Dishman Carbogen Amcis Ltd

NSE:DCAL

Earnings Call Transcript 2023-Q1

[Operator]

Ladies and gentlemen, good day, and welcome to Dishman Carbogen Amcis Limited Q1 FY '23 Conference Call. [Operator Instructions] Please note, this conference is being recorded.

I now hand over the conference to Mr. Harshil Dalal. Thank you. And over to you, sir.

[Harshil Dalal, executive]

Thank you, moderator. Very good evening to everybody. Thank you for joining on this call for the fourth quarter of financial year 2023. I'm sure all of you would have had a chance to go through the investor presentation that we had uploaded and published results. The June quarter was a quite progressive quarter for us as a company. And there was a good indication that we are in the right direction as far as the business is concerned.

The quarter saw a very strong pipeline of molecules in Phase III progressing quite well. And we are happy to state that we have started growth of almost USD 96 million on the development side, which is a significantly strong order book that we hold right now. And we are getting closer towards operationalizing our expansion in Switzerland for the EDQM molecule as well as the French plant for which Pascal can give you better insights later on the call.

The quarter also saw the India business getting quite a bit back on track from a revenue perspective at both the Bavla and the Naroda site. We do expect the margins for the Bavla site that is predominantly focused on the CRAMS business to keep to ramping up from here on. And this will be driven by a significant amount of revenue that we are expecting in this particular site to generate over the next few years.

The focus Generics as well as the Quats business did quite well in the fourth quarter, both from a revenue as well as margin perspective and we do expect even this business to keep ramping up and keep on contributing to a profit account.

The quarter on the cost side was also impacted. This was largely on account of the high energy costs that we have been experiencing in Europe. The higher cost of raw materials for our Dutch business and the higher logistics costs that we are seeing across the business is largely attributable to the geopolitical situation.

Well, we do expect that most of these costs would be passed on to the customers at -- in the foreseeable future. There is definitely a time lag due to the already accepted orders and as well as the competition.

Overall, we are excited about the growth for the group as a whole. And we do envisage the India business to progress significantly and play an important role in the overall growth for the group on the financial numbers side. The new revenue stream that we would be starting or would be having as part of our group revenue from the next financial year, that is the business from the new French facility as well as the significant opportunities that we are seeing from the Swiss business on the NCE side. So all of this put together gives us a very good visibility for the future. And we definitely thank you for your continued support, and we are sure that we are giving our ultimate best to take the company to the next level of growth.

With that, I will hand over the call to Pascal, our CEO for the Carbogen Amcis Group.

[Pascal Villemagne, executive]

Thank you very much, Harshil for this introduction, and good evening, everybody. [indiscernible] quarter of this year has been marked by the geopolitical events around the globe, which have affected our financial results. And cost of energy possible of raw materials have been clearly affecting our results by the end of this quarter. We are working with the commercial development [indiscernible] to renegotiate pricing, whether it's possible in the short term to integrate those rates that means as we mentioned that we are on a good way, the second month, those issues.

Obviously, this negotiation as you can imagine, are not [indiscernible] but we can get -- because everybody is suffering to figure out their margin. However, I'm very optimistic that Carbogen Amcis level, we can improve our EBITDA significantly in the coming months regarding that.

Some -- few words about the French reactivate. We are entering in the very last state of the project. We have successfully assumed the to the French authorities to get the opening green lights [indiscernible] hope the fall will within the next 6 months. In the meantime, there will be some back and forth questions and answers from the authorities that we are extremely confident from today that we will get that opening approval in the time.

So that's been [indiscernible] to work that has been performed by the quality and the regulatory affairs group in France, and that's going to drive us into the opening first -- during the first quarter of up to 2023.

Obviously, some work needs to be done on that point. We are from qualification and validation policy, we're still working on the new lines, which are now right on site, and we are confident that we are going to perform over the next several months, all the work necessary to start up the first [indiscernible] and then mentioned our first project in the facility by end of the quarter 1, '23 successfully.

Coming back to budget for this project has been expected, although we have fight against a lot of price increase here and there. We successfully concluded some great negotiation from a [indiscernible] point of view, and we kept our control over the construction of that new site, which is going to give us a significant competitive advantage in terms of some competitors that are building the same kind of facility in the meantime, but where we knew that haven't been successful to buy equipment of the model we are done. So in that respect, we have maintained our competitiveness and that's great news for the future.

Last word regarding the market perspective from CRAMS and also [indiscernible] and market. This is a fairly positive demand tenders coming out of different studies demonstrated that although the geopolitical situation is kind of a difficult. There is still a high level of money invested in the pharma industry in Europe. So that gives us a good and solid market to enter in. And we are very confident that we can maintain our high level of project pipeline, as we mentioned, now it's $96 million, which give us more than a year of work in front of us. So that's a very, very comfortable situation for our company that's Carbogen Amcis.

Now I think I should hand over to Sanjay.

[Harshil Dalal, executive]

Yes, Pascal. Sanjay, are you online? I think Sanjay's line is disconnected. We're just getting back on the call. I think in the meantime, what we'll do is we'll go with the financial results for the quarter, and then I can hand over the call to Sanjay Majmudar.

So as far as the quarter was concerned, the revenue from operations on a consolidated basis stood at about INR 541 crores. And the good number or as far as the gross contribution is concerned, we were at about 82% which is something that we definitely hope on maintaining throughout the course of the year. Because typically about 20% is the comp that we deem for.

The cost for this particular quarter included higher raw material costs, especially for our Dutch business. And when we talk into the segment-wise revenue and EBITDA breakup, we'll see that the Dutch business EBITDA was lower than what it has been traditionally, largely because of the higher input costs.

The employee expenses for the quarter were about INR 256 crores. The employee expenses are more or less in line with what we had in the last quarter of financial year '22. And we do expect the employee expenses to be more or less in this range for the remainder of the quarter of the current financial year.

The other expenses stood at INR 104 crores for the quarter, since other expenses included foreign exchange loss of about INR 9 crores because of which the EBITDA was lower by [indiscernible] than what we were actually expecting. And hence the reported EBITDA stood at INR 88 crores.

Total expenses also include the impact of the [indiscernible] IFRIC interpretation that we had mentioned in the last quarter results where there was a onetime impact of INR 18 crores. That impact in the current quarter is about INR 2 crores, which has also been stated specifically in the reported results. So on an organized basis, we took out the expenses about INR 90 crores.

The finance cost for the quarter stood at INR 19 crores. This looks to be a bit higher than what we had in the last quarter of financial year '22, and we think the important reason is the Forex loss, which is also booked as part of the finance cost to the expense of INR 3 crores.

As far as the segment-wise breakup is concerned, Dishman India, the APIs and the intermediates business did a revenue of INR 62 crores as compared to INR 32 crores in the first quarter of the last financial year. So obviously, last year first quarter or the first 2, 3 quarters, the revenue wasn't great from the India business because you were still expecting the approval from some of our customers so that we could start the production of 7 APIs.

And that has begun from the last quarter and also in the current quarter, we saw number of shipments of the APIs and intermediates happening from the Bavla site. So that translated into a revenue of INR 62 crores, which is almost 22% growth as compared to Q1 of last year.

The Quats and Generics business also showed a 7% growth and the revenue stood at about INR 51 crores. But the good thing was that we were able to turn the cost and the focus generates at a good margin and that obviously had a positive impact on the overall EBITDA margin.

The Carbogen Amcis CRAMS business did a revenue of INR 363 crores, which is about 3% growth as compared to last year's same quarter. So it was again a good quarter in terms of revenue at Carbogen Amcis. However, most of this revenue is dominated by the development revenue as compared to commercial. So there were certain commercial product suppliers, which could not go out in the first quarter and which are going out in the current quarter of the financial year. So we do see a higher amount of commercial sales from Carbogen Amcis CRAMS segment in the current quarter and in the remainder quarters.

The Carbogen Amcis BV business, which is our cholesterol and vitamin D analogues business, with a revenue of INR 63 crores. So this is a drop of about 46% as compared to last year's same quarter. However, last year, in the same quarter, we had a significant amount of supplies of cholesterol that went out to 1 specific customer. And that also means the revenue was exceptionally high, and which comprised almost 38% of the ending revenue in a single quarter for the BV business, which is obviously not the case in the current quarter. But we do expect the revenue to ramp up as we move into the remainder of the year both on the cholesterol as well as Vitamin D analogues side.

As far as margin analysis is concerned, India did report a positive EBITDA on the APIs and the intermediate side. The Quats and Generics did an EBITDA of about 10%. Carbogen Amcis CRAMS, the EBITDA margin stood at 19.4%, and the cholesterol and vitamin D analogues business, the margin stood at 19.3% which is quite lower than what our norm has been historically, which is somewhere around 30% margin mark. And the major reason for this drop in the margin is largely on account of the increase in the prices of [indiscernible] which is our primary raw material for manufacturing cholesterol as well as the analogues.

We do expect that the prices should normalize in the course of the year and we are trying to increase the selling prices of some of these products to the extent possible in order to get back to the margins that we were familiar.

Secondly, the energy costs have also increased and out of our European business, we have seen the largest impact in Netherlands. So -- and just to give you the idea of the energy cost differential is almost 3x to what it was in the first quarter of last year. So that did have an impact on the margin. We keep on trying and negotiating with the customers to pass on, if not could be part of this cost as part of increasing the current price, but there would definitely be a time lag and there could be at least 2 quarters before the starting the full effect of the cost being passed on to the customer. That's about it as far as financial highlights were concerned.

Just one last point on the EDQM as far as Bavla site is concerned. So we do expect to be completely ready in October this year for informing the authority about performing the inspection and there have been a lot of technical changes or improvements in various areas that have been carried out at the Bavla site. So we feel pretty confident [indiscernible] having to inspection to successfully pass it. As we had mentioned in our previous call, we have successfully passed many of the customer audits and which has allowed us to resume the production of almost all of the products for our customers on the current site. So that's a bit update on the EDQM.

And I think with that, I will hand over the call to Mr. Sanjay Majmudar, our Independent Director. Sanjay, over to you.

[Sanjay Majmudar, executive]

Yes. Good evening, everyone, and thanks for joining this call. I think since we are already a bit late, very quickly, an update as Harshil explained on the numbers. In spite of the -- a little bit of tailwinds in Europe due to the pricing and the cost pressure, I think overall performance in Q1 has remained quite in line with what was expected, with a marginal positive consolidated profit being reported as against the loss that was reported in the previous quarter. We believe going forward quarter-over-quarter both Bavla and Naroda. Of course, Naroda has performed exceedingly well and Bavla will also start getting up from second quarter onwards.

So we believe that at the end of the year, we should definitely see at least 10% top line growth this year and a significantly positive profit being reported for the year as a whole. That is how the internal working is indicating, and we are quite reasonably certain about it.

More importantly, if you talk of next year, with the co-investment project going on very satisfactorily and likely to be commissioned next year. And with the French facility at the Riom also getting commissioned next year. I think from next year onwards, we should see a very -- and of course, Bavla and [indiscernible] behind us, I think from next year onwards, we should be back to the old golden days of consistent performance and good profitability.

I think with this moderator, let throw the house open for Q&A.

[Operator]

[Operator Instructions] The first question is from the line of Mr. Subrata Sarkar with Mount Infra Finance Private Limited.

[Subrata Sarkar, analyst]

Yes. Sir, just a clarification, like even when we were attending your con call last year, you decide that, that year will be normal. And then from this year onward, everything will come back to normalcy and then like we will see that like the previous performance.

Now sir, again, in this con call, you are stating this year will be normal. And then from next year onwards, things will like become -- whatever like prior to that drop -- previous, like you'll revert back to that. So why this kind of shifting of goalpost that is happening? Sir, I can understand like there is a bad performance from cholesterol and Vitamin D, but it was quite expected like you could have easily understood because of normal in the situation, demand than abnormal demand last year would have normalized.

So can you clarify because as the shareholder, what is happening, sir, every time you are shifting your goal and commenting like from next onwards, things will be great, but nothing is happening basically for last 2 years. So please help us to understand the situation in more detail so that we can put faith on the management. Otherwise, it become very difficult to like you come into the con call, make some comments and then things -- you shift your goal. It's become very difficult as a shareholder to like rely on the management and like put faith on the management.

[Harshil Dalal, executive]

Thank you, Mr. Sarkar for your question. So Mr. Sarkar, what we had mentioned last year was that as far as the India business is concerned, we expect it to be close to 70%, 70% normalcy should be achieved in the current financial year. And that we are very much on track for achieving, that is #1.

As far as the Dutch business is concerned, obviously, there is a pressure as far as the cost is concerned, but we do expect the margins to come up at least to around 25% to 30% as we get into the remaining 3 quarters of the year. The revenue as far as the Dutch business is concerned, I mean, it is just that the fourth quarter did not have a significant amount of revenue but that is the nature of our business.

For us, it is very difficult to compare this quarter versus last year same quarter because there would be certain quarters where the revenues would be significantly higher than what the previous quarters have come. The right way to look at our business on a yearly basis and on a yearly basis, even as Sanjay alluded, we are quite confident of achieving at least 10% kind of growth as far as the revenue is concerned. The EBITDA should grow at a much faster pace, and that should result into a positive path.

So from what we had stated earlier, it is just that from a quarterly perspective, it's very difficult to give a guidance. if we can give a guidance more so on a yearly basis, and that is something that we did last year and that we are pretty much confident of achieving this year.

[Subrata Sarkar, analyst]

No. Sir, I understand that like this much we are tracking your company for a pretty long term. So we understand. I'm not at all talking about quarterly guidance and quarterly performance. I'm talking about full year performance. You can go back to your -- previous year con call and prior to that, Q4 of like FY '20 -- FY '21, and you can see that whatever you have committed it has not been delivered, like those are all documented document, so we can have a discussion. This is one thing.

And second thing now, sir, on a most specific parameters that the molecules like which we have got and we keep on presenting on a like CRAMS molecule like which are in research space. So just to understand because of the slowdown in the overall situation or whatever for other reasons, is there any slowdown in the development of those molecules? Is there any delay that you are facing why that molecule comes into the market?

I understand it's not your own decision, but like it's a partner's decision and it depends upon certain -- like certain approvals and certain things. I understand that if there is some change in the overall situation in terms of a molecule, then it will be great if you can like clarify us on those themes.

[Harshil Dalal, executive]

Yes, Pascal, please go ahead.

[Pascal Villemagne, executive]

Yes. Just to come back on your first question. Obviously, con call, the promises that have been done last year. The war in Ukraine and the cost of the main raw material we are using for the cholesterol and Vitamin D products as primarily affected the profitability of those products over the last quarter. And this is one of the major impacts. As well as Harshil mentioned, there is kind of a product mix effect on last quarter. I fully understand the disappointment, and we are the first to be disappointed in that matter. We are relying to get back on track earlier. But of course, the significant events in Russia and Ukraine has affected a lot of the raw materials and cost of energy has affected our revenues.

Coming back on your second question, with the CRAMS business, is there any impact? So far, we have been advised by our customers, and they are delayed. Those late-phase Phase III programs [indiscernible] are in our portfolio. And some of the applications are very good and are treating long-term disease, which means that the records coming out at the [indiscernible] are quite long to get. So that's why it takes a lot of time to get through all those steps.

To develop a drug, we need 8 to 10 years to finalize the clinics and the later phase of the Phase III can take 3 to 5 years depending on the kind of the disease we are treating to gather all the data and justify the market applications. But so far, no, we don't have any delay reported by our partners.

We have to also clarify that, that step that's powering these steps to get money for that. We make money out of that. And we do a lot of money out of that. So the fact that the product is staying in Phase III, doesn't mean that we are not generating revenues, quite contrary. We actually sometimes normally into the development phase because there is a lot to do than a commercial phase. Because in the commercial phase, then you start to have a big pressure on pricing. People want to fight and prepare from the very beginning, the time when the product can generates.

So we do more with lower margins on the R&D phase. So having those products into that phase is not that bad for our company. It's quite good. So yes, the commercial side gets more predictable revenues but we have a lot of the price pressure, and it's harder to defend high margin.

It's quite the contrary on the R&D side. We are a bit less of the vision because we you have [indiscernible] to finish that a much better margin and we put a lot of more in R&D, in analytics and so forth. So it's good to get this product through on the manual market because it's giving you the baseline for sure. But having those standing together, we still do it to work on that. It's 2/3 of the capital revenues, because those are R&D stuff where we do a lot of hours, and we spend a lot of time for our customer that we are investing.

I hope you that answer your question.

[Harshil Dalal, executive]

You are not audible. Can you repeat?

[Subrata Sarkar, analyst]

Sir, my last question is like we have 17 Phase III molecules. So can we give some kind of estimate, like, let's say, for API in another 3 years' time period, let's say, in FY '23, '25 end. Can you give us some estimate like out of the 17 molecule, although it's partner decision, but at least if you -- as a shareholder, if you can give us some guidance, like out of the 17 Phase III molecule, what is the number of molecule ballpark that you expect to get commercialized?

[Pascal Villemagne, executive]

So once again, that's what you said. It's not totally in our hands because it depends on customer, how successful they are to collect all the chemicals that are. How we can demonstrate and do the case to get their NDAs. We can look at our historical data. And yes, historically, 2 to 3 molecules are going to the market from the 15 to 20 [indiscernible] in our pipeline. That's what we can do as a guess. But once a way, just to get because we are highly dependent on how successful the molecule in the Phase III, how they can demonstrate the big differentiators from the competitor or if [indiscernible] can collect all the data.

We are all expecting -- we have 3 projects that are very, very likely to come to the market in the next 12 to 15 months. That's what our customers are offering. But once again, we can do it on how successful is to collect that data. And some of those molecules are quite difficult because they are embracing some very complex mechanisms in the body. So to [indiscernible] it takes time. But yes, that's probably 3 molecules out of the 18 that could come to the market if everything goes as when by our customers.

[Subrata Sarkar, analyst]

Okay. Sir, just at least if we see from a historical prospect [indiscernible] we late fan the last 3 years, many molecules from Phase III have moved to commercialization phase in last 3 years [indiscernible] ?

[Harshil Dalal, executive]

Yes, roughly about 7 molecules.

[Subrata Sarkar, analyst]

Okay. Last 3 years, like 6 to 7 molecule has moved from our like development stage to commercialization stage.

[Harshil Dalal, executive]

Correct.

[Operator]

Our next question is from the line of Mr. Nikhil Chandak with JM Family Office.

[Unknown Analyst]

Yes. My question was from a capital allocation policy. Where do you see more CapEx happening going forward? Last 2, 3 years, we've done a significant CapEx in the European region. Now if you compare Europe and India, clearly, the economics of manufacturing will never match up our asset turns in Europe or your margins in Europe just given the cost base will always be, I presume, higher than what it will be versus India. So do you continue yourself seeing investing more in the European region because that will be less ROE generative as compared to what it can be in India? And there is there a potential to shift the manufacturing from Europe to India?

[Harshil Dalal, executive]

Sure. Thank you, Nikhil, for your question. So as far as the capital allocation is concerned, right now, as you know, we are investing in France for the parental project, which would be our [indiscernible] oral formulation, supporting our customers.

And the second thing that we keep on investing all the development assets and the small skill manufacturing in Switzerland. So that is something that we will have to keep on doing in order to make sure that we keep on getting more and more molecules for development, which will eventually turn into commercial molecules in the future. As far as the larger scale manufacturing is concerned...

[Unknown Analyst]

Why can't those molecules be contracted from the Indian entity? Whatever new development is happening.

[Harshil Dalal, executive]

As far as the early phase development work is concerned, what we have seen is that most of our customers, they are extremely comfortable sharing the IP and getting the work done in the initial phases from a site in the Western world. And that is the reason we have close to about 450-odd molecules across different phases of development of molecules.

[Unknown Analyst]

Indian companies are doing it, right? I mean it's -- this is not a unique business only to Dishman, there are so many other Indian companies which do the contracting from the Indian entity and customers are confident of sharing information and data.

[Harshil Dalal, executive]

So most of the Indian companies -- so some of the Indian companies that we have seen the start with the discovery process which we are not into right now. And there are other companies which are in a small portion of the total portfolio, even dedicated to NCE. So as far as our competition is concerned, our competition comes from other players in Europe and also from U.S. We don't face any competition from any of the Indian players as far as the NCE business that comes to us at Carbogen Amcis is concerned. And Pascal correct me if I'm wrong if you want to add something.

[Pascal Villemagne, executive]

You're absolutely right. There is a strong appetite for some of our -- with some customers to stay and start the development of products in Europe, especially on those complex molecules. Keep in mind that Carbogen Amcis in Europe, we have some assets that we don't have in India in terms of size. So we are more well equipped to address this chemical phase in Europe with the small other size that we have in our plants.

On top of that, it was accumulate long-term investments. The fact that we have invested in France, it was also linked to the fact that we got some grants from the French authorities, which has enable us to reach a nice long-term investment as well. We also got from the local community a very fair price for the land. So -- and as I said, we have conveyed very strong negotiations to keep the cost of these investments that were at [indiscernible] Australia lower value, which is going to guarantee a high competitiveness of that asset and then a short return on investment.

So the market is completely global in the pharma industry. I understand your filing by if we can move those assets in India, we might find better profitability and shorter into investments, yes, if we have had the same assets. But we don't have exactly the same asset. So we have to find the right product, right volume to play and [indiscernible] site those leverage.

They [indiscernible] are the otitis right now, it's where we can get the best out of it. When we got to commercial, the rich, the high level of volumes we are expecting some of the products, of course, we are testing with the customers and the idea is to try some of the business in India and fulfill the India facility as well.

So there's a nice business there. Firstly, we grow and develop those products in Europe with the high confidence of the of the customer and then later on, once commercial, when we face some competition in terms of pricing, then we can consider that to India and get nice profitability out of the India assets.

[Harshil Dalal, executive]

So Nikhil, as far as the last manufacturing is concerned, we don't expect that to happen out of the Swiss or any of the [indiscernible] businesses. We will try and utilize China as well as the India side for the larger skill manufacturers. And that's how we are looking at the synergies to play out between our Swiss entity and the India-China business.

[Operator]

Our next question is from the line of Mr. Pravin Srinivas with Samson Asset Management.

[Unknown Analyst]

So I think that sort of missed the start of the call. Could you just tell me what happened in the Netherlands business due to the sort of margin spend because if you look quarter-on-quarter, the revenues are roughly in line as the margins essentially decreased by 10%. So what drove that decrease? And how do you expect to get the margin back to those levels again?

[Harshil Dalal, executive]

So thank you for your question, Mr. Srinivas. So as far as the Dutch business is concerned, we have 2 major -- so product segments in that particular business, the cholesterol and the Vitamin D analogous. The basic raw material for this product is the [indiscernible] that we sold from a supplier in one of the largest procurance of that material from the supplier.

Unfortunately, one of the other companies have sourced too much of [indiscernible] from this particular supplier because of which the prices have increased significantly. And in order to manufacture these analogues and the cholesterol, there are also other sources, which could be utilized.

So for example, one of our competitors in China uses another source, which is not [indiscernible] So one in -- so one, obviously, because of the increase in prices of the increase, the input cost increase, and that had a negative impact on the cost for the [indiscernible] As far as the revenue is concerned, we do expect the revenue to pick up in the remainder quarters because we do see that the demand for price for the Blue Whale market remains strong, which is one of the Vitamin D analogues that we manufacture. So that was definitely one of the impacts.

Second was the energy cost in Netherlands. So we do see the power and fuel cost in Netherlands go up significantly as compared to last year and the whole almost 3, 3.5x of what the costs were in the same quarter last year. And this is largely on account of the Russia and Ukraine war that the gas prices has gone significantly. So that was a second negative impact as far as margins were concerned.

And the third was obviously the logistics cost that team across all of the businesses, and that will be true for almost all industries, again, because of the geopolitical factor. So because of these 3 things, we think the margins dropping in Netherlands. Having said that, the same team is working extremely hard in trying to up the sales pricing for both the product segments to tax and possible and impact we try to pass on the cost as well as we do expect that especially the raw material costs should kind of cool off in the remainder part of the year. So that, that was a major reason.

Pascal, do you want to add something?

[Pascal Villemagne, executive]

I think you regarding the margin in Netherlands, yes.

[Harshil Dalal, executive]

Yes. Did that answer your question?

[Unknown Analyst]

Yes. Sir, a couple of follow-up questions on. So one is -- so do you expect that moving forward customer who is -- so the other competitor was in large orders for the raw material, he's going to pull off? Like is there any visibility around that? Like has the raw material costs dropped continue in Q2 has started, right? It has been not 7.5 months. Has had seen a downward trend? How are you sort of looking at that and thinking about it?

And secondly, the higher logistics costs affecting this quarter -- like it will ideally affected in Q4 FY '22. But by any things you need to be as much of an issue as it has been currently right? So what has changed? Like why is this strategy faster than the previous quarter?

[Harshil Dalal, executive]

Sure. So yes, to answer your first question, yes, we are seeing prices come off a bit as far as the [indiscernible] are concerns and that is our expectation that it should kind of normalize as we move further into the year. We might not see the 30%, maybe in this quarter, but maybe in the later quarters. So that is our expectation as far as the Dutch business is concerned.

Logistics costs was higher -- was higher in the last quarter, in the fourth quarter of FY '22 as well as in the current quarter. So that was -- I mean, that did contribute to the increased cost in both the quarter. So if you're comparing just these 2 quarters, then yes, then the logistics costs were more or less similar, and the major 2 reasons or if you are just being the differential that for both these prices and power entry into costs.

[Unknown Analyst]

So why was the FX loss impact of onetime expense? Like why is it not something you expect to have in the future? Do you like to add exposure? How does it work?

[Harshil Dalal, executive]

Yes. Yes. So we had -- so this CapEx loss that we had incurred in this particular quarter therefore, largely on account of a large repayment of a loan which we had to make in the June quarter. So it was like -- it was like a realized loss on that particular repayment that we had to take. We have hedged close to about, I would say, 60%, 70% of our exposure for the remainder part of the year and won't have any major repayments that are coming out in the next 9 months.

And that is the reason we believe that the INR 9 crores of loss in a single quarter is -- it's on a more of an extraction and that is in line with U.S. dollar INR FX we saw. And then there was a repayment of the particular loan, which is not going to happen in the remainder part of the year.

So with the hedges that we have been closed and with new major repayments coming off in the remainder part of the year, we do think so that should be a quarter with such a large amount of loss.

[Unknown Analyst]

Okay. And finally, so what is your guidance if you change your -- about FY '20 in term so revenues -- revenue growth as well as margins?

[Harshil Dalal, executive]

We do expect the revenues to grow by at least 10%. On the higher side, it could be somewhere around 12% to -- but that's kind of the broad range that we are looking at as far as the revenues are concerned, which could be much higher in the next financial year once we have started the supplies of the molecule as well as the linker [indiscernible] for the molecule as well as the French operations beginning to add to the revenues and the profitability.

So that is what our expectation is on the revenue side. On the margin side, we believe that it should be in the range of around 20% as far as the EBITDA is concerned.

[Unknown Analyst]

For the full year?

[Harshil Dalal, executive]

Yes, for the full year.

[Operator]

Our next question is from the line of Hari Belawat with [indiscernible] Consultants.

[Unknown Analyst]

This is regarding new projects. It is told that some $96 million has been spent on the new projects so far. What are the sources of funds for this debt, equity and internal accruals? How is the distribution in this?

[Harshil Dalal, executive]

[indiscernible] $96 million [indiscernible] in the presentation, that's the order pipeline that we have right now. So there is a development -- that is the amount of the development orders -- the value of the development order that are yet to start. There is a good amount of visibility for the last 12 months and which shows the development pipeline where it's coming from [indiscernible] development expenses.

[Unknown Analyst]

No, I agree with you. That is a different part of development. But from the new projects, you are raising some [ CHF 100 million ] somewhere it is mentioned are about INR 1,000 crores of funds. So what is the distribution of these funds for new projects? I'm talking about that.

[Harshil Dalal, executive]

Okay. [indiscernible]

[Unknown Analyst]

Yes. You can tell me.

[Harshil Dalal, executive]

Okay. So [ $100 million ] funding that we have raised, and we did not utilize completely. So that is basically to fund the expansion of the new projects in France, number one. So about 50% has incurred on that particular project. Part of the of the utilization of the remainder of $50 million. One is for our Swiss business where we are doing a certain amount of CapEx for increasing our [indiscernible] as well as well as the small skill manufacturing [indiscernible] We are also putting in some amount on our new gas [indiscernible].

[Unknown Analyst]

Okay. Sir, these are the equity and debt, what is the distribution in that? I want to know those figures.

[Harshil Dalal, executive]

The [indiscernible] for the entire CapEx. But then how much of the [indiscernible] and how much or how much of it is expanded through internal accrual. So right now most of the CapEx [indiscernible] We might see that's being taken right now to later on [indiscernible]

[Unknown Analyst]

Okay. That means the entire funds are tied up for these things.

[Harshil Dalal, executive]

Yes. Yes. Yes.

[Operator]

[Operator Instructions] As there are no further questions, I would like to hand over the conference to Mr. Harshil Dalal for closing comments. Please go ahead, sir.

[Harshil Dalal, executive]

Thank you, moderator. Thank you, everybody, for getting on to this call and being patient listeners and asking some quality questions. We would like to reemphasize that all of us are working extremely hard in order to make sure that we are able to deliver the performance that all of you are looking forward to. As far as the financial numbers are concerned, we have a very strong outlook. As far as the molecules are concerned, we are developing and manufacturing certain molecules, which are extremely mission nature and which would definitely help in improving patients' lives. And that study is going to be our sole for as we move into the future. And we [indiscernible] for your strong support, and we look forward to having you again on the call in the next quarter. Thank you very much, and talk about that.

[Pascal Villemagne, executive]

Yes. Have a good evening. Thank you.

[Harshil Dalal, executive]

Good evening. Bye-bye.

[Operator]

Thank you.

[Sanjay Majmudar, executive]

Good evening. Thank you.

[Operator]

Thank you, sir. On behalf of Dishman Carbogen Amcis Limited, that concludes this conference. Thank you for joining us, and you may now disconnect your lines.