Emami Limited — Q3 FY26

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

0:00 Ladies and gentlemen, good day and welcome to the Immi Limited Q3 FY26 earnings conference call. As a reminder, 0:08 8 seconds all participant lines will be in the listen only mode and there will be an opportunity for you to ask questions after the presentation concludes. Should 0:16 16 seconds you need assistance during the conference call, please signal an operator by pressing star then zero on your touchstone phone. Please note that 0:24 24 seconds this conference is being recorded. I now hand the conference over to Mr. Percy Pantaki from IIFL Capital. Thank you and over to you sir. 0:35 35 seconds Uh good afternoon. It's my pleasure to host Imami for the 3QFI26 conference call. Uh online with me I 0:44 44 seconds have uh Mr. Moan Goena who director and vice chairman. Mr. Vive Dir CEO international business. Mr. Gulra Batya 0:52 52 seconds president healthcare. Mr. Mr. Manish Gupta, President Sales and uh Mr. Gajj Bri, Chief Growth Officer and Mr. Rajesh 1:01 1 minute, 1 second Sharma, President Finance and IR. Uh I'll hand over the call to Mr. Moinka for his initial comments and then we will open up for Q&A. 1:13 1 minute, 13 seconds Thank you. Good afternoon ladies and gentlemen. 1:17 1 minute, 17 seconds Thank you for joining us today for Imami Limited's Q3 FY26 earning call. I'm delighted to share our results for the 1:26 1 minute, 26 seconds quarter and 9 months ended 31st December 25. 1:31 1 minute, 31 seconds I must say this has been a quarter of strong broad-based performance that is fully aligned with our expectations and 1:37 1 minute, 37 seconds strategic priorities. We have witnessed a sequential improvement following the GS2 disruptions that continue to affect the early parts of the quarters. 1:48 1 minute, 48 seconds The favorable winter season played to our strengths, driving stronger uptake across our winter portfolio and healthcare. 1:56 1 minute, 56 seconds On a consolidated level, net sales grew by double digits at 11% with revenue of 2:04 2 minutes, 4 seconds 1,152 crores, growing by 10% during the quarter. Our domestic business delivered 2:13 2 minutes, 13 seconds an 11% growth led by a robust 9% volume growth. All major brands performed well 2:21 2 minutes, 21 seconds in Q3 led by Boro Plus which grew by 16%, cashing grew by 10%, pain 2:28 2 minutes, 28 seconds management grew by 8% and healthcare range grew by 7%. The male grooming range grew by 4%. Navaratna and 2:37 2 minutes, 37 seconds dermicool grew by 1%. Our strategic subsidiaries that is the man company and Brillair together delivered a robust growth of 31%. 2:49 2 minutes, 49 seconds Our strategy of purposeful innovation and premiumization continues to gr gain traction. During the quarter we launched 2:58 2 minutes, 58 seconds several exciting products and variants that addresses evolving needs of new age consumers. 3:05 3 minutes, 5 seconds Our omni channel strategy continues to perform well with quick commerce doubling its sales and now contributing 3:13 3 minutes, 13 seconds 20% to our ecom business. Overall, organized channels contributed around 3:19 3 minutes, 19 seconds 32% year to date, increasing their contribution by 280 basis points over the previous year. 3:29 3 minutes, 29 seconds [snorts] 3:30 3 minutes, 30 seconds We have engaged KPMG to drive a future ready supply chain transforming across omni channel operations. 3:40 3 minutes, 40 seconds On the international front, our sales grew by 9% with doubledigit growth in seven oils in one bor plus creme 21 and 3:49 3 minutes, 49 seconds our pin management range. We saw steady growth led by SAK and CIS regions. 3:56 3 minutes, 56 seconds On the financial front, gross margin expanded to 70.6% and improvement of 30 basis points 4:04 4 minutes, 4 seconds underscoring our rigorous cost discipline, judicious price hikes and benefits of input price stability. 4:12 4 minutes, 12 seconds AITA for the quarter stood at 384 crores growing by 13%. While Abita margins 4:21 4 minutes, 21 seconds improved to 33.4% 4% an expansion of 110 basis points. 4:29 4 minutes, 29 seconds During the quarter we accounted for 10.1 cr towards the impact of changes in the 4:37 4 minutes, 37 seconds new labor code which is represented under the exceptional items. 4:43 4 minutes, 43 seconds Our profit after tax at 319 crores grew by 15%. 4:50 4 minutes, 50 seconds Our dit our digital spends now account for almost 50% of our overall media spends 4:59 4 minutes, 59 seconds in line with evolving consumer media consumption trends enabling sharper targeting and higher engagement. 5:08 5 minutes, 8 seconds I am also delighted to announce that our board of directors have declared a second interim dividend of 600% 5:16 5 minutes, 16 seconds amounting to rupees 6 per share for FY26. 5:20 5 minutes, 20 seconds The total dividend declared in 9 months FI26 amount to rupees 10 per share reflecting our confidence in our 5:28 5 minutes, 28 seconds business performance and our commitment commitment to reward the shareholders of the company. 5:34 5 minutes, 34 seconds Further, I would also like to inform you that as per the recent proposed amendments in the union budget, our 5:42 5 minutes, 42 seconds applicable income tax rate for the standalone entity would reduce to around 25% from 35% for FY27 onwards. 5:55 5 minutes, 55 seconds Looking ahead, we remain optimistic about Q4 and beyond. There's a better consumption momentum building in the 6:02 6 minutes, 2 seconds environment and we are positioned to capitalize on it. We remain focused on our core brands as well as new age 6:09 6 minutes, 9 seconds opportunities with strengthening demand trends, consistent portfolio actions and a clear strategic roadmap. We are 6:16 6 minutes, 16 seconds increasingly confident in our ability to deliver sustained profitable growth and create long-term value for our stakeholders. 6:25 6 minutes, 25 seconds With that, I would now like to open the floor for Q&A. Thank you so much for your continued support. 6:34 6 minutes, 34 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 6:41 6 minutes, 41 seconds telephone. If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use handsets while asking a 6:50 6 minutes, 50 seconds question. Ladies and gentlemen, we will wait for a moment while the question cue assembled. 6:56 6 minutes, 56 seconds The first question is from the line of Prakash Kapadia from Kapadia Financial Services. Please go ahead. 7:04 7 minutes, 4 seconds Yeah, thanks for the opportunity. Uh couple of questions from my end. Uh you know post the GST disruption in Q2 we 7:12 7 minutes, 12 seconds were confident of growth coming back. So that has you know happened uh during the quarter. So from year on mog how and 7:21 7 minutes, 21 seconds what you know do we build for growth as we move towards FY27 uh what I was trying to understand you 7:29 7 minutes, 29 seconds know given the base we have most of the products are you know under the 5% uh 7:35 7 minutes, 35 seconds GST slab now so you know earlier in most of our power brands new user edition was 7:42 7 minutes, 42 seconds missing so you know is that going to be a big uh driver for growth both what categories could benefit if you could 7:50 7 minutes, 50 seconds comment on the sales trajectory that would be helpful. 7:55 7 minutes, 55 seconds Yeah. So, uh Praash you are right. So, our endeavor is always to get to doubledigit growth. Of course, uh some 8:02 8 minutes, 2 seconds of our brands are seasonal. A lot depends on that. uh but nevertheless uh every brand uh has got a lot of 8:11 8 minutes, 11 seconds opportunity because penetrations are still on the lower side for most of our brands and because you rightly said that now the GST is at 5% we are confident 8:21 8 minutes, 21 seconds that you know the brand should get to close to double digit growth that is the targets that we have given to the brand teams depending on the seasonality here 8:29 8 minutes, 29 seconds and there you know uh the numbers depend mostly on that uh but still our targets are to get to double digit. 8:40 8 minutes, 40 seconds Okay. And and any specific categories you want to call out in terms of the power brand or you know given some of 8:48 8 minutes, 48 seconds these changes which has happened we should see uh you know growth momentum across most of our categories 8:56 8 minutes, 56 seconds and on the new user edition because that piece was really missing earlier. Is that now a big big driver for growth? 9:05 9 minutes, 5 seconds Sorry, what was missing? 9:06 9 minutes, 6 seconds Uh, new customer additions, new users to the Yeah. 9:14 9 minutes, 14 seconds Yeah. So, so each brand uh as I said in my con call that uh right now our 50% of 9:21 9 minutes, 21 seconds our communication is digital. So we are targeting the new consumers particularly the youth consumers and uh also now our 9:30 9 minutes, 30 seconds contribution uh from uh modern train and e-commerce has reached to almost 30%. So all this uh uh growth whatever you see 9:39 9 minutes, 39 seconds today is coming through these uh new age and young consumers that has always been a target for us. uh at the same time 9:47 9 minutes, 47 seconds rural which was not performing we are seeing uh some growth coming in from rural areas and with this reduction in 9:54 9 minutes, 54 seconds uh GST rates we are very hopeful that uh you know the rural should get to some momentum going forward so brands which 10:03 10 minutes, 3 seconds were growing to at 4 5% they should get to about 8 9% growth that is the first target that we have 10:11 10 minutes, 11 seconds understood understood uh and the new age and the new age brands that is the man company Brillair 10:18 10 minutes, 18 seconds you know they are anyway firing and we expect a higher growth coming in from there. 10:24 10 minutes, 24 seconds Yeah. Yeah. Uh and lastly on bookkeeping question Rajes the amotization figure of 23 odd crores every quarter how long 10:33 10 minutes, 33 seconds should that continue and what is the balance sheet figure as on date which is still left for amortization if you have that ready. 10:40 10 minutes, 40 seconds So, so that will continue for another 3 4 years and the rate would come down gradually to 80 crores 70 crores then 60 crores kind of 10:49 10 minutes, 49 seconds so gradually it will come down in next four years it will completely be done. 10:56 10 minutes, 56 seconds Okay fine I'll join back the queue if I have more questions. Thank you. Thank you. 11:00 11 minutes Thank you. The next question is from the line of Sesh Dishmuk from Capital. Please go ahead. 11:08 11 minutes, 8 seconds Hi sir. Thanks for taking my question. 11:10 11 minutes, 10 seconds Uh my first question is with regards to smart and handsome. Uh so we've made entry into new categories of sunscreen, deodorants, body wash, etc. Uh can you 11:20 11 minutes, 20 seconds highlight how the initial response has been to these MPDs? And also what is the strategy here? Is this a specific jo or 11:27 11 minutes, 27 seconds a channel specific launch? How do you see this scaling up pan India? 11:33 11 minutes, 33 seconds Yeah. So we have uh just done a test market uh that is uh on uh specific uh channels. It's only digital right now. 11:42 11 minutes, 42 seconds Basis the response coming in from there. 11:45 11 minutes, 45 seconds We will roll it out uh nationally. There are great learnings from the initial launch. So we are uh again trying to 11:53 11 minutes, 53 seconds revamp from there to roll it out nationally. Maybe in the second half of this year we will roll it out. 12:02 12 minutes, 2 seconds Uh okay sir got it. Uh so my second question is with regards to the demand trend uh can you highlight how uh the trends are shaping in rural as well as 12:10 12 minutes, 10 seconds urban uh now that 88% of the portfolio has seen a GST rate cut to 5%. Uh which are the categories uh which has seen a 12:19 12 minutes, 19 seconds pick up in demand for the rate cut which are the categories which are yet to see an uptick. 12:27 12 minutes, 27 seconds So uh the most of the brands particularly the winter you know has shown some signs of 12:35 12 minutes, 35 seconds growth and uh we are entering into the summer season. We will have to wait and see how the summer season because as you 12:44 12 minutes, 44 seconds know the winter uh is extended you know in most parts of the country. So yet we are yet to see the loading of the summer 12:52 12 minutes, 52 seconds season for now but hopefully in the next 15 20 days we will start loading our winter product uh summer products but uh 13:01 13 minutes, 1 second as far as the demand is concerned I don't see any challenge to get to 8 9% growth 13:08 13 minutes, 8 seconds because we are increasingly focusing on our uh small SKUs. Next year our big 13:14 13 minutes, 14 seconds focus is on the shampoo sachets uh plus some other small SKUs uh for 13:21 13 minutes, 21 seconds most of our brands even smart and handsome we are increasingly focusing on our small SKUs now because we see us we 13:30 13 minutes, 30 seconds see a good revival in the rural markets next year because see we have uh we have mostly we 13:39 13 minutes, 39 seconds have mostly addressed the needs of uh you know the modern trade and e-com and uh uh but now the fire has to come from 13:47 13 minutes, 47 seconds the rural areas and uh the next few quarters uh that is our focus. 13:59 13 minutes, 59 seconds Got it. Thank you. 14:02 14 minutes, 2 seconds Thank you. The next question is from the line of Harit Kapoor from Invest. Please go ahead. 14:12 14 minutes, 12 seconds Yeah. Hi. Am I audible? Yeah. Go ahead. 14:17 14 minutes, 17 seconds Yeah. So, so the first thing was uh could you just give a sense of uh uh damage increases uh that would have 14:26 14 minutes, 26 seconds happened on account in the in the lower end on the on the LUPS that you have uh because of these GST rate cuts. Is that 14:34 14 minutes, 34 seconds a sizable number uh that you would have put in? 14:40 14 minutes, 40 seconds So depending on the SKUs you know whatever uh uh whatever u uh because 14:47 14 minutes, 47 seconds there was it was not possible to reduce the prices in the small SKUs right so what was whether it was 12% 12% 14:56 14 minutes, 56 seconds accordingly we have increased the grammages different sorry sorry and what part of the portfolio would that how much what 15:05 15 minutes, 5 seconds percentage of the portfolio would that be where you've taken this 10% or deduction around 20%. 15:13 15 minutes, 13 seconds And and should that volume fully reflect into quarter four rather than quarter three where some changes would have would have still being made. Is that the right way to think about it? 15:24 15 minutes, 24 seconds Quarter three may I don't think the full impact has come in quarter three. You don't think it's coming quarter? 15:31 15 minutes, 31 seconds Yeah. Nata Natna is still not constructed in uh Yeah. Yeah. Perfect. Perfect. And the 15:39 15 minutes, 39 seconds second thing was on uh on uh uh you know hair oil. So uh you know King has done well for you. Obviously it's a portfolio 15:46 15 minutes, 46 seconds play now in terms of number of products there but you've seen seven and one also where which had an amazing few years and 15:54 15 minutes, 54 seconds then a slight weakness and now again growing very fast but it seems like value added across uh across uh uh companies is actually doing quite well. 16:04 16 minutes, 4 seconds uh just could you just you know your uh sense of what's driving this? Is it a low base? Is it uh uh you know something 16:12 16 minutes, 12 seconds else that's kind of driving up this value added market because even your even the uh the other players here are actually doing quite well. So your prognosis of what's happening here? 16:23 16 minutes, 23 seconds Yeah. So I'm handing it over to Manish. 16:25 16 minutes, 25 seconds He'll be able to answer. He's driving all the numbers. Sure. 16:31 16 minutes, 31 seconds So to answer your question uh see as you know from the previous calls we had mentioned about BCG working with us to 16:37 16 minutes, 37 seconds refresh and rejuvenate brand KK. So those results have started we relaunched it around August September it was there 16:45 16 minutes, 45 seconds was a bit of a disruption due to the GST and staff but October onwards the relaunch is in full flow so you are seeing the first impact in the OD 16:53 16 minutes, 53 seconds quarter already. Seven oils has a similar story as well and it's on a good growth path. So we hope the momentum to continue but there is a long way to go 17:02 17 minutes, 2 seconds because we did decline for the last few quarters sequentially. So I guess with every passing quarter we should start climbing back. 17:11 17 minutes, 11 seconds Now Manish you see this as a market phenomenon because uh everybody else around is also reporting fairly stellar numbers in uh in mid premium and above 17:20 17 minutes, 20 seconds hair oil portfolio. So I just wanted to like is you think it's a base thing also because you know uh uh not only you but 17:28 17 minutes, 28 seconds others also would have declined uh uh same periods last year. Is that a factor at play as well? 17:33 17 minutes, 33 seconds No see last you're right. See last year is a different story. I'm talking about three things. One is of course in the last couple of years let's say there was 17:42 17 minutes, 42 seconds uh softness in the numbers of both these brands. 17:44 17 minutes, 44 seconds So yes that has played a role. GST disruption had a role but the bigger story is what is the organic growth. The organic part is about relaunching it, 17:54 17 minutes, 54 seconds redeploying it, putting the new claims, new communication, addressing the consumer concerns which came out. That's the hope for the future. So far, it 18:02 18 minutes, 2 seconds looks good and uh I guess as we get into Q4 and then Q1, we'll be able to build further credentials on it. 18:12 18 minutes, 12 seconds Right. Right. And last thing to mind uh you know MoJi you you kind of spoke about uh uh rural uh obviously rural as 18:21 18 minutes, 21 seconds an important part of the overall strategy. So are are you saying that you know compared to maybe last year or the last few quarters the initial that the 18:29 18 minutes, 29 seconds sense that you're getting now is that uh rule is seeing an incremental kind of pickup. Is is that what kind of your teams on ground are hinting at? 18:39 18 minutes, 39 seconds Yeah. So, u absolutely and uh we have some we we have seen some good demands for our shashes in the rural markets and 18:48 18 minutes, 48 seconds all the focus for the company was also to build uh ecom, modern trade and the 18:55 18 minutes, 55 seconds new age brands uh but because of these GST cuts uh uh at least internally we have said that the next growth driver 19:03 19 minutes, 3 seconds should come from rural and our focus would be increasingly going into rural markets. We will of course keep our eye on the modern trade, e-commerce, quick 19:10 19 minutes, 10 seconds commerce that is always there but uh uh rural also can fire I think going forward 19:18 19 minutes, 18 seconds and now uh as I said summer we have to build now the summer portfolio uh and it's uh rural is a big uh play in as far 19:26 19 minutes, 26 seconds as the summer is concerned both for talc and narrat correct correct indeed I'll I'll come 19:34 19 minutes, 34 seconds back more if I thank Thank you. The next question is from the line of Amnesh Agarwal from PL Capital. 19:43 19 minutes, 43 seconds Please go ahead. 19:45 19 minutes, 45 seconds Yeah. Hi Moji. [clears throat] Couple of questions. First being that given the fact that the GST transition got completed in the month of November 19:53 19 minutes, 53 seconds only. So is there a probability that next quarter again we will have strong momentum with likelihood of say close to double digit kind of a topline growth? 20:05 20 minutes, 5 seconds That is uh that is what we expect that uh hopefully we should get to double digit growth. Uh the only caveat is uh 20:13 20 minutes, 13 seconds winter is uh extended and uh we have to get to the summer. Navaratna and Navatna 20:19 20 minutes, 19 seconds Talc Dermicool are big summer brands and we have to load uh these three products uh now in the month of February and March. 20:29 20 minutes, 29 seconds uh yeah and last year basis were very very high as far as the summer brands are concerned but uh see these are just numbers if it 20:37 20 minutes, 37 seconds doesn't come in this quarter it will come in next quarter because we anyway for the summer brands we are at a lower base uh but uh the momentum is what we 20:46 20 minutes, 46 seconds will have to capture I as I said uh that uh the momentum looks good as far as the rud is concerned uh and uh our dealers 20:55 20 minutes, 55 seconds are holding very less stocks so I don't see any reason that we can't build on uh uh the summer portfolio as soon as the season starts. 21:04 21 minutes, 4 seconds Okay. So my next question is on the tax rate because as I think is being indicated that the matt credit changes 21:12 21 minutes, 12 seconds have happened and now we will be having I think 70 80 70 60 and 40 as matt 21:19 21 minutes, 19 seconds credits. So the effective tax rate which which currently is around say uh adjusting for everything around 10 10 21:26 21 minutes, 26 seconds and a half. So what should we pencil in as tax rate for the coming two three years? 21:33 21 minutes, 33 seconds So Amnish before this uh budget announcement union budget announcement our tax rate was expected to go to the normal tax rate of 35% from next year 21:42 21 minutes, 42 seconds but uh with this recent announcements now it is going to be 25% tax rate. So in fact it has come down with the recent report amendments in the union budget. 21:52 21 minutes, 52 seconds So going ahead we we we should be at uh 25% tax rate and also utilize 25% of our 21:59 21 minutes, 59 seconds tax liability from M credit which will continue for 5 6 years minimum. 22:05 22 minutes, 5 seconds Okay. So it means that we should look at 25 and a half% kind of a tax rate and then the math credit number which you have indicated. So that will get 22:14 22 minutes, 14 seconds directed from is that so yeah right so that would be for a standard entity and we have some subsidiaries which are still in uh 22:22 22 minutes, 22 seconds investment stage we have international subsidies so overall uh tax rate uh for the consort entity would should be below below that level around 20% kind of 22:31 22 minutes, 31 seconds okay okay thanks a lot thank you thank you the next question is from the 22:39 22 minutes, 39 seconds line of navini from motil oal financial services limited. Please go ahead. Yeah. Yeah. Hi. Good afternoon everyone. 22:48 22 minutes, 48 seconds Uh sir uh is it possible to share uh our brandwide performance for the 9 months uh since we have seen uh uh quarter two 22:56 22 minutes, 56 seconds impacted by GST and then this quarter we have seen the stocking benefit also. So it will be fair to say 9 months uh if 23:04 23 minutes, 4 seconds you can share at least the top brands if we share the VA growth rates. 23:09 23 minutes, 9 seconds I mean uh you can get in touch with uh either Percy or Rajes uh to get those details please. 23:18 23 minutes, 18 seconds Sure sir. Sure. And uh those are those are in our uh those are in our investor uh presentation 9 months. Okay. 23:26 23 minutes, 26 seconds You can get it from uh Percy or Rajes. 23:29 23 minutes, 29 seconds Sure sir. And post this quarter uh three uh how should we look at our trade inventories? Are we have we because 23:38 23 minutes, 38 seconds October would have been kind of unfavorable from GST point of view. Uh so can we expect that after like 23:45 23 minutes, 45 seconds completion of quarter 3 now trade inventories are or are in similar line? 23:54 23 minutes, 54 seconds Sorry I'm not clear nin what is your ask? My ask was that uh uh since we have seen GST restocking restocking in the 24:02 24 minutes, 2 seconds last 3 four months have we reached to a level where our trade inventories are now normal and that's what I'm 24:10 24 minutes, 10 seconds absolutely I think uh we have great uh uh uh we have uh no excess inventories as far as the trade is concerned. 24:18 24 minutes, 18 seconds Sure. Sure. 24:20 24 minutes, 20 seconds We have migrated very well. I think we have migrated very well. 24:25 24 minutes, 25 seconds Fair point. So uh because 9 months we were we were kind of flat on revenue side. I just thought maybe the any specific brand where kind of 24:33 24 minutes, 33 seconds that was primarily that was primarily because of the summer uh you know this year summer was extremely poor and it 24:41 24 minutes, 41 seconds was primarily because of summer we lost almost five six% of our growth. 24:47 24 minutes, 47 seconds Sure. Sure. And that's what I was looking out for on a brand performance but I will take it from Rajiv. No issue sir. Thank you so much sir. 24:54 24 minutes, 54 seconds Thank you. Thank you. The next question is from the line of Aish Roy from Noama. Please go ahead. 25:03 25 minutes, 3 seconds Yeah, thanks and congrats on good numbers. Uh my first question is on the profitability of each uh distribution 25:09 25 minutes, 9 seconds channel. uh yesterday one large FMCG company said that uh the new age channels modern trade e-commerce commerce uh those are more profitable 25:18 25 minutes, 18 seconds than uh general trade uh because the distribution layers intermediaries are not there in the newest channels plus I think more premium packs large packs 25:27 25 minutes, 27 seconds they also sell more on those channels could in your categories also this be largely true or there is some kind of abrasion here 25:36 25 minutes, 36 seconds no uh I have maintained always that in our case it is the reverse. In our case the GT is more compared to the modern 25:46 25 minutes, 46 seconds trade. The lowest is the uh e-commerce and what is the reason for that? Why 25:54 25 minutes, 54 seconds it's different? Uh because intermediaries you'll be saving cost uh but yeah the promotions are higher on is that the yeah absolutely only because of the promotions that we offer there. 26:06 26 minutes, 6 seconds Okay understood. And in terms of uh uh the last point which you mentioned in the answer to previous question uh FY26 26:15 26 minutes, 15 seconds summer categories have seen the brand so beer players uh soft drinks and carbonated drinks and lower categories. 26:23 26 minutes, 23 seconds So here specific question is generally when we see such uh uh aberration next year generally is favorable because uh 26:30 26 minutes, 30 seconds last year Lina effect was there but specific question is how does trade behave? Do they stock up inventory because last year they must have burnt 26:38 26 minutes, 38 seconds some fingers there. So is is that a push back and what is your expectation of whatever you could gather from the weather uh forecast? Is it going to be a 26:47 26 minutes, 47 seconds bumper uh summer uh season for you this time? Yeah, let Mis answer this. 26:54 26 minutes, 54 seconds I think it's a pretty valid question. So what happens is in this case obviously the sentiment changes because of the recent history. last to last year in 27:03 27 minutes, 3 seconds FY25 the summer was really really bumper the pipelines go dry so you have a very great start next summer which we had last year so this year the situation 27:11 27 minutes, 11 seconds reverses a bit but thankfully because of GST and other things it's not such a un uncsurmountable challenge having said 27:18 27 minutes, 18 seconds that what happens is in the beginning the trade becomes a little cautious and we are cognizant of that our pipelines are nice we are playing accordingly over 27:27 27 minutes, 27 seconds the next 2 three weeks I think once as the weather starts opening up things will start flowing 27:35 27 minutes, 35 seconds and you expect a bumper season this time summer category you expect a bumper summer season this time based on whatever scientific data 27:42 27 minutes, 42 seconds is available I my job is to expect a bumper summer every year [laughter] I would I would pray for that but you 27:50 27 minutes, 50 seconds know like you know summer and winter is something we've seen recently in the last four or five years the whole country is erratic I mean you know I mean both summer and winter can shock 27:59 27 minutes, 59 seconds you Right. Uh you are right. We are sitting on a small base and uh so I think uh you know uh 28:08 28 minutes, 8 seconds looking at a 3A caggr we are taking aggressive numbers you know why not at least in the beginning of the season the fourth quarter you know for summer we 28:16 28 minutes, 16 seconds have a high base as Manish explained because last year it was very good so every dealer stocked the product in the 28:23 28 minutes, 23 seconds fourth quarter but this year we have slightly challenge is that our winter is extended and you know they are being a 28:30 28 minutes, 30 seconds little cautious but uh You know this is this is every year we see this you know uh it doesn't matter to us but uh 28:38 28 minutes, 38 seconds hopefully this year should be much better than the last year there is no doubt in it. 28:43 28 minutes, 43 seconds Understood. Uh last quick question on the macro. So one is on GST benefit to FMCG uh based on the results that uh at 28:51 28 minutes, 51 seconds least it seems food companies, noodles and biscuit companies seem to be the big winner based on Q3 numbers whatever has come out. uh and hair oil companies also 29:00 29 minutes seem to be reasonable beneficiary. Uh if you could comment on your take on GST benefit on FMCG in general and for your 29:08 29 minutes, 8 seconds categories. Uh that is my first question and second on rural consumption the uh 29:14 29 minutes, 14 seconds GRM G scheme NRGS scheme uh the outlay seems to have reduced uh sharply at least headline number would you be 29:21 29 minutes, 21 seconds worried given it's a ondemand uh kind of a scheme plus this time the uh central and state government both have a uh role 29:29 29 minutes, 29 seconds there so what would be your take on uh NRGS capital support for this year thanks 29:37 29 minutes, 37 seconds honestly you know our penetration is not that deep that these uh schemes matter so much you know what really matters is 29:44 29 minutes, 44 seconds always the seasonality what we have seen in the past so I don't see any impact of those schemes uh going down or up our 29:53 29 minutes, 53 seconds products are available at 1 rupee 2 rupee 5 rupee 10 rupee pack that doesn't have much major impact taken up uh what 30:01 30 minutes, 1 second uh what we will have is that overall uh as I said our focus in the last few 30:07 30 minutes, 7 seconds quarters was uh very much on uh empty ecom and quickcom that is still there 30:14 30 minutes, 14 seconds but we have deployed uh good amount of people in the rural for our shashes if the season uh is with us then uh I don't 30:24 30 minutes, 24 seconds see any reason why should we not get to close to 8 to 10% growth and GST benefit where are you seeing 30:32 30 minutes, 32 seconds maximum in your categories and overall All our products have now come to 5%. 30:41 30 minutes, 41 seconds You know other than just the smart and handsome portfolio. So you know uh we are seeing 30:48 30 minutes, 48 seconds benefit across. It depends on the product. Again it is very difficult for me to say you know sometimes what fires sometimes what doesn't fire. It is it is very difficult to pinpoint. 31:02 31 minutes, 2 seconds Thanks. That's all from my side. Thank you. 31:04 31 minutes, 4 seconds Thank you. The next question is from the line of Raman Ki from Sequent Investments. Please go ahead. 31:13 31 minutes, 13 seconds Uh hello sir, congratulations on good set of numbers. I just have one question on the dollar aspect. If you can quantify the growth figures which you 31:22 31 minutes, 22 seconds saw during this quarter and also uh if you can give a ballpark contribution towards uh from ruler 31:30 31 minutes, 30 seconds uh business towards your entire uh consolidated revenue that will be helpful. 31:43 31 minutes, 43 seconds Could you be a little more specific around it so that I can uh I just want to understand uh uh I just 31:50 31 minutes, 50 seconds want to understand like in terms of quantification can you just quantify the roller growth that you witnessed during this quarter. 32:00 32 minutes Oh, so we'll have to wait a little bit because the NISON results will come out only in a while. See what we do is right now we have the primary input numbers. 32:07 32 minutes, 7 seconds The rural offtake numbers will take a bit of a while but usually I mean this would be obviously a better quarter than the previous one. 32:15 32 minutes, 15 seconds Uh if you can can you provide was it was it a low single digit or a high single digit or mid double digit like that kind 32:22 32 minutes, 22 seconds of no so it's it's a it's a double- digit 32:31 32 minutes, 31 seconds number of course right I mean considering that the overall numbers are in that space and the middle the rural part will be better than the the upper 32:39 32 minutes, 39 seconds India let's say or the top India understood sir and sir from the entire portfolio. Our portfolio what percentage 32:48 32 minutes, 48 seconds is uh contributed by ruler demand about uh it's about 48 52 split in favor of rural from an offtake perspective. 33:01 33 minutes, 1 second Okay, understood sir. Thank you. 33:03 33 minutes, 3 seconds Y thank you. The next question is from the line of Nitan Gupta from MK Global. 33:12 33 minutes, 12 seconds Please go ahead. 33:14 33 minutes, 14 seconds Yeah, thanks a lot for taking my question. Uh my first question pertains to digital brand. So last year we wrote in uh Mr. Vis master. So just wanted to 33:23 33 minutes, 23 seconds check on the areas he has worked on and how are we placed now with the digital brands growth. 33:32 33 minutes, 32 seconds Yeah. So Girj if you can answer. 33:36 33 minutes, 36 seconds Yeah. Uh so as we've been uh speaking over the last couple of quarters I think quarter quarter uh sequentially we have 33:44 33 minutes, 44 seconds been seeing growth strengthening uh if you look at this quarter as reported in the results we have had a very strong 33:51 33 minutes, 51 seconds robust 31% uh growth uh as far as our two years are concerned uh and we see 34:00 34 minutes this growth remaining rob your voice is sorry I'm sorry to interfere your voice is not clear to me or to everyone? I'm 34:08 34 minutes, 8 seconds not very sure. You're not very clear to me. Am I clear now Moji? Slightly better. Slightly better. 34:16 34 minutes, 16 seconds Okay. No, as I was uh just to repeat my answer, uh what I was saying is that quarteron quarter we've seen growth 34:24 34 minutes, 24 seconds strengthen in the digital brands and this quarter we've seen a very robust 31% growth over last year. uh and this 34:31 34 minutes, 31 seconds growth in the coming quarters we expect to sustain this robust growth. 34:40 34 minutes, 40 seconds Have I answered your question? 34:42 34 minutes, 42 seconds Yeah. Yeah. So can you I I was basically looking to in terms of action we have taken in the portfolio. Do you like to highlight any specific action which sort 34:50 34 minutes, 50 seconds of have helped us sort of revive the growth in the digital brand portfolio? 34:56 34 minutes, 56 seconds Yeah. uh given the very nature of the brand which are digital in nature uh we are seeing very strong growth coming through quick commerce and through our 35:04 35 minutes, 4 seconds D2C websites uh in a broad basis and some marketplaces on a selective basis we also seeing uh significant growth 35:14 35 minutes, 14 seconds coming from some of our new innovations which is the rosemary oil shorts some perfumes that we are seeing strong growth under the man company and we have 35:22 35 minutes, 22 seconds done a lot of renovation work as far as our grouping category is concerned which is just about hit the market towards you know end of December and you 35:31 35 minutes, 31 seconds will see some more additional benefits acrewing in the coming quarters. 35:37 35 minutes, 37 seconds Okay. Thank you. Uh my second and last question pertains to this ayic portfolio. Uh what is the ayic export 35:45 35 minutes, 45 seconds share in our healthcare business? So government has announced to take some steps around uh improving the outlook for the ayic offering. So do you see 35:54 35 minutes, 54 seconds this as a potential driver of business for us? Yeah. 36:01 36 minutes, 1 second Uh thank you for the question. Uh as of now the ayurveetic portfolio for exports 36:09 36 minutes, 9 seconds is very very low predominantly because of registration issues in most of the countries where we could probably see potential. 36:18 36 minutes, 18 seconds uh I know the government through the business or the the Excel you know uh 36:26 36 minutes, 26 seconds organization is working towards getting registration sorted out but it's still a long process so it will take some time for ayuric 36:35 36 minutes, 35 seconds medicines to be scaled up it will take a few years in my view there may be short-term opportunities or medium-term opportunities coming in from certain 36:44 36 minutes, 44 seconds countries through the supplements route where certain products are allowed to be registered as health supplements but then that market again needs to be 36:52 36 minutes, 52 seconds developed and invested upon uh for the local you know people where there are Indians there is an opportunity for 37:00 37 minutes products like Javantrash etc and there is an market for products like ashwagandha in the US but beyond that it's it needs a lot of investments to 37:08 37 minutes, 8 seconds grow that market so it's not a short-term or a medium-term game it's a long-term game to be played 37:16 37 minutes, 16 seconds sure so this is really helpful Uh thanks a lot and all the very best. Thank you. Thank you. 37:23 37 minutes, 23 seconds The next question is from the line of Ajay Takur from Anandraati Securities. Please go ahead. 37:30 37 minutes, 30 seconds Hello. Hello. Yeah. Yeah. Yeah. AJ. 37:35 37 minutes, 35 seconds Yeah. Yeah. Thanks for taking my question. So, uh I had two questions. 37:38 37 minutes, 38 seconds One was uh more on the growth in the male grooming segment. Uh it's at around 4%. it looks slightly subdued despite 37:46 37 minutes, 46 seconds the fact that we have revamped this like uh last maybe you know last year itself. 37:51 37 minutes, 51 seconds So I just wanted to get a sense on um you know what is kind of you know the issues or what are the uh you know uh 37:59 37 minutes, 59 seconds the major you know factors which is kind of impacting the growth over here. 38:06 38 minutes, 6 seconds So um you are right the male grooming particularly the smart and handsome range has not been going for some time uh despite of the best effort now we are 38:15 38 minutes, 15 seconds significantly at a lower base the total contribution is hardly now at around 4 5% of our total business so uh it needs 38:26 38 minutes, 26 seconds a different strategy you know uh to get to double digit growth I don't have an answer right now 38:34 38 minutes, 34 seconds Okay, understood. Uh sir, second question was on the Bangladesh market. 38:38 38 minutes, 38 seconds Um um know how has the performance been in that market? Given the turmoil we have seen, has that had any implication 38:46 38 minutes, 46 seconds on our sales or any uh impact on our business over there? Yeah, the CEO of international is here. 38:53 38 minutes, 53 seconds Vive. Yeah. Hello. 38:57 38 minutes, 57 seconds uh Bangladesh per se in market sales we have resisted a good double digit growth but somehow we were correcting certain 39:05 39 minutes, 5 seconds pipelines but in the primary sales you'll reflect a very low single digit growth but the market performance has been pretty impressive and we had seen a 39:13 39 minutes, 13 seconds very good revival in Bangladesh in last quarter and some something similar is continuing in uh this quarter as well 39:23 39 minutes, 23 seconds okay but we are going to witness the elections on on around 12th of February uh this year and uh then Bangladesh is 39:31 39 minutes, 31 seconds getting into long holidays in March due to Ramadan and Eugations. So let us see let's hope for the best but otherwise 39:40 39 minutes, 40 seconds our demand is uh showing very robust growth in the marketplace. 39:45 39 minutes, 45 seconds Understood. Uh secondly if I were to look at it in terms of the international business uh the overall growth at 9% and 39:53 39 minutes, 53 seconds versus you know the headline growth in most of the markets like be it s be mena have shown a very decent growth. So what 40:01 40 minutes, 1 second is the uh a segment or what is a market which is kind of pulling it down. 40:08 40 minutes, 8 seconds So we had faced certain pressures in what we call asina markets like Iraq and some lukewarm response in certain North 40:17 40 minutes, 17 seconds African markets. So that is where we have been little lukewarm but most of the other markets and our business spans 40:26 40 minutes, 26 seconds in Southeast Asia, SAK, Russia, CIS, parts of Africa have all shown very good double digit growth. certain markets 40:35 40 minutes, 35 seconds have not been able to perform and in fact Iraq has declined. So that is the reason to have a overall growth of around 9% only. 40:44 40 minutes, 44 seconds Understood. Understood. Okay. Quite helpful. Thank you. Thanks. Thank you. 40:50 40 minutes, 50 seconds Thank you. The next question is from the line of Rashant, an individual investor. Please go ahead. 40:57 40 minutes, 57 seconds Hello. Thanks for the opportunity. Am I audible? 41:01 41 minutes, 1 second Yeah. Yeah. So my first question is how many retail touch points did we have as of 31st December? What is our target for 41:10 41 minutes, 10 seconds 31st March and FI27 exit? 41:15 41 minutes, 15 seconds This is Manishar. So I'll speak for the India numbers. We roughly reach about 450,000 plus stores directly via our sales force. Indirectly we are present 41:23 41 minutes, 23 seconds in over 5 million stores. Navaratan being the deepest penetrated uh brand for us and other brands could be in the 41:31 41 minutes, 31 seconds range of anything from 5 lakh to 30 lakh depending on the brand. As far as u March is concerned, I mean we have no 41:39 41 minutes, 39 seconds special uh right now any initiatives to expand this coverage. I mean uh if you've been following our uh uh calls over the last 41:48 41 minutes, 48 seconds few quarters, we want to consolidate and grow more lines in the stores, grow more assortment, grow more depth and develop 41:56 41 minutes, 56 seconds the M stores and other stuff. So the idea is to focus and chew well what what we have. Okay. The reason is I mean uh 42:05 42 minutes, 5 seconds in uh one of the earlier questions I I heard that I mean quite a few of our products in the you know the smaller 42:13 42 minutes, 13 seconds price range I mean like 1 to 5 rupee pouches. So uh uh align to the numbers 42:19 42 minutes, 19 seconds you gave out I mean are we seeing uh attraction for these uh smaller pro I mean smaller size products in uh the 42:27 42 minutes, 27 seconds e-commerce also or those are largely flowing through the traditional uh route. 42:33 42 minutes, 33 seconds Yeah it's mostly traditional I mean most of the lups and the small packs below 100 bucks are not uh ecom and empty friendly for viability reasons. In fact, 42:42 42 minutes, 42 seconds they actually seek products above 150 to 100 usually especially in the personal care side. 42:48 42 minutes, 48 seconds So in light of that also I mean you would like to keep the retail footprint at the this level and consolidate. Uh 42:56 42 minutes, 56 seconds no see this is a very good reach. This is a damn good reach for a company of our size and stuff and the brand pulls 43:04 43 minutes, 4 seconds in and we like for most FMCG companies anything from 50 to 60% sale comes in through the wholesale channels which 43:11 43 minutes, 11 seconds India is very well developed on and through the multi-layer wholesale the brand reaches more than 5 million stores. So we there's no der of pull on our brand equity. 43:21 43 minutes, 21 seconds See I mean our network is present in over 8,000 towns. So in terms of ability to reach hinterland of India, we have no problems. 43:31 43 minutes, 31 seconds Okay, fair enough. My second question was uh in terms of you know hair oil, I mean some of your competitors have uh 43:40 43 minutes, 40 seconds like one north chan famous company another almond oil company they have moved into coconut oil. Your any plans 43:48 43 minutes, 48 seconds from your side to move into that category? 43:54 43 minutes, 54 seconds uh Prashan right now we don't have plans yeah any particular reason or that's not 44:00 44 minutes a a viable cause it's not viable or if anything specific you can that I can't be very specific but uh 44:09 44 minutes, 9 seconds right now we don't have plans okay fair enough that's all from my sir wish you all the best thank you 44:16 44 minutes, 16 seconds thank you the next question is from the line of Samir Gupta from Capital please go ahead 44:24 44 minutes, 24 seconds Hi, good evening sir and congratulations on a good set of numbers and thanks for taking my question. Uh sir firstly just wanted to understand u how do we read 44:34 44 minutes, 34 seconds this uh performance. So 2Q was impacted by channel Dto stocking and this quarter we would have restocked the channel and 44:41 44 minutes, 41 seconds that benefit is there. Now if I look at 2Q plus 3Q which basically offsets for this destocking and restocking uh it is 44:50 44 minutes, 50 seconds a flat performance. 1Q I understand was impacted by a poor summer but 2Q plus 3Q adjusted for this phenomena is also 44:57 44 minutes, 57 seconds flat. Uh so are secondaries and tertiaries growing in line with primaries uh how how do we read this performance? 45:07 45 minutes, 7 seconds Hi again Vanish here I'll speak for the domestic India business. So you're right I mean uh from a secondary perspective 45:14 45 minutes, 14 seconds uh excluding talc we are in mid single higher digit side. talc is what were the 45:20 45 minutes, 20 seconds issue was in Q1 and Q2 but otherwise from a tertiary secondary perspective the pipeline is very nice we very clean 45:28 45 minutes, 28 seconds no issues on that front so mid to high single digit for the 9 months excluding talc that's what you're 45:35 45 minutes, 35 seconds saying correct not this quarter this quarter would have been no this no this quarter the talc wasn't 45:43 45 minutes, 43 seconds there so this is this quarter is like practically talc is almost nil so the entire thing is Huh? But this this 45:51 45 minutes, 51 seconds quarter you would have seen an upstocking benefit in primary. So what would be the secondary growth for this quarter? 45:56 45 minutes, 56 seconds No no no there is no upstocking uh in this quarter. There's no upstalking. 46:00 46 minutes That's what I said. See the secondaries for us in a 9 month period or ahead of primaries. There is no uptocking in the 9month period or in this quarter. 46:10 46 minutes, 10 seconds But Manish if TQ had got impacted because of detocking because of GST cuts and channel was basically not buying 46:19 46 minutes, 19 seconds waiting for the new GST GST rates to be applicable. It is natural for you know them to stock to a normal level of inventory in the third quarter. 46:29 46 minutes, 29 seconds No no no but channel didn't we also couldn't sell. No we also suffered losses as you've seen in the quarter 2 results. 46:38 46 minutes, 38 seconds Okay, maybe I'll take this offline. No worries. Uh, second question is on winter. So, there has been a mixed 46:45 46 minutes, 45 seconds feedback across, you know, companies on on how the winters have been. So, some companies have called out a harsher 46:52 46 minutes, 52 seconds winter this time. Uh, some companies have called it harsher but the onset was very delayed. uh uh in in northern and 47:01 47 minutes, 1 second western part you know there was virtually no winter till the second week of December. So what has been your feedback just just trying to understand 47:10 47 minutes, 10 seconds that it's very simple in hindsight it's very simple the winter summer cycles are getting erratic for us for this year 47:18 47 minutes, 18 seconds October November were damn good the winter set in very early November was superb December first half got warm December second half was again very good 47:27 47 minutes, 27 seconds January 1st half especially in the Hindi heartland got warm January second fortnite was very good right now it's on the colder side so it's like Yeah. 47:37 47 minutes, 37 seconds Okay. And and and the disparities geography wise north, south, east, west would be similar or there are varied uh you know varied differences there also. 47:47 47 minutes, 47 seconds Most of it is dominated by the north of course but overall from a number perspective I think we had a pretty good uh winter brand outcomes and that's what matters. 47:57 47 minutes, 57 seconds Got it. Got it. That's helpful. So thanks. Thanks a lot. The last one if I may squeeze in. So blended price for Imam to also answer on Manisha's 48:07 48 minutes, 7 seconds question. You are right. So you know the winter was very harsh you know but in winter some portfolios have done 48:14 48 minutes, 14 seconds exceedingly well like uh Boroplus lotion you know has done exceedingly well compared to the Boro plus antiseptic 48:21 48 minutes, 21 seconds cream. Okay. So it is uh again it is not like just because the winter was very harsh so all the brands of winters fired. 48:30 48 minutes, 30 seconds So there is also a difference in the portfolio's growth. Okay, got it Moji. That that's very helpful. 48:39 48 minutes, 39 seconds Last question if I may squeeze in. Uh what would be the blended price decrease for Imami at a portfolio level for the 48:46 48 minutes, 46 seconds consumer? So there is a GST cut for 80 90% of your portfolio different buckets of uh uh GST cuts uh for different 48:53 48 minutes, 53 seconds products. But at a consumer at a portfolio level, what would be the price decrease effective uh uh post the GST cut from 23rd September? 49:03 49 minutes, 3 seconds Yeah, around roughly about 8%. 49:09 49 minutes, 9 seconds Uh that's all for me sir. Thanks a lot and all the best. Thank you sir. Thank you. 49:14 49 minutes, 14 seconds Thank you ladies and gentlemen. That was the last question for today. I now hand the conference over to the management for closing comments. 49:23 49 minutes, 23 seconds Thank you Samir. Thank you and thank you all the participants for joining us today for our Q3 results conference call. Thank you. Have a good day. 49:31 49 minutes, 31 seconds Thank you. Thank you all. Bye-bye. 49:34 49 minutes, 34 seconds Thank you. On behalf of Capital Services Limited, that concludes this conference. 49:39 49 minutes, 39 seconds Thank you for joining us and you may now disconnect your lines. Thank you.