Biocon Ltd Update Call Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Damayanti Kerai - HSBC Securities (USA) Inc - Analyst : Thank you. Hi, everyone. This is Damayanti Kerai from HSBC. My first -- thank you for the opportunity. My first question is one of the key merit which ma'am has mentioned for this transaction is operational synergies through consolidation of group resources. So can you elaborate a bit on this because until now also, I understand BBL was a majority -- BL was a majority honor in BBL. So how does this change post this transaction? And what are the key merits if you can really elaborate on those? LSEG STREETEVENTS | www.lseg.com | Contact Us consent of LSEG. 'LSEG' and the LSEG logo are registered trademarks of LSEG and its affiliated companies. DECEMBER 08, 2025 / 2:30AM, BION.NS - Biocon Ltd Update Call

Question: Damayanti Kerai - HSBC Securities (USA) Inc - Analyst : Okay, ma'am. Okay, that's helpful. My second question is, from minority stakeholders of BL, what kind of approvals will be required for this transaction to go through?

Question: Damayanti Kerai - HSBC Securities (USA) Inc - Analyst : Okay. I think one of the points mentioned is for the cash payment to Viatris, there are some special requirements.

Question: Damayanti Kerai - HSBC Securities (USA) Inc - Analyst : Okay. Thank you, ma'am. I'll get back in the queue.

Question: Bharat Shettigar - - Analyst : Yeah, hi. Thanks a lot for the call. Just two or three questions from my side. Firstly, in terms of approvals from minority shareholders of Biocon Limited, do you need to get a majority of minority approval for this transaction?

Question: Bharat Shettigar - - Analyst : And the threshold is 50% of approval? Or is it higher?

Question: Bharat Shettigar - - Analyst : Right. Understood. And in terms of the US dollar bond issued by Biocon Biologics, do you need any approval from the bondholders to complete this transaction? And if not, then post-transaction, will there be any change in terms of the bond structure, whether issuer, guarantor, et cetera?

Question: Bharat Shettigar - - Analyst : Right. And the final question is on the point mentioned about raising commercial paper of up to INR1,800 crores. So just trying to understand this $400 million payment to Viatris, is there multiple components to it? And is there something which needs to be paid immediately? Just wondering how is that structured. LSEG STREETEVENTS | www.lseg.com | Contact Us consent of LSEG. 'LSEG' and the LSEG logo are registered trademarks of LSEG and its affiliated companies. DECEMBER 08, 2025 / 2:30AM, BION.NS - Biocon Ltd Update Call

Question: Bharat Shettigar - - Analyst : Right. So by March 31, you need to raise the full equity, but in the interim, you need to make a INR1,800 crore payment. Is that right?

Question: Bharat Shettigar - - Analyst : Right. Okay. This is helpful. I'll get back into the queue.

Question: Abdulkader Puranwala - ICICI Securities Ltd - Analyst : Yeah, hi. Thank you for the question. Just quickly, how do you plan to take over the balance 1.6% stake from the employees and others?

Question: Abdulkader Puranwala - ICICI Securities Ltd - Analyst : Okay. So that happens after March '26.

Question: Abdulkader Puranwala - ICICI Securities Ltd - Analyst : Okay. I mean, is there a fairness report? What do you guys have shared for this entire transaction? Is that --?

Question: Abdulkader Puranwala - ICICI Securities Ltd - Analyst : Okay. Thanks. Thank you.

Question: Shyam Srinivasan - Goldman Sachs Group Inc - Analyst : Hi. This is Shyam from Goldman. Thank you for taking my question. Just the first one on the back on the biologic -- Biocon Biologics debt again. While we made our debt structure there much more easier from a cash flow perspective, we still have a large bullet at the end. So just want to understand how the financials of the subsidiary need to kind of evolve over time to one make that net debt to EBITDA at the subsidy level more palatable. How are we planning to get cash flows in time? And the sub-question there is on -- does the parent need to infuse capital into the subsidiary in the interim?

Question: Shyam Srinivasan - Goldman Sachs Group Inc - Analyst : Okay, I'm not worried about the structure. I'm only worried about fiscal '30, let's assume, when you need to make $1 billion payment out of BBL. So what are the things that we need to -- one needs to look at from a BBL perspective needs to evolve for us to generate that kind of cash flow? I think that's the question.

Question: Shyam Srinivasan - Goldman Sachs Group Inc - Analyst : Got it. So you're not worried, Kiran, you're basically saying the $250 million-odd EBITDA that you're generating right now, and hopefully that grows over time, and that is good enough for us to honor some of those debt obligations.

Question: Shyam Srinivasan - Goldman Sachs Group Inc - Analyst : Got it. Helpful. Second question, just on the differential swap ratios for Mylan, I know there's a cash element, so I don't know how to calculate, but maybe you could clarify. One is, the 70 share swap and the 60 share swap. So just want to understand the differential and what drives that.

Question: Shyam Srinivasan - Goldman Sachs Group Inc - Analyst : Got it. And last data keeping question, just on the CCPS to equity share conversion at BBL for Viatris, there was some ratio of 1.26, I noticed, CCPS going to whatever equity. So what is that calculation? Thank you.

Question: Shyam Srinivasan - Goldman Sachs Group Inc - Analyst : Helpful. Thank you. All the best.

Question: Charul Agrawal - Bank of America Merrill Lynch - Analyst : Hi. This is Charul Agrawal from BofA Securities. So my question is with regarding to the shareholding that BBL minority stakeholders get in Biocon. Would there be any lock-in period that would be applicable for this?

Question: Charul Agrawal - Bank of America Merrill Lynch - Analyst : Okay. Thank you. That was my question.

Question: Siddharth Negandhi - - Analyst : Hi. Thanks for the opportunity. Just a couple of things from my end. First, on the synergies that you mentioned on the commercial and manufacturing front, should we expect a consolidation of the commercial workforce for these synergies to be realized? That's one. LSEG STREETEVENTS | www.lseg.com | Contact Us consent of LSEG. 'LSEG' and the LSEG logo are registered trademarks of LSEG and its affiliated companies. DECEMBER 08, 2025 / 2:30AM, BION.NS - Biocon Ltd Update Call On the manufacturing side, similarly, given that the facilities are early biologics versus small molecules, just wanted to understand that a little more in detail in terms of how the fungibility of manufacturing facilities come in. And should we expect better capacity utilization because of this? So that's question number one on synergies. Question number two was, again, on the swap ratio, just wanted to understand, effectively, if you look at, very broadly, Viatris gets half the shares in cash and -- half the stake value in cash and half the stake value in stock. So accordingly, the effective stock, the swap ratio comes to [1.22]. Is that driven by a commercial arrangement prior to the transaction that was existing with Viatris? Or is there anything else that's driving that? Those are my two questions.

Question: Siddharth Negandhi - - Analyst : Thanks. That's very helpful, ma'am. Thank you so much for that. And just wanted to ask -- you also mentioned about commercial synergies. So should we expect certain consolidation?

Question: Siddharth Negandhi - - Analyst : So some workforce consolidation and according cost synergies that we should expect there? LSEG STREETEVENTS | www.lseg.com | Contact Us consent of LSEG. 'LSEG' and the LSEG logo are registered trademarks of LSEG and its affiliated companies. DECEMBER 08, 2025 / 2:30AM, BION.NS - Biocon Ltd Update Call

Question: Siddharth Negandhi - - Analyst : That's very helpful. Thank you, and all the best to you and the team.

Question: Abhiram Iyer - Deutsche Bank - Analyst : Hi. Thank you for taking my question. This is Abhiram Iyer from Deutsche Bank. My questions are pertaining to the acquisition debt. You answered the question around the bonds, nothing's changing the structure pertaining to Biocon Biologics. But is there any change in the acquisition debt or any concerns required there? And my second question is just a follow-on from that. Going forward, if we are borrowing for CapEx needs, whether it's Biocon or Biocon Biologics, would it be done at the respective entities? Or do you envisage future borrowings to be consolidated at the parent level? Thank you.

Question: Abhiram Iyer - Deutsche Bank - Analyst : Thank you. And just as my second question is pertaining to -- has there been any discussion with getting a rating upgrade or rating agencies here? Because this would definitely improve the capital structure as the agencies require. So would you see borrowing costs being lowered in the future?

Question: Abhiram Iyer - Deutsche Bank - Analyst : All right. Thanks for answering my questions, and best of luck with the transaction.

Question: Tushar Manudhane - Motilal Oswal Securities Ltd - Analyst : Yeah. This is Tushar from Motilal. Ma'am, just with respect to the Viatris, with the early exit, conceptually, while the holdco discount definitely benefits reduction in holdco discount. But the early exits, just to like to understand whether the full integration, the purpose of acquiring Viatris from since 2022 to until date, is that sort of whatever the milestones we intended to achieve, given that we had this binding agreement with them. Where do we stand as far as that part is concerned?

Question: Tushar Manudhane - Motilal Oswal Securities Ltd - Analyst : Got it, sir. Just one more point extending to this, that this also, as I read on to the Viatris press release, this also accelerates the expiration of the biosimilars non-compete restrictions placed by Biocon management. Any thoughts on that?

Question: Tushar Manudhane - Motilal Oswal Securities Ltd - Analyst : Got it. Thanks a lot.

Question: Alankar Garude - Kotak Securities Ltd - Analyst : Hi. This is Alankar Garude from Kotak Institutional Equities. Good morning, everyone. Kiran, ma'am, can you confirm that now there is no need for us to sell any further stake in Syngene?

Question: Alankar Garude - Kotak Securities Ltd - Analyst : Got it. The other question is, I mean, you also had the option of merging Biocon with BBL and you spoke about the reasons for not doing it. I think that is possibly the bond structure is one of the things. But can you clarify that going forward, whether a merger between Biocon and BBL, whether it would --

Question: Alankar Garude - Kotak Securities Ltd - Analyst : Got it. And one final question from my side. From the perspective of minority shareholders of Biocon, you spoke about the benefit of undervaluation, as well as some synergies. On the other hand, they will also have to face dilution because of the --

Question: Alankar Garude - Kotak Securities Ltd - Analyst : Got it. So basically, undervaluation of both the entities is the primary factor driving this transaction?

Question: Alankar Garude - Kotak Securities Ltd - Analyst : Got it. That's it from my side. Thank you.

Question: Amey Chalke - JM Financial Institutional Securities Pvt Ltd - Analyst : Yeah, hi. Thank you for taking my question, and congrats to the management on this arrangement. So I have just one question. Most of the questions have been answered. Since you were talking about the dilution of your own stake, are you going to participate in the QIP any which way to increase the stake? Thank you so much.

Question: Amey Chalke - JM Financial Institutional Securities Pvt Ltd - Analyst : Sure, ma'am. Thank you so much. LSEG STREETEVENTS | www.lseg.com | Contact Us consent of LSEG. 'LSEG' and the LSEG logo are registered trademarks of LSEG and its affiliated companies. DECEMBER 08, 2025 / 2:30AM, BION.NS - Biocon Ltd Update Call

Question: Manoj Jain - - Analyst : Hey. Morning. Two questions for me. One is on deleveraging. You mentioned that you are 2.5x and you're going to delever further. Do you expect, going forward, deleveraging is going to be completely organic or you plan more corporate actions like what you have done to clear up all the structured instruments? Can we expect more going forward?

Question: Manoj Jain - - Analyst : No, I totally agree. It's going to improve EBITDA growth. I just wanted to check whether you want to have a faster deleveraging by more corporate action or you can have it like smoothly going down with EBITDA growing.

Question: Manoj Jain - - Analyst : No, yeah. That's fair. And my second quick question is your promoter's shareholding is coming up to 44% as per your PPT. Any plans to take it above 50%, or if you can give some color that whether promoters are going to be participating in planned QIP or if you can share something on that front.

Question: Manoj Jain - - Analyst : Understand. That's all from my side.

Question: Jonathan Tan - CreditSights - Analyst : Hi. Thank you. This is Jonathan from CreditSights. I'd just like to clarify something on dividends. So from my understanding, the US dollar bond covenants have some restriction on dividends made by Biocon Biologics. Does that change post this deal?

Question: Jonathan Tan - CreditSights - Analyst : Okay. Thank you.

Question: Vikram Damani - - Analyst : Hi. Morning. Just a quick question. Post the new 4,500 QIP as of March 31, what will be our estimated gross and net debt, if you can clarify that? Thank you.

Question: Vikram Damani - - Analyst : Okay. Thank you.

Question: Nitin Agarwal - DAM Capital Advisors Ltd - Analyst : Hi. Thanks for taking my question. This is Nitin from DAM Cap. Ma'am, for the Biologics, the biosimilar business, I think F27 should be a little bit of inflection here with most of our recent -- multiple recent launches as well as the (inaudible) that's getting launched. So in general, when you think about the biosimilar business trajectory from here on, not from looking for a specific guidance, but what should the revenue trajectory for this business really look like, given the fact that we'll have a much broader portfolio of commercial products in the -- in markets, specially developed markets from next year onwards?

Question: Nitin Agarwal - DAM Capital Advisors Ltd - Analyst : Just pulling on that, Kedar, what should we -- how should we think about the debt-to-EBITDA metrics moving from here on? I mean, at what stage do you envisage the debt-to-EBITDA coming closer to a sort of a 1x number and 2x the business in a position to generate free cash from next year onwards?

Question: Nitin Agarwal - DAM Capital Advisors Ltd - Analyst : And Kedar, on the free cash generation, should be -- that should be a, I mean, realistic situation to expect from next year onwards?

Question: Nitin Agarwal - DAM Capital Advisors Ltd - Analyst : Thank you so much.

Question: Bharat Shettigar - - Analyst : Yeah, hi. Thanks for taking the follow-up question from me. A couple of things from my side. Firstly, on the Edelweiss debt, can you remind me how much is the amount and how will that be repaid?

Question: Bharat Shettigar - - Analyst : Understood. And then the other question is with respect to the Mylan payment now with the share swap as well as the $400 million cash payment, is that like the final settlement for the CCPS? Or could there be some future liability pending as well after this transaction is done?

Question: Bharat Shettigar - - Analyst : Okay. Thanks a lot for this.