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Supriya Lifescience Ltd
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Ladies and gentlemen, good day, and welcome to Supriya Lifescience Limited Q1 FY '25 Conference Call.
[Operator Instructions]
Please note that this conference is being recorded. I now hand the conference over to Ms. Prachi from Orion Capital. Thank you, and over to you.
Thank you, Aditya. Good morning, everyone. On behalf of Supriya Lifescience Limited, I extend a very warm welcome to all the participants. Before we begin the call, I would like to give a short disclaimer. This call may contain some of the forward-looking statements, which are completely based upon our belief expectations as of today. These statements are not a guarantee of our future performance and involve unfortune risks and uncertainties. With this, I would like to hand over the call to Satish, Executive Chairman and whole time Director, for his opening remarks. Over to you, sir. Thank you.
Good morning. and a warm welcome to all the participants. Thank you for joining us today to discuss the quarter 1 financial year '25 results of Supriya Lifescience Limited. To take us through the results and answers to your questions, along with me are Dr. Saloni Wagh, Managing Director; Mr. Krishna Raghunathan, Chief Financial Officer and our Investor Relations team, Orion Capital. I hope everyone had an opportunity to go through the financial results and investor presentation, which we have uploaded on the stock exchange and on our company's website.
Let me begin with the highlights of quarter one financial year '25 financial year performance. It gives me immense pleasure to announce that despite the geopolitical uncertainties, supply chain disruptions and macroeconomic [indiscernible], our business has demonstrated resilient performance. The company has achieved a revenue of INR 161 crores, which is a 22% growth as compared to the previous year with a robust gross margin and EBITDA margin of 39%.
This strong performance is a direct result of our successful execution of the long-term present strategy which includes: A, enhanced market penetration and expansion into highly regulated markets coupled with a broadened product portfolio within these regions; B, widening our product basket through the infusion of newer molecules and therapeutic solutions; C, secure and increased number of regulatory approvals is similarly focusing on backward integration to deliver high product quality; D, integrating manpower and leveraging technology to drive operational efficiency and achieve effective cost management, prioritizing R&D investments and ensuring supply chain stability.
During the year, the company significantly strengthened its presence in regulated markets, leading to a notable increase in revenue contribution from European region. In quarter 4 financial '24, the European market accounted for 43% of the company's revenue. This figure to an impressive 51% in Q1 financial year '25. Our customer base of 1,700 customers across 128 countries provides a strong foundation for our strategic shift towards regulated markets, which is [indiscernible] to enhance the company's overall profitability by expanding into regions with Indian regulatory frameworks. We demonstrate our commitment to delivering high-quality products and operational excellence, which driving cost leadership in manufacture. The company has developed a pipeline of new products, including extending beyond its long standing expertise in anti-stimulants too, include anesthetics, anti-anxiety, antidiabetics and other therapeutic areas. He has the products are scheduled for launch in the upcoming quarters. We also extend our contract development and manufacturing organization, CDMO, business portfolio with the addition of molecule model, which will provide additional 500 [indiscernible] of capacity. We are set to double our total capacity to 1020 kilometers by the end of the September this year. The forthcoming ramp-up in capacity, driven by our ongoing responses, will be a peak at least for future growth.
The company is leveraging its relations with M&C's for business development. The performance we have achieved over the last several quarters reflect the transition of our business model from being predominantly focused on prime APIs to its combination of APIs and CMO CDMO services.
With this, I hand over the call to our CFO, Mr. Krishna Raghunathan, to share Q1 financial year '25 financial highlights with you all. Over to you, Mr. Krishna.
Thank you, sir. Hello, everyone, and good morning. I will now show the operational performance of the quarter and following which we will open the floor for questions and answers. The company reported revenue from operations of INR 161 crores in Q1 FY '25 as against INR 132 crores in Q1 FY '24, registering a growth of 22% year-on-year. Q1 FY '25 stood at INR 62.5 crores as against INR 44.5 crores in Q1 FY '24. And EBITDA margin stood at 39% for Q1 FY '25 as against 34% in Q1 FY '24. Profit before tax was approximately INR 60 crores for Q1 FY '25 as against approximately INR 43 crores in Q1 FY '24, a growth of around 40%. [ PAT ] had stood approximately of INR 43 crores in Q1 FY '25 as against INR 28.5 crores in Q1 FY '24. PAT margins stood at 28% compared with 22% in Q1 FY '24.
We have significantly optimized our working capital by reducing working capital days from 215 into FY '24 to 168 days in Q1 FY '25. This improvement is primarily driven by a substantial reduction in inventory holding period from 223 to 167 days. Our annualized asset turnover ratio has risen to [ 0.68 ] to point this quarter compared to 0.63 in corresponding period last year. We continue to uphold a strong financial position with a debt-to-equity ratio of 0.01. Significantly, we have maintained a conservative approach to borrowing by utilizing only [indiscernible] credits and bank gearing these without tapping into the working capital limits. Now we can open the floor for questions and answers. Thanks to all of you.
[Operator Instructions]
Our first question is from the line of Parth Agrawal from Western Research.
I have two questions. One is the gross margin or the EBITDA margin that we have for is three API. Is the new APIs that we are targeting, is the margin profile same? Or is it lower, higher? Can you just highlight on that part?
Sir, let me tell you that Supriya Lifescience is working in the regulated market. Now regulated market, we all know that we will get the maximum returns. Whenever you go for a new API launch, it becomes a little difficult. You can't go in a regulated market. That time, you have to go to non-regulated market, but it's a short term. So, again, it will achieve the same expected whatever reasons are there will be delivered to by us to the shareholders.
So considering that the future growth would more likely to be driven by the new APIs, can we expect some margin compression, let's say, for 2, 3 years until until the product matures for us?
Yes. Correct. Like you rightly said, our Chairman said that till the products mature in the more regulated market, there could be a slight compression in the margin. But the goal will always be to be present in the more regulated market.
Got it. My second question was on the target market price. So as per my understanding, whatever our traditional APIs for the target market was relatively short or-- was a smaller size compared to what we are currently targeting. Is my observation correct or wrong? Can you just comment on that?
Correct, yes. So now with the bigger capacity coming in and the module going up on stream by September. And our Chairman mentioned, that we will be doubling our capacity. In this case, with the larger capacity, now we are targeting those molecules, which does have a larger global market. So we are slightly moving towards larger global market -- global volume kind of products.
So does that even increase a competitive intensity for you, which was not there previously?
At this point, in fact, we are trying to go with backward integration. I think that is going to be one of our very strong point. Whichever product we have selected -- by the way, on backward integration, we'll be able to make a significant difference in the market. And with this kind of backward integration up to KSM level, we are very confident that we'll also be able to keep the competition out even in the newer products.
So in the newer products as well, you are starting with the backward integration. You're not distressing the market first and then based on the size, you will take backward integration. From day 1, we are going for reward indications. Is that the case?
Supriya normally, whenever enters any API, they always consider backward integration. Much lesser competition, new products which can hit China, not manufactured in India at all. This is the strategy of Supriya Lifescience under the leadership of Dr. Satish Wagh.
Our next question is from the line of Aditya from MSA Capital Partners.
Many congratulations, and [indiscernible] to you and the entire team. Just a couple of questions. So I understand the gross margins have expanded. But if I were to attribute between the increase to product mix or decrease in cost, what would be the attribution.
Sir, as I told you in the past, if you see the strategy very deeply of the company, company is born for the regulated markets business. Now everybody understands whoever are in this industry in pharma. Regulated markets gives you better opportunity, better profit, nobody doesn't enter very fast. And the pharmaceutical industry is such that regulated market whenever the customer changes the supplier's name and bring a new name. He is focused that in the next 5, 10 years, he is going to continue with the organization. We will not change the supply because today, everybody is checking on the supply side, quality size, and they need a constant good vendor who implements the good manufacturing practice. I'm sure you understood now.
No, definitely. So can I say that this 69, if not 69, the 65 is now the new steady state for the company?
No. So like our Chairman said before also, I see a lot of new launch news [Technical Difficulty] financial year. So there will be some margin normalization, which will happen. The current margins are there growth like we said the mature products are doing really well in regulated markets. So naturally there, the pricing for these products is much higher. So once these new products come in, we will again have a normalized margin profile. We have always guided about 28% to 30% in terms of margin. However, looking at the current financial year, 30% plus is something what we see we will be able to maintain. However, a concrete guidance on how upwards of 30% this would be, we will be able to give post quarter 2 results.
Understood. And just a bit on the geographical front, or Europe as a region has performed really well for us this quarter. But North America, the revenues have been -- have witnessed sharp degrowth. Do we see an uptick because new and new products are being registered with the US FDA.
Yes. So a lot of the new products, which we are going to launch there, the North American and the Latin American market size would be much larger as compared to euro. So when these products start contributing to the revenue, definitely, you will see that the North America and Latin American market share will go on.
Sir, I think my statement which had come from my side I think you have not carefully gone through it. I said the products which we are going to enter will hit China. Did you understand, will hit China. There will be no manufacturers in this country in India, it will be make in India. So for me, when I go to North America, Latin America, any part I will be a strong alternative for the supply to China to those people.
Understood. And just last question if I come back in the queue. When can we see the CMO revenues kicking in? And does this quarter have any to revenues?
No. So this quarter does not have any CMO revenue. We will start seeing the CMO revenues kick in probably by third quarter of this financial year. So third and fourth quarter will have some revenues from some of the CMO contract. From next year onwards is where you know you will start seeing larger contribution from CMO opportunities.
Our next question is from the line of Jay Shah from JS Family Office.
Congratulations for a great fit. And congratulations Dr. Wagh for really creating an alternative to China. I just want to ask one question that we are going ahead with the CDMO expansion. What is it that the management also sees when we are being approached by a client and even what is it that the client sees when they approach Supriya for a CDMO contract. Let's say from Supriya side, I understood by this is Mr. Wagh's comment that backward integration is one of our strong points. But what is it that we would also be comfortable when onboarding a client, some qualitative aspects on both sides from you and from the client.
So [indiscernible] the position of the company, [indiscernible] large regionals already have a set reputation in the market because when you work with these kind of [indiscernible] nationals, they already have very high standards in terms of quality, in terms of EHS. So if you're able to qualify with the -- pass their audit, it sets a very right tone in the market that you have the right kind of policy, regulatory and EHS approvals internally. So that is definitely one thing that we look at.
The other thing that we look at is also the quantum of the business. If we will be able to take that product into our facility, how well it goes with our line of technical capabilities and do we have the right kind of backward integration capacity also created. So these 2 are the bigger quality aspects that we look at, why onboarding any new customers.
Okay. And second question is in this new facility that you are trying to start with in the [indiscernible] and tie. Would it be fair to say that there will be product fungibility as well as chemical or conduit in that setup or it would be dedicated to a few products or few chemistries.
So at this point, we have multiple lines set up there. This is going to be for finished formulations, contract manufacturing and contract development. We have multiple lines there, like injectables, bottling lines, tablets and capsules. Within the line, yes, there is product [ visibility ] that we can use it for multi different kind of products. So this is the kind of capacity that we have created an Ambernath currently.
Our next question is from the line of Jai Shah from SKV Securities.
Congratulations on a great set of numbers. So my first question would be, what is the total revenue generated by our top three APIs. And given that you previously indicated that the top 3 products contributed approximately 44% to 45% of revenues in prior quarters. So what is the status for those in this quarter?
So unfortunately, we will not be able to speak at product level or therapy level in today's call. But we have always been saying that the new product addition will derisk the portfolio. So definitely, you will see a more robust portfolio moving forward.
Okay. My second question would be, could you also quantify the contribution of CMO and CDMO operations to the company's overall revenue for the quarter? And what percentage do we expect this to reach in the future?
So at this point, like I said in my previous answer, in this particular quarter, there is no contribution from CMO, CDMO. The contribution will start coming in, in the later half of the financial year. We anticipate moving forward, let's say, in the next 3 to 4 years, our CMO should contribute about 20% of the total revenue.
Our next question is from the line of Jagvir Singh from Shade Capital.
Congratulations on a good set of numbers. Sir, my question is related to China, so are you seeing any upgrade in the sales market.
We basically will tell you, we are going to work in the regulated market. China, yes, there is. But many of the products which we continue and going to have in the future, it is observed that the suppliers who are supplying all over the world does not even carry a qualification of GMP, not even ISO, but people continue to buy because there is no second sources. But since, Supriya has a good opportunity while discussing with various of fronts various companies that, it's a U.S. FDA plant. It can be CGMP part, WHO plant. So opportunities are coming more and more. And we would work for the profits in the markets.
Okay. And sir, second question is 2, 3 years like Delhi is a big market for us now and [indiscernible] market is a bigger pie. So there be any [indiscernible] in the [indiscernible] S2 was was bigger than the S1, is there anything on [indiscernible] it.
Strategy of the company, as I told you, we don't concern at any market. We concentrate in getting more and more EBITDA and profits for that, we have a regulated plant. So we try to utilize at maximum the plant for getting better performance and better returns.
But my question is earlier, SP has always [indiscernible] in H1, is there any change in the spend or it will likely to continue?
It's to better [indiscernible] will it be that?
Yes. Yes. It will -- we actually are seeing very positive trend in terms of revenue growth as well as margin profile. So definitely, you will expect positive growth in terms of revenue as well as margins moving forward as well.
Here, I give you some more information because I think when I was talking, whether you listened or not, I don't know. We are going to concentrate or we have been concentrating on make in India process, which is currently only supported and given the material from China. We are going to fight with China not with any Indian company. And the chemistry is China, we should fight and get the performance. For that, people are interested with a GMV U.S. FDA plant rather than non-GMV plants of China. So opportunity is huge. Future is great. Today, also, I hold more than 70% stock with me. I'm very happy that we will do good work, good job, which will deliver good results in the market.
Our next question is from the line of Neil Shah from Ashika Stock Broking.
Congratulations on set of numbers. Just two questions I have we are looking at CDO and CMO opportunities and you already have 1 contract something like DSM. So we were examining ways of opportunities is welcome with [indiscernible] companies in order to DSM. So any color on that, any specific details that we have now?
So the ASM contracts are moving really well. We are in the process of registration of the product in Europe and Japan market as well as other regulated markets like U.S. So once all these registrations come, we already have supplied to them smaller volumes for their food grade requirement. Once the registration comes, you will see a good scale up happening from the DSM contract.
So apart from the DSM contracts and other opportunities that we were discussing for some other advanced [indiscernible].
So there are many other opportunities which are there. Two of them are at an advanced stage. We should be able to announce at least one of them, hopefully, by next quarter because we are expecting some validation volumes from this particular contract in the next quarter. So definitely, there will be some positive news coming.
Okay. Got it. And any update on the status of Health Canada's audit and variance for Ketamine hydrochloride. Any recent developments or any kind of expected time line?
So no, we recently had a Health Canada joint audit with EDQM online, which happened in the beginning of last year, which we have already cleared. So we have no further notification from Health Canada. Of course, USFDA and NMDA China, we are expecting in the later half of the year. But it's a part of our regular routine compliance. Our large U.S. FDA was at a 48-hours notice, and we were able to clear that as well. but as such in the audit outside of there.
Our next question is from the line of Aashish Upganlawar from InvestQ FPMS.
From your presentation, I could make out that there is a marked improvement in the working capital components. So is that one-off or this sustainable kind of improvement that we have seen? And what do we read from this? I mean, is the market become better for us to command better terms or something like that? Or is it just one-off.
See, when it comes to working capital, right from last March, I think we have been having some sort of better numbers every quarter. In fact, the last quarter where it was the lowest, we always attributed that the inventory days will be somewhere around 150 and as of this quarter, it's around 167 days. I think this is a number which we will have to control very diligently because when it comes to working capital, both the receivables and payables, I think are all in a controlled manner for me. And since we deal with a lot of narcotic products, we do get a lot of money in advance.
So technically, my receivables is on a bit of shape. And when it comes to payables, of course, we have been paying all the vendors on time. So we do get around to 92, 120-days period, which has always happened. So the major part is something which is in [indiscernible], which we have been concentrating well right from last March that we will improve, which has been our commitment to the market, which we are doing it in a better way.
Okay. I think the numbers that are given us for March '24 or so quarter-on-quarter, would it make sense to observe that it is really different across quarters, quarter ends actually.
I think if you look at it, it is better to look at it at a year and every of the number would be, what you call, all the year-end achievements will also be taken into consideration. I would suggest that you can look at it at the year end. But yes, quarter-end numbers also, we internally checked every quarter and also, but for the market, I think you can have a look at every year, and that would be making more sense to you.
And you mentioned that margin something like 30% plus. I mean I think we have been maintaining EBITDA margins of 30-plus percentage to be a normal expectation that one should have. But Q1, we saw year-on-year 500 basis points plus of improvement, so is that kind of Y-o-Y improvement is what one should expect this year? I understand that you gave some comment that beyond Q2, you will be able to give some guidance on that. But is that a trend that one should expect that kind of improvement, 500 basis points Y-o-Y.
So no, like I said before so this kind of a EBITDA margin profile is because of more penetration into regulated markets with the newer product launches coming in, in the later half of the year and their concentration being in more semi-regulated market, we expect the margin to sort of normalize. Like I said, second half, second quarter would be a better time for us to give a concrete guidance. But definitely, it will be 30% plus now.
That would be the same -- 30% is the same as last year. So improvement will be...
It will be higher, definitely than 30%.
Sir, I will add something. You should be happy when I said that first time manufactured in India against China. So the price-wise not there at all. There is a supply. The supply, which is being created for all over the world comes from a non-GMP, non-ISO plans. So today, when a GMP, U.S. FDA, ISO every criteria holding plant comes, do you think every customer will jump for that for the safety, so that is what is happening. So I am very hopeful that we will continue in this direction because we are here to work with only regulated markets, the ratio between 100% of production is 90% today.
So when you sell in 90% market, you can understand regulatory in the area, will give you more money because they want to create a secured vendor for their future supplies. And whenever a vendor is created, it is at least for 10, 15 years. It's not a short gap, nobody will change only on price but consistency, quality, integrity. These are the 3 works involved.
Our next question is from the line of Tushar Bohra from MKVentures.
Thanks for your question and congratulations to the management for a good set of numbers. So one of the slides in the presentation highlights 18 DMFs submitted to FDA and 9 CE is [indiscernible]. Management has also alluded that we expect a lot of new product launches in the second half. So maybe if you can share more details qualitatively or maybe a specific products what kind of launches are you expecting as well as these markets? And also, in the last year as well in the last 2 quarters, we have, I believe, launched a few production maybe some comment on the performance of those and whether the overall revenue buoyancy can be attributed partly to some of these launches.
So in the new product launches, we are looking at therapeutic categories like anti-anxiety anesthetic, we want to focus and expand our basket in this product range and anti-diabetic. So these 3 other new therapies, what we are introducing in our portfolio. Most of these launches are going to happen towards end of this financial year.
But these are like our Chairman said that these are very large volume products globally, where most of the customers today are single sourced out of China. So this is going to be a very big opportunity for us. And we are very confident that moving forward, some of these products will really contribute well in terms of revenue and margins.
Once the mode is fully operational, then we will also have the additional capacity to scale up these products. So that is why you will see a significant impact of these coming in only in the next financial year, although they will start generating some small revenue in the third and the fourth quarter. But the full impact you will be able to see in the next financial year only. So this is as far as the new product launches are concerned.
And then on the products that have been launched in the last, say, 2 quarters or so?
So the product, which we have launched, we have only launched 1 or 2 products in the last quarters. But currently, with most of the customers, we are under validation stage. So for these also, but we are getting good traction of these products. But these products also to show full impact, we will at least need 1.5 years for them to start significantly contributing to revenue. But the ones which we have launched recently are low-volume kind of high-value products. But the ones which will come in the second half of the year, they will, I think, be the larger impact making products for us moving forward.
And how many such lenders then are we expecting this year? Maybe 3, 4 launches or better?
Two product launches we are expecting end of this year.
Sure. Second, my question on the -- I think we had mentioned in the one of the previous disclosures about the new molecule that we've taken in CDMO or CMO for a large global player, not the DSN contract, but another contract that you had mentioned. I think anesthesia in that category. Maybe if you can just highlight any progress made on that? And what should we expect?
So we are on track for this particular project as well. Currently, this is in pilot state. So we are just completing validation for this project. Again, the time line for this 1 also remains the same. Maybe in quarter 3 of this financial year, we will start seeing some smaller volumes from them on the validation front. Like I said before, also probably end of quarter 2, we will be in a good position to make some positive announcements on some of the newer CMO contracts that we are signing.
Can you also highlight any process on the whey protein contract?
Pardon?
Can you also highlight any progress made on the whey protein contract, supplies related to that.
I will add it, Tushar. See, whey protein, we have to be well requested to go for first line license. We got the first line license. But after that, they said you go for the first line license for the manufacturing and exports that had just received 2 days back. So now the discussion which we were doing for expos, that discussion has already started with the customers, and we are sure in a couple of days, things will start moving.
So in that case, with all -- with the new launches as well as some traction in some of our existing contracts, can we say that there is a possibility of upside risk on the 20% revenue guidance that we've broadly maintained for the medium term, say this financial year, next year.
Correct. So the 20% revenue guidance definitely is more on the conservative side. With all these newer contracts and newer launches kicking in, there is definite hope for us to do much better.
And 1 last, if I can, seen. While we expect that the new product launches being in senior regulated markets to start with, we'll have maybe some moderation on the margin. But given that there is a [indiscernible] revenue as well as some operating leverage via the existing facility, do we expect that the overall EBITDA number should continue to trend upwards from here broadly given the quarterly variations apart.
Correct. So like our Chairman said, yes, definitely, you can expect the EBITDA trend to be upward.
Our next question is from the line of Rehman Khan from [indiscernible] Capital.
Just had one question regarding the Ambernath facility. Is it still operational? What are the activities being done there, et cetera. Can you just highlight some points on that?
Ambernath facility is under currently validation. Some of the equipments which have come, they are getting under validation. It will take at least minimum 2 months to start the production. But hopefully, within the next 60 days, it will go on stream, but [indiscernible] partially keep on going.
Just to add to what even said, the Ambernath facility, we will be focusing on CMO, CDMO kind of opportunities in the finished formulation side. So we have take up a very large bottling line, a tablets, capsule as well as an injectable lines. We also have set up in the Ambernath facility an R&D. And this R&D will be focusing on contract research kind of projects.
We will also be developing some of the newer APIs which we want to add in the future. The development of these will also happen at the managed. So this is what we have planned out of the Ambernath side.
Just to add on that, I believe in the last call, there were about INR 100 crores allocated for FY '25 for the CapEx for Ambernath, is that going to be the same? Or are there any changes?
As of now, the CapEx allocated for Ambernath would be somewhere around INR 75 crores. If you add up all the last 3 quarters, board resolution numbers, will add up somewhere to INR 75 crores to INR 78 crores. I think that would be the number which we are looking at. See, the Ambernath already had around INR 30 crores, INR 40 crores of building, which we had already done.
So with all these things, I think it should be somewhere in the range of INR 130 crores would be the total outlay in Ambernath.
[Operator Instructions]
Our next question is from the line of Aditya from MSD Capital Partners.
Just wanted to quickly check, when do we -- so the existing [indiscernible] facility, U.S. FDA was supposed to come in audit in October, what is the progress there? And second part would be the Ambernath facility. So when you're saying that it will be commercialized in Q2, have you already registered with all the health authorities like [indiscernible] and U.S. FDA?
So for the [indiscernible] side, we are expecting U.S. FDA audit end of the year, so that is when it will happen. And for Ambernath, like we said, it is still under validation phase. So once we bring it to commercial production, we will then initiate the local authority certification, which is the WHO GMP and the local GMp. Next year, beginning is some time when we will trigger a USFD or a U inspection for this particular facility. So you can expect that the clearance will happen at the beginning of the next financial year.
Understood. Got it. And just a bookkeeping question. In Q1, what would be exports revenue and of that, what would be the revenue from regulated markets compared to last year?
I think if you could see in our export would be around 84% of our total revenue would be exports. And I think last year, I think would be around a similar number, around like 80% would be the number on average.
And of this, how much would be related markets this quarter compared to last year quarter.
Regulated last year will be somewhere around 45%. This year, it would be somewhere around 54%.
Our next question is from the line of Sayan from MNS Associates.
I just had a couple of questions. Can you help us understand the current market size of our top 3 APIs and what value do we get for these KPIs? And what is the overall outlook going forward?
So in this forum, we would not be able to speak anything product specific. So sorry, we'll have to regret this question.
Okay. My next question is, I don't know if this was already taken. I was away for a while. Can you help us understand how the ongoing CMO, CDMO contracts and the size of these contracts?
So like I said before also, we already have 2 CDMO contracts in place, the [indiscernible], we already have started supplying to them for their validation quantity and some part of the food application demand on the right approvals come in place, which we are expected on this chart [indiscernible] to the pharma side [indiscernible] charge rating revenue in this financial year, we have about 2, 3 opportunities, which are in the final stage. So like I said before, by end of quarter 2, we should be in a position to make some positive announcement on some of the other CM opportunities, also some signing of these. And in the next 3 to 4 years, we anticipate that the more CDMO should contribute 3% of our total revenue on the conservative side, if the Ambernath FDSCMO also kicks in the way we are anticipating, it could definitely be higher.
My last question would be, can you provide some idea about the newer molecules that Supriya is tapping into? And how many of them are in the process of getting approvals?
Also like our Chairman said, as a strategy, we are focusing on molecules where there is a very high dependence on China and where is the global customers are currently single source. So we are expecting at least 3, 4 products in this category anesthetics and antidiabetics. Anesthetics, antidiabetics and antianxiety are some of the therapies, what we are focusing on. Also, we are expecting these launches to happen end of this financial year.
Sir, I just add to that. When I said that these products are -- whole world is buying where there is no GMP also, but the world is supposed to buy, so you must understand, I am a qualified manufacturer with a lot of [indiscernible], so people will definitely come to me because they are safe having the process of every product, good manufacturing practice.
Our next question is from the line of Hardik, an individual Investor.
My question is I want to move the update -- or what is the update on that mouth cancer circuit.
So the oral cancer kit, we have just applied for the patents in multiple countries. We have just applied for the patent in Korea, Taiwan. We will now fully applying in Thailand because we are getting a lot of active interest from these markets. Locally also, of course, we already have the patent in place and that like will begin very soon. But the export market is what we are targeting. We expect that in the next 1 to 1.5 years, we should be granted the patients in these particular markets where the potential is much higher.
So in terms of like revenue, what would be the potential size that we'll get benefit out of this?
So at this point, it is too premature to talk in terms of revenue because this is a very novel technology, where first time some company is going to launch globally, there is no like-to-like product. it would be too premature to talk about revenues. But definitely, in the next coming quarters, we'll have complete revenues in place that we'll be able to share.
Okay. And complete commercial production process would take a few quarters, right, as I understand.
It will two years, at least 2 years is what we are anticipating.
Our next question is from the line of [indiscernible] from [indiscernible] Investment Advisors.
Can you share some detail about Brazilian opportunity?
See, Brazilian after the audit and approval of Brazil government, the authority. We are talking with our customers recently, last 10 days back, we were in Brazil and Mexico. More and more discussion, we have seen the opportunities for the new products and the current basket to increase. And I'm sure it will be done because the government has already given last ultimatum to every formulation manufacturer in Brazil that every product which comes to the country, to their country, there should be a GMP certificate. If not, then the source has to be changed. Otherwise, that product will be stopped.
So there is an ultimatum for them. So we have good opportunities. We have been -- we have discussed with our customers and come back just 48 hours back only. So we are definitely going to increase our basket in Brazil and Mexico market.
Okay. So when can we expect some revenue from Brazil market?
Already, revenue is coming up. There is no new revenue. We are present in Brazil for the last 18 years. If you see every year, it is increasing. Only the question was some of the APIs approval and the new notification of the government, which came into force, we are very quick within a span of 1 year. We've already done the audit. So I'm sure that the things will improve and the companies will be forced to take their decision for changing the source because the government has given ultimate that if you don't do it by December 2024, the things will not come from the non-GMP plants from China and with the 30-year experience, why is it traveling all over the world in China also, I have seen, there are manufacturers who does not have even GMPs, but selling all over the world. So the new things will start moving. I'm sure we will have good opportunity, and we will definitely take advantage of that particular notification of Brazil government.
In the interest of time, this will be our last question. On behalf of Supriya Lifescience Limited, that concludes this conference. Thank you for joining us, and you may now disconnect your lines.
Thank you.
Thank you very much.