DOMS Industries Limited — Q3 FY26

Doms Industries Ltd Q3 FY2025-26 Earnings Conference Call https://www.youtube.com/watch?v=wU2PJM4XS5c Published: 3 months ago

0:01 1 second Ladies and gentlemen, good day and welcome to Dom's Industries Q3 FY26 earnings conference call hosted by ICICI 0:09 9 seconds Securities Limited. Before we begin, a brief disclaimer. The presentation which Dom Industries Limited has uploaded on 0:16 16 seconds the stocks stock exchange and their website and the discussion during the call contains or may contain certain forward-looking statements concerning 0:25 25 seconds Dom's industry's limited business prospect and profitability which are subject to several risks and uncertainties and the actual results 0:33 33 seconds could materially differ from those in such forward-looking statements. As a reminder, all participants line will be in the listenonly mode and there will be 0:42 42 seconds an opportunity for you to ask questions after the presentation concludes. Should you need assistance during this conference call, please signal an 0:50 50 seconds operator by pressing star then zero on your touchtone phone. Please note that this conference is being recorded. I now 0:59 59 seconds hand the conference over to Mr. Aneruda Jooshi from ICICI Securities. Thank you and over to you. Yeah, thanks Ira. On 1:08 1 minute, 8 seconds behalf of ICICI securities, we welcome you all to Q3 and 9 months FI26 results 1:15 1 minute, 15 seconds conference call of Dom's Industries Limited. We have with us today senior management represented by Mr. Rahul 1:22 1 minute, 22 seconds Shaha, Chief Financial Officer. Now I hand over the call to Rahul Bay for his initial comments on the quarterly as 1:29 1 minute, 29 seconds well as 9 months performance and then we will open the floor for question and answers question and answer session. Thanks and over to you all. 1:38 1 minute, 38 seconds Thank you Anai. Good evening and a very warm welcome to everyone to the conference call for Q3 and 9 month FY26. 1:49 1 minute, 49 seconds Joining me on this call is the team from Marathon Capital, our investors relations advisor. I hope everyone had 1:56 1 minute, 56 seconds an opportunity to go through the investor presentation and the results release that have been uploaded on the exchanges and our company's website. 2:07 2 minutes, 7 seconds To begin with, let me take you through the highlights for Q3 and 9 month performance. 2:13 2 minutes, 13 seconds Our Q3 results showcased the strength of our balanced growth strategy, systematic execution, and innovationdriven new 2:21 2 minutes, 21 seconds product launches, demonstrating our focus on strengthening our market presence. On a year-on-year basis, we 2:29 2 minutes, 29 seconds delivered a consolidated sales growth of 18.2% driven by strong performances in our core categories. 2:37 2 minutes, 37 seconds A 9-mon consolidated growth of 22.7% positions us to close the fiscal year at 2:44 2 minutes, 44 seconds the upper end of our guided range of 18 to 20%. 2:49 2 minutes, 49 seconds This performance reflects the resilience of our teams with disciplined approach towards implementation of our strategic priorities. 2:58 2 minutes, 58 seconds Operationally, we continue to leverage our comprehensive product range which remains a key driver for our 3:05 3 minutes, 5 seconds performance. Quarterly growth was led by growth in categories across office supplies where we continue to see 3:12 3 minutes, 12 seconds positive results on the back of enhanced capacities and positive market reception of products. 3:20 3 minutes, 20 seconds Kits and combos and hobby and craft categories for robust demand driven by new attractive and utility focused product launches. 3:30 3 minutes, 30 seconds polistic art material backed by addition in existing infrastructure with modernization of some of our 3:38 3 minutes, 38 seconds processes bolstering operational efficiency. Our baby hygiene business also saw significant uptake 3:45 3 minutes, 45 seconds fueled by winter demand for diapers and enhanced capacity as compared to la last year. 3:53 3 minutes, 53 seconds Geographically, a revenue growth continues to be anchored by strong domestic demand which has grown to 3:59 3 minutes, 59 seconds represent more than 85% of overall sales. On the export front, despite headwinds in the US market due to higher 4:09 4 minutes, 9 seconds tariffs, we are pleased to report a doubledigit growth of more than 15% over the 9 month period. This was driven 4:17 4 minutes, 17 seconds by strong demand for domanded products across key categories like Nepal, Sri Lanka, Middle East and few African countries where we are present. 4:29 4 minutes, 29 seconds Additionally, our distribution agreement with Pila has yielded positive results with initiation of exports of domanded 4:36 4 minutes, 36 seconds stationary products to countries like Chile, Mexico, Canada, Europe, Turkey, South Africa and Australia. These 4:44 4 minutes, 44 seconds initiatives and results clearly showcase our ability to navigate challenges and capitalize on opportunities in diverse markets. 4:54 4 minutes, 54 seconds We are committed to expanding our product suite to meet the evolving needs of our growing consumer base. The 5:02 5 minutes, 2 seconds quarter saw new product launches like acrylic markers and SKU additions in sketch pens, mechanical pencils, pens, 5:11 5 minutes, 11 seconds attractive kits across various categories. Further, I am pleased to share that we have recently commenced manufacturing and supply of vibrant 5:20 5 minutes, 20 seconds metal pencil boxes designed specifically for kids. Complemented by a newly designed range of school bags and paper 5:28 5 minutes, 28 seconds stationary, we are well positioned to capitalize on the upcoming back to school season. 5:35 5 minutes, 35 seconds We have recently approved the formation of a 50/50 JV with 7 FBA, a Fila Group 5:41 5 minutes, 41 seconds company. The primary objective of the JV would be to manufacture and supply backpacks, bags, and pencil cases 5:49 5 minutes, 49 seconds targeting the premium segment. The partnership combines Tila's global reach seven product designing and knowhow and 5:58 5 minutes, 58 seconds don manufacturing and execution capabilities. The formation of this JV is expected to be completed by end of Q1 6:07 6 minutes, 7 seconds acquire 27 and we believe that the JV will likely add new growth initiatives for the company in the future. 6:15 6 minutes, 15 seconds On the marketing front, we are strengthening our connection with audiences through innovative online and 6:22 6 minutes, 22 seconds offline initiatives. Our social media community has grown significantly with over 3.8 million YouTube subscribers and 6:31 6 minutes, 31 seconds 170,000 plus Instagram followers, making Dom the top admired brand in stationary and art materials. 6:40 6 minutes, 40 seconds Our success wouldn't have been possible without the continuous efforts of our people who have been one of our strongest pillars for the growth. As a 6:48 6 minutes, 48 seconds recognition of their ongoing contribution, we recently granted additional 1 lak 37,690 6:56 6 minutes, 56 seconds estos to the me members of the dom's family. 7:00 7 minutes Coming to our expansion initiative during the quarter, we were able to enhance capacities across our core 7:07 7 minutes, 7 seconds categories like solistric stationary, holistic art and office supplies within our existing infrastructure catering catering to the continued demand. 7:18 7 minutes, 18 seconds Additionally, our 44 acre project remains a key focus area with ongoing AEX investments which will enable us to 7:25 7 minutes, 25 seconds meet growing product demand. We are progressing steadily on the project alit with a slight construction delay on 7:33 7 minutes, 33 seconds account of prolonged and unseasonal monsoon during the last fiscal. 7:38 7 minutes, 38 seconds We expect to start the commercial production from the first building during Q2 FY27. 7:45 7 minutes, 45 seconds This capacity expansion along with other brownfield along with other ongoing brownfield initiative has been strategically 7:53 7 minutes, 53 seconds planned. Hence the delay should not materially impact our plan and other ongoing brownfield expansion initiatives 8:01 8 minutes, 1 second should be able to support our growth strategy till that time. 8:05 8 minutes, 5 seconds Now coming to the details of our financial performance consolidated operating revenues for Q3 FY26 stood at 8:14 8 minutes, 14 seconds 592.2 crores a growth of 18.2% compared to the same quarter last financial year. 8:22 8 minutes, 22 seconds This increase in sales was predominantly on account of LG performance in domestic market recording a 19.4% growth in gross 8:30 8 minutes, 30 seconds product sales year on year during the quarter. During the quarter under considerations input cost for most goods 8:37 8 minutes, 37 seconds had remained constant or were lower especially for key raw materials like polymers, waxes etc. providing a positive impact for our margins. 8:48 8 minutes, 48 seconds However, the price is now trending upwards. We expect a neutral impact on a on our full year results. The 8:55 8 minutes, 55 seconds consolidated epic for Q3 FYI 26 reduced by 17.7% surpassing the 100 cr and stood at 103.4 9:05 9 minutes, 5 seconds crores as compared to 87.9 crores in QC FY25. 9:10 9 minutes, 10 seconds The EIA margin for the quarter stood at 17.5% at the upper end of our guided range of 16.5 to 17.5%. 9:20 9 minutes, 20 seconds The profit after tax for the quarter stood at 61.4 cr with a growth of 13.1% over the same period in the previous 9:28 9 minutes, 28 seconds financial year and the fat margin for the quarter stood at 10.4%. 9:34 9 minutes, 34 seconds During the quarter, PAT moderated slightly primarily on account of reduction in other income due to utilization of IPO proceeds towards 9:43 9 minutes, 43 seconds capeex which during the earlier period were parked in fixed deposits. 9:48 9 minutes, 48 seconds However, the overall profitability remained within our guided range as our core business continue to demonstrate 9:55 9 minutes, 55 seconds volume growth backed by stable margins underscoring the robustness of our portfolio and the effectiveness of our discipline execution framework. 10:06 10 minutes, 6 seconds On the apex front, we continue to focus on our expansion initiatives for the 9 month period. We have done a 10:13 10 minutes, 13 seconds consolidated capex of approximately 230 crores including capital advances. 10:19 10 minutes, 19 seconds Uh with this we believe our capex spends for the fiscal would now cross 250 crores. Looking ahead, we continue to 10:27 10 minutes, 27 seconds remain optimistic about our growth plan supported by our expected increase in demand in the domestic market, especially with the onset of the 10:36 10 minutes, 36 seconds upcoming back to school season, thereby positioning us well for sustained growth and achieving our laid our laid out 10:44 10 minutes, 44 seconds fiscal target. With this, I would now request to open the floor for questions and answers. 10:51 10 minutes, 51 seconds Thank you. 10:53 10 minutes, 53 seconds Thank you very much. We will now begin the question and answer session. Anyone who wishes to ask a question may press star and one on their touchstone 11:01 11 minutes, 1 second telephone. If you wish to remove yourself from the question cue, you may press star and two. Participants are requested to use handsets while asking a 11:10 11 minutes, 10 seconds question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. 11:24 11 minutes, 24 seconds The first question is from the line of Janesh Jooshi from Prauadar Capital. Please go ahead. 11:32 11 minutes, 32 seconds Uh thanks for the opportunity. Uh so my first question is on uh Debon. Uh I mean 11:39 11 minutes, 39 seconds what was the rationale for uh forming a separate GB with them uh to focus on uh 11:46 11 minutes, 46 seconds say backpacks and bags uh when we already have an existing GV with uh Sudo which is into a similar line of business. 11:57 11 minutes, 57 seconds Hi Dish. Uh uh seven with whom we've done this JV was actually founded in 12:04 12 minutes, 4 seconds 1970 uh by seven brothers in Italy and is one of Europe's leading manufacturer of 12:12 12 minutes, 12 seconds ergonomic backpacks, bags, trolleys and accessories. 12:16 12 minutes, 16 seconds uh seven generated revenues of close to 90 million euros in 2024 and holds a dominant position in Italy 12:25 12 minutes, 25 seconds and uh across Europe in the back to school market and has a retail presence 12:31 12 minutes, 31 seconds of over 6,000 plus retail uh points. Uh it also has more than 60 international 12:38 12 minutes, 38 seconds patents for this category of uh products. uh recently sila completed the 12:44 12 minutes, 44 seconds acquisition of 51% stake in seven uh the proposed JV that we are doing with seven 12:51 12 minutes, 51 seconds uh you know it merges uh seven's premium design and R&D expertise with Tom's strength of managing manufacturing 13:00 13 minutes operations efficiently and it would lead to you know building a state-of-the-art uh Indian production for TAG groups uh 13:10 13 minutes, 10 seconds global backpacks and bag requirement and at the same time it will allow DOMS to offer this premium range in the domestic 13:18 13 minutes, 18 seconds market. Uh you know for success of this entire J the active participation of the 13:25 13 minutes, 25 seconds promoters of uh seven will result in effective transfer of mo and expertise 13:31 13 minutes, 31 seconds to the DI company. uh at the same time will objectively remain focused on the 13:38 13 minutes, 38 seconds business relating to Dom's branded bags primarily catering to the Indian mass market demand for range of backpacks and 13:46 13 minutes, 46 seconds school bags. Uh and also service the requirement of bags for doms, kits and combo bags. Uh this position skoro to 13:56 13 minutes, 56 seconds scale efficiently in the mass market segment capitalizing on Dom's brand and distribution network. So with clear 14:04 14 minutes, 4 seconds objectives defined for you know both the companies where Skido focuses on manufacturing distribution and sales of 14:11 14 minutes, 11 seconds domestic mark market products and the new JV focused on manufacturing for CILA's global uh demand and highend 14:20 14 minutes, 20 seconds premium range. We anticipate that uh there wouldn't be any conflict between both these uh ventures of dogs and both can be successful in the same segment. 14:33 14 minutes, 33 seconds Uh understood. Uh sir, if I heard you right, uh you mentioned that uh the sales of uh 7 was roughly about 90 14:41 14 minutes, 41 seconds million euros in 2024. Uh so is it safe to assume that uh uh that kind of potential can acrewue within the JV? Uh 14:49 14 minutes, 49 seconds that is uh question one and uh secondly uh when is the production expected to begin over here and what will be the 14:57 14 minutes, 57 seconds typical uh uh price point of the uh backpacks? if you can just give some color on that. 15:04 15 minutes, 4 seconds Uh so Ganesh uh we are targeting to complete the formation of the JV by uh end of Q1 FY27. 15:13 15 minutes, 13 seconds Uh initially the plan is to start uh you know manufacturing operations to cater to the demand of uh seven products in 15:23 15 minutes, 23 seconds international market. uh definitely the opportunity is large but we still don't have any number in mind in terms of the 15:31 15 minutes, 31 seconds size of this operations but uh over a period of time we believe uh you know a sizable portion of this uh of the uh 15:40 15 minutes, 40 seconds seventh backpack requirement can be manufactured and exported from India. 15:46 15 minutes, 46 seconds uh in terms of pricing of these products, if I look at the current portfolio of seven, the prices of these 15:53 15 minutes, 53 seconds bags in Italy start from around uh 60 to 70 uh euro per bag. So now what product 16:02 16 minutes, 2 seconds gets finalized and launched in India? We are still a little time away from this but like I said the first focus would be 16:09 16 minutes, 9 seconds to uh start the manufacturing operations and uh you know use uh this production 16:17 16 minutes, 17 seconds facility to meet seven global requirements. 16:22 16 minutes, 22 seconds Uh sure. Uh sir, two small uh bookkeeping questions uh from my side. 16:26 16 minutes, 26 seconds Uh one is that uh uh if you can just share what will be our cex number for 27 and 28 given the fact that our uh 44 16:35 16 minutes, 35 seconds acre expansion is towards the end of completion. uh that is one and uh secondly uh just one small observation 16:43 16 minutes, 43 seconds now if I look at our purchase of uh stock in trade on 9 month uh basis uh that is at about uh 63 crores roughly 16:51 16 minutes, 51 seconds about uh 3.7% of our top line uh and if I look at the base period uh this figure 16:58 16 minutes, 58 seconds was roughly about 2% of the top line now given the fact that we are largely backward integrated uh uh can you please 17:06 17 minutes, 6 seconds explain what has led to a surge uh in this number I mean have we started resorting to some kind of outsourcing 17:13 17 minutes, 13 seconds within any of the products. So if you can just clarify on that bit as well. 17:20 17 minutes, 20 seconds Uh so to answer your first question uh so uh this year like we said on the call 17:27 17 minutes, 27 seconds we'll end up investing close to 250 crores uh in capital uh expenditure. We 17:34 17 minutes, 34 seconds believe a similar sort of investment will be done in the next financial year with our Apex investment target between 17:41 17 minutes, 41 seconds 225 to 250 crores. uh currently uh the I wouldn't uh you know the first few 17:48 17 minutes, 48 seconds buildings of the uh 44 acres are getting ready but like we mentioned earlier also multiple times this is like a ongoing 17:57 17 minutes, 57 seconds project with multiple buildings being uh constructed in this project and every quarter starting from Q1 FI 27 we'll get 18:06 18 minutes, 6 seconds new buildings possession of new buildings and then about 90 days to commercialize operation so this will go on for the next uh year and a half sort of a thing. 18:17 18 minutes, 17 seconds Uh to answer your second question on uh stocking rate uh are you referring to the consolidated financials or the 18:25 18 minutes, 25 seconds standalone financials uh console figure? 18:30 18 minutes, 30 seconds So in console uh there are uh two uh major uh activities in which uh you would see a little bit of increase in 18:39 18 minutes, 39 seconds stocking trade is with respect to uh paper stationary. Uh earlier you know uh 18:45 18 minutes, 45 seconds pioneer was our only subsidy focused on paper stationary. to meet the growing demand and to manage these operations 18:54 18 minutes, 54 seconds better way. We acquired uh STPL in east and have started also getting uh paper 19:01 19 minutes, 1 second stationary products manufactured from a partner you know a OEM partner in South India. So that is one reason why this uh 19:10 19 minutes, 10 seconds uh stock trade in paper stationary has increased. uh and also at uh unique length which is a baby hygiene uh 19:19 19 minutes, 19 seconds business. Uh basically there you know company is predominantly into panstyle diapers. In this quarter we also 19:27 19 minutes, 27 seconds introduced uh you know the flat diapers a very small portion but they were basically manufactured from a third 19:34 19 minutes, 34 seconds party OEM supplier and sold in the uh market under the uni wer brand. uh UV 19:42 19 minutes, 42 seconds does not have the uh production infrastructure to make these flat side of flat style diapers and just in order 19:49 19 minutes, 49 seconds to complete the product range right now uh we've initiated some trading activity uh once this uh segment also grows we'll 19:58 19 minutes, 58 seconds evaluate uh you know uh looking at more uh uh investment for these sort of typos as 20:06 20 minutes, 6 seconds well that got that thank you so much sir and all the best. 20:14 20 minutes, 14 seconds Thank you. Participants who wish to ask a question may press star and one at this time. The next question is from the 20:22 20 minutes, 22 seconds line of Sneha Talia from Noama. Please go ahead. 20:27 20 minutes, 27 seconds Hey, good evening team. Congrats on the set of numbers. Couple of questions to my personal stationary we have seen a 20:34 20 minutes, 34 seconds deep group and I recall you telling me but you know we gladly focusing a lot towards it. uh so what's missing here and why the eagle growth is what I 20:42 20 minutes, 42 seconds wanted to understand uh if you see uh in paper stationary uh 20:51 20 minutes, 51 seconds year on year for the third quarter you'll see a slight degrowth uh one of the reasons for this is uh you know 21:00 21 minutes earlier uh a lot of our paper stationary business was been rooted to pioneer stationary and there was some amount of 21:08 21 minutes, 8 seconds trading activities for the paper that we used to buy like for example STPL which was last year not our subsidiary in this 21:16 21 minutes, 16 seconds time when we used to get books manufactured for them we used to buy the paper and sell it to STPL and buy the books from them so there was some amount 21:24 21 minutes, 24 seconds of reading activity which has now decreased but if you look at the 9 month number you know YTD number you'll see in 21:31 21 minutes, 31 seconds the paper stationary segment we've grown at about 8.7 8.9% and now with the back to school season 21:39 21 minutes, 39 seconds coming in uh and now having more capacity with HTTPL plus also our partners in uh South India we believe 21:48 21 minutes, 48 seconds this segment to uh perform much better. 21:54 21 minutes, 54 seconds Thanks Mahulan. Second thing on the new capacity which is likely to come up and you've been saying that you know you'll be coming up in manner in all you can 22:03 22 minutes, 3 seconds give some break up as to first year which are the products where the focus will be on. as to you know analyze the growth in individual segment and you 22:11 22 minutes, 11 seconds know followed by next year you know expansions will be in which other phase uh say first we'll start with enhancing 22:20 22 minutes, 20 seconds our capacity for wooden pencil uh if you remember we were planning to uh you know initiate capacity expansion for wooden 22:29 22 minutes, 29 seconds pencil in our existing infrastructure but uh looking at the strong demand that we had in the ballpoint segment we then 22:38 22 minutes, 38 seconds decided to uh expand uh our ballpoint manufacturing capacity in the existing infrastructure. 22:45 22 minutes, 45 seconds So uh you know uh wooden pencil capacity expansion is something which we first do 22:52 22 minutes, 52 seconds in this 44 acre project uh followed by enhancement in production capacity for a writing instrument. uh then pencil and 23:01 23 minutes, 1 second pencil accessories which is basically eraser sharpener followed by art material. 23:08 23 minutes, 8 seconds Uh but again sir again may basically uh you know one of the uh you know strategies that we've always followed is 23:16 23 minutes, 16 seconds to be a little flexible when it comes to uh introduction of capacities to meet 23:23 23 minutes, 23 seconds the demands of the market and uh as much as possible uh you know uh be a little 23:30 23 minutes, 30 seconds more uh you know flexible when it comes to uh initiating these capacity additions. So if there is any uh change 23:39 23 minutes, 39 seconds in the market demand scenario then we will probably change but otherwise the current plan is to first do pencil capacity addition followed by uh writing instruments and then scholastic art. 23:53 23 minutes, 53 seconds Understood. Now also wanted to understand in our you know hygiene segment now what would be the break up between the diapers? I know we've 24:02 24 minutes, 2 seconds recently launched the wet wise but still any J take up here. 24:08 24 minutes, 8 seconds Uh so more than 90% of the sales is still uh diapers. Uh wipes is something uh which is still building up. Uh you 24:16 24 minutes, 16 seconds know we started with a single SKU in the w segment with a bag having 72 uh wipes. 24:23 24 minutes, 23 seconds We recently introduced a smaller pack with 30 wes. Uh so that's sales in this segment is building up. Uh but right now 24:32 24 minutes, 32 seconds more than 90% of the sales comes from the diaper business. 24:37 24 minutes, 37 seconds Understood. And eventually what would be the actual mix here like can it become like more like 6040 or you know it has to be like any share which is an ideal share in this particular business? 24:49 24 minutes, 49 seconds Uh not targeted anything. Diaper image is the core focus area. Uh wipes is like a a complimentary product. So the key 24:58 24 minutes, 58 seconds focus would be diversion and currently the way we have the capacity I assume that this percentage 25:06 25 minutes, 6 seconds of uh 90 10 or 8515 will continue for some time. 25:15 25 minutes, 15 seconds Understood. Thanks Rah and all the best. Thank you. 25:20 25 minutes, 20 seconds Thank you. The next question is from the line of Aradna Jen from BNK securities. Please go ahead. 25:28 25 minutes, 28 seconds Hi, thank you for the opportunity. 25:30 25 minutes, 30 seconds Congratulations for the continued good set of numbers. Uh couple of questions. 25:35 25 minutes, 35 seconds First, I wanted to know a little more on the JV. So, basically the 15 odd crores that we are initially investing, what is 25:41 25 minutes, 41 seconds the plan? Uh what's the sort of revenue potential that we are expecting from this particular JV and like you said 25:49 25 minutes, 49 seconds that Sko will be you know we are positioning Sko as a mass brand while this will be a premium brand. So 25:56 25 minutes, 56 seconds initially is the plan that we'll just be exporting or will we also be targeting the domestic audience um in India like 26:04 26 minutes, 4 seconds what is the thought process and uh in like the initial investment is 15 odd crores but going forward do we expect 26:13 26 minutes, 13 seconds more investment in this particular JV and where exactly will the manufacturing be done that's my first question 26:21 26 minutes, 21 seconds Arana uh Arana basically uh the approve rule that we taken right now and disclosed to the stock exchange is 26:29 26 minutes, 29 seconds basically a total investment up to 15 cr rupees by both partners uh in proportion to their shareholding in the uh JV 26:38 26 minutes, 38 seconds company. uh this JD company like I mentioned initially will first uh focus on uh the export opportunity which is 26:47 26 minutes, 47 seconds available whereby we'll the Jerry company will be a OEM manufacturer for uh the backpacks and supply it to 26:56 26 minutes, 56 seconds seven and other file group companies across the world. Uh in terms of uh you 27:03 27 minutes, 3 seconds know product category uh these bags are ultra premium bag pack bags. uh here uh 27:10 27 minutes, 10 seconds the audience in India for such backpacks is very very limited uh but right now also considering uh Skido also operates 27:19 27 minutes, 19 seconds the entire business through the Dom's distribution network um when we decide to launch these ultra premium backpacks 27:26 27 minutes, 26 seconds in India market it will be done through the same distribution network but targeting a very uh small very niche set 27:34 27 minutes, 34 seconds of uh end consumers uh in terms of projections. Uh you know we don't have the uh you know we've not 27:43 27 minutes, 43 seconds yet prepared anything because this investment will happen in a uh step-by-step manner but uh you know with 27:50 27 minutes, 50 seconds our experience of uh running SKO for almost a year and a half now uh we believe that even in this business 27:59 27 minutes, 59 seconds achieving a 3x to 4x sort of a uh gross fixed effect turnover is something which is achievable. 28:07 28 minutes, 7 seconds uh but it will happen uh you know across the next uh uh year or so once the buildup starts. 28:16 28 minutes, 16 seconds Understood. And the manufacturing will happen in Umbberg for this or it will happen in Omar. 28:23 28 minutes, 23 seconds Understood. My second question is on office supplies like office supplies have done really well this quarter as well. Uh what is leading to this kind of 28:31 28 minutes, 31 seconds traction? Have we like added new pens which is leading to this growth or the growth is primarily coming from the existing pens that's gaining traction 28:40 28 minutes, 40 seconds and in the pen segment do we like have a hero product which is like standing out uh amidst all the other products uh and 28:49 28 minutes, 49 seconds have have we like expanded beyond the rupee 10 price point at this point in time. 28:57 28 minutes, 57 seconds So uh basically for us all our products are zero products. You know we invest so much in making a product. So all the 29:05 29 minutes, 5 seconds products are very close to our heart and the reception that we get from the market is also something similar. So basically the growth that you see in the 29:13 29 minutes, 13 seconds office supply segment is definitely driven by uh writing instrument. The pen where you know we be continuously 29:20 29 minutes, 20 seconds increasing our capacity. So uh you know and we earlier when we started our new molding unit for pens uh you know you 29:29 29 minutes, 29 seconds typically start with a few set of machines getting operational and over a period of time all machines operational. 29:36 29 minutes, 36 seconds So in this quarter you basically seen the entire 10 segment capacity addition that built up that happened in the last 29:44 29 minutes, 44 seconds previous two quarters coming in production. Therefore you see uh good results from this segment. uh in terms 29:51 29 minutes, 51 seconds of focus we still continue to focus primarily on the 5 rupee segment and with uh expanding our portfolio in the 29:59 29 minutes, 59 seconds 10 rupee segment also so weeks wise we are still similar what we were earlier so it's like 70% coming from 30:08 30 minutes, 8 seconds not move beyond the 10 rupee segment okay and in terms of we also had plans 30:15 30 minutes, 15 seconds of bringing in tips in house so any progress there or are we still uh you know obtaining the tips from outside. 30:27 30 minutes, 27 seconds Uh no uh we still continue to operate tips from outside. Uh as we said that you know we want to get into 30:35 30 minutes, 35 seconds manufacturing of tips. uh this is more from a perspective of having some amount of you know internal control over the 30:43 30 minutes, 43 seconds type of taste and to understand how you know it it would be more like a R&D plus uh in-house consumption requirement that 30:51 30 minutes, 51 seconds we'll have uh we are in the process of uh getting there so once the new facility start then you know we'll also 31:00 31 minutes get into tip manufacturing and in terms of say guidance for fi sorry to interrupt you Ara Radna, sorry 31:07 31 minutes, 7 seconds to interrupt you. Uh, I request you to rejoin the queue for a follow-up question, please. Sure. Okay. Thank you. 31:15 31 minutes, 15 seconds Thank you. Ladies and gentlemen, in order to ensure that the management is able to address questions from all the participants in the conference, please 31:24 31 minutes, 24 seconds limit your question to two per participant. 31:27 31 minutes, 27 seconds The next question is from the line of Percy from IIFL Capital. Please go ahead. 31:33 31 minutes, 33 seconds Uh, hi Rahul. Uh, good evening. uh this bag seems to be a focus area for you. 31:40 31 minutes, 40 seconds Just wanted to understand uh in Sko till now what has been our investment and uh 31:47 31 minutes, 47 seconds what is the uh uh uh revenue uh turnover of uh this business whatever you want to 31:54 31 minutes, 54 seconds say either on a uh FI 256 basis or a quarterly number or a ARR 32:02 32 minutes, 2 seconds just for us to get a sense as to how the business is ramping up. 32:11 32 minutes, 11 seconds Good evening. Uh so uh backpacks or I think the entire back to school segment is a segment which we were keen at 32:21 32 minutes, 21 seconds exploring since uh uh uh a long time. Uh with Skido we found partners who helped 32:27 32 minutes, 27 seconds us in uh getting into this segment especially in the mass market segment uh uh very well. uh the bags were launched 32:36 32 minutes, 36 seconds in the last back to school season towards the end of the last back to school season and now this is going to be actually the first complete back to 32:44 32 minutes, 44 seconds school season where we'll be launching this product. Uh till now we've invest invested about uh 1.02 02 crores uh in 32:54 32 minutes, 54 seconds Skido and for the 9 month ended 31st December we've generated a sale of about uh 9.5 crores in this business. 33:06 33 minutes, 6 seconds Uh this is both the product that we sell uh you know in the market under the Dom's brand and also the bags which you 33:15 33 minutes, 15 seconds know manufactures and supplies to do for its kits and combo packs. 33:21 33 minutes, 21 seconds You said sorry 9 months FI 26 is 9 cr. 33:25 33 minutes, 25 seconds Yeah the total investment in will be roughly about two uh crores plus 33:34 33 minutes, 34 seconds understood understood. Uh coming in about 1 cr 1.02 crores proportionate to our shareholding. 33:45 33 minutes, 45 seconds So coming to uh uh this uh uh scholastic art uh business I think it has grown 33:52 33 minutes, 52 seconds about 12% in this quarter. Um so just wanted to understand see we understand your growth drivers which is the pens uh 34:00 34 minutes segment uh uh uh and all these new initiatives bags etc. But your core bread and butter which is the uh uh 34:09 34 minutes, 9 seconds stationary uh uh business uh the scholastic art and scholastic stationary business uh I mean where are we now in 34:19 34 minutes, 19 seconds this segment uh in terms of uh distribution? Where are we in terms of uh uh market share? uh what is the 34:29 34 minutes, 29 seconds market growth here and what do you think we can grow uh uh this business over the 34:38 34 minutes, 38 seconds next three to four years uh uh uh which would include our own market share uh gain so just I mean not asking for a 34:46 34 minutes, 46 seconds guidance but just asking for a way to sort of uh uh evaluate and model uh this 34:55 34 minutes, 55 seconds business out um do Do you still think that this is a business which can grow 35:02 35 minutes, 2 seconds at uh sort of close to uh 15 to 20%, or do you think that no there will have to 35:10 35 minutes, 10 seconds be these other new growth businesses like pens, bags etc which will need to grow at maybe 50 to 100% in order for 35:19 35 minutes, 19 seconds the company to do that high teams kind of a number. 35:25 35 minutes, 25 seconds Uh so firstly basically scholastic stationary scholastic art and kitchen combo is something which we look 35:32 35 minutes, 32 seconds together because you know uh there are a lot of uh complimentary products in these categories. So overall when we see 35:41 35 minutes, 41 seconds all these three categories put together we've grown by about 11 and a half%. 35:46 35 minutes, 46 seconds uh one of a few reasons for this growth especially if you see folstic stationary 35:52 35 minutes, 52 seconds is despite the impact of US tariffs you know one of the key products that we used to export uh to uh the fil group 36:01 36 minutes, 1 second company in US is wooden fences the blackyard wooden fences uh where uh after the impact of 50% tariff the sales 36:10 36 minutes, 10 seconds has come down considerably uh despite that in this segment And uh year on year we've grown by about 2%. Uh this has 36:20 36 minutes, 20 seconds been because one uh you know we've launched mechanical pencils uh which were launched in Q2 FY26 and they've got 36:29 36 minutes, 29 seconds a good reception from the market. these categories. 36:33 36 minutes, 33 seconds So let's plus uh you know a little bit of capacity spare capacity which we add 36:41 36 minutes, 41 seconds from the uh you know uh decline in demand or sales to us for the wooden 36:48 36 minutes, 48 seconds pencil was used to increase the uh capacity for uh wooden color pencil 36:54 36 minutes, 54 seconds which gets categorized in art. So that is one reason where you see the uh sales in the scholastic art segment increasing 37:03 37 minutes, 3 seconds uh significantly year on year. Uh plus you know we uh like we mentioned that we are slowly starting to increase our 37:12 37 minutes, 12 seconds capacities for the wooden pencils. Uh in the 45 acre the first plant that we are going to get ready will be focused on 37:20 37 minutes, 20 seconds wooden fences. Uh out of that some capacity built up has already started. 37:26 37 minutes, 26 seconds uh because we had some space in our color pencil uh division. So we've increased our capacity there. So overall 37:33 37 minutes, 33 seconds color pencil as a segment as a subsegment has done really well. In terms of overall uh capacity increase uh 37:42 37 minutes, 42 seconds you know our target to increase the capacity of our wooden pencil uh is from about 5 uh 8 million that we have sorry 37:51 37 minutes, 51 seconds 5.53 million that we have currently to about uh 8 million uh going in uh in the next couple of years. Uh this will be a 38:00 38 minutes gradual increase. uh so in the coming year and actually more in the year after in FY28 you'll see significant growth 38:09 38 minutes, 9 seconds coming from the sales of uh uh so electric stationary and soic art material where wooden pencil will become 38:18 38 minutes, 18 seconds a key growth driver. Uh we believe that there is still significant potential uh in the market both uh in domestic and on 38:28 38 minutes, 28 seconds export front. uh you know there are already now talks of uh the US tariffs coming back to normal. So once this 38:36 38 minutes, 36 seconds comes back uh you know to the normal range um again the loss sales to uh US 38:43 38 minutes, 43 seconds will uh reinitiate thus with more capacities in place we'll be able to get better output uh for both the domestic 38:52 38 minutes, 52 seconds and export market. So we are confident on the growth prospect on these two segments as well. 38:58 38 minutes, 58 seconds uh in terms of market share honestly we'll not have you know we don't uh track or follow any market reports but 39:06 39 minutes, 6 seconds would be fair to assume that you know we'll be uh you know especially in the pension segment upwards of about 35% and 39:15 39 minutes, 15 seconds with the new capacities coming in we'll be close to about 45% short of a market share 39:22 39 minutes, 22 seconds and this 11 and a half% is with exports can you tell me what the number would be for only the India business 39:31 39 minutes, 31 seconds uh for the growth of uh uh for the three segments you said and together 39:39 39 minutes, 39 seconds yeah yeah yeah uh the scholastic art scholastic stationary kits and combos which you said together is 11 and a half% that includes exports what would 39:47 39 minutes, 47 seconds it be for the India business uh I would not have purchased this answer uh right now probably can come 39:55 39 minutes, 55 seconds back uh to you all with this uh reply we'll have our uh you know I team get in touch to answer I don't have the numbers 40:04 40 minutes, 4 seconds off hand right now no problem and this 11 and a half% which you have done going ahead let's say over a three-year keer what do you think 40:12 40 minutes, 12 seconds should be a target for uh a three-year period uh so per this will all depend upon when 40:20 40 minutes, 20 seconds the capacity is and is going to come up and how it is going to be built up but uh you know This should follow once 40:28 40 minutes, 28 seconds there will be a time when there is a major capacity addition happening you'll see this number to increase significant 40:35 40 minutes, 35 seconds in that year and then moderate down but but that's why I'm doing I don't want understanding 40:44 40 minutes, 44 seconds yeah yeah so this segment also should follow the company's overall uh you know growth range in the next 3 to 5 years 40:54 40 minutes, 54 seconds okay Rahul thanks a lot uh that's All from me. All the best. Thank you. 41:00 41 minutes Thank you. The next question is from the line of Kunal Bora from BNP Paribas. Please go ahead. 41:08 41 minutes, 8 seconds Yeah. [clears throat] Thanks Alway. So first, how should we look at uh the new capacities and their contribution? Would 41:15 41 minutes, 15 seconds it like add five 7% every quarter? Will it be lumpy? And how does the capacity come in over the next six to eight quarter? That's the first question. 41:23 41 minutes, 23 seconds Second one I'll come to Lily later but like if you can ask the first one. 41:28 41 minutes, 28 seconds Uh so basically what uh historically the way we've seen it is once we get the possession of the building to start the 41:37 41 minutes, 37 seconds plant it takes us almost about a 90 days sort of a period and once we uh start the plant it takes us about six odd 41:45 41 minutes, 45 seconds months to reach a uh you know uh decent level of capacity utilization because in 41:53 41 minutes, 53 seconds the initial phases there are some buildups happening some you know connections and assemblies and uh synergies that get developed. You need 42:02 42 minutes, 2 seconds to sometimes change the positioning of certain machines and all. So it takes us about six to seven months to reach a 42:08 42 minutes, 8 seconds decent level of production. So uh this is how we see typical buildup happening. 42:14 42 minutes, 14 seconds So the idea is every three months having some new capacities starting first with pencils uh then with uh office supplies 42:24 42 minutes, 24 seconds uh this writing instruments which includes pens, markers, highlighters then would be pencil accessories which 42:31 42 minutes, 31 seconds is eraser sharpener because that will complement the growth in capacity for pencil because in a pack of you need to 42:38 42 minutes, 38 seconds give one sharpener and eraser three and then eventually followed with some amount of uh additional capacity for solici material. 42:49 42 minutes, 49 seconds Thanks for that. But I wanted to understand whether it'll be uniform. 42:52 42 minutes, 52 seconds It'll be uniform or it'll be lumpy. I mean like say will will there be one large factory or it'll be like similar size factories uh similar contribution from each of the factories. 43:02 43 minutes, 2 seconds So uh basically in the 45 acre project most of the buildings are similar in size which is about 150,000 square ft each building. 43:14 43 minutes, 14 seconds Uh so uh this is uh you know you since you've seen the plants just to give you a reference this is almost double the 43:22 43 minutes, 22 seconds size of our current eraser plant which you have seen. Uh so uh they are similar so the growth will not be very lumpy. 43:33 43 minutes, 33 seconds Yes, there would be some quarters where you will probably see a lump compared to the base quarter because probably in the base quarter you might not have had that 43:42 43 minutes, 42 seconds amount of capacity addition but sequentially it should be uh pretty much in line. 43:48 43 minutes, 48 seconds Understood. How many factories will come in total over the next whatever 2 three years four years? 43:54 43 minutes, 54 seconds Uh so the right now we have uh plans to construct about a total of nine buildings. Nine buildings. Okay, understood. Okay. 44:03 44 minutes, 3 seconds Okay. Okay. Second one is regarding operation building. There is construction going on for uh sheds. Uh 44:11 44 minutes, 11 seconds these are going to be basically storage unit. Then there would be utility building. So these are all in addition but right now we are planning to have uh 44:19 44 minutes, 19 seconds nine or building uh constructed for production purposes and these nine buildings will come over about nine quarters. I mean the eight nine quarters how does it come? 44:30 44 minutes, 30 seconds Yes. 44:32 44 minutes, 32 seconds Understood. Okay. Okay. Okay. Second and last one is uh regarding the ultra premium bags you'll be manufacturing. 44:38 44 minutes, 38 seconds Where are these bags currently getting manufactured and what is the cost saving you are able to achieve and will the margins be comparable to what you make currently? 44:50 44 minutes, 50 seconds So this uh production which seven spa does uh is right now they have production facility a small facility in 44:57 44 minutes, 57 seconds Italy and also source considerably from uh China. 45:02 45 minutes, 2 seconds Uh definitely with the uh you know uh uh with the seven uh the uh you know the 45:09 45 minutes, 9 seconds partners like partners at seven also being involved in this JV and working closely with dogs they will also have 45:17 45 minutes, 17 seconds their skin in this venture. So they would also want to shift the production as much production as possible to India 45:25 45 minutes, 25 seconds over a period of time. So uh you know this can become a sizable business for uh Tomms as well. 45:34 45 minutes, 34 seconds But what's the rational? I mean will the cost be which you will be able to deliver be much lower compared to what the China cost will be or the quality or 45:42 45 minutes, 42 seconds like what's the rational of shifting the production? 45:46 45 minutes, 46 seconds So this uh 7 SBA will have a little more control uh because this will be now their own joint venture like we'll have 45:54 45 minutes, 54 seconds 50% they will also have 50%. So they'll have more control. Uh plus uh you know with Pila and Dom's partnership we've 46:03 46 minutes, 3 seconds been able to demonstrate uh in certain key categories like fences uh so let's say art materials that from a production 46:13 46 minutes, 13 seconds perspective we can be as competitive but much more trustworthy and better quality product than China. So uh we would want 46:21 46 minutes, 21 seconds to replicate the same success for the seven bombs JD as well. 46:26 46 minutes, 26 seconds Okay. And lastly, what's the what's the current turnover and do you think like almost uh everything which is getting manufactured can come to you or uh 46:34 46 minutes, 34 seconds you'll have to prove yourself or and how does that work? We'll definitely have to prove ourselves you know it's not that everything will come come to us and 46:43 46 minutes, 43 seconds today after almost more than a decade and a half sort of a partnership with we've still not been able to get all 46:52 46 minutes, 52 seconds this production because our focus always uh equally important to uh you know grow themsel 47:00 47 minutes uh so I wouldn't say that 100% will come to uh India but once we start this process I I think we can have a 47:08 47 minutes, 8 seconds significant portion coming into India uh in the next few years. Okay. Okay. Okay. That's it from me. 47:16 47 minutes, 16 seconds Thank you sir. 47:18 47 minutes, 18 seconds Thank you. The next question is from the line of Sunonny an individual investor. Please go ahead. 47:26 47 minutes, 26 seconds Hello. Am I audible? Hello. Hi. Am I audible? Yes, we can hear you. 47:31 47 minutes, 31 seconds Yeah. Hi. Hi. So uh I just wanted a qualitative view about uh uh number one uh where do you see your new acquisitions in the foreseeable future? 47:40 47 minutes, 40 seconds What are your learnings from the new acquisitions like in the diaper segment or in Skittle or the other companies? 47:46 47 minutes, 46 seconds And number two, when do you expect a bump up in your uh earnings given that the huge capex you have been doing in the last 2 three years. So in which 47:54 47 minutes, 54 seconds financial year do you see a bump up in your earnings uh from the huge capeex? So these are the only two questions sir. 48:02 48 minutes, 2 seconds Thanks. I think you know right now all our facilities 48:10 48 minutes, 10 seconds uh decent business which we started which we invested about 48:17 48 minutes, 17 seconds uh nearly two years back. uh has done a sale of YPD sale of almost close to 10 48:23 48 minutes, 23 seconds crores. Uh on a total investment of uh by both the partners too took together 48:30 48 minutes, 30 seconds of about 2 crores. Uh wow business is doing well. Uh when we invested in this company last year uh they closed last 48:39 48 minutes, 39 seconds two financial year uh you know at 160 odd crores. This year we are targeting to close uh at close to 200 crores. Uh 48:49 48 minutes, 49 seconds Pioneer there has been a shift in the business model where earlier pioneer used to do direct sales now it gets 48:56 48 minutes, 56 seconds rooted through dogs. Despite that the company uh has grown in sales uh micro wood which is basically supplying 49:04 49 minutes, 4 seconds material uh to do uh you know do packing material to do is also doing well. So overall all companies are doing well. 49:14 49 minutes, 14 seconds HTTPL super is something which we invested very recently and this is now the first uh you know back to school 49:22 49 minutes, 22 seconds season where we'll participate through them also. Uh but given it strategic location the pedigree of the management 49:29 49 minutes, 29 seconds and plus some amount of uh backward integration that we are in the process doing there uh we believe uh this would also be a successful acquisition for us. 49:42 49 minutes, 42 seconds Right. Right. And regarding the uh when do you expect the sales uptick? 49:48 49 minutes, 48 seconds So uh uh we basically uh you know uh the way we planned uh sorry not right now 49:55 49 minutes, 55 seconds but historically has been always to achieve a very steady growth. Uh payex 50:02 50 minutes, 2 seconds and investment in capital expenditures is like a ongoing activity. uh you during the last few years or so after 50:09 50 minutes, 9 seconds listening you would have seen that the sales uh of Tom has been uh you know very measured and uh grown uh uh you 50:18 50 minutes, 18 seconds know without any bumpiness it's something that we've grown sustainably so we'll want to follow the same approach so right now also uh while 50:27 50 minutes, 27 seconds there has been some amount of delay in our new project but we believe there have been other significant investments that have been happened in our current 50:36 50 minutes, 36 seconds infrastructure plus sudden other uh brownfield investment that we've done which will support a similar sort of a growth pattern in the coming few financial years as well. 50:47 50 minutes, 47 seconds Right, right, right. That's it. That's it. Congratulations from your my side from for a great results or consistent results over these years, sir. Thank you. 50:58 50 minutes, 58 seconds Thank you. The next question is from the line of Ana Nani from Thinkwise Wealth Managers LLP. Please go ahead. 51:07 51 minutes, 7 seconds Uh hi, thanks for the opportunity. Uh I wanted to ask about Uni land. The AITA margins in this quarter are at 12%. 51:15 51 minutes, 15 seconds whereas the guided change was around 7 to 8%. So I wanted to understand what caused the uh spike in margins and whether it's sustainable. Thank you. 51:27 51 minutes, 27 seconds Hi. So basically for UniLand uh or for the entire uh diaper business uh you 51:34 51 minutes, 34 seconds could say that uh the third quarter is one of the strongest quarters in terms of performance with more than about you 51:42 51 minutes, 42 seconds know 30% of sales coming in uh single quarter uh because of the winter season 51:48 51 minutes, 48 seconds and this is slightly a seasonal business uh where the with the onset of monsoon 51:55 51 minutes, 55 seconds uh the business starts uh during In peak winter it is the highest sales and then it tapers down after holy sort of a uh 52:04 52 minutes, 4 seconds and Q1 is almost the weakest. So in this quarter what typically happens is your fixed cost utilization is highest. 52:13 52 minutes, 13 seconds That's the reason why you'll see the margin to be the highest in this quarter. But when you consolidate the full year numbers where Q1 is deep 52:22 52 minutes, 22 seconds followed by Q4 and then Q3 uh and Q2 and Q3 at a uh you know the same level we 52:30 52 minutes, 30 seconds think this business will do about 8 to 9% uh annual margin. 52:39 52 minutes, 39 seconds Thank you. Thank you. 52:45 52 minutes, 45 seconds The next question is from the line of Mosam Sha from Wealth Guardian. Please go ahead. 52:52 52 minutes, 52 seconds Hello, thank you for the opportunity and congratulations on a good set of numbers. Uh my first question is 52:59 52 minutes, 59 seconds regarding the Jammu Kashmir land that we have acquired. Uh so basically uh around at what cost have we acquired? 53:12 53 minutes, 12 seconds Uh sim uh we uh we paid uh about 16 crores for acquisition of land buildings 53:20 53 minutes, 20 seconds and uh certain electrical fittings which will be of the use to the company. Uh the land is spread across about uh two 53:29 53 minutes, 29 seconds and a half plus acres with a builtup area of close to 50,000 square ft. 53:36 53 minutes, 36 seconds uh and this is uh strategically located very near to our uh current operations 53:42 53 minutes, 42 seconds in Chamu. So uh management uh would be uh more uh uh easier. Uh here we plan to 53:51 53 minutes, 51 seconds uh you know uh enhance some amount of our uh capacities for uh wood and uh 53:58 53 minutes, 58 seconds flat processing and as well as you know uh there are certain attractive products in the fine art category uh also which 54:07 54 minutes, 7 seconds requires some amount of process which we'll get from uh this new investment in general. 54:17 54 minutes, 17 seconds Okay. Okay. Thank you. And also so we are guiding for 18 20% of revenue growth 54:25 54 minutes, 25 seconds whereas uh in the first 9 months we have already done 23%. 54:30 54 minutes, 30 seconds So is this something that we are we are very uh guiding limited revenue growth or uh are we seeing a degrowth in 54:39 54 minutes, 39 seconds quarter 4 being back to school season and everything? 54:46 54 minutes, 46 seconds Mam if you would have seen the numbers you know in the third quarter if you compare year on year our growth has been 54:52 54 minutes, 52 seconds about 18 and a half% 18.7% to be precise uh this is because in the base period 55:00 55 minutes now starting from third quarter the base period will already have the uh you know 55:06 55 minutes, 6 seconds the impact of the unique acquisition so uh growth can be forecasted for the full 55:13 55 minutes, 13 seconds year growth of close to 18 20% And we knew that first two quarters will be higher growth because there was no 55:20 55 minutes, 20 seconds unilan uh uh consolidation impact in the base quarters while in the next two quarters we will have an impact of the 55:28 55 minutes, 28 seconds uni. So the growth first time page on a much larger sort of a base will be a little lower but having said that it's 55:36 55 minutes, 36 seconds not that we looking at any sort of a degrowth. uh we are confident that uh you know we'll uh close the year at the 55:43 55 minutes, 43 seconds upper end of the uh guided range and at the same time continue to be a little 55:49 55 minutes, 49 seconds conservative uh uh you know that that's uh normally the way how we always be but we are confident that we'll uh you know 55:58 55 minutes, 58 seconds achieve or reach at the upper end of the guided change. 56:04 56 minutes, 4 seconds Okay. Okay. Thank you. And uh also this this quarter we have uh achieved the revenue uh we have in our revenue mix 56:13 56 minutes, 13 seconds there's a lot of uh higher proportion given to the eastern market. So is it 56:19 56 minutes, 19 seconds because of the ac new acquisition STP uh in the eastern market? 56:27 56 minutes, 27 seconds No no uh specifically uh you comparing uh sequential growth or uh year on year you're you're on you're on 56:36 56 minutes, 36 seconds so typically I don't know I don't have to say but one of the reason is sometimes you know what happens is uh it really depends upon the 56:45 56 minutes, 45 seconds festive season also so if the uh you know tura future season in uh you uh in 56:53 56 minutes, 53 seconds the fiscal year 2025 was in the third quarter then the sales in East India becomes a little less during that period and this 57:02 57 minutes, 2 seconds year I remember that puraputa was actually in the second quarter. So probably that can be one reason but otherwise there has been no impact of 57:10 57 minutes, 10 seconds the HTPL acquisition on it. it is uh just that the business uh fundamentals 57:17 57 minutes, 17 seconds are playing out like I said you know that uh now is the season where we'll see good impact of uh 57:25 57 minutes, 25 seconds HTPL uh uh acquisition coming in because one earlier it's a new acquisition then 57:32 57 minutes, 32 seconds the uh GSP uh rate change had impacted the sales of paper stationary overall uh 57:40 57 minutes, 40 seconds and after that uh we during that time and currently we invested something in backward integration in terms of a 57:48 57 minutes, 48 seconds printing line being set up which is already close to completion. This quarter we see significant uh uh revenue 57:55 57 minutes, 55 seconds decent revenue uh being consolidated from HDPL to the office. Okay. 58:04 58 minutes, 4 seconds Thank you so much and all the very best. 58:08 58 minutes, 8 seconds Thank you. The next question is from the line of Ani Ruda from ICICI securities. Please go ahead. 58:17 58 minutes, 17 seconds Yeah. Uh so Rahul by two questions. One commodity uh price inflation is pretty 58:23 58 minutes, 23 seconds high. Uh so how are you managing uh it in terms of price hike, trade spends management or uh change in revenue mix, 58:32 58 minutes, 32 seconds product mix? Uh because rather than inflation, the volatility in commodity prices is also extremely high. 58:39 58 minutes, 39 seconds Uh so that is question number one and question number two uh if you can share more details on the ESOP plan uh in 58:48 58 minutes, 48 seconds terms of means how many employees have got that and uh wasting period target uh uh whether it is in lie of cash salaries 58:57 58 minutes, 57 seconds or or bonuses or it is in addition to the uh cash salaries bonuses etc. So uh 59:04 59 minutes, 4 seconds any any further details that you can share? Yeah, thanks. 59:09 59 minutes, 9 seconds So Anubai uh thank you for your question. Uh you rightly put that in the current quarter especially from the time 59:17 59 minutes, 17 seconds uh uh there have been this discussions about uh uh Greenland and Iran uh there has been a significant uh increase in 59:26 59 minutes, 26 seconds prices. Uh there has the volatility has also increased. uh but as a company uh you know right now we are uh just uh 59:35 59 minutes, 35 seconds waiting and watching whether these are sustainable or if these are something which are like a temporary phenomenon. 59:42 59 minutes, 42 seconds uh once uh uh a month uh and a half sort of a thing down uh you know we will uh 59:49 59 minutes, 49 seconds decide that if these these remain sustainable uh then we will have to change uh you know our pricing structure 59:57 59 minutes, 57 seconds either in terms of the channel margins or the MRP of the products depending on the how the costs pan out and how much 1:00:05 1 hour, 5 seconds it will increase. uh so uh definitely this will have a little bit of impact on 1:00:12 1 hour, 12 seconds uh our margins in the uh current quarter but in what extent we still don't know and plus uh you know how uh we have a 1:00:21 1 hour, 21 seconds very large purchase basket uh we've not seen still increase across the purchase basket but these are in some of the key 1:00:30 1 hour, 30 seconds raw materials while for some other key raw materials the prices continue to remain constant So uh you know that's something which we 1:00:39 1 hour, 39 seconds will uh wait and then decide on how and uh when to pass on any increases if any. 1:00:48 1 hour, 48 seconds Uh secondly in terms of EOP so another these uh EOP grants that we've done we we've done it from our existing approved 1:00:57 1 hour, 57 seconds uh ESOP scheme uh which was the ESOP 2023 scheme uh from this scheme in 2000 1:01:04 1 hour, 1 minute, 4 seconds October 2024 uh we had done certain grants uh I think one lakh 70,000 odd 1:01:11 1 hour, 1 minute, 11 seconds grants had happened to about 900 plus employees uh this year from the same uh 1:01:17 1 hour, 1 minute, 17 seconds pool being granted about uh 137 plus uh thousand of esoph,000 plus employees. Uh 1:01:27 1 hour, 1 minute, 27 seconds so basically the veing period and time frame remains the same. Uh this is in addition to their uh you know current uh PPCs. 1:01:39 1 hour, 1 minute, 39 seconds Okay. Sure. Sure. This is uh very helpful and uh many thanks uh and congrats for great set of numbers. Yeah, thanks. 1:01:48 1 hour, 1 minute, 48 seconds Thank you. 1:01:51 1 hour, 1 minute, 51 seconds Thank you. We'll take the last question from the line of Anik Mitra from Phenomic Solution Private Limited. 1:01:58 1 hour, 1 minute, 58 seconds Please go ahead. Am I audible, sir? I am. Yes, you are. 1:02:05 1 hour, 2 minutes, 5 seconds Yeah. Thanks for taking my question, sir. uh your uh new uh means brownfield uh capacity expansions and also green 1:02:14 1 hour, 2 minutes, 14 seconds fields are coming in phased manner. So what sort of revenue addition we can see 1:02:21 1 hour, 2 minutes, 21 seconds over the period of time if you can guide us uh from another four to six quarters point of view. 1:02:29 1 hour, 2 minutes, 29 seconds Uh uh honestly uh right now uh you know uh what we are seeing right now for the 1:02:36 1 hour, 2 minutes, 36 seconds coming uh financial year uh we will probably continue our growth momentum of 1:02:43 1 hour, 2 minutes, 43 seconds close to uh 18 to 20% revenue growth. uh since same sort of a growth that we'll be closing with this current financial 1:02:51 1 hour, 2 minutes, 51 seconds year uh we'll be pay uh you know we achieve uh we'll try to achieve the same growth uh in the coming financial year 1:02:58 1 hour, 2 minutes, 58 seconds as well and after that you know we should also the pace uh on which this growth is being achieved is uh 1:03:06 1 hour, 3 minutes, 6 seconds increasing uh so after that uh and we still not made a plan of what we do but 1:03:13 1 hour, 3 minutes, 13 seconds that will depend on uh you know how the capacity built up stands up and at least for next year we can say that we'll 1:03:20 1 hour, 3 minutes, 20 seconds continue the current growth momentum and target to achieve a sales growth of 18 to 20%. 1:03:27 1 hour, 3 minutes, 27 seconds Okay. So sir uh whatever 18 to 20% you are projecting for the next year is it uh like will it come from this 1:03:35 1 hour, 3 minutes, 35 seconds additional capacities or is it the normal uh like with the uh current capacities 1:03:42 1 hour, 3 minutes, 42 seconds uh predominantly from the uh uh full utilization of the current capacity because the capacity that has happened 1:03:51 1 hour, 3 minutes, 51 seconds during the course of this year uh for the 9 months plus in the next three months you'll get full benefit of that 1:03:58 1 hour, 3 minutes, 58 seconds in the coming financial year and plus some new capacities being added in the coming financial year but it will be a more of a volume driven growth. 1:04:10 1 hour, 4 minutes, 10 seconds Okay. Okay. And sir with the backward integration uh whatever you are doing uh for pencil capacities so what sort of 1:04:18 1 hour, 4 minutes, 18 seconds margin improvement we may see at full capacity utilization or optimum at optimum level of uh utilization. 1:04:27 1 hour, 4 minutes, 27 seconds So I mean basically you know uh we are already one of the most backward integrated companies uh when it 1:04:35 1 hour, 4 minutes, 35 seconds [clears throat] comes to manufacturing of wooden pencils. Uh so this is uh you know the new capacity uh addition that 1:04:42 1 hour, 4 minutes, 42 seconds we might be doing for cy integration will be to support the increase in capacity for uh the uh main product like 1:04:52 1 hour, 4 minutes, 52 seconds you know now the potential to increase so I there wouldn't be any significant uh impact of this on the margin 1:05:01 1 hour, 5 minutes, 1 second so we can consider margin will be uh as it is means it will be maintained like to maintain the margin this capacity 1:05:08 1 hour, 5 minutes, 8 seconds utilization will uh means this additional capacity will help. Absolutely. 1:05:14 1 hour, 5 minutes, 14 seconds I got it. I got it. That's that was from my side. Thank you so much. Uh congrats for good set of numbers sir. 1:05:22 1 hour, 5 minutes, 22 seconds Thank you so much. 1:05:24 1 hour, 5 minutes, 24 seconds Thank you ladies and gentlemen. In the interest of time that was the last question. I would now like to hand the conference over to the management for the closing comments. 1:05:36 1 hour, 5 minutes, 36 seconds Uh thank you everyone for joining us. We appreciate uh your continued support and confidence in our journey. Should you 1:05:44 1 hour, 5 minutes, 44 seconds have any further questions uh please reach out to our uh investment uh investor relations team. Thank you and have a great day ahead. 1:05:55 1 hour, 5 minutes, 55 seconds On behalf of ICICI Securities Limited, that concludes this conference. Thank you for joining us.