Q4 FY25 and a minimum of INR 150 crores additional revenue in FY26. The facility is anticipated to achieve 25-30% capacity utilization next year and 50-60% the year after. Despite initial expenses causing margin pressure for the next 2-3 quarters, Indore is targeted to reach breakeven by Q4 FY26.

Traction in Ferticare and Critical Care Divisions

The Ferticare division is seeing strong traction with new products. Guficin Alpha, launched in May 2024 for recurrent implantation failure, now serves 300-330 patients per month. Supergraf, an ultra highly-purified HMG, is growing 8-10% month-over-month and is targeted to become an INR 10 crores brand next year, aiming for 10-15% market share in 2-3 years. In Critical Care, Dalbavancin, currently at INR 3-4 crores/year, has a potential to reach INR 40-50 crores down the line, with its price recently reduced by one-third to boost adoption.

Botulinum Toxin and Aesthetic Segment Growth

The botulinum toxin segment within the aesthetic division is experiencing robust growth, with a 60-65% year-over-year increase. While the base is currently small (INR 10-15 crores in aesthetics and INR 8-10 crores in neuro), management expects further growth with new product pillars to be launched in the next 3-6 months. The company has brought in new senior members to drive this segment, focusing on scientific engagement, clinical data, and training to expand both market share and overall market size.

Strategic Focus and International Expansion Outlook

Gufic Biosciences is currently prioritizing the Indian domestic market and the ramp-up of the Indore facility, including securing EU GMP approval by Q2/Q3 2026. International expansion, particularly for botulinum toxin, has been put on hold to manage bandwidth, with plans to revisit after approximately one year. The company is exploring tech transfer options for international manufacturing rather than building new assets, and a new President of International Business has been appointed to strengthen global market presence.

Margin Outlook and Debt Position

Gross margins have improved by approximately 2% over the last two years due to product mix and growth in UK/export business. However, EBITDA and PAT margins are under pressure and expected to remain lower for the next 2-3 quarters due to increased employee costs, other expenses, depreciation, and interest related to the Indore facility. Management anticipates these margins to improve significantly after FY26, once Indore's capacity utilization picks up. The company's current loan outstanding is around INR 300 crores (INR 155 crores term loan, INR 200 crores working loan), which is considered peak debt, with expectations for it to reduce as Indore generates cash.

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

More Healthcare earnings calls