Arvind Fashions Limited — Q2 FY26

Arvind Fashions Ltd Q2 FY2025-26 Earnings Conference Call https://www.youtube.com/watch?v=MGjDjGB-t14 Published: 6 months ago

0:00 Ladies and gentlemen, good day and welcome to the Aran Fashion Limited Q2 FY26 earnings conference call. As a 0:08 8 seconds reminder, all participant lines will be in the listenon mode and there will be an opportunity for you to ask questions after the presentation concludes. Should 0:17 17 seconds you need assistance during this conference call, please signal an operator by pressing star then zero on the touchstone phone. I now hand the 0:24 24 seconds conference over to Mr. Bitar Chiplania CFO at Arvind Kashian Limited. Thank you and over to you sir. 0:33 33 seconds Thanks Ruda. Hello welcome everyone and thank you for joining us on the Arvin Fashions Limited earning conference call for the second quarter ended 30th 0:42 42 seconds September 25. I am joined here today with today by Kulin Lalhai vice chairman and non-executive director and Amisha 0:50 50 seconds Jen managing director and CEO. Please note that results, press release and learning presentation have been mailed across to you yesterday and these are 0:58 58 seconds also available on our website www.arvinpassions.com. 1:03 1 minute, 3 seconds I hope you you had the opportunity to browse through the highlights of the performance. We will commence the call with Kulin providing his key strategic 1:12 1 minute, 12 seconds thoughts on our second quarter's performance. Post that I will cover the financial post that Amisha will cover 1:19 1 minute, 19 seconds the financial performance and also the business highlights. At the end of the management discussion, we will have a Q&A session. Before we start, I would 1:28 1 minute, 28 seconds like to remind you that some of the investment some of the statements made or discussed on this call today may be forward-looking in nature and must be 1:36 1 minute, 36 seconds viewed in conjunction with risks and uncertaintities we face. A detailed statement of these risks is available in this quarter earning presentation. The 1:45 1 minute, 45 seconds company does not undertake to update these forward-looking statements publicly. With that said, I would now turn the call over to Fine to share his views. A very good afternoon to you all. 1:57 1 minute, 57 seconds Thank you for joining us for the Q2 results. We are pleased to share that EFL delivered the consecutive quarter of doubledigit revenue growth and the 2:06 2 minutes, 6 seconds highest ever sales and evida this quarter. The demand environment was stable and we achieved an 11.3% growth 2:13 2 minutes, 13 seconds led by a healthy 8.3% LTL in our retail channel and around 25% plus growth in 2:20 2 minutes, 20 seconds our online channel leading to over 18% growth in AIDA to 200 crores which is a 80 bits margin expansion. During the 2:30 2 minutes, 30 seconds quarter the government implemented the GST 2.0 reform. A large part of our portfolio has moved to a lower GST rate 2:38 2 minutes, 38 seconds and we have ensured that the GST benefits has been passed on to our consumers. We believe that the GST reforms will surely improve customer 2:46 2 minutes, 46 seconds demand in the medium term. We continue to stay focused on profitable growth which is helping us deliver on our 2:53 2 minutes, 53 seconds balance sheet and cash flow KPIs as well. With overall working capital continuing to stay stable, 3:00 3 minutes we are leaning into our growth drivers and increasing brand visibility through marquee advertising campaigns. A strong 3:07 3 minutes, 7 seconds square foot expansion, healthy LTL growth, great momentum in the online channel, and the high growth trajectory of our adjacent categories have all 3:16 3 minutes, 16 seconds helped us maintain a double-digit growth rate for this quarter. With a strong wedding calendar in H2 and several 3:24 3 minutes, 24 seconds government initiatives to boost consumption, we remain hopeful of continuing the growth momentum. We will continue to stay focused on our mantra 3:31 3 minutes, 31 seconds of profitable growth resulting in further improvement in return on capital employed. I would like to now hand it over to Amisha Jen to take us through 3:40 3 minutes, 40 seconds the specifics and more details about our financial performance. 3:47 3 minutes, 47 seconds Good afternoon everyone. Warm welcome to the investor call for the quarter ended September 30th 2025. 3:54 3 minutes, 54 seconds In the quarter gone by, NFC stood at 1,418 crores as against 1,273 crores in 4:02 4 minutes, 2 seconds the previous year, same quarter and EBIDA was 200 crores versus 170 crores. 4:09 4 minutes, 9 seconds In this quarter, ASL delivered yet again an impressive double digit revenue growth of 11.3%. 4:17 4 minutes, 17 seconds And Eida growth of 18.2%. 4:20 4 minutes, 20 seconds The direct channels contributed significantly to this growth. Our continued strong efforts to grow direct 4:28 4 minutes, 28 seconds channels of retail and B2C yielded good outcomes in the quarter. 4:33 4 minutes, 33 seconds These together now account for nearly 50% of sales, a 5% point higher share over last year. Retail growth is very 4:42 4 minutes, 42 seconds healthy at 14% with a very good L S L S L S L S L S L S L S L S L S L S L of 8.3%. 4:48 4 minutes, 48 seconds Retail growth across all brands was in double digit. We added over 36,000 square ft of retail space in the quarter. 4:57 4 minutes, 57 seconds Online B2C grew by over 50% taking its share to 12% while B2B and other channels the share dropped to 20% from 5:06 5 minutes, 6 seconds 22% last year. This is in line with our strategy to pivot away from online B2B. 5:13 5 minutes, 13 seconds The share of online business crossed 30% in the quarter and a very healthy improvement in profitability. 5:21 5 minutes, 21 seconds The wholesale channels growth was minimally impacted in the quarter due to destocking and we believe that is that this is transitionary and the growth will be back in H2 in these channels. 5:32 5 minutes, 32 seconds Let me take a moment to talk about GST. 5:36 5 minutes, 36 seconds During the quarter, government reduced GST on articles priced less than 2500 to 5% from an earlier 12% rate. We rolled 5:45 5 minutes, 45 seconds out the changes required by the government to implement the GST reforms 2.0 door with immediate steps to pass on the GSC benefits to the consumer. 5:55 5 minutes, 55 seconds Our IT systems were upgraded to reflect exact prices, price changes as directed by the government. Clear price 6:03 6 minutes, 3 seconds communication was rolled out across all channels. These reforms will leave higher disposable income in the hands of 6:09 6 minutes, 9 seconds the consumer and we expect these reforms to have a positive impact on demand. 6:16 6 minutes, 16 seconds At the brand level, US Polo continues to grow exceptionally at 21% led by impactful advertising campaigns, work 6:25 6 minutes, 25 seconds done on products and opening of market stores in new retail identity. 6:31 6 minutes, 31 seconds Growth [clears throat] in other brands was muted due to impact of transition to the new GSD. 6:38 6 minutes, 38 seconds I'm happy to share that one of our key adjacent categories footwear grew by over 25%. 6:44 6 minutes, 44 seconds We believe that the disruption caused by the implementation of BIS norms is now behind us. Overall, the adjacent categories grew by 22%. 6:54 6 minutes, 54 seconds Among the other metrics that showed improvement, inventory freshness and gross margins. Inventory freshness is at 7:00 7 minutes an all-time high of more than 85%. And gross margin improved by 210%. 210 basis 7:08 7 minutes, 8 seconds points. We continued our focus on advertising campaigns which were higher by 20th basis points. Among the balance 7:15 7 minutes, 15 seconds sheet metrics, inventory buildup was to cater to early festive onset while overall working capital remains stable. 7:23 7 minutes, 23 seconds It will normalize by the end of the year. 7:27 7 minutes, 27 seconds The growth in Eida at ASL in Q2 is at 18.2% and 80 basis point improvements despite higher advertising and employee 7:36 7 minutes, 36 seconds costs. Reduction in retail discounting by 90 basis points. Richard channel mix 7:43 7 minutes, 43 seconds cost efficiency in select have led to improvement in margin. GP has gone up by 210 basis points to nearly 53%. 7:52 7 minutes, 52 seconds In this journey of profitable growth, the PAT in Q2 is at 37 crores versus 30 crores in Q2 last year. 8:02 8 minutes, 2 seconds The growth in PBT is nearly 31%. 8:05 8 minutes, 5 seconds Now, as we enter H2, we expect positive traction due to the upcoming wedding season. We're happy to share that there 8:13 8 minutes, 13 seconds was double double digit growth during Diwali and Fujo in our direct channels. 8:17 8 minutes, 17 seconds We will continue to open new stores and are on track to deliver new store addition target for the year as well. We also expect that the government 8:26 8 minutes, 26 seconds initiatives will aid higher consumer disposable income leading to a demand improvement across our categories. 8:34 8 minutes, 34 seconds The outcome will of course depend on the market environment. Thank you. 8:43 8 minutes, 43 seconds Thank you very much. We will now begin with a question and answer session. 8:47 8 minutes, 47 seconds Anyone who wishes to ask a question may press star and one on the touchstone telephone. If you wish to remove yourself from the question queue, you 8:55 8 minutes, 55 seconds may press star and two. Participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question to 9:04 9 minutes, 4 seconds attendance. The first question is from the line of Deep Sha from Immediate Securities. Please go ahead. 9:11 9 minutes, 11 seconds Yeah. Yeah. Hi. Uh so yeah, thanks for the opportunity and congratulations on good set of numbers. Uh so firstly uh if 9:19 9 minutes, 19 seconds you can call out how the different brands have performed during the quarter because seeing the wholesale numbers I think so arrow and flying machine are 9:27 9 minutes, 27 seconds still under pressure. So if you can first call out how the different branch have performed and secondly any any read on the festival. Uh I think Amisha gave 9:36 9 minutes, 36 seconds a brief uh brief around the festival but if you can uh further [clears throat] uh talk about how the festival has been. 9:45 9 minutes, 45 seconds Sure. So I think uh you know if you look at our brand portfolio as you have seen I think we've clocked a pretty he uh you 9:53 9 minutes, 53 seconds know strong sustained growth uh across the portfolio at 11.3%. 9:58 9 minutes, 58 seconds And if you look at from that the key driver of the growth is obviously coming also from our direct channels coming 10:04 10 minutes, 4 seconds down to and that includes both our retail and our uh B2C channels uh and this is in line with our growth drivers 10:13 10 minutes, 13 seconds and the strategy that we've put together. Now coming down to the brands, US Polo has clocked a extremely strong double-digit growth which is close to 10:22 10 minutes, 22 seconds 20% upper and while uh you know and this has led this has been driven by a lot of 10:29 10 minutes, 29 seconds work that has gone into it uh more around product innovation, premiumization uh you know driving a new retail 10:37 10 minutes, 37 seconds identity and obviously the you know driving new store openings. 10:42 10 minutes, 42 seconds Having said that uh we've continued to see strong growth across our PB portfolio as well uh and arrow and 10:51 10 minutes, 51 seconds flying machine are also sort of driving and are going in the right direction based on the strategy that was put together. The important thing to note is 10:59 10 minutes, 59 seconds that in this quarter towards the second end of it we were in uh you know the G GST reforms were put into place and while there was a minor transitionary 11:08 11 minutes, 8 seconds impact because of that because of post talking we do believe that you know this should streamline over a period of time 11:15 11 minutes, 15 seconds uh over the next quarter. So all in all I think we believe that we're on track you know from a strategy point of view 11:22 11 minutes, 22 seconds uh you know driving early double digit growth and that's where we will continue to be 11:30 11 minutes, 30 seconds okay and see second question would be around so I understand it will be too early to call out but how has been the 11:38 11 minutes, 38 seconds experience that are in session what are the key learnings which you have in last couple of months and what are the key strategies uh which you will work upon in the Valentine. 11:48 11 minutes, 48 seconds Sure. So I think the pri I think for me coming back to Arvin has been homecoming right. So it's uh it's it's you know 11:56 11 minutes, 56 seconds coming back uh has been the same as my prior experience. Uh what I see and what is heartening is that you know there is 12:03 12 minutes, 3 seconds a clear focus and strategy behind what we're doing. uh as you know that you know we've been talking about uh about 12:11 12 minutes, 11 seconds driving our direct channel strategy and what we have seen is a very strong uh focus towards that we have a portfolio 12:20 12 minutes, 20 seconds of five brands which is extremely strong and I think the teams are really geared up to drive behind that. So from my experience and where I see us going if I 12:29 12 minutes, 29 seconds look ahead I think few things are extremely clear. One is that we will double down on our portfolio of five 12:36 12 minutes, 36 seconds brands. We believe that there is significant headroom for growth by ensuring sharp brand positioning, driving differentiated products, and 12:45 12 minutes, 45 seconds delivering great end-to-end experience across our brand. I think it is imperative for us to ensure that we're able to now sort of segment out our 12:53 12 minutes, 53 seconds consumer cohort across these brands, are able to cater to those consumers in the way that they would like for us to speak with them. So that's that will be one 13:02 13 minutes, 2 seconds part of it. The second big thing that we will drive and what you have already seen um you know great results coming out of is our diversification of our 13:10 13 minutes, 10 seconds portfolio. We will continue to double down on that. Uh it's been working and if you look at our portfolio between footwear, innerware, women's wear, it's 13:18 13 minutes, 18 seconds been working well. I believe there is significant room to grow over there as well and we we will consider 13:25 13 minutes, 25 seconds accelerating that part of it. What's going to be important for us over here is to ensure that we are um investing 13:33 13 minutes, 33 seconds behind the right demand spaces based on where some the consumer preferences are and how the consumer preferences are shifting. Right? So you will see us kind 13:41 13 minutes, 41 seconds of drive that as well. I think the third thing that you will see us do is with consumer at the center of everything we 13:49 13 minutes, 49 seconds do, we will continue to double down on how we serve the consumer and this is going to be important to ensure that we capture any shift in consumer 13:56 13 minutes, 56 seconds preferences. You know, we will drive st segmentation be extremely data backed and with that we will drive enhanced marketing 14:04 14 minutes, 4 seconds capabilities to ensure that we're serving our consumers better. We will also double down in terms of serving our consumers through the channels that make 14:11 14 minutes, 11 seconds mo make make most sense to them and that along with the strength of our portfolio along with our investment towards 14:19 14 minutes, 19 seconds adjacent categories we should be able to see accelerated growth in our portfolio. 14:23 14 minutes, 23 seconds Now coming back to H2 I do believe that we have a great strategy laid out we have a strong plan and our teams have been at it in terms of delivering 14:32 14 minutes, 32 seconds against it. So we do believe that we'll continue our focus on our grow drivers at that as we've laid out earlier as well. And while we do that, we will 14:40 14 minutes, 40 seconds continue to push for a better experience for our consumers as we expand our retail as well. 14:48 14 minutes, 48 seconds Yes. Uh yeah, thanks Anishia. A couple of more questions I will write it with you. Uh thanks and congratulations on this set of numbers. 14:55 14 minutes, 55 seconds Thank you. Thank you so much. 14:58 14 minutes, 58 seconds The next question is from the line of Priyank from Wam Capital. Please go ahead. 15:03 15 minutes, 3 seconds Yeah. Hi team. Uh uh first on the question of uh with a strong SSD growth of 8%. 15:10 15 minutes, 10 seconds Uh along with coupled with gross margin expansion of 200 pips. Uh why don't we see uh that percolating down to the beta 15:19 15 minutes, 19 seconds margin expansion. I mean uh this model had a significant operating leverage. Uh we understand that. So I and then we I 15:27 15 minutes, 27 seconds also heard that we have been investing into advertisement. 15:31 15 minutes, 31 seconds uh what are the four pockets post gross marketing which are dragging down the 15:38 15 minutes, 38 seconds the change over that is required to be seen with SHC coming in as well as with the gross marketing expansion. 15:47 15 minutes, 47 seconds Hi Py this is Gar. uh you see the large part of the growth in quarter uh two came from the direct channels uh retail 15:56 15 minutes, 56 seconds and online B2C both have an attendant uh commission as a cost which becomes part of the sellers. So the flow through is 16:04 16 minutes, 4 seconds after that we also continue to invest in marketing which was higher again by 20 basis points. Having said that, I think 16:11 16 minutes, 11 seconds our focus has been to reduce discounting which reduce which we improved in the last quarter and going ahead we will 16:19 16 minutes, 19 seconds continue to focus on the sale. Cost improvement is another lever which we continue to work on. But what what is taking away the gross margin is the 16:27 16 minutes, 27 seconds commission and some of the variables and that come along in the retail and the B2C channel. Got it. 16:35 16 minutes, 35 seconds Why why there is a drastic shift in the employee cost over last two quarters that we witnessed? 16:42 16 minutes, 42 seconds You have to yeah you have to look at the employee cost on a sequential basis. This July there has been of course a salary 16:50 16 minutes, 50 seconds correction for the for the company. So that is around 10% and you know that quarteron quarter growth on cost is 18%. 16:58 16 minutes, 58 seconds So 10% is explained by that and the rest of the cost is largely due to a change over in the management and there are certain one-time fixed cost which came 17:06 17 minutes, 6 seconds along with that. We hope that this will be normalized in the coming quarter. 17:12 17 minutes, 12 seconds Got it. Uh on the strategy side uh on the wholesale uh I heard that there was a restocking this quarter but if you 17:19 17 minutes, 19 seconds were to look on the long-term trend of the wholesale on the three-year basis that it has not grown it has remained in 17:25 17 minutes, 25 seconds fact flat. So uh I'm not sure uh where was the restocking element coming into 17:32 17 minutes, 32 seconds it. Was that was it uh something was something else to think of it on the wholesale channel and what would be the strategy? 17:43 17 minutes, 43 seconds So if you look at our wholesale channel uh first of all when we look at the consumer sales uh we have seen uh high 17:54 17 minutes, 54 seconds uh consumer sales right so there we have seen improvements uh in terms of department stores as well we saw a strong growth only in the MBO 18:03 18 minutes, 3 seconds channel there has been a marginal impact due to the stocking as a result of GST transitions but from a consumer sales point of view I think both the channels 18:11 18 minutes, 11 seconds have shown uh pretty healthy growth. So from a growth perspective, we expect a high singledigit growth uh going forward. 18:23 18 minutes, 23 seconds One last question uh there have been few targets that we have been chasing uh and I'm sure we are following those. Uh there are few targets which are unmet. 18:33 18 minutes, 33 seconds Any any key changes that you think that you will have to do it in your own lens maybe in a different way uh or maybe a 18:41 18 minutes, 41 seconds different things to be done uh anything that you would want to highlight on that and and and and I heard you on your strategy part saying that there would be 18:50 18 minutes, 50 seconds the investments that would go through in the channels as well as marketing. So should how how should we think of a margin expansions also a two-sided 18:57 18 minutes, 57 seconds question. one on the one of the overall few targets that we were thinking of on the long term and on the abit emerging side. Thank you. 19:05 19 minutes, 5 seconds So thank you for your question. uh as I talked about I think you know uh we've kind of laid out and I mean currently 19:13 19 minutes, 13 seconds our strategy in terms of driving uh some of the core pieces right if you look at it we've we've been after going after 19:20 19 minutes, 20 seconds places where the consumer is already right we've investing behind our direct channels both on the retail side and on 19:28 19 minutes, 28 seconds the B2C side right retail has been driven out of like forite sales and the net uh expansion of retail uh at the 19:35 19 minutes, 35 seconds same time we've been driving through the B2C strategy, right? So, that part of it, I think, is on point and as the consumer shifts, we'll be able to capture some of that very very easily. 19:45 19 minutes, 45 seconds Now, as we talk, we're in the process of building out our threeear strategy. Uh, and we are as the team and I kind of 19:52 19 minutes, 52 seconds work this through, we should be able to, you know, present this to the board in the next four to five months. uh having 19:58 19 minutes, 58 seconds said that as I said earlier I think our intent here is to make sure that we are you know aligning more closely with how the consumer preferences are shifting. 20:09 20 minutes, 9 seconds So from a strategy point of view, you know, I'll kind of reiterate one thing that if you look at our portfolio and if you look at the strategy that we've had, 20:17 20 minutes, 17 seconds I believe that we have a strong portfolio that kind of straddles through price points, right? So now the question is how do we make sure that we go after 20:25 20 minutes, 25 seconds a very sharp brand positioning, drive differentiated offering and deliver a great end toend experience for these consumers. Now while we do that, we also 20:34 20 minutes, 34 seconds want to make sure that with the same set of consumers, we are able to expand our offering. Right? So from a wallet share etc point of view our adjacent categories have to hit harder and we 20:43 20 minutes, 43 seconds will start serving them through you know the relevant demand spaces. We'll make sure that we're serving consumers um and we're going after the genz we're making 20:51 20 minutes, 51 seconds sure that you know our our our overall offering sort of caters to the preferences of the consumers. The third critical thing and I think the point 20:59 20 minutes, 59 seconds that you pointed out as well is for us to ensure that whatever we do we will keep the consumer at the core of it. 21:06 21 minutes, 6 seconds Right. So uh segmentation is going to be a very critical strategy for us. We're going to you know get more and more data back and enhance our marketing 21:14 21 minutes, 14 seconds capabilities. So while we do that we will obviously double down on investing behind uh demand generation but we 21:22 21 minutes, 22 seconds continue to focus on IBIDA. So to the point on IBIDA I think the company has been consistently following a certain 21:29 21 minutes, 29 seconds strategy and we will continue to do that. We have earlier also mentioned that we would like to maintain our IIDA 21:36 21 minutes, 36 seconds delivery in zone of about 50 to 80 basis points and as we build out our strategy that's the direction we will take. 21:44 21 minutes, 44 seconds Sorry one just clarification uh on the diversification part of the portfolio you were reputing to me where you said 21:51 21 minutes, 51 seconds that you had a significant room to grow would it be within the brands or if required we can think of additional brand acquisitions also in the portfolio. 22:01 22 minutes, 1 second So see I think you know going back to uh what I was saying I do believe that there is headroom within the core categories in our brands itself right so 22:09 22 minutes, 9 seconds we will make sure that we will go after that uh and like I was saying that we will make sure that from a consumer point of view we we are serving the 22:18 22 minutes, 18 seconds consumers across different consumer cohorts right but having said that we do have an opportunity to look at adjacencies within our brand right so 22:26 22 minutes, 26 seconds the adjacent categories within our brand portfolio we will go after that and ensure that we are able to cater to these consumers based on their needs and 22:33 22 minutes, 33 seconds preferences right so as consumer preferences shift we want to make sure that through our adjacent categories right for hypothetically footwear 22:41 22 minutes, 41 seconds women's etc we will continue to scale to that so that's one to the second question that you asked that you know are we looking at you know outside of 22:49 22 minutes, 49 seconds this see as and when a decent strategic opportunity presents itself we are open to looking at it uh and you know that's 22:58 22 minutes, 58 seconds just something uh we will always uh look at closely and see uh if it is strategically aligned to uh what we are after. 23:07 23 minutes, 7 seconds Very clear. All the best. Thank you. Thank you so much. 23:11 23 minutes, 11 seconds Thank you. The next question is from the line of Ain from Motil. Please go ahead. 23:18 23 minutes, 18 seconds Yeah, I think Congress has some good set of numbers. So my question is regarding business. If you look at it like that's the one which operates the AR wholesale 23:26 23 minutes, 26 seconds entity. So that segment has reported 3% of decline on the one H to one H basis. So what would be the reason behind that? 23:36 23 minutes, 36 seconds So can you I mean hi this is G. Can you repeat the question please? 23:41 23 minutes, 41 seconds Such a standalone entity. So the standalone has recorded a 3% revenue decline on a 1 to 1 basis. 23:49 23 minutes, 49 seconds So what would be the reason behind the standalone is the one that operates arrow arrow business right? Yes. Yes. 23:56 23 minutes, 56 seconds Uh so for the first half of FI26 the standalone entity delivered 350 crores of revenue this was down 24:05 24 minutes, 5 seconds the primary reason you know arrow arrow of course the retailing is you're aware 24:10 24 minutes, 10 seconds is based in the uh uh subsidiary right this represents primarily the wholesale 24:17 24 minutes, 17 seconds business and uh as Amisha said earlier and we mentioned I think as at the end of the quarter there was some kind of a 24:25 24 minutes, 25 seconds restocking or I would say delay in the billing to the wholesale channels and that is why you are seeing a very mutant growth there. I mean not for the second quarter even if I look on a 1 H to 1 H 24:34 24 minutes, 34 seconds basis even then there's a 3% decline but largely this can be explained you 24:40 24 minutes, 40 seconds see quarter two uh quarter 2 is uh H1 is a reflection of what happens in quarter two and quarter two we were impacted by 24:48 24 minutes, 48 seconds the wholesale building a okay okay I'll get back to you on that uh second thing is like uh we are adding 24:56 24 minutes, 56 seconds good number of store additions but the store closes were also there so in the first half we close somewhere around 35 odd stores. So to which brand are these 25:04 25 minutes, 4 seconds stores pertaining to so we you know we added 24 stores and we 25:11 25 minutes, 11 seconds closed 16 stores. The stores that have been closed are the small stores and you would see that we've still added 10 25:18 25 minutes, 18 seconds stores late addition but total addition is 36,000 ft². So we are shutting down few of our small stores and adding adding larger stores. Having said that 25:27 25 minutes, 27 seconds the the large chunk of the new store editions is coming in US. 25:32 25 minutes, 32 seconds Okay. And the store closures is it specific to single brand or uh so they are they are across all the brands. We are we are actually you know 25:40 25 minutes, 40 seconds kind of rationalizing our store size and you must have noticed that that has happened over the last two two three quarters. 25:47 25 minutes, 47 seconds Okay. Okay. Okay. Got it sir. Uh and the last question is that can you throw some light on the footwear segment? uh see we 25:55 25 minutes, 55 seconds know that that the segment has an annual net of somewhere around 350 crores. So what's the outlook there? What is your midterm and long-term returns for that segment? 26:06 26 minutes, 6 seconds I think if I can come in here I think the last couple of years the footware business was impacted by the BIS 26:14 26 minutes, 14 seconds regulation and before that phase the business was in exponential growth trajectory. I think what is very 26:22 26 minutes, 22 seconds heartening is that this is a business now which has come back to high 20s sort of growth rate and uh we still believe 26:31 26 minutes, 31 seconds the business will catch further momentum as the entire supply chain stabilizes. 26:37 26 minutes, 37 seconds So this is one of those growth drivers which I think will be a very large one for the company. we would actually 26:44 26 minutes, 44 seconds expect to hope to double the size of the company uh of footwware in the next uh three uh three years or so. So I think 26:53 26 minutes, 53 seconds it's a very exciting uh space where we have built very unique capabilities. I think the product market fit we've got 27:00 27 minutes in the sneaker business is very very unique. So we are leaning in very heavily and I think the growth is now coming back with the BIS disturbances behind us. 27:10 27 minutes, 10 seconds Okay, got it. And one small question regarding this footwear. Is it like entirely 100% retail business or do we also have a distribution or uh indust footwear ones? 27:21 27 minutes, 21 seconds There is um a little bit of key account business but we don't do multibrand in footwear. We do online both uh wholesale 27:29 27 minutes, 29 seconds and direct. So we don't have an MBO business in footwware. 27:33 27 minutes, 33 seconds Okay. Okay. Got it. I'll join again in the queue. Thank you sir. Wish you all the best. Thank you. 27:40 27 minutes, 40 seconds I repeat you may press star and want to ask a question. The next question is from the line of Ashto from ICICI securities. Please go ahead. 27:52 27 minutes, 52 seconds Yeah. Hello. Uh very good afternoon management and thank you for giving me the opportunity. Uh so my first question 27:59 27 minutes, 59 seconds uh is on the overall apparel sector. So uh we have seen that last year it was largely impacted by uh of cut in the 28:08 28 minutes, 8 seconds discretionary spends uh but now there seems to be uh growth momentum coming in especially for the premium brands uh 28:15 28 minutes, 15 seconds even like other premium retailers have also highlighted a similar trend. So uh is my understanding overall correct about the premium segment? Uh uh like I 28:25 28 minutes, 25 seconds understand that there has been personal tax cut uh in part GST cut which uh is uh definitely uh you know aiding growth 28:33 28 minutes, 33 seconds but apart from that uh is there any other consumer sentimental shift that is happening or there are few internal 28:40 28 minutes, 40 seconds drivers uh that is making this shift. Uh so anything on this would be really helpful. 28:48 28 minutes, 48 seconds So, so uh you know so as you can see you know we've obviously continued to clock uh pretty solid uh growth and if you 28:55 28 minutes, 55 seconds look at our H1 uh between Q1 and Q2 both I think we've seen consistent uh growth now there are two parts to it yes there 29:03 29 minutes, 3 seconds has been a macro uh impact right so from a stimulus provided from the tax cuts 29:11 29 minutes, 11 seconds that have been that have come in and also very recently with the GST reforms uh coming in we do believe that this 29:18 29 minutes, 18 seconds puts sort of you know a stimuli behind the consumer demand in general and we're expecting that you know this will continue in the medium term. So that's 29:26 29 minutes, 26 seconds one part of it. Uh having said that from our perspective you know we have always been uh talking about working is that we 29:34 29 minutes, 34 seconds want to make sure that we're catering to our consumers from solid premiumization point of view and if you look at our portfolio we've been premiumizing across 29:43 29 minutes, 43 seconds our brands and that is something that has really worked for us. So that is a definite trend and also our brands are strong uh and they're catering to segments which are actually trading up. 29:55 29 minutes, 55 seconds So that's that's an important part of it. Having said that, I think one key lever and something that is cons see consistently has been our strength is 30:04 30 minutes, 4 seconds our product innovation. And if you look at our brands and let me take the example of US polo uh you know we've 30:11 30 minutes, 11 seconds been after improving and uh while increasing from a premiumization point of view but at the same time you'll see 30:18 30 minutes, 18 seconds a lot of innovation that has come uh in the brand as well and that is the consistent story if you look at arrow as 30:24 30 minutes, 24 seconds well I think uh in terms of bringing in uh whether it is coming through the lines of New York or Alexa or whether it 30:32 30 minutes, 32 seconds is you know putting or investing behind our franchises like Autoflex, you know, we've been consistently after 30:39 30 minutes, 39 seconds innovation. So that's that's driving some of the growth in our brands as well. And Tommy and CK are much loved brands. They sit in a in a premium 30:48 30 minutes, 48 seconds segment and you know both of them continue to show strong growth as well. 30:54 30 minutes, 54 seconds Okay. Okay. Understood. Very clear. Uh so my next question uh is on the channel. So uh like uh uh I heard that 31:02 31 minutes, 2 seconds uh the retail focus is there and uh I guess it's already around 43% of the uh total revenue. So I just wanted to 31:10 31 minutes, 10 seconds understand what would be the optimum mix uh know between these channels especially the retail uh know going 31:17 31 minutes, 17 seconds forward uh uh so it's already at 43%. So and we have highlighted that there will be like 100 to 200 basis points of 31:25 31 minutes, 25 seconds improvement in retail plus online this year. So but what after that? 31:31 31 minutes, 31 seconds Yeah. So I think uh you know I think I'll kind of take a step back right and when we look at how we want to go about 31:38 31 minutes, 38 seconds uh again addressing the consumer needs the one important thing for us is to make sure that we are able to talk to 31:46 31 minutes, 46 seconds our consumers are able to learn insights are able to pivot quickly and are nimble enough to adjust to the changing 31:54 31 minutes, 54 seconds preferences of the consumer. Now as you think about that I think fundamentally what you need is to be really close to the consumer and that kind of is 32:03 32 minutes, 3 seconds fundamentally driving our strategy. So we will continue to build on our B2C strategy which is making sure that we 32:11 32 minutes, 11 seconds are catering to the consumers directly through our uh retail channels. At the same time we will continue to drive 32:18 32 minutes, 18 seconds through our online uh B2C business as well. Our aspiration is to take it from today both of these put together are 32:26 32 minutes, 26 seconds about 50% share of business. Our aspiration is to take it upwards from there and make sure that we are able to 32:34 32 minutes, 34 seconds get to about 50 to 70% range uh in over the next few years. 32:44 32 minutes, 44 seconds Okay. Okay. Understood. And uh is it possible to uh give a broad uh uh uh profitability across the channels? Uh a broad range is fine. 32:55 32 minutes, 55 seconds I think the right way to look about uh look at this is to look at uh the return on capital employed. I think we are uh 33:03 33 minutes, 3 seconds that is the northstar for us in this business and these direct models have um you know in a sense a very good uh 33:11 33 minutes, 11 seconds capital turn cycle and on on most of our channels from a channel contribution 33:17 33 minutes, 17 seconds perspective range between 20 to 25% channel level profitability. The channels which are at the early 20s tend 33:26 33 minutes, 26 seconds to be more gross working capital light and the channels which are a little bit on the higher side of the 20 to 25% 33:35 33 minutes, 35 seconds bucket tend to have a higher gross working capital. So netnecket from a rosi perspective I would say our direct channels are slightly more royative and 33:44 33 minutes, 44 seconds that's why you are also seeing over time that the rosi of the business is inching up as we scale up. 33:52 33 minutes, 52 seconds Uh right right side and uh uh just one more question uh uh is it uh like also 34:00 34 minutes possible to broadly uh give a revenue split across or maybe the share split across the five key brands. 34:07 34 minutes, 7 seconds We don't give brandwise details. We've mentioned this also in the past. So you know some of this is competitor 34:15 34 minutes, 15 seconds sensitive information. So whilst we are giving you a broad perspective of brand performance, we won't be able to get into specific numbers. 34:23 34 minutes, 23 seconds No, no problem sir. And also sorry one last question. Uh uh so uh you have mentioned that the inventory turn is uh 34:31 34 minutes, 31 seconds uh uh at 3.8 times right now. Uh so do you think that uh this is already at the optimal uh level or there is still scope 34:39 34 minutes, 39 seconds for improvement and if there is any scope then what would be the drivers uh for for this improvement? 34:46 34 minutes, 46 seconds You see uh I mean there is always scope for improvement. The biggest driver could be you know faster uh deployment 34:54 34 minutes, 54 seconds of our returns and obviously um inventory turns in some of our retail stores. Both these put together I mean 35:01 35 minutes, 1 second we are quite optimal and we are at the industry best standards I would say but you know 5 to 7% improvement is still 35:08 35 minutes, 8 seconds possible which can happen over the next 12 to 18 months. 35:12 35 minutes, 12 seconds Okay. Okay. Sure. Thank you. Thank you ma'am. Thank you sir for this. Thank you. 35:21 35 minutes, 21 seconds The next question is from the line of Chaitan from systematics group. Please go ahead. 35:28 35 minutes, 28 seconds Yeah. Hi, thank you for the opportunity and congratulations on a good set of numbers. Uh just wanted to understand so our adjacent categories have seen a 35:36 35 minutes, 36 seconds strong growth of say 20% plus during the quarter. Can you highlight how the performance has been for the core apparel business for US polo and Tommy 35:45 35 minutes, 45 seconds CK and then do the adjacencies as you explained for the footwear do other adjacencies have any substantial 35:51 35 minutes, 51 seconds presence beyond our EBOS? Uh and if so then how is the performance over there? 36:01 36 minutes, 1 second So if you were to look at uh you know our grand portfolio and I think going back to while we've clocked a very hefty 36:07 36 minutes, 7 seconds growth uh you know overall uh US continues to clock uh you know upwards of 20% growth and uh you know that is 36:17 36 minutes, 17 seconds also coming on the back of everything that has gone into it right so from product innovationization 36:23 36 minutes, 23 seconds retail expansion and uh that is obviously coming from the core part of the brand, right? The core part of the 36:31 36 minutes, 31 seconds portfolio is actually hitting it quite hard right now, right? So, it's not just the adjacent categories that's driving growth in US polo, but overall growth is 36:40 36 minutes, 40 seconds being uh driven from there. And in terms of uh Tommy and CK, I think like we said, I think they've been maintaining a 36:47 36 minutes, 47 seconds growth momentum and we expect this to continue over a period of time as well. 36:52 36 minutes, 52 seconds uh like we've also pro uh called out earlier uh you know this is you know as the consumer is trading up we are seeing 37:00 37 minutes that uh these two brands are obviously uh extremely strong from a brand positioning point of view from an offering point of view and we expect to 37:08 37 minutes, 8 seconds see uh a trend of growth over there as well 37:16 37 minutes, 16 seconds okay on the adjacencies part like uh as uh how uh like is it present beyond EBOS 37:24 37 minutes, 24 seconds uh like for footwear you had explained it right for other adjacencies like innerware women's wear kids wear 37:31 37 minutes, 31 seconds yes so uh kids we cater to through uh kids uh all channels uh in terms of 37:38 37 minutes, 38 seconds innerware we are catering that to the overall all channels as well and it is has a significant presence between u you know MDO online retail etc. 37:50 37 minutes, 50 seconds Okay, got it. Got it. Thanks a lot. 37:53 37 minutes, 53 seconds One of the um uh interesting new adjacencies which um is a big focus area going forwards is also going to be 38:02 38 minutes, 2 seconds women's web. It is the last adjacency in a sense to be launched. It's early stage of its journey but very encouraging 38:10 38 minutes, 10 seconds growth vectors in in that part of the business as well. So I I mean that's a future bet where one should see high scale up coming in the years to come. 38:26 38 minutes, 26 seconds Okay. Thank you. 38:28 38 minutes, 28 seconds Thank you. The next question is from the line of Nihal Mahes from HSBC. Please go ahead. 38:36 38 minutes, 36 seconds Yes, I am audible. Yes. Yes, please. 38:41 38 minutes, 41 seconds I have three questions. First is on flying machine. So there is an implement in the LTL growth there. I just wanted to understand the initiatives that are driving the improvement in that brand. 38:52 38 minutes, 52 seconds Sure. So I think see flying machine has been a journey over the last couple of years and uh you know with flying machine what is heartening to see is 39:00 39 minutes that we believe the brand is in uh growth growing in the right direction. 39:04 39 minutes, 4 seconds uh you know as we sharpen uh our positioning there is uh of the brands we actually have gone ahead and improved the product range that is out there and 39:13 39 minutes, 13 seconds we're also looking at the channel to serve from a consumer point of view right so from all of that perspective flying machine has been a complete 360 39:21 39 minutes, 21 seconds uh effort and we seem to be uh you know what we've seen is uh solid like to like sales and a good initial indicator uh 39:30 39 minutes, 30 seconds from our overall retail and a channel portfolio point of view as well. So we're quite uh pleased to see the direction in which the brand is going. 39:40 39 minutes, 40 seconds Sure. And and taking the last six months is the overall growth in the brand also strong or is it that maybe because of the shift uh in channels that you're 39:48 39 minutes, 48 seconds focusing that the retail growth is strong whereas maybe the online business is seeing a bit of a push back. 39:55 39 minutes, 55 seconds I think it's a function of uh you know product and consumer. So I wouldn't kind of look at it as an either or. what 40:02 40 minutes, 2 seconds we're seeing is that demand and based on uh you know from a timing etc point of view I think we're seeing demands uh across uh channels 40:11 40 minutes, 11 seconds one of the channels within FM which we have strategically deemphasized is the online wholesale so whilst we are 40:20 40 minutes, 20 seconds doubling down on direct online we are um reducing or have reduced the scale of the wholesale online business so that's 40:28 40 minutes, 28 seconds I would say the only channel where there is a adjustment happening but all the other channels as Amisha was saying are being pushed for growth. 40:38 40 minutes, 38 seconds Point taken. The second question was for arrow and flying machine combined together possibly to get a sense of where the editor is and what is the 40:47 40 minutes, 47 seconds target to take it to what range over the next two to three. 40:52 40 minutes, 52 seconds Yes. So I think uh you know the uh I think again I think we've kind of stated this earlier as well. The target to take 41:00 41 minutes flying machine and arrow is in the mid single digits and uh with again with the 41:07 41 minutes, 7 seconds efforts that have gone behind both arrow and flying machine and arrow is a little ahead in its journey but with the effort of ensuring uh a strong brand 41:15 41 minutes, 15 seconds positioning aligning to uh you know from a consumer point of view aligning the product along with it and you know 41:21 41 minutes, 21 seconds ensuring that we are segmenting again from both the channel point of view and a consumer perspective As we drive that 41:30 41 minutes, 30 seconds uh we believe that you know Arrow should continue to see uh growth and we should see again strong productivities coming out of there 41:37 41 minutes, 37 seconds and as we had mentioned earlier you know both these uh brands will see a higher improvement in bottom line year on year compared to the rest of the portfolio. 41:47 41 minutes, 47 seconds So every year we kind of have set a business plan accordingly so that the trajectory goes towards what Amisha mentioned and I think heartening that 41:56 41 minutes, 56 seconds both brands for this year's EOP we are on track for those kind of improvements. 42:02 42 minutes, 2 seconds Just one following if it's possible what has been the improvement why in the first half for these two brands it's 42:10 42 minutes, 10 seconds what is the overall improvement machine for the first half if it's possible to share that part. So I won't 42:17 42 minutes, 17 seconds get into exact specific numbers but broadly we had said that if at a company level operating leverage has to be 80 to 42:26 42 minutes, 26 seconds 100 bits these two brands need to have a certain order of magnitude above that. 42:31 42 minutes, 31 seconds So that's the way their business plans also reflect in terms of percentage aid margin improvement. So we believe that we are on track for that this year. 42:41 42 minutes, 41 seconds Understood. Just just one last question that your remarks in that obviously if ever 42:52 42 minutes, 52 seconds sorry your audio isn't clear can you just maybe get a bit closer to the mic or something? 42:59 42 minutes, 59 seconds Sorry ma'am. Hello. Kind of I was asking that uh Amisha you did mention about the fact that uh if 43:08 43 minutes, 8 seconds opportunity ever comes up beyond the adjacencies and existing bands it would be considered in that backdrop considering we've sort of become cash 43:15 43 minutes, 15 seconds flow positive net cash uh positive this year. Is there a thought that only the existing flows that the business generate would be used for acquisitions 43:23 43 minutes, 23 seconds or uh like what is the limit that the business is thinking in case ever a acquisition is planned? 43:30 43 minutes, 30 seconds I think right now we believe that as we are scaling the business you know the operating cash flows are moving in the 43:37 43 minutes, 37 seconds right direction and materially so and as Amisha mentioned current focus is on really uh ramping up the current 43:45 43 minutes, 45 seconds portfolio if and when an opportunity arises as she mentioned we we will be 43:51 43 minutes, 51 seconds open but we're not expecting any major capital event if that is what you were 43:58 43 minutes, 58 seconds kind of asking I mean right Now we don't believe the business will require external capital to support its 44:05 44 minutes, 5 seconds strategy. I think the OCF is heading in a very positive direction. 44:10 44 minutes, 10 seconds Point taken question. Thank you so much and I wish you all the best. Thank you. Thank you. Thank you. 44:17 44 minutes, 17 seconds The next question is from the line of Kospascar from ICICI direct. Please go ahead. 44:25 44 minutes, 25 seconds Yeah. Uh thanks for giving me the opportunity. Congrats for a great set of numbers. Uh most of my questions have been answered. Uh I have uh few couple 44:34 44 minutes, 34 seconds of questions. First uh on Amisha's initial comment of inventory freshness uh which is at alltime high of 85%. So 44:43 44 minutes, 43 seconds would like to uh you know hear from you what was it earlier and uh you know uh uh just your thought on how it is 44:52 44 minutes, 52 seconds helping you or what led to this inventory freshness or what are the strategies you know uh you know which is 44:59 44 minutes, 59 seconds helping you this freshness and whether this strategy is only pertaining to uh few brands like US polo Tommy or it is 45:08 45 minutes, 8 seconds across your portfolio of brands maybe I'll take this question since you know I can answer on the transformation 45:16 45 minutes, 16 seconds journey over the last three years. I think this has been the heart of the transformation effort that the whole 45:23 45 minutes, 23 seconds team has worked on which is getting the fundamental flow of inventory right and that means one starting with really 45:32 45 minutes, 32 seconds creating strong differentiated elevated products. I think across the portfolio lot has gone into getting the product 45:40 45 minutes, 40 seconds engine to really fire and closely associated with that is to really drive full price sell through I think we have 45:48 45 minutes, 48 seconds seen a significant improvement in some brands the sellroughs have gone up by as high as 6 to 8% in some brands it has 45:55 45 minutes, 55 seconds gone up by 3 4%. And that means you are going to have a lot less uh old inventory left in the system post end of 46:03 46 minutes, 3 seconds season sales. Another big uh uh work that the company has done is on balancing it channels. So we have very 46:12 46 minutes, 12 seconds successfully built Mega Mart as our in-house liquidation channel and today a very very effective channel for us to 46:20 46 minutes, 20 seconds realize very high value on the end of season left merchandise and with very very high amount of CA cash conversion. 46:27 46 minutes, 27 seconds So it's a very quick very beautiful efficient channel. So in a sense it's been a 360deree effort right from 46:34 46 minutes, 34 seconds product to planning to driving the retail and and ensuring the the liquidation channels perfectly being 46:41 46 minutes, 41 seconds balanced and that has meant us moving from a late 60s early '7s to as high as 46:48 46 minutes, 48 seconds 85% below one year and that is what is reflected then finally in lower discounts and higher LTL. These are I 46:56 46 minutes, 56 seconds think the fundamental health parameters of the business which has seen this big transformation and I think what is heartening to see is that journey is 47:05 47 minutes, 5 seconds still continuing and we are continuing to see the benefits of that and still moving towards better numbers on this front. 47:14 47 minutes, 14 seconds Uh that was uh so second question is on flying. Uh so adjacencies we have been 47:21 47 minutes, 21 seconds uh you know seeing in most of your brands. So in daming uh especially are we looking at some kind of addresses you 47:28 47 minutes, 28 seconds know which might help us to you know uh kind of a uh revive the growth uh in the 47:34 47 minutes, 34 seconds range also category uh you know yes so I think look I think from a flying machine point of view I think fundamentally first we want to make sure 47:43 47 minutes, 43 seconds that we work on our four categories right and as we get uh and I think I've kind of addressed this earlier as well as we get much sharper with our brand 47:51 47 minutes, 51 seconds positioning as we look at uh serving the consumers through the channels of their preference and you know putting out products that's relevant. I think that's 47:59 47 minutes, 59 seconds been the core focus and we will continue to drive the core part of the business first right I mean adjacencies uh will come in later but at this point in time 48:07 48 minutes, 7 seconds I think what we are looking to do is to double down on the core right uh so just uh uh to better 48:16 48 minutes, 16 seconds understand double down on core uh will it be more from the product portfolio innovation point of view or having a 48:23 48 minutes, 23 seconds correct pricing for uh the product what is available uh currently in portfolio. 48:30 48 minutes, 30 seconds So I think you know when you uh talk about both product and pricing right I think fundamental question goes back to who is our consumer and who are we 48:37 48 minutes, 37 seconds catering to right. So as we look at our consumer as we look at you know the cohort and the demand spaces around it 48:44 48 minutes, 44 seconds we will make sure that our product portfolio and the pricing lines up against it. Right? So it's not never either. It's always going to be a 48:52 48 minutes, 52 seconds strategy of ensuring that the product portfolio is right from a consumer cohort point of view. Having said that, we will also then marry that with the 48:59 48 minutes, 59 seconds channel that is relevant to these consumers. Right? So, uh as we go forward, we will make sure that we are firing on all three pillars which is the product, the brand and the channel. 49:11 49 minutes, 11 seconds Thanks for the understanding and thank you. The next question is from the line of Vun Singh from Alpha Accurate Advisor. Please go ahead. 49:24 49 minutes, 24 seconds Am I audible? Yes. Yes sir. Yes. Okay. Thank you for the opportunity sir. 49:31 49 minutes, 31 seconds Uh two questions. First is uh regarding uh second half. Uh so given 49:38 49 minutes, 38 seconds that we have added around 50 53 odd shows in the first half. Are we in a comfortable position to add maybe 100 stores in the second half? 49:48 49 minutes, 48 seconds See, so the the way you know and as we've laid out u retail expansion is a very critical part of our strategy and that that kind of includes three things 49:57 49 minutes, 57 seconds right we want to go after renovating relocating and upsizing um as uh deemed right from a market and catchment point of view right so that's the fundamental 50:06 50 minutes, 6 seconds thing we are behind now as we look at our u our BD and as we look at our region expansion for H2 uh the answer to 50:14 50 minutes, 14 seconds your question is you know we've doubled down our investment from a team and from how we're going about it over the last couple of quarters and we feel that we 50:23 50 minutes, 23 seconds are on track and we should be able to land closer to our total uh net square ft addition that we have planned for. Uh 50:31 50 minutes, 31 seconds and as uh said earlier we've kind of put a target for ourselves which is in the zone of about 1.5 lakh uh net square ft 50:40 50 minutes, 40 seconds addition and uh you know we will kind of go um we feel that we are actually doing well towards that target. I could also 50:47 50 minutes, 47 seconds highlight that I think it is less about the number of stores but having the optimal size of stores the stores in the 50:54 50 minutes, 54 seconds right locations. I think those are the critical parameters at this point in time. 51:00 51 minutes No. So uh Amisha I think 150 store edition guidance and maybe 70 odd store closure which is what has happened in FI 51:08 51 minutes, 8 seconds FI 25A I mean edition was 120 and 74 was store closure. So 1 uh or 0.12 million 51:17 51 minutes, 17 seconds is what we added in April 26. I think we are supposed to add 0.17 million traffic 51:23 51 minutes, 23 seconds not 0.15 and in case you say 0.15 then does that mean that we are reducing the guidance? 51:31 51 minutes, 31 seconds So we are you know we are we are in line to add what we guided earlier. Uh we added 74,000 in H1 and we are pretty 51:40 51 minutes, 40 seconds confident that we will add the rest of it. 51:44 51 minutes, 44 seconds Okay. Okay. Sure. So roughly uh 100 odd stores we should be able to add in second half. 51:52 51 minutes, 52 seconds We are working towards that I think. Uh and we have got a good pipeline of stores and we are hoping that we will do that. 52:00 52 minutes All right. Okay. uh and secondly the new stores that we are adding I mean from the current quarter number uh that 52:08 52 minutes, 8 seconds calculation that we could do is around 3,000 4,000 is what the number that I could see uh please help us understand 52:16 52 minutes, 16 seconds that the whatever new store edition that we are doing that is of what size because system level uh average store size is around 12300 square ft² 52:25 52 minutes, 25 seconds so our new store editions are anywhere between 1200 to 2,500 ft² And depending on the type and the offering and the you 52:34 52 minutes, 34 seconds know catchment uh some stores we are actually adding marquee stores and some club stores which are larger but the 52:41 52 minutes, 41 seconds rest of the stores are you know our normal average size between 1,000 to 1200 square ft. 52:48 52 minutes, 48 seconds Okay. Okay. Sure. and uh just wanted to understand on a margin that uh I think earlier we added the 50 bits margin 52:57 52 minutes, 57 seconds expansion is what we should expect in FI26. So from 30,000 in FI25 XY is 13.5 53:05 53 minutes, 5 seconds in F26 and given the first half that we have uh I think the required run rate in 53:12 53 minutes, 12 seconds second half is 14 or more than 14% AI margin uh so is this number uh I mean are we are we comfortable with 14% kind 53:21 53 minutes, 21 seconds of an AI margin in second half given that Amisha also called out regarding uh 53:27 53 minutes, 27 seconds uh investments etc to also be on the set card for driving growth. 53:35 53 minutes, 35 seconds So you know what we had guided earlier in terms of aida margin growth we are pretty confident of achieving that 53:42 53 minutes, 42 seconds we are confident of achieving that. So I think in first half 12.6% 6% margin second half 14.3 is what is the number 53:52 53 minutes, 52 seconds number coming up so I think we understood and one last question on the online part I think you uh called out 54:00 54 minutes that uh we are defocusing online uh wholesale business uh but in 54:07 54 minutes, 7 seconds the current quarter number I could see that your growth for the online B2B has 54:14 54 minutes, 14 seconds been much higher compared to online B2C So uh I mean how should we understand uh 54:21 54 minutes, 21 seconds the reasoning for this growth and the deep process that you mentioned consequently the I think 54:29 54 minutes, 29 seconds but uh at least our investor tech and the numbers that Aisha also said both are in line B2C actually grew faster 54:37 54 minutes, 37 seconds almost like 50%. and online B2B yeah deg 54:45 54 minutes, 45 seconds 10% only I see I see okay so sir sir understood thank you very much and wish you all the best 54:53 54 minutes, 53 seconds thank you I repeat you may press star and want to ask a question the next question is from the line of Rajiv from 55:01 55 minutes, 1 second Nwama please go ahead yeah uh good afternoon sir thanks for the opportunity um so you mentioned uh 55:09 55 minutes, 9 seconds that employee cost on a Q basis um would have been 10% higher otherwise if not for that uh you know the management 55:17 55 minutes, 17 seconds change so if we adjust for that the gross margin uh the AIA margin expansion would have been close to 90 basis point and uh is that the sustainable number 55:26 55 minutes, 26 seconds which you are let's say shooting for at least for this current fiscal uh going forward as the employee cost normalizes I mean mathematically what you're saying 55:34 55 minutes, 34 seconds is right Rajie yeah maybe I can come in here I think The last three years we have consistently been more than 100 55:43 55 minutes, 43 seconds bits uh operating leverage in this business and the one slight difference in the next 3 years I would say is 55:50 55 minutes, 50 seconds whilst fundamentally we can continue in that trajectory because we've got uh further operating leverage coming in and 55:57 55 minutes, 57 seconds some of the lower performing brands are moving up faster. We intend to up our marketing spends and that's I think 56:05 56 minutes, 5 seconds something we have mentioned in the last couple of uh quarters that our percentage of marketing as a percentage 56:12 56 minutes, 12 seconds of sales is being taken up. So in a sense we are taking a bit of that operating leverage and investing in future growth and that's why I think 56:21 56 minutes, 21 seconds depending on which quarter possibly the range of operating leverage you would see would be somewhere between 50 bits 56:29 56 minutes, 29 seconds to 100 bits. you know it could go up and down because of the way the marketing is going to play out and the way we are investing in the brand. 56:39 56 minutes, 39 seconds Sure. Uh I mean you partly answered it but um considering that last year also I think on the abl side we have grown at 56:48 56 minutes, 48 seconds 13%. And uh we barely saw any operating leverage on that entity uh and now we have on the retail side we have grown at 56:56 56 minutes, 56 seconds least 20% on USDA side. Would we expect operating leverage coming in that side or you are going to I think you will you should expect now 57:04 57 minutes, 4 seconds operating leverage in all parts of the business and that's what's actually also come through in H1. So you should expect that in the full year also. 57:13 57 minutes, 13 seconds Sure. Um lastly one question uh to Amisha. So um so we have heard lot of continuity from um you know what uh 57:22 57 minutes, 22 seconds felish was continuing on let's say uh brand extension and uh expanding the network but are there any other uh you 57:29 57 minutes, 29 seconds know low hanging fruits which you are targeting you know to impart uh you know your uh it's a change of garden um you 57:38 57 minutes, 38 seconds know something which you are bringing on the table which is uh really new which we have not seen so far. 57:44 57 minutes, 44 seconds Sure. So um you know I'll kind of uh again go back and talk in terms of uh you know fundamentally how we are 57:51 57 minutes, 51 seconds thinking about things right um a uh like I mentioned I think a strong portfolio of five brands and we believe that there is headroom there. So as we look at 58:00 58 minutes these five brands as well right we want to make sure that we are articulating and extremely sharp on how we are positioning our brand right so from a 58:08 58 minutes, 8 seconds brand positioning consumer com and how we talk to our consumer we will see that we will double down over there the 58:15 58 minutes, 15 seconds second thing we will talk about is uh as you and as going forward is also looking at how we are catering to this consumer 58:23 58 minutes, 23 seconds from a product point of view right so sharpening our merchandising range sharpening the way the product portfolio the pricing of the portfolio aligning 58:31 58 minutes, 31 seconds that to the consumers that we serve is going to be a second large thing. Now as you look at the consumer, you look at the product portfolio that you know you 58:38 58 minutes, 38 seconds sort of cater to them then you want to make sure that you are talking to them right. So and hence I went after saying that we will be looking at a sharp 58:47 58 minutes, 47 seconds segmentation we will be data backed and we will ensure that we are improving and going after our marketing uh 58:54 58 minutes, 54 seconds capabilities also right so enhancing that through technology in everything we do we're going to make sure that we are 59:02 59 minutes, 2 seconds going to leverage that from a consumer targeting point of now as I said this I think it's also important to understand that you know when you talk about 59:10 59 minutes, 10 seconds product when you talk about brand the critical thing is to make sure that the last vertical which is the last pillar which is channels has to stack up right 59:18 59 minutes, 18 seconds for each brand right so we will be looking at these three things in a very sharp manner across our brand portfolio 59:25 59 minutes, 25 seconds largely speaking I would say that there will be two large enablers to the business in the future one is obviously I've already spoken about which is 59:33 59 minutes, 33 seconds improving the way we look at data and ensuring that we make lot data back decisions and that should also inform the way we talk to our consumers the way 59:40 59 minutes, 40 seconds we target them, the way we segment them, right? That's one part of it. The second is we will be looking at technology in pretty much everything we do, right? So 59:49 59 minutes, 49 seconds how we go to market, how we cater to the consumers, how do we look at merchandising, every part of our value chain, we will ensure that there is 59:56 59 minutes, 56 seconds acceleration from a technology point of view as well over the years. Perfect. Uh thanks a lot. All the best. 1:00:05 1 hour, 5 seconds Thank you. Thank you. 1:00:09 1 hour, 9 seconds We will take that as our last question for today. I now hand the conference over to Mr. Ghar for a closing comments. 1:00:16 1 hour, 16 seconds Uh thank you everybody for joining the call today. If you have any more questions, please feel free to reach out to us and we would be happy to answer them online. 1:00:24 1 hour, 24 seconds Have a good day. 1:00:26 1 hour, 26 seconds On behalf of Arvin Fashion Limited, that concludes this conference. Thank you for joining us and you may now disconnect your lines. Thank you.