Dishman Carbogen Amcis Ltd
NSE:DCAL
| US |
|
Fubotv Inc
NYSE:FUBO
|
Media
|
| US |
|
Bank of America Corp
NYSE:BAC
|
Banking
|
| US |
|
Palantir Technologies Inc
NYSE:PLTR
|
Technology
|
| US |
C
|
C3.ai Inc
NYSE:AI
|
Technology
|
| US |
|
Uber Technologies Inc
NYSE:UBER
|
Road & Rail
|
| CN |
|
NIO Inc
NYSE:NIO
|
Automobiles
|
| US |
|
Fluor Corp
NYSE:FLR
|
Construction
|
| US |
|
Jacobs Engineering Group Inc
NYSE:J
|
Professional Services
|
| US |
|
TopBuild Corp
NYSE:BLD
|
Consumer products
|
| US |
|
Abbott Laboratories
NYSE:ABT
|
Health Care
|
| US |
|
Chevron Corp
NYSE:CVX
|
Energy
|
| US |
|
Occidental Petroleum Corp
NYSE:OXY
|
Energy
|
| US |
|
Matrix Service Co
NASDAQ:MTRX
|
Construction
|
| US |
|
Automatic Data Processing Inc
NASDAQ:ADP
|
Technology
|
| US |
|
Qualcomm Inc
NASDAQ:QCOM
|
Semiconductors
|
| US |
|
Ambarella Inc
NASDAQ:AMBA
|
Semiconductors
|
If you don’t study any companies, you have the same success buying stocks as you do in a poker game if you bet without looking at your cards.
Utilize notes to systematically review your investment decisions. By reflecting on past outcomes, you can discern effective strategies and identify those that underperformed. This continuous feedback loop enables you to adapt and refine your approach, optimizing for future success.
Each note serves as a learning point, offering insights into your decision-making processes. Over time, you'll accumulate a personalized database of knowledge, enhancing your ability to make informed decisions quickly and effectively.
With a comprehensive record of your investment history at your fingertips, you can compare current opportunities against past experiences. This not only bolsters your confidence but also ensures that each decision is grounded in a well-documented rationale.
Do you really want to delete this note?
This action cannot be undone.
| 52 Week Range |
136.5
273.5
|
| Price Target |
|
We'll email you a reminder when the closing price reaches INR.
Choose the stock you wish to monitor with a price alert.
|
|
Fubotv Inc
NYSE:FUBO
|
US |
|
|
Bank of America Corp
NYSE:BAC
|
US |
|
|
Palantir Technologies Inc
NYSE:PLTR
|
US |
|
C
|
C3.ai Inc
NYSE:AI
|
US |
|
|
Uber Technologies Inc
NYSE:UBER
|
US |
|
|
NIO Inc
NYSE:NIO
|
CN |
|
|
Fluor Corp
NYSE:FLR
|
US |
|
|
Jacobs Engineering Group Inc
NYSE:J
|
US |
|
|
TopBuild Corp
NYSE:BLD
|
US |
|
|
Abbott Laboratories
NYSE:ABT
|
US |
|
|
Chevron Corp
NYSE:CVX
|
US |
|
|
Occidental Petroleum Corp
NYSE:OXY
|
US |
|
|
Matrix Service Co
NASDAQ:MTRX
|
US |
|
|
Automatic Data Processing Inc
NASDAQ:ADP
|
US |
|
|
Qualcomm Inc
NASDAQ:QCOM
|
US |
|
|
Ambarella Inc
NASDAQ:AMBA
|
US |
This alert will be permanently deleted.
Dishman Carbogen Amcis Ltd
You don't have any saved screeners yet
Ladies and gentlemen, good day, and welcome to the Dishman Carbogen Amcis Limited Earnings Conference Call. [Operator Instructions] Please note that this conference is being recorded.
I now hand the conference over to Mr. Pascal Villemagne. Thank you, and over to you, sir.
Thank you for the introduction, and good evening, dear shareholders, and thank you for participating to our investor call. I'm Pascal Villemagne, CEO of Carbogen Amcis branch.
I'd like to come back on the third quarter results, which demonstrate for Carbogen Amcis' very good results, followed by what we have done last year, if we compare quarter-to-quarter. This is the result of a number of consolidated actions that we have taken over last year, and we are [indiscernible] on the quarter on the top line.
We see, however, that we can do better in terms of profitability. And this is the reason why we are implementing further actions to leverage on this. Obviously, we are still struggling with a number of external factors, depending on the countries, especially in Europe. Cost of energy and raw materials are still affecting our performance. And this is something, although we think a lot of different initiatives, difficult to predict and follow up on those increases because, from time to time, it's difficult to pass on those extra costs to our final customers because of contracts or high competition coming from different types of order from different types of markets.
However, we stay very optimistic for the next quarters that are coming, and we should reach our targets, which are obviously an increase of the revenues for the top line and as well as an improvement of the cost EBITDA.
In terms of future, we also have a good news because we are registering a large number of new projects coming in, with a very healthy pipeline of development projects for the prime activities. So it's a good sign that we advanced a large part of our purchase order for the next months in confidence. We have a lot of confidence in some of actually those numbers.
Last point I'd like to emphasize is the -- we mentioned already in this call that we are engaging Carbogen Amcis in a [indiscernible] transformation. This internal project is going well, with the implementation of our [indiscernible]. And we are on track to release this new ERP during the third quarter of '24. It goes along with a number of transformations as we are going to implement Carbogen Amcis to even improve our level of profitability in that branch.
Thank you, everybody, and I pass on to Mr. Harshil Dalal, our CFO.
Thank you very much, Pascal. A very good evening to everybody. I'm sure all of you would have a chance to go over the financial results for the first quarter of the current financial year, which, in fact, was a very good quarter for us.
We reported a record sale of INR 723 crores as compared to INR 540 crores in the comparable quarter of last year. This represents close to 34% of growth in the revenue top line. Having said that, our estimate for the full year remains in line with what we had mentioned earlier, which would be anywhere between INR 2,700 crores to INR 2,750 crores.
As far as the COGS are concerned, the cost of goods sold are concerned, those remain at about 22%, which is more or less in line with our annual estimate of close to about 20%. We had -- as Pascal mentioned, it was a very good quarter for Carbogen Amcis Switzerland, while their commercial revenue increased significantly. And so did the Phase III revenue. The commercial revenue increased from 11.5 million in Q1 of last year to 30.5 million in Q1 of the current financial year. So that's a significant jump, which is driving the growth in the revenues.
As far as our employee expenses are concerned, which is one of the biggest expense item on our P&L, that increased by INR 40 crores in outcomes. However, there is a ForEx impact on account of translation of the Swiss Franc into INR, that is to the tune of about INR 20 crores. And the remaining portion is largely related to the increase in the merit cost because of the inflation in -- especially in Europe.
The other expenses of INR 143 crores includes foreign exchange notional loss of about INR 12 crores. And -- I mean that translates into an EBITDA of about INR 127 crores. This is after excluding the Software-as-a-Service IT cost. So all of this translates into an EBITDA margin of about 17.5% as compared to 16.5% in the comparative quarter of last year.
As far as the finance cost is concerned, since most of our borrowing is in foreign currency -- is nominated in foreign currency, because of the sustained increase in the LIBOR, SOFR rates, whether it's U.S. dollar borrowing or Swiss Franc borrowing that has had a negative impact on the finance cost, which is the comparable quarter was about INR 19 crores, that increased to INR 28 crores in Q1 of this year.
All of this translated into a profit before tax of about INR 29.5 crores and a profit after tax of INR 17 crores as compared to a negative INR 3 crores in Q1 of last year and INR 4 crores in Q1 of last year, respectively.
As far as the segment-wise results are concerned, as I mentioned, Carbogen Amcis, as a group, performed fantastically, but more so on the CRAMS side of the business, where the revenue increased by about 54% as compared to Q1 of last year. So from INR 363 crores, that increased to INR 561 crores.
As far as our Dutch business is concerned, which manufactures the cholesterol and vitamin D analog, we also saw a significant increase in revenue over there, which was about 46.7%. So revenue increased from INR 63 crores to INR 93 crores, driven by growth in both the cholesterol as well as the analog business.
As far as India is concerned -- as far as the NCE APIs and Intermediates are concerned, most of the orders to be serviced are back-ended in the current financial year. so which are to be serviced between Q3 and Q4 of the financial year. And that is the reason we see a lower sales figure in Q1 of this year, but we expect the most of it to be recouped. And we should be on our target to achieve revenue in excess of INR 300 crores on the API side for the full financial year.
As far as the Quats and Genercis is concerned for India, the revenue stood at about INR 40 crores. And this was also lower as compared to what we are expecting for the full year on a run rate basis. So we do expect a pickup in that particular business in the remaining 9 months of the financial year. So I would say it's more about timing rather than anything else as far as the India business is concerned. And obviously, I'll hand over the call later to Paolo, who can also explain about the recent regulatory audit and what we are expecting in the next month.
So overall, it was a very good quarter for us, both on the revenue front as well as on the margin front. The EBITDA for Carbogen Amcis, which is the CRAMS business, stood at about 21.7% for the quarter as compared to 19.4% in the comparable quarter.
The cholesterol and vitamin D analog business did an EBITDA margin of 18.4% as compared to 19.3%. So what we see in this particular business segment is that there is an increase in the margin as compared to Q4 of the last financial year. However, the prices of the [indiscernible] which is the key raw material, do remain elevated, though we have seen a bit of pulling off in the energy prices.
As far as the India business is concerned, the margins were subdued largely because the revenues were quite low in the first quarter. However, as I mentioned, the revenue should pick up in the remaining three quarters of the financial year, which would result into significantly higher margins for the India business.
Having said this, I would like to hand over the call to Mr. Paolo Armanino, our Chief Operating Officer for the India business. Paolo?
Can you hear me?
Yes. We can hear you now Paolo.
Good evening, everyone. So maybe, as we mentioned, I can give an update about regulatory agencies? So we have faced an inspection last week with -- to start from -- in the Japan as translator. It consists of getting 4 days audit at our [indiscernible] which is the same cycle where we are going to have the [indiscernible] in second half of September.
This action was related to one product, but mostly in general, there was the inspection of the overall site. So all the premises were inspected by the auditor. The inspection result was definitely positive. And we, actually, had a very good outcome by the inspector. And only there is a few observations were found.
The nature of the observation is not very severe. It looked minor actually as a matter. And in the coming weeks, we will be receiving the report by the PMDA authorities from Japan. And we verify to their observation, which largely has been already done by the team at Bavla site during the last day because the observation, as I mentioned, was not particular [indiscernible].
So the PMDA audit has been completed and now we are going to focus mainly for the coming weeks to the [indiscernible] which is, as I mentioned, going to be held in second half of September. So this was a kind of preliminary audit by an external agency foreign authorities.
Thanks, Paolo. I think -- with that, I think, moderator, we can open the floor for Q&A.
[Operator Instructions] The first question comes from Karan Agarwal from Old Bridge Capital.
A couple of questions from me. The first one is the commercial MC revenue that you spoke about. Was that the assumption of the French facility ramp up? Or it's all coming out from Switzerland? And then that numbers that you gave out were only Switzerland and/or France?
Karan, thank you for your question. But yes, I mean all of the CRAMS revenue for Carbogen Amcis is pertaining to the Swiss entity, U.K. entity and Shanghai, all these three entities put together. The French operations have yet to commence in terms of generating revenue.
But Pascal, maybe you might want to add more to it?
Yes, it's okay. We are finalizing longer qualifications. And we run our first what we so-called technical batch and we should start the operational work by the end of the month. And then starting the first development work with customers over September, which is a good news. But we not yet have commercial production in that new facility. For the time being, we only have development projects serving clinical [indiscernible] for our customers.
Okay. A couple of other questions. One, do you expect 10 of your 15 late Phase III molecules to commercialize in this year? And the second Harshil to you, what's the gross and net debt on books [indiscernible] in '23?
Sure. So maybe Pascal, you can answer the first question on the 15 molecules in the Phase III?
Yes. No, for the time being, we've seen molecules that are still in Phase III. Two of them applies, but the customer is not getting any kind of further information from U.S. authorities. So in principle, we should not see this is carrier something, but most probably for the next fiscal year.
One of the Japanese customers that we already mentioned, part of the product is already commercial and another application for the product that they're manufacturing. They should enter into a commercial stage by '25. And we are manufacturing various campaigns of that products. So we see a lot of activities into the development, which would be probably transferred during the next fiscal year. But for this year, there is no other commercial than the one that's coming in the last year.
Yes. So currently, as far as the gross and net debt is concerned, so our net debt stood at about CHF 160 million. And the gross debt was about CHF 210 million.
Okay. And just last one question, Harshil. I mean are you seeing -- I mean any weakness in terms of your pipeline or your interaction with end customers? Because of the fund -- biotech funding, especially in the U.S., not garnering the momentum that we saw throughout '21 and first half of '22?
You're absolutely right. We see an erosion in terms of market demand because 3 years back, we were seeing a lot of new biotech [indiscernible] on site. Since the beginning of the year, it's even harder and harder to find new companies and to launch new projects. However, as I mentioned, we still have a very [indiscernible].
By the end of the first quarter, we ended up by adding CHF 126 million [indiscernible] compare quarter-to-quarter. We raised this pipeline by 10%. So we see that there is fairly healthy situation. Notably linked to the fact that we are very active on oncological markets, and that specific market is still very dynamic, a bit less than it used to be. We have to be realistic, but it still demonstrates a lot of diligence comparing to other pharmaceutical market.
The next question comes from Vishal Manchanda from Systematix.
I missed your opening comments. I wanted to understand whether Bavla facility has been inspected or it is yet to get inspected?
So the Bavla site from EDQM still needs to be inspected, but that is what will happen in the next month.
So that's what sure, it's going to happen next month?
Yes. We got inspected by the Japanese PMDA. So that was last week. And that was for the Bavla site for a specific product.
Okay. And was that inspection successful?
Yes, it was a successful inspection. And as Paolo mentioned, they have pointed out some minor observations. But apart from that, it was quite successful.
Okay. And was the audit related to an NPE product or a generic product?
So it was related to a product that we already supplied to one of our customers who wanted to launch it in the Japanese market.
Okay. So you're not currently supplying it from Bavla. Is that right? And you're supplying it from...
No, no, no. We are already supplying it from Bavla, but not to the Japanese market. So now that the customer wants it to be launched in Japan, that triggered this particular inspection.
Okay. Okay. Any color on the size of the opportunities for this product?
I don't know Paolo if the customer has mentioned what could be the potential opportunity?
They did not mention that how it's divided between countries actually. I cannot tell you about this.
So large volume API or kind of high-potent API?
Large volume API. It's about multi [indiscernible] APIs.
Okay. And regarding the bank facility, are all the costs related to the credit facility into the number?
Yes. All the costs -- except for the costs that were related to setting up of the project, which were like preoperational costs. Those will be capitalized. But apart from that, all of the other costs that go into the P&L.
So the new employee that you would have recruited for the facility on those costs are being expensed or they have been capitalized?
No. So they are getting expensed out unless and until we identify that these employees worked on the -- on setting up of the plan. In that case, it would be capitalized.
Okay. Okay. And I missed the guidance around when the French facility will start contributing to the revenues?
That would be from September onwards. So most likely from Q3 on the commercial side.
Okay. And kind of peak revenue could be around $30 million, $40 million. Is that the right number?
Yes, it is.
Revenue from the French facility?
Yes. That's what we have other targets. Always difficult to say exactly by when shall we reach this peak because, as you may understand, we are building up the project pipeline with our customer.
What we can say is that currently, we are having there a number of customer audits and all the audits are extremely good. And we have a very nice feedback from all the customers that really enjoy this state of the art facility. So -- and it translates into the fact that in spite we haven't started yet, we have enhanced already about $6 million per share for that particular unit. And we keep on receiving the number of demands and we are quoting those demands, and we should increase our project pipeline adequately.
So this facility is going to contribute to revenues this year as was planned in our budget for sure. And the peak activities should come for the next 2 to 4 years, depending on how successful we will be to completely fill the filling line that we have in that manufacturing unit.
Okay. I guess one more on the ADC linker projects that you're doing for the Japanese client. When is that commercializing?
A part of that is already commercial, but it's not -- that part of the product that is commercialized is done by the customer himself. As we mentioned already in previous calls, the facility that we have built dedicated to that project, we come -- and contribute to the new applications for that particular ADC, and that is planned to be marketed by '25 by the customer.
Okay. Okay. And just one final one. What would be the CapEx requirement for this financial year FY '23?
On a consolidated basis, we're looking at about 30 -- I mean, sorry, CHF 25 million to CHF 30 million.
[Operator Instructions] The next question comes from Keshav Kumar from RakSan Investors.
You were looking at Bavla before the EDQM audit. How have we serviced those volumes since the audit?
I'm sorry, Keshav. Can you please repeat your question? I think the initial part was cutoff.
Yes. So the commercial CRAMS we were doing at Bavla before the EDQM audit. How have we serviced those volumes since the audit?
So Paolo, if you want to answer that? So basically, Keshav, what happened after the EDQM observation is that, first of all, we performed detailed risk assessment for all of the molecules that were supplied to the customer. And once that stage was clear, after that, many of our customers got remote audit or physical audits done for the Bavla site. They submitted those reports to the EMA, the European Health Authority, brought for clearance. And after that, we were able to restart the manufacturing of those molecules for those customers.
In the CRAMS business, what we are mandated by our customers is to keep at least 5 to 6 months of inventory for them in order to make sure that there is no bottleneck in the supplies of APIs, number one. And number two, the customer also maintains a good amount of inventory in order to make sure that the end product is not impacted.
So the combination of these two factors and then obviously, with the audits being done by the customers, after that, we were able to restart the manufacturing and then the supplies are being made to the customers.
So even -- I mean, as we speak today, we are manufacturing for most of our customers for whom we were manufacturing prior to the EDQM operations. And we expect the volumes to increase quite a bit after the EDQM inspection is completed.
So sir, has there been any attrition or revised quantities because our revenues have gone down drastically over the year since then?
Yes. I mean the initial years after the EDQM observations, the revenue dropped significantly. So if you see the India stand-alone revenue, financial year '21, they dropped from -- we were doing like about INR 500-plus crores out of India. That dropped to about INR 200 crores in FY '21, which then ramped up to INR 300 crores in '22 and then INR 400 crores last year.
As customers kept on getting more and more -- I mean more and more customers started getting approvals, we were able to supply more quantities to these customers. But still, there are certain geographies where these customers -- within Europe, that these customers are not able to sell or use our APIs for the final product, where -- in which case, the EDQM clearance becomes quite important for us.
So sir, does that mean that meanwhile, that customer might be shifting to a second resource because they can...
Yes. The thing is that in many of the customers, we are the sole suppliers of the API. So what we understand is that they will be shipping from whatever stock that they have, then they would have a good amount of stock of the APIs that was supplied earlier.
So that is how we see it. And obviously, in between there were COVID years where as such, the supplies were lower than what they were prior to COVID, so that also actually helped us in making sure that the customers have uninterrupted supply.
Sure, sir. So basically, if the EDQM audit goes through successfully, then we can expect to be back on the same base in FY '25, at least? What we would be the...
Yes, absolutely. And it should be even higher than that. With the kind of orders that we are expecting from our existing customers plus, it opens up the door to get more orders for the new -- from the new customers as well. So we do expect a significant ramp-up in the revenues after the EDQM clearance -- in the financial year after the EDQM clearance.
Okay, sir. And sir, secondly, we had mentioned that Amcis China margins were 25% for 9 months FY '23. So what was the full year number for both revenues and margins?
You mean for China?
Yes.
So China, in the fourth quarter, the margins were quite high. It was close to about 35% in the fourth quarter of this financial year. Even last year, the margins were about 30% for the full financial year.
Okay. So basically -- so if I go back to FY '19, we did about 15% of PBT. After that, the following year was a deferred tax write-off, which was noncash. But nevertheless, we saw a one-off year with very good PBT showing what Shanghai can deliver, but never the sustainability. So what has led to the margins this time around? And why should it be sustained and not revert back to lower levels going forward?
So what has happened is that there has been -- I mean there has been quite a bit of transformation in our Shanghai site in terms of the orders, which are now being manufactured out of that particular site.
So if you see, say, 4, 5 years back, maybe we had 2 projects that were being done out of China versus today, we would have at least 7 to 8 projects, which are being done out of the Shanghai site. The Shanghai site kind of acts as an extended bank of the Swiss arm.
So we have seen many of the orders going to the Shanghai site. And there have been a lot of improvements that have been done in that particular site in terms of making it as close to a GMP site as possible. So the plan is that maybe in the near future, we might even go for a Chinese FDA so that we are able to sell in the Chinese market as well.
But Pascal, do you want to add anything to that on the China site?
No, I think you summarized well the situation. One thing I can say is that in our business all the development work we do, we deliver clinical trials of the customers. If the clinical trials faced an issue and the customer stopped the clinical trials from one day to the other, you are having an issue because -- you lose the project because of the clinical level.
So that also explains sometimes the counter performance from one quarter to another. We are extremely depending from the success of the clinical trials from our customers. And yes, from time to time, we faced some issues because we have to find a new project to replace the one we just lost.
This is the reason why I'm insisting with the sales teams to broader the customer portfolio. And the more customers, the more products we have, the late sensitive we would be to one of the project launch. This is the key to get to a more regular performance on one of those facilities.
The next question comes from Sathish from Share Investments.
Congratulations on a good set of numbers. So I have few questions for Pascal and a few for Harshil. Harshil, could you just tell how much money has been debited on the France plant in the current quarter, on the revenue side? [indiscernible] which is interpreted in the P&L? And what type of ramp-up we can expect post EDQM from the existing customer itself? Where I think it's something like low-hanging fruits, clearance of EDQM can definitely give a good pipeline burst in terms of revenue. If you can throw light on that.
And for Pascal, what type of development pipeline you are seeing in terms of your order book for development side. Because we heard few CDMO players who are quite a [indiscernible] on the -- where development site work is coming to Delhi. Basically, we are seeing unprecedented inquiries for them.
I just wanted wanted to know what is your view and what is your business sense on those lines? And regarding the integration of Carbogen Swiss and India unit 9 [indiscernible] last 2 years, we're having any sales for unit 9, the HIPO facility. So what is the management view on making the site commercially?
Yes. Thank you, Satish, for all your questions. I can go one by one. So the first question regarding the costs, which have been debited to the P&L for the French facility, so that is EUR 2.7 million. So that's a cost which is delegated in the first quarter of this financial year. Sorry, if you can just repeat your second question. So it was the -- yes. So I think the existing customers -- maybe, Paolo, you can answer the question, but we do expect that the business from the existing customers itself should increase quite significantly after the EDQM clearance because many of them are waiting for the clearance to be obtained, after which, they want huge amount of quantities of the AGI/Intermediates from us. Paolo, do you want to add to that?
Yes. What we see exactly as you are saying, how many customers? And we also make lot weeks and months. I'm speaking directly with the customer multiple times. They are just on waiting. So they're doing like [indiscernible]. And they're in the already available and selling price available.
And so we discussed already what is going to happen after EDQM. So there are also many markets, which currently they cannot supply materials. And immediately after the approval, they will be able to support this market. So a major part of the customer, just waiting for the approval by the [indiscernible] to response the deliveries. And many of these customers are really discussing with us in advance phase of the contact tool and so on and so on.
Okay. And to Pascal, regarding the development pipeline, you can throw some light on that?
Yes, absolutely. So regarding the development product line, basically the base of our customers is running around mainly Oncology because we have IPO capabilities in Switzerland and very long parties around that. We also have a number of ophthalmologic products and also a number of off-line drug applications that we are chasing.
The capability in some instances are not huge comparing to some CMOs where they have a lot of plants, a lot of reactors to fill. So we are more medium size compared to [indiscernible]. However, we have those [indiscernible] switch, and with that expertise, we are able, as I mentioned, because that part of the market [indiscernible]. We are able to still continue to grow our pipeline of development despite of the trends that have been described earlier on the call here and there, a few CMOs are serving a bit to fill their large equipment capacities when it start to divide it from a biotech perspective.
And regarding HIPO unit 9, we have one of the best HIPO facility, but it's lying idle for the last 2 years. So what type of -- what's your management's view on making that plant commercially once it's available?
So regarding the facility in India, of course, it's also part of the Bavla site. And as Harshil mentioned, there is an expectation from customers to seek audit clearance from the EDQM. So yes, the facility has an attractive setup, but we have to be patient to clear the debt from an audit perspective. And from that point in time, we can really shape and rediscuss a number of discussions that we are on for a while with some of the customers.
The next question comes from Ketan from RoboCapital.
I wanted to know if you have any debt repayment plan. Do you plan to sell any noncore assets and repay the debt? Or how will be the debt level in next 2 to 3 years?
Ketan, thank you for your question. So as far as, sir, the debt is concerned, yes, I mean we have the regular repayments, which we'll be doing every year. But as you see, most of the debt has been taken in the last 2 years -- 2, 2.5 years, and that is for the capital expenditures that we were doing for setting up the new French facility as well as the EDC expansion in Switzerland.
And what's ongoing right now is the digital transformation that we are undertaking across the Carbogen Amcis group. And the fourth one is obviously the CapEx that we are doing at the India site, taking into account not just the regulatory audits, but also keeping into view the next 10, 15 years, where we do not anticipate to face any such regulatory issues as we did in March of 2020.
So what we expect is that we would start realizing the returns from this investment over the next 2 to 3 years, which would help us in generating a good amount of cash flow and which can definitely be utilized to either pay off the debt or keep it as an investment. Whatever the net debt in 3 years' time should reduce from where we are right now is what we are targeting internally.
Having said that, if you see our business, it is quite capital-intensive. So depending upon how the business progresses, in order to get new molecules, in order to -- I mean we'll have to see how the molecules commercialized, the ones under late Phase III development, we are trying to utilize those sites in Manchester, Shanghai and eventually India, for manufacturing the Intermediates. It's not the final API for these molecules, especially for the larger volume ones. And we would not want to have any unnecessary CapEx, but try to fully utilize the capacities and the capabilities that we have across the organization.
So to answer your question, we do expect that the net debt should come down in the next 3 years, with a cash -- with the free cash that would be generated. But obviously, there are no plans to sell any noncore assets because we don't see any noncore assets as we speak right now.
Okay. And these fixed assets, which you are purchasing from last, let's say, 2 to 3 years, this must be in relation to all the expansions you would have just mentioned, right?
That's correct.
Okay, sir. And then what is your CapEx plan and maintenance CapEx going ahead?
Sir, I would say, on a run rate basis, about 25 million can be taken as a run rate of the CapEx to be done over the next 3 years. It's for 25 million for the year, 25 million to 30 million. So this would include the maintenance CapEx as well.
Sir is 25 million Swiss Francs?
Swiss Francs.
Francs. Francs. Yes. Okay. So all of this will be maintained. Okay. And if you can make an estimate...
So most of it will be maintenance as well as some of it would be like replacement CapEx. Some of it could be -- like, for example, we entered into this co-investment agreement with a Japanese customer. So it's depending upon the volumes that might be required for some of these new molecules. We might enter into this kind of an agreement which will require some kind of CapEx as well.
But all of the CapEx that we will be doing, that could be backed by either a form of contract or a form of purchase order. So there will be no CapEx. There will be just in the anticipation of some business coming here.
Okay. And can you provide some estimates for FY '25 revenue?
In terms of -- so in terms of revenue -- so as we guided, even last time, we do expect that over the next 3 to 5 years, we should expect revenues to increase by at least 12% to 15%. The operating margin should increase at a higher pace as India keeps on ramping up the revenues, especially out of the Bavla site.
So as you would have seen prior to the EDQM, India was doing margins of 40%-plus. And once we are able to get towards this hurdle of regulatory orders, we do expect that more business should come to India, and that should help us in improving the overall group EBITDA. So the EBITDA should keep on increasing by about 15% to 20% year-over-year.
[Operator Instructions] The next question comes from Rupen Shah, an individual investor.
Harshil, if I remember correctly, last 1.5, 2 years back, we had announced four partnerships with European and U.S. partners. So what is the status on that?
So what we had announced was what I just recently mentioned. It was a co-investment agreement that we had entered into or we have entered into with this Japanese customer for whom we would be manufacturing the ADC molecule.
No, no, sir, that is there. Japanese is there, but we had announced with our European partner and American partner also?
European...
[indiscernible].
So there would be -- so there are co-investment agreements with some of our other customers as well, including some of the hi-tech companies in the U.S. and Europe. So for that also, we are currently manufacturing the molecule and supplying it out of the Swiss entity.
Okay. So investment in that must be -- much less than what we have done for the ADC project right?
Yes, that's correct. That's correct.
Okay. Okay. And what is the status of -- we have applied for patent for vitamin D analog or something like that? What is the status on that?
Yes, so that has been applied. We are still waiting for the results of it. So that has yet not been approved. So we are waiting for that.
[Operator Instructions] As there are no further questions, I would now like to hand the conference over to Mr. Pascal Villemagne for the closing comments. Over to you, sir.
Thank you very much. Well, thank you so much for your attention today. And we'll be back in a quarter to describe our revenues and results. I thank you, everybody, who participated today. And thank you, Harshil. And thank you, Paolo, for your participation.
Thank you very much, everybody. Have a lovely evening.
Thank you, sir. On behalf of Dishman Carbogen Amcis Limited, that concludes this conference. Thank you for joining us. You may all disconnect your lines now, and have a pleasant evening, everyone.