Hester Biosciences Ltd

- No additional CAPEX planned for Africa and Nepal; existing capacities deemed sufficient. - In India, the company recently expanded capacity; related CAPEX has already been incurred. - The expanded capacity at the India facility, including increased freeze-drying capacity, will come into operation in Q3 FY25. - Minor modifications planned to repurpose a BSL-3 facility (originally for COVID bulk antigen) for animal vaccines without significant CAPEX. - Focus on leveraging existing capacity and pipeline products rather than major new capital investments. - No specific investment planned in the pet division currently; focus is on introducing new healthcare-related products rather than CAPEX. - Strategic investments include building distribution channels in Africa via subsidiary and invested company Trishul Exim.

- Q1 FY25 showed strong foundation with 36% quarter-on-quarter standalone sales growth and 34% consolidated sales growth. - Poultry Healthcare division grew 35% in Q1, driven by recovery in the poultry industry and focus on vaccines. - Animal Healthcare division saw 41% growth, boosted by positive dairy sector trends. - Petcare division achieved 29% growth, with increased penetration in vet clinics and new product launches. - Africa business is expected to grow geometrically, with improving orders and distribution network. - Capacity expansions in India (freeze-drying capacity doubling) expected by Q3 FY25 to support higher volumes without new CAPEX. - Launch of Avian Influenza Vaccine expected in Q4 FY25 or Q1 FY26 expected to drive future poultry vaccine growth. - Management optimistic about sustaining upward topline and bottom-line trends through FY25 and beyond, without giving formal guidance.

- Q1 FY25 set a strong foundation with 36% quarter-on-quarter standalone sales growth and improved profitability. - The company is on an upward trend in topline and bottomline, aiming to maintain this positive trajectory throughout FY25. - Margins have shown significant improvement in Q1, with 21% operating margins considered sustainable for the foreseeable future. - There is a focus on expanding healthcare-related products in pet division and large animal vaccine R&D, supporting diversified growth. - New capacity expansion in India (freeze-drying capacity more than doubled by Q3) will enable revenue growth without immediate additional CAPEX. - Africa operations expected to grow geometrically, benefiting from increased orders and improved distribution channels. - No explicit formal guidance given, but management optimistic about sustaining growth and margin improvements over FY25 and beyond.

- Rajiv Gandhi mentioned that worldwide PPR vaccine sales have been lower due to diverted funding (e.g., to COVID), but there is now a positive upward movement in PPR orders. - In Africa, there is extremely high visibility of orders from both private sector and government tenders. - The African market is challenging, but Hester is confident about geometric progression in order growth due to its distribution network. - Tanzania and some other countries are starting to budget for PPR vaccines themselves, reducing dependency on international funding. - Q3 and Q4 results are expected to demonstrate good progress, reflecting improved order flow and business. - Overall, agencies like FAO emphasize capacity enhancement anticipating large PPR vaccine demand in future.

- As per the transcript of the earnings call held on 2 August 2024, Hester Biosciences mentioned that: - The current capacity utilization in India is near full, and the CAPEX for expansion has already been incurred. - There is no planned CAPEX for increasing capacity in Africa or Nepal at this point. - They do not foresee the need for additional spending on capacity in the near term. - There was no mention or indication of any new fundraising plans through debt or equity in the current or near future. - The company emphasized focusing on optimizing existing capacity and maintaining an upward trend in revenues and margins without additional capital raising.