Advanced Enzyme Technologies set to grow profits by 40% in FY17

Advanced Enzyme Technologies has received a strong response at the bourses with subscription of over 116 times, listing at a premium of 35 per cent to the issue price.

What lies ahead for Advanced Enzyme? How do you plan to utilise the money you raised through IPO?

We have raised ₹50 crore as growth capital and the rest ₹351 crore has gone as an offer for sale to people who have invested in this company over its journey in the last 27 years. I am very upbeat about the future.

Since our inception, we have been doing 20-25 per cent on our top-line and about 30-35 per cent on our bottom-line. So people who invested in our company 4-5 five years ago have tripled the value.

Can you throw some light about your growth outlook for FY17?

We expect to grow at a rate of about 30 per cent on top-line and 40-42 per cent on the bottom-line. So it will be a good number and very good profitability in the coming year, too.

You have a strong presence in the US market. The US business contributes about 55 per cent. What is the outlook on that market going forward? Will you increase the share or maintain it at the current level?

We are working on it. We have clearly created a strategy to grow more in the US market because it is the largest enzyme market in the world. The US-based company that we had acquired five years back has been present in the US since 1986, much before our inception.

We want to cash in on our strength rather than going into a new market. We are much more US-centric and US-focussed, apart from having presence in the emerging markets such as India, South-East Asia — Vietnam, Indonesia and Malaysia, and West Asian countries. These are the areas where we are growing much faster. We will continue to grow in Europe as well.

You already have 30 registered patents and four pending approvals. When do you expect to get these approvals? What is your launch pipeline for FY17?

Honestly, we do not link patent to our revenue. We call it the R&D culture in the company. R&D and patents are the consistent way to expand and broaden our base and make it much stronger. The other aspect is expanding the market, revenue and profitability. We are doing both simultaneously. They are all parallel actions. There is no linear linkage between the two.

But we have a very strong enzyme base — we have developed 50 proprietary enzymes. We are very strong to take on large-scale production with reasonable and competitive price. That is the strength of our company.

Normally, what happens is that one molecule developed and it is not reasonably priced. So you can’t take the market. But in this case, we are able to produce at a reasonable cost so that we can enter the market with the right price.