Bikaji Foods International Limited — Q3 FY26

Bikaji Foods International Ltd Q3 FY2025-26 Earnings Conference Call https://www.youtube.com/watch?v=CDU7corMCG8 Published: 3 months ago

0:01 1 second Ladies and gentlemen, good day and welcome to Bikaji Food International Q3 FI26 earnings conference call. As a 0:08 8 seconds reminder, all participants line will be in listenonly 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 your touchstone phone. I now hand the conference over to Mr. Amsh Dawari. 0:28 28 seconds Thank you and over to you sir. 0:32 32 seconds Thank you. Good afternoon everyone and thank you for joining the Fors International K3 F26 earning conference call. From the management team we have with us Mr. Rishab Jen CFO and Mr. 0:44 44 seconds Manushwama COO. I now request Mr. Rishab J to take us through the key opening remarks after which we will have the floor open for question and answer. 0:53 53 seconds Thank over to you sir. 0:56 56 seconds Uh thank you to all the investors and friends. Uh so largely from this quarter perspective, this quarter is the story of two halves. So in October where we 1:04 1 minute, 4 seconds have seen some pre-born of Diwali uh this year. So we seen sweet business being in negative growth this year. But overall when we see a core business 1:12 1 minute, 12 seconds which is ethnic snacks and western snacks. So ethnic snacks has grown at close to 30 and a half 30 and a half%. 1:18 1 minute, 18 seconds Versus uh western snacks grow 20% plus growth. So we seen overall snack growing at 14% plus uh in this in this year and 1:26 1 minute, 26 seconds we also seen some early sign of GST benefit which is which is government has passed on in September month. So we seeing good volume growth also in ethnic 1:35 1 minute, 35 seconds ethnic snacks and restaurant snacks overall. So we seen good sign in our core business that's what in this quarter and also January is part going 1:43 1 minute, 43 seconds on and we are seeing some good results also in this quarter also. uh in this quarter being also we done some two two big uh big campaign which is regarding 1:52 1 minute, 52 seconds with respect to bua soi buja to baji campaign which we started in September September month and ran in this full quarter and has given a very good result 2:00 2 minutes in in a buja category in our traditional snacks category which has grown up of 16 17%. 2:06 2 minutes, 6 seconds Also we have started one UP specific UP campaign which is KIA which has started in December month and it's early to say 2:13 2 minutes, 13 seconds but yeah getting good result in UP from bottom line perspective we seeing gross margin at a steady level at close 2:20 2 minutes, 20 seconds to 35 close to 35% uh which is including PI but yeah overall we have seen uh gross margin 35% ad cost of course this 2:28 2 minutes, 28 seconds October month is is always big on ad quarter uh ad cost and so add cost was close to 4% in this third third quarter 2:38 2 minutes, 38 seconds so our beta is close to 12 and a half% but overall we seen good operational efficiency as well as GP has has remained con has remained stable in last 2:46 2 minutes, 46 seconds three quarters two three quarters uh from uh from raw material perspective we seeing uh stability in all key raw material like except peanut which we 2:54 2 minutes, 54 seconds just see which we seen some uptick but overall peanut is not so big in our overall portfolio but yeah all the other raw material has been stable and we we 3:02 3 minutes, 2 seconds started doing long-term parking of each key raw material because it's a peak season or peak crop season. 3:08 3 minutes, 8 seconds So overall uh next 3 to six quarters what we see uh we see some stable growth uh being we are at low category low utilization as of now 52%. 3:17 3 minutes, 17 seconds So we we seen early sign of good recovery due to GST and good demand uptick. So we see at least 14 to 16% 3:25 3 minutes, 25 seconds growth in our fourth category. That's what overall uh from uh from uh investment perspective we we are doing some uh we committed close to 131 cr 3:34 3 minutes, 34 seconds rupes of investment in the factory last year out of which 60 cr has been invested we taking 40% stake uh we are we are putting additional 40 cr as per 3:43 3 minutes, 43 seconds agreement this year and we we have part in we taken the approval from the board also for this and uh but after this our 3:50 3 minutes, 50 seconds overall stake will be close to 48%. And also we have done some done JV with TK Khalil. TK Khalil is a big big name in 3:59 3 minutes, 59 seconds Middle East and having more than four decade of experience in bakery category. 4:03 4 minutes, 3 seconds uh he's he's made some big business in bakery in India and we're tied up with him and formed a JV where he will be having 30% stake and we will be having 4:11 4 minutes, 11 seconds 70% stake in our company in Biki Bakes uh separate company under Bikaji and that's a futuristic investment but yeah 4:18 4 minutes, 18 seconds we see that it can become 100 crore business because now all the children and children's and all new new uh uh new 4:27 4 minutes, 27 seconds TG normally see this business as a big business and we also had done some some investment ment in this 4:35 4 minutes, 35 seconds overall from 9 months number uh 9 months number so gross margins grow 34.9% with a beta at 14.2%. or revenue from 4:43 4 minutes, 43 seconds operation if you see uh this without PL we grown at close to 14% revenue from operation at console level uh 4:52 4 minutes, 52 seconds from distribution perspective manoj you can yeah so in in terms of distribution and 4:58 4 minutes, 58 seconds which is what is identified growth lever so we continue to grow if you look at in terms of our overall reach is gi we are 5:07 5 minutes, 7 seconds now close to 1.4 4 million outlets and in terms of our direct reach we have we are now at about 1 3.35 lakh outlets directly. 5:20 5 minutes, 20 seconds Uh the marketing campaign which Rish just spoke about. So what we had identified was that we need to infuse 5:26 5 minutes, 26 seconds something so as to accelerate the growth in bua category. With that in mind, uh 5:33 5 minutes, 33 seconds we started a campaign buhya to Bika G which has given a good and an excellent dividend in terms of increasing our 5:42 5 minutes, 42 seconds reach uh and increasing the consumption both resulting into our overall bua bua growth numbers which was primarily 5:50 5 minutes, 50 seconds focused in our core stage. U the other campaign what we also did was uh we roed 5:56 5 minutes, 56 seconds in Mr. Fank tripati as the celebrity and this was more towards UP and nearby 6:03 6 minutes, 3 seconds markets that was the that's the property campaign which we started this was in the later half of quarter 3. So it's too 6:12 6 minutes, 12 seconds early to comment but that yes the initial reads and the responses what we are getting is very positive and um we 6:21 6 minutes, 21 seconds are very confident that this should help us build quarter 4 and thereafter business for us. So we in did you know 6:29 6 minutes, 29 seconds we went on to multiple communication vehicles and very aggressive on digital media on this stuff. Another uh big 6:38 6 minutes, 38 seconds thing which has happened in this quarter is what uh we have relaunched our logo BK. So now the one which we have is more 6:47 6 minutes, 47 seconds vibrant. It is more enticing and this is a refreshment of our old uh logo and effective this year this uh calendar 6:56 6 minutes, 56 seconds year we have now moved on to uh this new logo which is also there in the in the deck of ours 7:04 7 minutes, 4 seconds uh growth if we look at uh so quarter three volume growth so this is uh supported by the GST staff so volume 7:12 7 minutes, 12 seconds growth picked up is for the quarter was 8.4%. 7:16 7 minutes, 16 seconds Um and ethnic sacks, western sacks did extremely well so was papa. So if you see there's a two contrast pictures that 7:25 7 minutes, 25 seconds where it was apled one and now what was quarter three. So this quarter three performance has led YTD performance 7:32 7 minutes, 32 seconds moving up. But to underline ethnic facts and western saxs have done uh very well 7:39 7 minutes, 39 seconds and things getting back on track on a YTD basis if we look at so uh now 7:48 7 minutes, 48 seconds ethnic stand for stand close to 10% and western tax is is 6% above which in H1 7:57 7 minutes, 57 seconds if you look at was a concern which had come up was pretty low but this is in this quarter it was 8:03 8 minutes, 3 seconds is made up for the first half. Uh sweets of course was low and that we had explained earlier uh calls as well that 8:12 8 minutes, 12 seconds it is always good to see quarter 2 and quarter 3 put together. So this was early Diwali hence quarter two numbers 8:19 8 minutes, 19 seconds were high and uh quarter 3 was a negative growth but on a YTD basis if we 8:25 8 minutes, 25 seconds look at uh so sweetes again know on a positive stuff and a growth of 8.1%. 8:33 8 minutes, 33 seconds while quarter 3 was a negative start. 8:36 8 minutes, 36 seconds Now this uh sweets and gifting category has impacted the growth of focus states because the contribution of these two 8:44 8 minutes, 44 seconds categories in focus and other states is very very high. So just to put a number 8:51 8 minutes, 51 seconds and this is uh if in the core states it is 78% in other states it's about 20 uh 8:59 8 minutes, 59 seconds upward of 30% and in focus states upward of 25%. So when these two categories because of Diwali got shifted so 9:08 9 minutes, 8 seconds therefore the growth of focus states or other states looks muted or negative. 9:14 9 minutes, 14 seconds But if you we net off sweets in gifting the growth for these two these two uh state categories is also in line with 9:21 9 minutes, 21 seconds the core state exports has done very well. This is now the results what we are getting for the investment made in 9:29 9 minutes, 29 seconds the yester quarters and years that is about building our capacity wherein we invested behind Ariba foods uh scaling 9:37 9 minutes, 37 seconds up our capability on production for the frozen items which is most salient in 9:44 9 minutes, 44 seconds these markets and also our people investment what we did in the exports market. 9:50 9 minutes, 50 seconds We expect this exports growth to continue and for next 2 three years we should be witnessing same kind of growth. 10:02 10 minutes, 2 seconds U family pack and uh impulse pack is uh again you know if you look at family pack looks weak in this quarter. This is 10:11 10 minutes, 11 seconds on the back of the gifting and uh sweet which is primarily large pack only. 10:17 10 minutes, 17 seconds There's nothing small pack in that that is no impacting that makes this picture bleak in terms of family pack growth. 10:24 10 minutes, 24 seconds But if we look at uh traditional snacking growth, so we have grown higher in family pack than the the small packs. 10:38 10 minutes, 38 seconds So overall from retail business perspective, so our retail retail business has 286% growth. We have in quarter three being it's the biggest 10:46 10 minutes, 46 seconds because Diwali is big and for THF as well as for biki uh Diwali and sweets gifting is very big in retail retail stores. So we done delivered 47 cr 10:55 10 minutes, 55 seconds rupees uh business from 23 stores as on date uh as on date and the target is to open at least 10 stores next year uh in THF as well as in Pikachi. 11:09 11 minutes, 9 seconds Overall from revenue perspective revenue has grown close to 11% with the VITA growth compared to last year quarter three quarter ignored 77% being uh 11:18 11 minutes, 18 seconds increased in Vita margin compared to quarter 3. 11:24 11 minutes, 24 seconds That's a part from the presentation. We are happy to take all the questions. Thank you. Thank you. 11:31 11 minutes, 31 seconds We will now begin the question and answer session. Anyone who wishes to ask a question may press star and one on their touchstone telephone. If you wish 11:40 11 minutes, 40 seconds to remove yourself from the question queue, you may press star and two. 11:43 11 minutes, 43 seconds Participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question assembles. 11:56 11 minutes, 56 seconds The first question is from the line of Abnish Roy from Noama Institutional Equities. Please go ahead. 12:04 12 minutes, 4 seconds Thanks. My first question is on dry fruits and uh nuts. So uh consumer uh treats dry soaps and nuts also as a 12:13 12 minutes, 13 seconds broader part of the snacks category and clearly consumer is focusing more on health and we have seen many companies 12:20 12 minutes, 20 seconds create big business for example Tata consumers already 250 cr r in nuts they have created what will be your thoughts on this because this is a very low 12:28 12 minutes, 28 seconds hanging fruit because part of the same broader snacks category any thoughts on this have you tried this at any point of time any any pilot projects you have 12:37 12 minutes, 37 seconds done in So if we look at into uh the mass category so this is not mass this is 12:44 12 minutes, 44 seconds niche and the top of pyramid uh if we look at in terms of just the dry fruit so that's a commodity but yes when you 12:53 12 minutes, 53 seconds do process this stuff that becomes the snacking part of it which is actually 2% of the overall snacking category at this 13:01 13 minutes, 1 second point in time. So uh we also do have you know some cashew nuts and these uh the nut stuff uh but that's that has not 13:09 13 minutes, 9 seconds been our focus thus far and in near future we this is not our priority because this is importantly on the on 13:17 13 minutes, 17 seconds some few channels where this uh the premium products could be sold. So our focus has been more on the range of numpins and bua. 13:28 13 minutes, 28 seconds Yes. Uh one follow up on the core versus focus. Uh my question is why is sweet and gifting higher in focus market? Is 13:37 13 minutes, 37 seconds it easier to do that especially in a new market? What is the reason? 13:42 13 minutes, 42 seconds No. So uh two reasons of one is that the play of modern trade is [clears throat] very high because you know by virtue of 13:50 13 minutes, 50 seconds our modern trade presence in all these states reliance and demart. So we are overindexed in these states and there 13:59 13 minutes, 59 seconds the because modern trade does very well in all these stores. So therefore our sweets and gifting goes very high. So this is what this is the reason that our 14:08 14 minutes, 8 seconds contribution of sweets and gifting is very high in focus and even high in other states. 14:16 14 minutes, 16 seconds So my next question is on your overall uh advertising strategy. Uh generally we don't see two brand ambassadors in the 14:23 14 minutes, 23 seconds same category in the in the same geography. So Amitab Bach until when do you have him as the brand ambassador as 14:30 14 minutes, 30 seconds per the agreement and uh what is the specific reason for having in the same geography Pankash party as the brand ambassador for Namken? So how does it 14:38 14 minutes, 38 seconds help? Is it a long-term transition from Amitab to Pankas party? Is that the reason? 14:45 14 minutes, 45 seconds No. uh so one is that not same geography if you look at Amitab Bachan is our brand ambassador nationally and 14:52 14 minutes, 52 seconds internationally as well and will continue to be our brand ambassador uh we have extended his contract for 14:59 14 minutes, 59 seconds another two years so that's one pankati we have roped in for a campaign basically so these these are you know 15:07 15 minutes, 7 seconds the geography specific which would be doing so not that in UP we are not using Amitab Bachan as our brand ambassador 15:14 15 minutes, 14 seconds that is it but for specific BI is a we also engage with know one of the known 15:21 15 minutes, 21 seconds agency so this is Ogilby we have worked with and we have done this now as a campaign so this does not impact 15:28 15 minutes, 28 seconds anything with what Amitab Bachan has been doing or would continue to do in that stuff but I didn't understand what was the 15:36 15 minutes, 36 seconds need so no point is that Amitab Pachchan helps us do all category right now 15:44 15 minutes, 44 seconds getting one ambassador brand ambassador for specific stuff. So he's a generic overall stuff pankati we wrote in 15:53 15 minutes, 53 seconds because this connects more closer to this geography to the masses and the teaching what we are looking at. So 16:00 16 minutes basis research we figured it out the options were one we could have used Amitaban. One is a overall broad 16:06 16 minutes, 6 seconds messaging and then uh focused for particular state. Instead the option what came know brighter was that we have 16:14 16 minutes, 14 seconds a different celebrity but this is nothing to do with replacement of one over another. 16:21 16 minutes, 21 seconds Sure thanks that was my take. Thank you. 16:32 16 minutes, 32 seconds The next question is from the line of Dan from Threenra Asset Manager. Please go ahead. 16:39 16 minutes, 39 seconds [clears throat] 16:39 16 minutes, 39 seconds Good afternoon to the team and thank you for giving it unfortunately. Uh so I have couple of questions. First of all the uh distribution strategy side. So uh 16:49 16 minutes, 49 seconds direct distribution reach has increased to 13 lakh uh 13.9 lakh outline as as of December 25. So from here should uh 16:57 16 minutes, 57 seconds growth be driven more by a higher up higher throughput per outreed or by entering new micro markets and how should we think about the margin impact of it. This is my first question. 17:09 17 minutes, 9 seconds Yeah. So growth has come both so it's a two-pronged growth strategy. One is that know continue to drive growth which is 17:18 17 minutes, 18 seconds more know if you look at in terms of our core states because that that's where our uh numeric distribution or our reach 17:25 17 minutes, 25 seconds is already at a uh on a higher level. So there the growth story is more about throughput of store in the focus and 17:34 17 minutes, 34 seconds core or the other the focus and other state the it is uh both that the stores 17:41 17 minutes, 41 seconds where we are they will grow and the inorganic growth in terms of new stores where we were not present earlier and as we reach in that stuff. Now talking 17:50 17 minutes, 50 seconds about the margin impact. So yes we make better margins in our core states and there know increasing uh or driving 17:59 17 minutes, 59 seconds growth from throughput helps us mitigate for whatever you know when we expand more in our focus states. So overall there's no margin impact in that stuff. 18:09 18 minutes, 9 seconds This is a thought through thing what we do. 18:12 18 minutes, 12 seconds Okay. Uh I'm just continuing my first question and just more focusing on the margin side like right now in quarter 3 18:18 18 minutes, 18 seconds your family pack continue to contribute with impulse pack at 38%. So if impulse 18:25 18 minutes, 25 seconds packs start going fast the loan poor market so do you expect any margin or working capital from a mixed prospect? 18:34 18 minutes, 34 seconds No no no no so it will not have major impact uh because a gap between family and impulse pack in overall gross margin is not more than 2% ethnic snacks 18:42 18 minutes, 42 seconds category to so if our what we see that in next 2 three years this this 55 45 should become so familiar should become 18:51 18 minutes, 51 seconds 55 and 45% should be impulse back so it will have less than 10 to 20 basis point impact and we are doing multiple thing to improve build on efficiency and 19:00 19 minutes overall pricing strategy so this will this will offset this so we don't see any major effect uh if uh if impulse back goes up to and we want to go we 19:09 19 minutes, 9 seconds want uh to go to improve our impulse back contribution being it's a trial pack to in a focus state 19:17 19 minutes, 17 seconds okay fair enough and like last one more bookkeeping question like I want to understand uh regarding marketing intensity has increased with multiple 19:25 19 minutes, 25 seconds regional campaigns and ATL BTS brands so what uh like as per management what internal metrics such as volume up 19:34 19 minutes, 34 seconds volume up uh repeat purchase or outlet productivity used to assess ROI and in what time and these campaigns typically break even. 19:44 19 minutes, 44 seconds So uh so these are no multiple steps in it and multiple vectors if you look on this. So one is the first and foremost 19:52 19 minutes, 52 seconds is that we look at the efficacy or effectiveness of the campaign. So there are reach agencies which gives that what 19:59 19 minutes, 59 seconds was the viewership how many viewed and how many did multiple times. So that's the power of campaign that how has it 20:06 20 minutes, 6 seconds gone below but this is all know so this is nothing to do with numbers uh just 20:13 20 minutes, 13 seconds how the campaign has gone while this has a correlation with our numbers in terms of that your productivity sales team 20:21 20 minutes, 21 seconds productivity start going up which means that there is some demand creation or which could be a new entry and also in 20:29 20 minutes, 29 seconds terms of repeat purchase or the throughput of the store. So both ways you know uh in this case gets measured. 20:36 20 minutes, 36 seconds So one to the marketing team they have a KPI to deliver and similarly you know in synergy sales team is to deliver KPI in 20:45 20 minutes, 45 seconds terms of that how many new stores how many you know what kind of productivity and throughput it has. So those are the measures what we track and then we call 20:53 20 minutes, 53 seconds out that is was it successful or not or should we repeat it or not that. 20:59 20 minutes, 59 seconds Oh okay. Okay, that's it for my s and good luck for your coming quarter. 21:05 21 minutes, 5 seconds Thank you. The next question is from the line of Harprit from G Global Consulent Research. Please go ahead. 21:14 21 minutes, 14 seconds Yes. So, thank you for this opportunity. 21:16 21 minutes, 16 seconds My question is regarding the stock runout like this has been a serious issue for the company for some time now. 21:24 21 minutes, 24 seconds Like for some retailers they do not purchase on purpose and wait till the 24th of a month which causes stocks run 21:31 21 minutes, 31 seconds out and as a result loss in real consumption. So what has the company been doing to deal with this? 21:39 21 minutes, 39 seconds Uh can you be a little more specific on this question? I mean I'm so sorry I couldn't understand. Well, 21:48 21 minutes, 48 seconds like for some retailers, they do not purchase on purpose and uh being aware of the fact that discounted prices will 21:55 21 minutes, 55 seconds be available from 24th of a month which leads to stock runout and as a result loss in your consumption like customers 22:04 22 minutes, 4 seconds are not able to buy due to unavailability of product. So what has the company been doing to manage this? 22:10 22 minutes, 10 seconds [clears throat] 22:11 22 minutes, 11 seconds Yeah. So uh one is that it is not that that 24th onwards there are schemes the scheme starts on the first of the month 22:19 22 minutes, 19 seconds itself that is one uh also none of the retailer because if company loses something that's a sales loss to the 22:26 22 minutes, 26 seconds retailer as well right so that's not the case but what happens is that know whenever any schemes are anticipated uh 22:34 22 minutes, 34 seconds unless you talking in in specific to the GST the when announcement was to happen right So till 23rd people were waiting 22:43 22 minutes, 43 seconds that now the the post GSC rates will come down and then they buy. So even at that point point in time it was not that 22:51 22 minutes, 51 seconds sales was zero. What happened was that these retailers started destocking. So let's say giving an example if a 22:58 22 minutes, 58 seconds retailer keeps say 20 pieces or 15 pieces of one particular SQ. So that point in time he brought this inventory 23:06 23 minutes, 6 seconds down to 56 and he did not purchase know in anticipation of that know the rates GST impact benefit will come and then 23:13 23 minutes, 13 seconds I'll buy again 1520 whatever. So that was a momentary stuff. Otherwise in FMCG space this is how it works that round 23:22 23 minutes, 22 seconds the month or all four weeks there are purchases but yes always you know you 23:29 23 minutes, 29 seconds look at week four becomes little high and week one are high two and three are the regular servicing of that stuff. 23:38 23 minutes, 38 seconds Got it. And uh like the Nepal GV is expected to start production in a year and uh in the e ethnic snacks category 23:47 23 minutes, 47 seconds which is a core category and uh we aim to become uh among the top three players 23:54 23 minutes, 54 seconds there and gain a high mark high singledigit market share. So what is the promise there? 24:03 24 minutes, 3 seconds What is that? So largely from Nepal perspective uh our plans will come up in next eight close to next eight months 24:12 24 minutes, 12 seconds largely and we started we we will start working with uh CG group in maybe by end of by end of this year end of this 24:20 24 minutes, 20 seconds financial year. So we are hopeful that they they are a big group there and they having good distribution. So in next 24:27 24 minutes, 27 seconds next uh two to three years we'll be having at least top three we'll be top three players in in Nepal. That's why we done a JV with them and that's what our aspiration is with them. 24:39 24 minutes, 39 seconds Okay. Thank you so much and all the best. Thank you. Thank you. 24:46 24 minutes, 46 seconds The next question is from the line of Nitin from MK Global. Please go ahead. Yeah, thanks for the taking my question. 24:54 24 minutes, 54 seconds Hi Manuji. Hi Rashab. uh can you please help us understand the monthly revenue trend like I want to assess how the GST 25:02 25 minutes, 2 seconds rate cut is aiding demand and also want to know your view on the GST benefit aiding demand ahead like uh how you 25:11 25 minutes, 11 seconds think uh the GST rate cut will help overall improvement in the growth trajectories that's the first question 25:19 25 minutes, 19 seconds so uh largely what we seen that you see were cold ethnic snacks in ethnic snacks in first half has grown 56% versus this 25:28 25 minutes, 28 seconds quarter the third quarter has grown at around 13 30.3%. And we've seen good uptick in in family pack as well as 25:35 25 minutes, 35 seconds impulse pack. That's what we see the result of some input benefit what we given. We done some MRP reduction. So it's a more affordable to consumer uh 25:44 25 minutes, 44 seconds consumer and also some grammar increase in impulse back. So we we see some also there is possibility that there are smaller player who who is largely 25:54 25 minutes, 54 seconds doing uh not not so not not a business in a much more professional way. So the the we we get opportunity to do at 5% 26:02 26 minutes, 2 seconds GST the chance of doing that type of business will be limited. So we we seen some benefit of due to this also. So overall we see that uh and you'll see a 26:11 26 minutes, 11 seconds volume growth also in traditional snacks is is close to 12 11 12%. Uh 11 12%. So we seeing some good results after the HT 26:18 26 minutes, 18 seconds rate cut and this will be continued in coming quarters. 26:24 26 minutes, 24 seconds Yeah this is really helpful. I just want to know like uh December would be the clean month [clears throat] with just to benefit any sense you can provide on 26:31 26 minutes, 31 seconds like how would have been the growth in December month if you can. 26:36 26 minutes, 36 seconds So uh Nathan if if we were to look at you know in terms of ethnic snacks or the western snacks so immediately after 26:43 26 minutes, 43 seconds GSC so complete even in October also they these categories did extremely well. So the uh it is only you know on 26:51 26 minutes, 51 seconds account of sweets and gifting that October was a weak uh month in terms of overall company but uh GST benefits 26:59 26 minutes, 59 seconds started reflecting or coming in October onwards. So uh it is not that it has only come in December but the good thing 27:07 27 minutes, 7 seconds is that the momentum continues. So what it was uh like September end there was a little confusion chow around that GST 27:16 27 minutes, 16 seconds will bring the rates down and so the purchases were on hold which someone took up as a question as well but this 27:23 27 minutes, 23 seconds picked up October onwards. So all three months our growth has been by far high than what we had delivered in the earlier quarters. 27:33 27 minutes, 33 seconds Thanks this is helpful. And uh do you expect like further acceleration in growth possible? 27:40 27 minutes, 40 seconds So um I think see now it is it rested on overall category growth as well but momentum is good. January you know 27:48 27 minutes, 48 seconds almost is is about to get over. We don't see any disruption or look back on this stuff. 27:57 27 minutes, 57 seconds Thanks this is helpful. Uh second question pertains to your gross margin. 28:01 28 minutes, 1 second So like a despite relatively weaker mix where package sweet aliens down almost around 900 bips Q I am talking 28:09 28 minutes, 9 seconds sequentially our gross margin correction has been limited to only 40 bits. So can you help me understand like what other 28:16 28 minutes, 16 seconds factors are helping to uh keep the gross margin stable on a sequential basis. 28:22 28 minutes, 22 seconds So we have seen good growth in our core product which is vikari buja and that's that's high in gross margin in our ethnic snacks and we seen good growth 28:31 28 minutes, 31 seconds being we done two camp two campaign around this majorly bui campaign so we seen good growth in biker buja and that is overall has been improving gross 28:40 28 minutes, 40 seconds margin also the product mix what we're trying to improve on focus product which are high in gross margin and and we started this two two and a half years 28:46 28 minutes, 46 seconds back so that also worked well with with this Okay. So it is largely to do with the 28:55 28 minutes, 55 seconds bud that's basically health and trust and lastly the core market growth at around 8%. So like how should we see this uh growth shaping shaping up ahead. 29:08 29 minutes, 8 seconds [clears throat] 29:08 29 minutes, 8 seconds So you know growth if we look at it now in terms of our markets basically. So as we 29:15 29 minutes, 15 seconds have said that the uh focus would be growing higher than what the core markets are. But for now if we look at 29:23 29 minutes, 23 seconds uh this in this particular quarter focus looked weak because as I explained you know in in my earlier statement uh that 29:33 29 minutes, 33 seconds there is a huge play of sweets in gifting which was which got shifted in quarter two. Otherwise other than sweets 29:41 29 minutes, 41 seconds and gifting if we look at so the the growth of focus and other states is also in fact ahead of what core core has 29:49 29 minutes, 49 seconds delivered. So going forward know to your question focus will be growing you know higher than what the core states would grow. 29:59 29 minutes, 59 seconds No sir this is helpful. Thank you and all the very best. Thank you. 30:06 30 minutes, 6 seconds The next question is from the line of Shirish from Modil. Please go ahead. 30:14 30 minutes, 14 seconds Hi Manoj Rishab G. Thank you for the opportunity and good afternoon. Uh Manoj just one quick question. uh when we 30:22 30 minutes, 22 seconds entered the quarter September end every industry player was very excited with 5% GST uh and shift which was expected but 30:32 30 minutes, 32 seconds when I look at 9 month number I think uh the focus market has grown only 10.2%. 30:38 30 minutes, 38 seconds The reason why I'm asking is that I'm sure you are not happy with 8.4% 4% volume growth. So two things one is that 30:45 30 minutes, 45 seconds you said there is a GST benefit which you have passed in terms of higher gamage. So if you can split that 8.4% 30:52 30 minutes, 52 seconds volume growth what is the percentage or what is the contribution has added because of the gramage addition. 30:59 30 minutes, 59 seconds Sure. 31:02 31 minutes, 2 seconds So sirish sirishi uh so largely from uh increase in gamage in quarter three what we then due to GST. So it is have been 31:11 31 minutes, 11 seconds improving volume growth of to you know one and a half 2%. 31:15 31 minutes, 15 seconds In overall yeah but overall you will see that our overall volume growth in ethnic snacks and uh I think snack category or snacks 31:24 31 minutes, 24 seconds category is close to upper 12 13%. So that's that's high in in last three quarters and that's what we targeted. 31:33 31 minutes, 33 seconds Okay. And anyway impact in our speech business because that was same because papa and sweet stay same same it was only in the snacking space. 31:43 31 minutes, 43 seconds Okay. Uh the other thing which is the observation that in quarter two most not you but most of the players said that 31:51 31 minutes, 51 seconds there is a detocking because there was a confusion GST will happen and other thing but did you really get any benefit 31:58 31 minutes, 58 seconds of restocking in the trade in quarter 3 and again is it settled or it is still ongoing? 32:07 32 minutes, 7 seconds Okay so Sherish uh for the impulse category no one would wait for you know this thing. So the opportunity loss or 32:14 32 minutes, 14 seconds the day loss is a loss. However, you know from consumption standpoint but yes if you look at in terms of destocking so 32:23 32 minutes, 23 seconds yes uh there was certain impact but then that got over in a week's time itself. 32:28 32 minutes, 28 seconds Thereafter it's a ongoing replenishment models the weekly servicing weekly buying and that stuff but yes whatever contention was happened during that time 32:36 32 minutes, 36 seconds that the outlet who ran out of stock and all you cannot replace that stuff. 32:42 32 minutes, 42 seconds Okay. Uh the other thing which I came [clears throat] uh uh I mean I'm reading from slide 20 from your presentation 32:49 32 minutes, 49 seconds when I compare 9 months growth in the focus rate uh which is just about 10%. I mean I'm giving the benefit Diwali has come here or there or festive season 32:58 32 minutes, 58 seconds would have shifted but in 9 months we are no we are still 10% growth is uh is it much lower than your expectation and 33:08 33 minutes, 8 seconds how much uh growth we can expect I mean you did allude saying that the focus rate will grow faster but I think what 33:15 33 minutes, 15 seconds are the issues yeah so uh rightly said that 10.2% 2% 33:24 33 minutes, 24 seconds growth is is not a good growth in that stuff. It is it will not be less than 15% 15 17% should be the bare minimum 33:32 33 minutes, 32 seconds growth in that stuff. uh the disruptions you know when you talk about so that because of GST because of you know the tweets could have done or the other 33:40 33 minutes, 40 seconds categories could have done even better this is what in uh the western snacks which again uh is a higher contribution 33:47 33 minutes, 47 seconds in focus in core state in focus in other states was weak in quarter 2 those were the stuff but if you look at that how it 33:55 33 minutes, 55 seconds is made up you know in rest of the categories so numpkin western snacks and all so it is again coming back to what 34:03 34 minutes, 3 seconds uh in line for what we have said or in line with our plans for what we have. 34:09 34 minutes, 9 seconds I have a specific question man here. Um out of six markets which we have identified in focus state specifically UP is a very large smacking market. So 34:18 34 minutes, 18 seconds could you strip off what is the growth you are seeing in particularly UP? 34:25 34 minutes, 25 seconds So UP is is on a high growth in that stuff. So if 10% is the overall growth. 34:31 34 minutes, 31 seconds So UP is close to about 14% growth in this stuff. So it's on a high side. 34:35 34 minutes, 35 seconds There's one market now Delhi which we call as our focus state has not done very well in that stuff. And we also did 34:43 34 minutes, 43 seconds not know invest as much in Delhi. So there's no specific campaign or something what we have done for that stuff. But to your question yes up has 34:51 34 minutes, 51 seconds done better than the overall focus states. 34:55 34 minutes, 55 seconds So up would be growing on an average about uh 50 60 K some month now. 35:03 35 minutes, 3 seconds No no sh what hello yeah so up I said no if you look at no 35:12 35 minutes, 12 seconds would have is about 13 14% growth whereas overall focus states is 10%. 35:18 35 minutes, 18 seconds Okay, got it. And in export, what are the reasons? I mean, I do understand Aria is yet to contribute meaningfully, 35:25 35 minutes, 25 seconds but what are the drivers for this growth? Are you opening more markets or is that core markets in the export is showing you scalability? 35:35 35 minutes, 35 seconds Yeah. So, Aribba is a enabler, right? 35:38 35 minutes, 38 seconds You have stocks to sell, right? uh but uh the letter the second question which you said that in terms of the expansion 35:47 35 minutes, 47 seconds so the driver is expansion you know getting into new accounts large accounts where we were not there earlier we got 35:54 35 minutes, 54 seconds listed and there is a good response demand coming in so that's the driver Aria is the backend stuff I mean so 36:01 36 minutes, 1 second which is solving for this problem so which are the large market in your exports 36:08 36 minutes, 8 seconds so large US of course continues used to be a large market. US, Canada, then Middle East, these are the markets uh 36:15 36 minutes, 15 seconds which have done. So, US you know in spite of odds like know the tariff thing and all that stuff we did still well in 36:23 36 minutes, 23 seconds in US. Costco is one of our one of the largest account there where we were not there and u so we got listed in this 36:31 36 minutes, 31 seconds quarter and and a very good performance in this in this store and very good response in terms of repeats. 36:39 36 minutes, 39 seconds Okay, just last question on BBPL. What is the rational? I mean I know Khalil is a very big man but is the companies 36:46 36 minutes, 46 seconds going to diverse and getting into biscuits and croissants and other segments and what is the scalability of this model? Are you going to get the 36:54 36 minutes, 54 seconds Khalil brand in India or you're going to spread more uh because you're you're giving a capital also. 37:02 37 minutes, 2 seconds Yeah. So uh shish one certainly not biscuits right? So this would have three parts of it. So very premium breads, roaster and then the third is cakes. 37:14 37 minutes, 14 seconds These are these would be the three segments we playing in and the business would be under again three heads. One is frozen export and everything is frozen. 37:24 37 minutes, 24 seconds That's one. Uh second is that the business would come from uh we'll export from air. That's what Khalil's presence 37:31 37 minutes, 31 seconds will bring in because he is already into this model of that stuff. It is the facility or manufacturing capability we are building in here. So one is exports. 37:41 37 minutes, 41 seconds Second is B2B right and the third would be domestic which will be the least of that stuff. Now this is a futuristic 37:50 37 minutes, 50 seconds investment. We have set up our plant in Bangalore and uh the as Rishab said that over 3 years I mean this has a potential 37:58 37 minutes, 58 seconds to get us about 100 crores as in our topline number that's where it is. So this will not be you know uh it'll be a 38:06 38 minutes, 6 seconds complete separate team not that anything to do with Bikadi this will be uh run by 38:13 38 minutes, 13 seconds a professional team which is no more into bakery and all this stuff. 38:18 38 minutes, 18 seconds So you mean to say that the existing stores which Khalil is operating in UAE is not a part of this deal? 38:26 38 minutes, 26 seconds No no no no so this is Vik this is Indian stuff only. 38:31 38 minutes, 31 seconds Okay. Okay. And uh this plant uh when do you think we'll get operational? Say another year or so or we'll take a little longer. 38:39 38 minutes, 39 seconds No, no, no. By end of this quarter only it will happen. Okay. Okay. Thank you and all the best. 38:47 38 minutes, 47 seconds Thank you. Thank you. 38:51 38 minutes, 51 seconds Anyone who wishes to ask a question may press star and one on their touchstone telephone. Thank you. The next question is from the line of Abhishek from Systematic Groups. Please go ahead. 39:02 39 minutes, 2 seconds Yeah. [clears throat] Hi sir, thank you for the opportunity. Uh while you mentioned in your opening remarks on the raw materials being fairly stable, uh 39:10 39 minutes, 10 seconds just wanted to check specifically on potato. Uh what is the procurement cost trend that you're seeing in potato because I understand that December 39:17 39 minutes, 17 seconds January is the period of uh crop flow and procurement and you can correct me if that is not accurate but just wanted to check what is the sort of procurement 39:25 39 minutes, 25 seconds cost trends that you're seeing specifically in potato right now. So potato crop has been very stable and good this year. So we we we don't see 39:34 39 minutes, 34 seconds any major disruption in price or or quantity availability this year and we started it's early to say but early to 39:41 39 minutes, 41 seconds do but yeah in next two months we'll do a long-term buying of all of at least for next six seven months that's what we do normally in Feb or March but yeah price isn't very stable. 39:53 39 minutes, 53 seconds All right. So, got it. That's very helpful. Thanks and all the best. Thank you. 40:01 40 minutes, 1 second The next question is from the line of Anchit from Goldman Sachs. Please go ahead. 40:08 40 minutes, 8 seconds Hello. Uh am I audible? Yes. Yes. 40:13 40 minutes, 13 seconds Yeah. Hi, thank you for taking my question. I just wanted to understand on this gi bakes um what is the trajectory? 40:19 40 minutes, 19 seconds Are you expecting revenues to start coming in from FY27 itself and in terms of the products in terms of say premium 40:28 40 minutes, 28 seconds breads etc. is it just going to be export or you will um is it going to be like in stores etc in different stores 40:36 40 minutes, 36 seconds or will it be just in your retail stores in Bikaji retail stores? 40:40 40 minutes, 40 seconds Yeah. So to your first question yes revenue will start coming in from year one itself uh on the product side. So 40:49 40 minutes, 49 seconds yes uh the split of the business you know if you look at would be majorly exports then B2B and then few topend 40:57 40 minutes, 57 seconds stores as well. So domestic sales. So this would be available in top- end stores because this will be all premium 41:05 41 minutes, 5 seconds and also we leverage uh the eqcom ecom channel also on this stuff. So should be available there as well. 41:14 41 minutes, 14 seconds And will what will this be under the same brand of Bikaji or how do you plan to brand this? 41:22 41 minutes, 22 seconds The work if the work is going on in this but it will not be under the same brand Bikaji the we'll announce it shortly before we you 41:29 41 minutes, 29 seconds know com this commission the factory but not Biki for sure. 41:35 41 minutes, 35 seconds Okay. Okay. Thank you so much. Thank you. 41:43 41 minutes, 43 seconds The next question is from the line of Tohham from Otilwal. Please go ahead. 41:49 41 minutes, 49 seconds Yeah, thank you Rishi Manuji. I just wanted to check one direct coverage. 41:54 41 minutes, 54 seconds Right now we have a 334k direct coverage and last one year we have added almost 46,000 addition. So Manuj if you want to 42:03 42 minutes, 3 seconds give a ballpark uh break up of this 46 uh K breakup of this uh core versus non-core addition in the last one year. 42:14 42 minutes, 14 seconds So the most of the addition which has come in is in the focus states right so as I speak come in so it's about 42:22 42 minutes, 22 seconds 1.65 65 lakh outlets is what we are covering in focus states and core states is about 1.15 and the rest is other states about 55,000 outlets. 42:34 42 minutes, 34 seconds Okay. So majorly it is a non-core uh addition. Okay. Uh second because yeah 42:43 42 minutes, 43 seconds second sorry yeah yeah yeah on the impulse pack right now if you look the snacking portfolio so almost 50% of snacking portfolio 42:52 42 minutes, 52 seconds comes from impulse pack and in 9 months data which is grew only 6.8%. 42:58 42 minutes, 58 seconds So like for full year for next basically for next financial how do you look this impulse per growth for the F27. 43:07 43 minutes, 7 seconds So what we plan to do is that see for us family pack is equally important and we get better margins also in that stuff 43:15 43 minutes, 15 seconds that also in our core stage this is what helps us store throughput also uh in the channels like say modern trade ecom it 43:22 43 minutes, 22 seconds is the play of the large pack only but as we drive distribution as we drive focus states and which is where as I 43:30 43 minutes, 30 seconds said that the faster growth would come from the focus states so that's where is the role of the impulse pack so to your 43:37 43 minutes, 37 seconds question what we see that the growth of impulse and family pack will be in line not that uh a very differential growth 43:45 43 minutes, 45 seconds in that stuff you'll see but yes impulse would be on a slightly higher side okay and in this core versus focus 43:54 43 minutes, 54 seconds market like as you previously you said that focus your target could be 15 to 17 so what could be the target for core 44:01 44 minutes, 1 second high single digit for next year no no double digit target so you will see that about say 13% plus minus would be the core states performance. 44:12 44 minutes, 12 seconds So 13% plus minus for food and focus would be more than 15. Yeah. Upwards of 15%. Yes. 44:19 44 minutes, 19 seconds Upwards of 15. Okay. Got it. And recently for this margin for 9 months gross margin XPL you have done 33.5 44:28 44 minutes, 28 seconds and uh operating margin we have done 12.5. So how do you look for this year and next year for gross and operating XPL? 44:37 44 minutes, 37 seconds So largely we see evita margin should move up at least 50 basis point from this year 44:44 44 minutes, 44 seconds and for operating okay you're staying operating is 50 and gross will be stable how is it 44:51 44 minutes, 51 seconds so beta should be should improve by 50 basis beta okay every 50 and would be the range of 2 and 2.5 right for next year as well 45:00 45 minutes yes got it got it thank you so much thank Thank you. 45:16 45 minutes, 16 seconds Thank you. The next question is from the line of Parv from MEA equities. Please go ahead. 45:31 45 minutes, 31 seconds Mr. Par, please go ahead. 45:33 45 minutes, 33 seconds Yes. Yes time for opportunity research you want to I wanted to understand about the product range when we are launching 45:40 45 minutes, 40 seconds the new product what are the strategies that we are we are used to see basically I wanted to understand the strategy 45:47 45 minutes, 47 seconds space that how the company researching the products to distribution as per the geography 45:56 45 minutes, 56 seconds so uh this is two approaches what we take one is the innovation team the R&D team which keeps working all that uh 46:04 46 minutes, 4 seconds keep picking up you know we participate actively in all food exhibitions say like gul food indas aar so on and so 46:12 46 minutes, 12 seconds forth so which is a forward-looking stuff and ongoing process that's one second is that we also pick that what is 46:18 46 minutes, 18 seconds doing well in the market what how the category is behaving which subcategory is doing well and how is are we indexed 46:26 46 minutes, 26 seconds to the overall category stuff this is the principle 3x3 which arrives us on where to work on and that's how we pick 46:35 46 minutes, 35 seconds up know the subcategories that where what should be you know developed and this is how we get these NPDs out in the 46:44 46 minutes, 44 seconds market. Now talking about geography uh there is diversity across states. So and that's how the consumption palate is. So 46:52 46 minutes, 52 seconds we then it becomes uh region specific kind of a certain things. This is how we do and this is what is our strategy on 47:00 47 minutes adding new products of new product launch. Yes. Yes. Perfect. Thank you S. 47:13 47 minutes, 13 seconds Thank you. 47:20 47 minutes, 20 seconds Participants are requested to ask a question. 47:24 47 minutes, 24 seconds Please press star and one on their touchstone telephone. 47:33 47 minutes, 33 seconds The next question is from the line of Janadharan and individual investor. Please go ahead. 47:40 47 minutes, 40 seconds Hello. Am I audible? Yes sir. You audible? Yeah. 47:45 47 minutes, 45 seconds Yeah. Uh hello sir. I'm an individual investor in it. So my only question is if raw material costs normalize upwards 47:54 47 minutes, 54 seconds right and demand softens I understand that demand is going to go up but just this is an hypothetical question. If raw 48:01 48 minutes, 1 second material cost normalize upwards and demand softens, which level be it pricing, be it mix or be it cost will 48:09 48 minutes, 9 seconds protect margins the most for see if raw material prices goes up right 48:20 48 minutes, 20 seconds so to one we'll try to see that what further optimization can be done that is one then if this would be true for 48:29 48 minutes, 29 seconds competition as will we'll closely watch that how competition is behaving on that stuff and we'll respond accordingly. 48:36 48 minutes, 36 seconds That's what we do because there's a threshold we would not 48:42 48 minutes, 42 seconds go would not wish to go below a threshold in terms of our margins part. 48:49 48 minutes, 49 seconds Yes. Yes. And one more question where do you see Bikaji's market share in the organized ethnic snack space over the next 3 to 5 years? 49:02 49 minutes, 2 seconds So we see a double digit market share in in next 3 to 5 years. [clears throat] So maybe around 11% 11 and a half kinds. 49:14 49 minutes, 14 seconds All right. Thank you. Thank you so much sir. Thank you. 49:19 49 minutes, 19 seconds Thank you. As there are no further questions from the participant, I now hand over the conference to management for closing comments. 49:29 49 minutes, 29 seconds Uh thank you everyone for taking time out and uh being part of this call. Uh hopefully we could answer the questions 49:37 49 minutes, 37 seconds what came up. Still anything left out, we'll be happy to to revert back. you can reach out to our corporate affairs 49:45 49 minutes, 45 seconds person uh Pratik or the agency and we'll be uh we'll revert back to the questions anything left. Thank you very much. 49:55 49 minutes, 55 seconds Thank you on behalf of Pigaji Food International. That concludes this conference. Thank you for joining us and you may now disconnect your lines.