Godrej Agrovet Limited — Q3 FY26

Godrej Agrovet Ltd Q3 FY2025-26 Earnings Conference Call https://www.youtube.com/watch?v=4ABShi5sJd8 Published: 3 months ago

0:00 Ladies and gentlemen, good day and welcome to Godri Aggrobate Limited Q3 0:06 6 seconds FI26 earnings conference call hosted by Equirious Securities Private Limited. As 0:14 14 seconds a reminder, all participant lines will win the listen only more and there will be an opportunity for you to ask questions after the presentation 0:22 22 seconds concludes. Should you need assistance during this conference call, please signal an operator by pressing star then 0:30 30 seconds zero on your touchdown phone. Please note that this conference is being recorded. I now hand the conference over 0:38 38 seconds to Mr. Shivanch from Equid Securities Private Limited. Thank you and over to you sir. 0:46 46 seconds Thank you. Good afternoon everyone and thank you for joining us on the Godidge Agroate Q3 FI26 earnings conference call 0:54 54 seconds from the company with we have with us Mr. Nadiv chairman of the company Mr. 0:59 59 seconds Sunil Petara chief executive officer and managing director Mr. S wraj chief financial officer Mr. Burgess Vodhridge 1:07 1 minute, 7 seconds managing director Ast Life sciences and Mr. Dr. Arjit Mukharji, Chief Operating Officer, Aspect Licenses. We would like 1:15 1 minute, 15 seconds to begin the call with brief opening remarks from the management following which we will have the forum open for an interactive question and answer session. 1:23 1 minute, 23 seconds Before we start, I would like to point out that some statements made in today's call may be forwardl looking and the disclaimer to this effect has been 1:31 1 minute, 31 seconds included in the earning presentation shared with you earlier. I would now like to invite Mr. Nudhridge to make the initial remarks. Over to you, sir. 1:41 1 minute, 41 seconds Good afternoon everyone. I welcome you all to the Godidge Agroette earnings call. Now I will comment on the business update for quarter 3 fiscal year 26. 1:51 1 minute, 51 seconds Google Cadet web delivered a strong performance in quarter 3 fiscal year 26 with consolidated revenues growing by 2:00 2 minutes 11% yearonear and profitability accelerating sharply reflected in a 23% 2:08 2 minutes, 8 seconds year-on-year increase in profit before tax before exceptional items. This was 2:15 2 minutes, 15 seconds driven by disciplined margin expansion, operational efficiencies and strong contributions from the vegetable oil, 2:23 2 minutes, 23 seconds animal feed, poultry and processed foods businesses alongside a sharp turnaround in Aztec. For the 9 months ended 31st 2:33 2 minutes, 33 seconds December 2025, the company reported consolidated revenues of 7,900 2:40 2 minutes, 40 seconds cr rupees, an increase of 9% yearon-year profit before tax excluding non-recurring and exceptional items for 2:50 2 minutes, 50 seconds the period was 482 cr rupees marking a healthy 17% 2:57 2 minutes, 57 seconds yearon-year growth. Coming to the key financial and business highlights of each of our business segments, the 3:04 3 minutes, 4 seconds animal feed segment de delivered another quarter of strong volume growth with volumes up 12% yearonear in quarter 3. 3:14 3 minutes, 14 seconds Notably, cattle feed volumes grew by 21% contributing meaningfully to the overall 3:21 3 minutes, 21 seconds expansion. The underlying segment result grew 17% yearonear and underlying edit 3:29 3 minutes, 29 seconds per metric t improved to 2,20 rupees per metric t in quarter 3 fiscal 3:38 3 minutes, 38 seconds year 26 from rupees 1,937 per metric ton in quarter 3 fiscal year 3:47 3 minutes, 47 seconds 25. Our vegetable oil business continued to deliver stellar performance with segment revenue growing 27% 3:55 3 minutes, 55 seconds yearonear and 25% growth in segment results driven by improved fresh fruit 4:02 4 minutes, 2 seconds punch arrivals and and a better oil extraction ratio. 4:08 4 minutes, 8 seconds The crop protection business delivered a 37% year-on-year revenue growth driven by higher salience of generics and 4:17 4 minutes, 17 seconds select specialty products. Segment results were flat reflecting the impact of lower volumes in both in licensing 4:26 4 minutes, 26 seconds and in-house portfolios due to unseasonal rains and cyclones across key 4:32 4 minutes, 32 seconds markets. Aztec Life Sciences registered a strong recovery with revenues growing 4:39 4 minutes, 39 seconds 33% yearonear driven by robust volume growth across both the enterprise and 4:46 4 minutes, 46 seconds CDMMO segments. The EDITA for the quarter turned positive at 5 crore rupees. A 4:55 4 minutes, 55 seconds sharp improvement compared to a loss in the same period last year supported by higher volumes and improved gross margins in the enterprise category. 5:06 5 minutes, 6 seconds Streamline Jerry recorded a 3% year-on-year revenue growth supported by stable volumes across key product 5:14 5 minutes, 14 seconds categories. Profitability however remained under pressure with EDITA declining to 11 cr rupees and margins 5:23 5 minutes, 23 seconds softening to 3% primarily due to higher milk procurement costs and a shortfall in revenue growth. 5:33 5 minutes, 33 seconds Good foods delivered stable revenues of 215 cr rupees. 5:42 5 minutes, 42 seconds Pr profitability strengthened significantly with edita growing 51% 5:48 5 minutes, 48 seconds yearonear to 17 cr rupees and margins expanding to 8%. Supported 5:56 5 minutes, 56 seconds by improved contribution margins in the branded portfolio and better live bird prices, the business continued to 6:04 6 minutes, 4 seconds advance its strategic shift toward value added offerings with branded salience rising to 81% 6:14 6 minutes, 14 seconds in quarter 3 from 77% last year. Thank you. 6:21 6 minutes, 21 seconds So, can we start with the Q&A? Yes. 6:24 6 minutes, 24 seconds Yes, please. Okay sir, thank you very much. We will now begin the question and answer session. Anyone who wishes to ask 6:32 6 minutes, 32 seconds a question may press star and one on their touch telephone. If you wish to remove yourself from the question queue, 6:39 6 minutes, 39 seconds you may press star and two. Participants are requested to use handsets while asking a question. Ladies and gentlemen, 6:48 6 minutes, 48 seconds we will wait for a moment while the question cue assembles. The first question is from the line of Prabul Singh from ICS securities. Please go ahead. 6:59 6 minutes, 59 seconds Uh thank you for the opportunity sir. I hope I'm audible. Yes. Yes. You're audible. 7:06 7 minutes, 6 seconds Very good afternoon. Uh congratulations first of all on a good set of numbers. A couple of questions. One the uh 7:13 7 minutes, 13 seconds realization on the vegetable oil fund specifically on the palm oil uh subsegment seems to have strengthened fairly sharply. Just wanted your views 7:22 7 minutes, 22 seconds on what the main reasons are and what kind of outlook do you see in terms of rising for this segment. 7:32 7 minutes, 32 seconds Right overall I think uh hi this is Sunilary here. 7:39 7 minutes, 39 seconds Okay. So you know uh I think there are a couple of uh operational factors and I would also like to talk about a bit of the pricing part. So first let me talk 7:47 7 minutes, 47 seconds about the pricing part. Actually if I were to see on Q3 over Q3 last year year in year actually pricing overall in fact 7:54 7 minutes, 54 seconds actually is a negative one right because while the palm kernel prices were higher than last year actually the CPO prices 8:02 8 minutes, 2 seconds were lower than last year so they kind of offset and actually the price led uh impact on growth is actually one. So 8:11 8 minutes, 11 seconds what this is led by primarily is a strong volume growth and the numbers behind the volume growth obviously are led by three four important operational 8:19 8 minutes, 19 seconds parameters. One is we have been seeing a very healthy growth in our you know uh fresh fruit bunches metric tons. So 8:27 8 minutes, 27 seconds which has happened and that is in the range of 16%. And then uh we have seen a steady work by the team on improving of 8:35 8 minutes, 35 seconds our OE you know which is the efficiency from oil extractions and that also has reached a all-time high number in this 8:42 8 minutes, 42 seconds quarter. So I think uh a very focused approach towards building I think operational efficiencies across is one 8:50 8 minutes, 50 seconds of the critical parameters which has gone through this. 8:54 8 minutes, 54 seconds Just to as a follow up the oil extraction ratio that you mentioned if I'm not mistaken last quarter the number was given as about 19 7% or so. 9:05 9 minutes, 5 seconds Yeah. 9:05 9 minutes, 5 seconds What is the kind of range that we've seen this quarter? 9:08 9 minutes, 8 seconds Okay. So last year uh last quarter uh they were 19.49% 9.5 you can take and I mean this quarter we have touched a alltime high of 21%. 9:20 9 minutes, 20 seconds Obviously this varies a lot with some of the weathers but even if I to compare because this quarter 3 in any case has a spike but I think a good way to look at 9:29 9 minutes, 29 seconds this would be what was it last year quarter 3 versus what is this year quarter 3 so last year quarter 3 this number was 20.7 and this year we have 9:36 9 minutes, 36 seconds beaten that to 21 right got it the other question was uh 9:44 9 minutes, 44 seconds with respect to the uh salience of branded products you mentioned that in the foods business the the failures is at 81%. 9:53 9 minutes, 53 seconds Uh correct me if I'm wrong this has come down a bit on a sequential basis uh because Q2 I think the number was closer to 85%. 10:05 10 minutes, 5 seconds Just a second. 10:08 10 minutes, 8 seconds Uh okay. I don't think so this is any meaningful change. I'll just check the number again. 10:13 10 minutes, 13 seconds But uh this hover in the range of around 81 82 81 82%. It is it is not any meaningful if if the question really is 10:21 10 minutes, 21 seconds to look toward is there any meaningful drop because of any challenges in our business in terms of branded. Yeah, you're right. It was 85. But again there 10:29 10 minutes, 29 seconds are seasonalities in this you know. Now again if I were to compare Q3 last year versus this year Q3 right that is 77 and it's 81 now this year. 10:39 10 minutes, 39 seconds Got it sir. Can we get the number for the dairy part also sir the value added product share for this quarter? Yeah. 10:46 10 minutes, 46 seconds Okay. Yeah. We we'll just get you that also. 10:50 10 minutes, 50 seconds And also one thing which uh on this problem is happening is because we have one thing which is very clear a direction now strategic shift that is happening and I we have all communicated 10:58 10 minutes, 58 seconds is that this live word part of the business while we are reducing it. This plays till we obviously meaningfully 11:06 11 minutes, 6 seconds keep we have dropped it obviously very sharply till we keep on dropping dropping dropping this to a a negligible number. Finally over the years this will 11:15 11 minutes, 15 seconds have a little volatility which keeps on then changing this percentage because these are minor 2 3% change differences. 11:20 11 minutes, 20 seconds So I would say the answer is is there any shift away from our branded focus is there any impact on that? No not at all. 11:30 11 minutes, 30 seconds I just wanted to clarify the numbers. Can you get the number for D also? 11:34 11 minutes, 34 seconds Yeah. So daily value added product sale this year is total is 30 35% 11:45 11 minutes, 45 seconds 30% is that what you said 35% total business which in the last year same quarter was 34 33.8%. 11:55 11 minutes, 55 seconds One last question sir if I may. Uh this quarter would have probably still seen at least from the presentation that in the crop production business there was 12:02 12 minutes, 2 seconds still some impact at least or at least in 9 months there is still the impact of the weather patterns and the slow slower application due to the rainfalls. How 12:11 12 minutes, 11 seconds should we look at the last quarter at this point of time for crop production? 12:16 12 minutes, 16 seconds Yeah, I think it's important that you ask the question because I mean I would have addressed it otherwise as well. So I would say you know the way I see the 12:23 12 minutes, 23 seconds weather pattern the impact on like a few things happened in the quarter three first of all this time again we all across the industry we have been seeing there have been very unseasonal rains 12:32 12 minutes, 32 seconds which almost extend into mid November you know so like for example one of biggest products that we have is uh you know the product which cater to uh you 12:40 12 minutes, 40 seconds know grape crops now obviously we all read the grape crops got really devastated this time so the weather patterns really obviously played its own 12:48 12 minutes, 48 seconds role going forward in the quarter three or quarter four I think this quarter uh there is one last base effect which will 12:57 12 minutes, 57 seconds come into play for us uh and I would like to call that out is that the heatweed normally has uh you know co-arketing 13:05 13 minutes, 5 seconds uh you know uh sales in a base of quarter four last year which given the fact that the hit season has got 13:12 13 minutes, 12 seconds impacted this year in the first half itself that base effect will remain for us and that will impact the quarter four of crop protection but that's a base 13:21 13 minutes, 21 seconds effect if I would take out that impact of the hate tweet co-arketing out we are targeting to grow at a very healthy pace 13:29 13 minutes, 29 seconds in the x this co-arketing number uh on a topline basis so that's where the focus is and we expect now this base effect 13:37 13 minutes, 37 seconds will finally be gone after this and that's all from me thank you so much 13:46 13 minutes, 46 seconds and all the best thank you sir The next question is from the line of Abijit AA from Kie. Please go ahead. 13:56 13 minutes, 56 seconds Uh yeah, good afternoon. Thank you so much for taking my questions. Uh yeah, hi. Hi. Good afternoon sir. So 14:04 14 minutes, 4 seconds maybe uh you know just to start uh would be great to get your perspective on uh you know any outcome of the um possible 14:12 14 minutes, 12 seconds sort of value unlocking initiatives the analysis that you've been doing over the last few months. So what are your thoughts at this point in time and what 14:21 14 minutes, 21 seconds portfolio of businesses do you see it best for godes to sort of uh you know continue with okay thanks for asking the question so 14:29 14 minutes, 29 seconds you know this obviously as you know we have multiple businesses so right now as you talk we are in a very deep work right now is ongoing currently I in fact 14:38 14 minutes, 38 seconds I would say I'm we are almost at the end of this entire deep strategy work that you started around 2 months back 14:45 14 minutes, 45 seconds where this entire portfolio choice making portfolio role allocations will happen. So immediately if you ask me I 14:52 14 minutes, 52 seconds might not be able to tell you but yes we are the of this we are going to make some very clear sharp choices in the businesses which we clearly see as a 15:01 15 minutes, 1 second top end of our investments and top end of our growth choices we'll make some choices about businesses we may say that okay hey we want to put them into maybe 15:09 15 minutes, 9 seconds a little bit of a deep priority and uh I guess uh somewhere towards early April we should be able to come back to the 15:17 15 minutes, 17 seconds street with a proper communication and I would like to do proper interaction to give a full uh you know uh deep uh point of view on how do 15:25 15 minutes, 25 seconds we see as a group uh the unlock and the journey roadmapback journey of GVL but 15:31 15 minutes, 31 seconds to tell us I think we have now a pretty reasonably well emerging clarity on how we want to play the portfolio it's just 15:39 15 minutes, 39 seconds that we have to give it fine tuned and we have to do some internal alignments got it no thank you sir that's uh 15:47 15 minutes, 47 seconds helpful and uh just one Another finally on Aztec um know we've seen a little bit of a turnaround there but of course we 15:55 15 minutes, 55 seconds still a long way away from uh you know our past glory days um so just wanted to seek your perspective on how you're seeing trends in the fourth quarter now 16:04 16 minutes, 4 seconds coming up and then you know any commentary with regard to regard to the upcoming year uh basis uh you know maybe Mr. Godidge's interactions with uh 16:12 16 minutes, 12 seconds potential customers at recent traces and that sort of thing. Thank you so much. 16:17 16 minutes, 17 seconds Okay. If I like ask Arijit and Baju then pigeon and on this year so if you have seen in Q3 also we have 16:24 16 minutes, 24 seconds seen a revenue growth of around a year on year is a 33% growth and also a bit of positive and from historically Q4 has 16:32 16 minutes, 32 seconds been a bit better quarter for us because this is the time where both our enterprise and CDM export and domestic 16:39 16 minutes, 39 seconds market also goes. So I think we should follow this trend which we have achieved in Q3. So overall I think this year we 16:46 16 minutes, 46 seconds should see overall we we should see a growth of around 20% in terms of the revenue bottom line because some of the negotiations are still continuing. So we 16:55 16 minutes, 55 seconds are not in position right now to see the bottom line but but we see that it will be the anit a bit year on will be the positive 17:03 17 minutes, 3 seconds we'll be closing in terms of the positive aita for this year and for next year we're targeting revenue growth of about 15% and we're 17:12 17 minutes, 12 seconds very pleased to see that our inquiry funnel has doubled from 22 to 45. 17:18 17 minutes, 18 seconds So one thing which is very clear I think in the last call which had happened that we had asked for what is a how do we see this year we had said we had targeted ourselves to be a bit break even this 17:26 17 minutes, 26 seconds year I think that guidance stays for us you know I think we were pretty confident that we should be able to pull that off so I think uh the turnaround is 17:34 17 minutes, 34 seconds well and truly in play now is what I would say got it uh no thank you for that uh so 17:43 17 minutes, 43 seconds just maybe go one level deeper so this 15% growth target for next year. Is that entirely driven by the CDN of business 17:51 17 minutes, 51 seconds or um no it will be a mix of see okay this is a broad direction to be very honest we 17:58 17 minutes, 58 seconds are in the middle of our ML operating cycle but this is something we definitely would aspire to uh I think uh there'll be a play of both CDM and 18:05 18 minutes, 5 seconds enterprise but we clearly see CDO leading the growth and it'll grow faster than enterprise for us 18:13 18 minutes, 13 seconds but we're very pleased to see the enterprise business has turned around this year and we're expecting it to be stronger in the future 18:22 18 minutes, 22 seconds and is it fair to assume that the margin profile on the uh you know incremental growth that we achieve in this business is going to be uh you know maybe I mean 18:30 18 minutes, 30 seconds substantially superior to what the overall enterprise business does is that a fair assumption yeah fair to assume yeah the 3D business margin profile is 18:39 18 minutes, 39 seconds uh indexed at at around 1.5 times at least of the enterprise business okay got it sir thank you so much I'll come check in the queue for anymore. 18:51 18 minutes, 51 seconds Thank you sir. The next question is from the line of Ages Lakhani from Unifi AMC. 18:57 18 minutes, 57 seconds Please go ahead. 19:00 19 minutes Yeah. Hi team. Uh two questions. Uh first one is that uh you know if you could call out in palm oil uh you know 19:08 19 minutes, 8 seconds there is a there's a significant divergence between PO and CPO pricing and that spreads have been expanding. So 19:16 19 minutes, 16 seconds could you call out what is driving the PO dynamics and where are we in our backward and forward integration from a 19:23 19 minutes, 23 seconds from a standpoint of capeex and where the incremental plants are coming. So that's my first question. 19:31 19 minutes, 31 seconds Yeah. Okay. So this uh you know divergence between PQ and PO see PQO is actually very it's part of the LOIC uh 19:38 19 minutes, 38 seconds you know Lorix segment of the oil and it is also very connected in a way with play with coconut as well. Right. So that has a very different kind of usage 19:47 19 minutes, 47 seconds which is into lot of you know uh what do you call B2B usage in the industry. So that plays a very different kind of a demand and supply situation and hence 19:56 19 minutes, 56 seconds that divergence is does happen. CPO prices are pretty much uh you know linked to what is the overall dynamics 20:04 20 minutes, 4 seconds of the multiple soft which play out you know so I think uh these two have different trends and they do tend to 20:11 20 minutes, 11 seconds play out a little differently. That's why if you see one trend that we are clearly seeing right now in the quarter 3 is that the CPO prices actually have 20:19 20 minutes, 19 seconds marginally lower over the CPO of last year quarter 3 but the PQ is not following that trend. 20:28 20 minutes, 28 seconds Uh right Mr. Kadalia actually a followup is that this is I mean this construct that you've just presented was always 20:35 20 minutes, 35 seconds the case right so but the divergence in prices if you see over the last two to three years has expanded materially so 20:42 20 minutes, 42 seconds I'm trying to understand that uh because there are different dynamics that are working is it could you give some color about 20:49 20 minutes, 49 seconds can you can I add something on this I would ask Mr. Let's pause the question here. I think you have a better respect to the history. 20:56 20 minutes, 56 seconds I think the supply of coconut oil uh has been impacted and the demand for both of 21:03 21 minutes, 3 seconds these is higher than before. So coconut oil is shot up considerably and it is at 21:10 21 minutes, 10 seconds a significant premium to PKO and I don't it's not very clear whether 21:17 21 minutes, 17 seconds this will change over time but it's very likely it's not easy to increase coconut oil production and there seems to be a 21:25 21 minutes, 25 seconds lot of demand. So it looks like this premium is going to last but we can't be sure. 21:32 21 minutes, 32 seconds Understood. That was just very helpful sir. And could you just call out that you know some of the initiatives on plantations that we've taken are you 21:40 21 minutes, 40 seconds know appearing to bear fruit and what's the call out for FFB branches in 27? 21:46 21 minutes, 46 seconds Okay. Uh so I'll take the short list. So so I think first of all I would like to point out hello ladies and gentlemen the line for 21:54 21 minutes, 54 seconds the management seems to have disconnected. Please hold while we reconnect them. Ladies and gentlemen, the line for the management has been 22:02 22 minutes, 2 seconds reconnected. Thank you and over to you sir. 22:05 22 minutes, 5 seconds Yeah. Okay. I'll continue here. So one big uh uh so as I said that there are multiple levers at play right now. See one piece which I had talked of last 22:12 22 minutes, 12 seconds time also as part of our strategic overall shift is that we want to start driving multiple pillars of growth in the chosen businesses and we I'll 22:21 22 minutes, 21 seconds overall talk the strategy at a later time. This is one business where multiple pillars of growth are already in play. So first and foremost is as of 22:29 22 minutes, 29 seconds we talked today that we have already done a record high expansion of uh acreage hectares today we have done 22:37 22 minutes, 37 seconds 15,000 hectare expansion in the 9 month period and we are slated to be roughly around 17 18,000 by the end of the year 22:46 22 minutes, 46 seconds just to give a perspective this number was almost half last year so that's the kind of pace that we have kind of set up 22:52 22 minutes, 52 seconds towards expansion secondly I think there's a lot of work that we do through our samadhan centers that we have set up 23:00 23 minutes which are you know very very strong capability centers which works very regular with farmers in all the multiple parts of as of now Andra Telangana and 23:08 23 minutes, 8 seconds later on northeast where they work with farmers and helping the palm plantations and improving their yields improving their harvesting practices improving 23:17 23 minutes, 17 seconds their you know output and that also I think starting to yield better results going back on the out future look I 23:25 23 minutes, 25 seconds think we expect while obviously there can be seasonalities and some very off year which can always play but on a regular basis I think there's a business 23:33 23 minutes, 33 seconds slated for a FFB tonnage growth of I think a good healthy teams in terms of anywhere between 12 to 15% you know 23:44 23 minutes, 44 seconds so you're 12 to 15% FFB increases in the next uh in FI27 right yeah I'm think over a long-term period 23:51 23 minutes, 51 seconds because I think sometimes you know one off years can happen if the consumptions are pretty bad in some year it does tend to impact the plantation maybe a year 23:59 23 minutes, 59 seconds later I'm talking really on a steady state basis on a kagger we are pretty confident given the kind of acreage uh 24:06 24 minutes, 6 seconds expansion that's saying given the work that we're doing farmers that we would be in this uh you know team's range of expansion you know 24:15 24 minutes, 15 seconds plus one more yeah sorry plus one more thing which will happen over the years you know in this business one of things which is 24:22 24 minutes, 22 seconds going to come in play is the there's a demographic dividend which will start playing out over a period of couple of years you know that as more and more 24:30 24 minutes, 30 seconds plantations are getting into they will get from becoming 0 to four years age to four to four plus years and that's when 24:38 24 minutes, 38 seconds the productivity of the plantation starts and they are in the most high productivity stages between 4 to 18 years you know and that's like a the way 24:45 24 minutes, 45 seconds in a way almost if I to compare the India's has seen its own demographic dividend paying out it's a it's a demographic dividend on a productivity start playing on the mix of plant situations also going forward. 24:57 24 minutes, 57 seconds Yes. So point taken as could you just speak about the backward and forward integration here on the on the on the value added side and where are we in the capeex journey? 25:07 25 minutes, 7 seconds Yeah. So we have already put in the KFX in terms of a downstream uh refinery for uh you know making products which are 25:14 25 minutes, 14 seconds high valued products like you know the cocoa butter substitute the cocoa butter equivalents the CPKO refining uh all these are right now in the last stages 25:23 25 minutes, 23 seconds of implementation are one is uh before I go downstream our new uh CPU processing 25:31 25 minutes, 31 seconds plant on the upstream in Kam will go live in a matter of 2 months and our downstream refinery will also go get 25:39 25 minutes, 39 seconds commissioned by somewhere in the first quarter of the coming year and that will see us actually then ramping up the downstream value part. 25:50 25 minutes, 50 seconds Understood. Uh so my next question is on the dairy. Uh sir if you go to see right we about a year and a half back we had 25:57 25 minutes, 57 seconds the consultants who we hired and you know you've spoken about multiple structural changes you have done and you 26:04 26 minutes, 4 seconds know while that looked good in one year given you know how the milk inflation has been uh last year it's not started 26:12 26 minutes, 12 seconds to pan out so I'm trying to understand that from your vantage all the efforts that you have put in uh you're seeing 26:20 26 minutes, 20 seconds better traction but the material uptake that you had expected from this business is still not shaping out even one one 26:27 26 minutes, 27 seconds and a half year after the consultants have left us. So could you please throw some light on that? 26:33 26 minutes, 33 seconds Yeah. So I think uh you know I would say the work which is happening on the consultant side there's a very large piece of work which happened on the 26:40 26 minutes, 40 seconds gross margin expansion and if you see that margin expansion by and large is still holding on. Yeah. In fact, if you see there is a impact of three odd 26:49 26 minutes, 49 seconds percentage points on the overall gross margin play for us despite milk procurement being as high as 10 to 10 26:56 26 minutes, 56 seconds odd percent for us because we obviously have a larger uh piece of procurement which happens from Maharashtra and Maharashtra has seen more inflation than 27:04 27 minutes, 4 seconds rest of the uh know states. So in fact I would say maybe not maybe it is actually of the some of the structural cost work 27:12 27 minutes, 12 seconds which happened at the back end uh where we have been able to still absorb this piece uh you know uh to large extent and 27:20 27 minutes, 20 seconds not get into a spiral otherwise you know otherwise a 10% milk price increase can be pretty uh you know devastating in the 27:27 27 minutes, 27 seconds past it would have been so I think that piece stays uh going forward yes the question to which you're asking is okay uh how more meaningful can the overall 27:36 27 minutes, 36 seconds impact So I think again as part of the strategy work and some operational work that we're doing and this is again maybe I'll talk much more in detail when we meet is 27:44 27 minutes, 44 seconds that there are some choices we are doing on the and that is I think a critical uh work which is going to happen in CDP the 27:52 27 minutes, 52 seconds go to market strategy the consultants never did work on that side okay and I think the next pace of work is how do we 28:00 28 minutes start doing some very fundamental choice making on which markets we'll play strongly in which route to market will 28:08 28 minutes, 8 seconds play strongly in and we are building capabilities on that and that I think will along with then obviously product and marketing investments will play out 28:16 28 minutes, 16 seconds the game fully for us that I think is something which will play out over a period of you know few quarters and I'll 28:23 28 minutes, 23 seconds be very candid because that's the kind of work which we are going to do in some kind of a restructuring of our go to market study 28:31 28 minutes, 31 seconds understood and sir just finally what is in the in the foods business u you So uh the branded 81% that you talk about what's the cut between RJC and Yum. 28:42 28 minutes, 42 seconds Okay just 28:56 28 minutes, 56 seconds yeah. Okay. So uh how much? 29:03 29 minutes, 3 seconds Just give me a second. Now I'm just putting this up. 29:09 29 minutes, 9 seconds Yeah. Okay. It's the the number is not so the overall the way the number is the cut is plate for us in this 81 it's 29:17 29 minutes, 17 seconds around 28% is yummies and around 52 odd% is RGC 29:25 29 minutes, 25 seconds just got it just you know because RGC is tad bit lower margins and yummies is the higher margin could you call about how 29:34 29 minutes, 34 seconds are you looking at the branded segment I would have presumed I mean the the the thought I had that this number of uh you 29:42 29 minutes, 42 seconds know uh this yummies used to be in that 15 20% range. So you of course sort of moved it from that range to probably the closer to 30 but how can you give some 29:51 29 minutes, 51 seconds more color on how you are seeing the scale up of these two of the of the foods business. 29:56 29 minutes, 56 seconds Yeah again I'm I'm telling you while we'll give you a very detailed color later on but let me tell you directionally what it is. 30:02 30 minutes, 2 seconds I think we are very clear that in the foods businesses there are two themes that we would like to chase. One is as we have already in lots of us in this 30:09 30 minutes, 9 seconds village foods business the uh you know poultry business we've already taken a call that live bird is not where we want to play you know we are not going to be 30:17 30 minutes, 17 seconds in a trading business it is just a back end right now which is supporting our real good chicken piece as of now and hence we are meaningfully sharply 30:24 30 minutes, 24 seconds bringing it down our entire double down is going to be on the branded retail business going forward which is where the yummies piece plays in and even the 30:33 30 minutes, 33 seconds RBC retail piece is something which will play in forward so the whole game would be that we want to make it as a branded retail play. What you are seeing from 30:41 30 minutes, 41 seconds 15% has moved to 30 is where this number will keep on increasing over the next 5 years and in the end state game for us is that we want to be a pure play 30:50 30 minutes, 50 seconds branded retail organization in our foods businesses and have as less a play of trading stroke uh you know uh B2B businesses. 31:04 31 minutes, 4 seconds Thank you and all the best. 31:07 31 minutes, 7 seconds Thank you sir. Ladies and gentlemen, to ask a question, please press star and one. Now 31:15 31 minutes, 15 seconds participants who wish to ask questions may please press star and one at this time. 31:21 31 minutes, 21 seconds The next question is from the line of Ahmed Madha from Unifi Capital. Please go ahead. 31:28 31 minutes, 28 seconds Yeah, thanks for the opportunity. Uh I have a few questions. Uh but to start with your comments on uh PKO prices uh 31:38 31 minutes, 38 seconds we have seen recently the copra prices and coconut oil price come off uh from peak about 20 25%age. Have we seen 31:46 31 minutes, 46 seconds similar trends for PKO in last few months? 31:50 31 minutes, 50 seconds Okay. I would first ask Mr. God to comment on this and then if required I'll Mr. Go. No, I haven't watched the 31:57 31 minutes, 57 seconds most recent situation, but I would like to comment that uh coconut oil is still significantly above PK oil. 32:07 32 minutes, 7 seconds Yeah. So, and I would maybe take one more comment on this. I that the answer is since we have been tracking this number, have you seen any drop happening 32:15 32 minutes, 15 seconds in uh PK prices? As of now, it's holding. 32:19 32 minutes, 19 seconds Okay. Sure. uh and the your comments on the domestic crop production business this season being weak and x of uh x of 32:28 32 minutes, 28 seconds one product uh we'll be doing fine you can give some comment overall as a blended what kind of growth we are 32:36 32 minutes, 36 seconds seeing for the balance part of the season uh that's first question and second question is in terms of uh building on the licensing portfolio how 32:44 32 minutes, 44 seconds is that shaping up have we added any new products uh in uh last quarter Ladies and gentlemen, the line for the management seems to have disconnected. 32:54 32 minutes, 54 seconds Please hold while we reconnect them. 32:57 32 minutes, 57 seconds Ladies and gentlemen, the line for the management have been reconnected. Thank you and over to you sir. Can you hear me? Yeah. Yes sir. 33:05 33 minutes, 5 seconds Okay. 33:05 33 minutes, 5 seconds Second two questions there. Uh so the first part is I think how does the whole quarter look like? As you again said that that one time impact of our co-arketing is going to stay. this is 33:14 33 minutes, 14 seconds maybe the last bump of the year that we hope which is coming our way and the new year will start pretty fresh and I'll talk about how we will be you know 33:22 33 minutes, 22 seconds gearing up for the new year. Uh I also said that the XO marketing fees I think we are looking at a pretty healthy growth obviously uh I think there'll be 33:30 33 minutes, 30 seconds pretty healthy growth. I don't want to disclose the exact number of what we are gunning for as a uh number internally but I think that part will be healthy 33:37 33 minutes, 37 seconds but yeah there'll be an impact of this one uh co-arketing piece which will play in uh in terms of the way we are working out on the uh CP business I think I 33:45 33 minutes, 45 seconds would like to give you a bit of color again maybe a insight into the way our strategic discussion meeting will play out later on. One of the biggest pieces 33:52 33 minutes, 52 seconds as I again said is that we want to move away from uh you know single points of you know dependence to multiple pillars 34:00 34 minutes of growth and in the uh journey on CPD business of a domestic that journey has started playing out which where we have 34:07 34 minutes, 7 seconds started diversifying ourselves beyond two products of let's say cotton herbicide segment and let's say another 34:15 34 minutes, 15 seconds product of gracia we actually have identified a multiple critical and meaningful crop segments in the country 34:22 34 minutes, 22 seconds and uh we have identified and started building a pipeline of that in which both in-house products and in licensing 34:31 34 minutes, 31 seconds products both will play a role. Now to give you an insight of what has happened in this in the last quarter we have launched Ashitaka which is our first 34:40 34 minutes, 40 seconds foray into maze harvey side and I'm pretty happy to share that uh even though uh uh 34:48 34 minutes, 48 seconds it no even though you know I think uh we could have connected even a little bit earlier the response in the market we've 34:55 34 minutes, 55 seconds launched has been very very positive in fact I mean we have sold off whatever we place in the market and the optics 35:03 35 minutes, 3 seconds itself have been pretty good and so that gives us a hell of a lot of confidence of how we keep on ramping up this product Ashitaka going forward in the 35:11 35 minutes, 11 seconds coming year that's one secondly I can also share right now that in coming month this month itself we'll make a 35:18 35 minutes, 18 seconds second foray of diversification that we are going to launch a new product uh which again the in licensing product 35:24 35 minutes, 24 seconds called Takai and that is a multicrop insecticide segment which again will be our first foray into a multicrop crop 35:33 35 minutes, 33 seconds infected product and we again are very confident that is another diversation step that that will give us a play into not only one crop multiple crop in which 35:42 35 minutes, 42 seconds patt is one of the big crops and we actually have been pretty missing in patty per se. So if you see these two 35:49 35 minutes, 49 seconds itself are the two big foray which have happened in terms of diversifying out. 35:55 35 minutes, 55 seconds Apart from that uh in the coming year we have you you you can expect from us two in-house products uh which would roll out in FY27. 36:06 36 minutes, 6 seconds Okay. And then these two in licensing products will play in to full scale up. 36:12 36 minutes, 12 seconds So that's here and now. But apart from that there's a full-fledged strategy crop product matrix which is ready and we'll share with you how the pipeline 36:19 36 minutes, 19 seconds and pal in the balance three four years of the LRP period. But this is here and now what will happen in the next four uh 12 months. I hope uh I've given you a sense of what we're doing. Yeah. Sure. 36:30 36 minutes, 30 seconds Sure. And on the estate business you made comments about how the uh Q4 and FI26 looks like. Uh I have two 36:39 36 minutes, 39 seconds questions. One is in terms of pricing pressure in the enterprise segment molecules. Has that eased off? Are we 36:46 36 minutes, 46 seconds seeing any price improvement or stability as of now? And secondly, for FI27, 36:54 36 minutes, 54 seconds how should we uh foresee the the margins profile changing with uh the business achieving some scale? 37:02 37 minutes, 2 seconds Okay. So that's a question on SEX or Arj on this. So two part of the answer first 37:10 37 minutes, 10 seconds as a as agrochemical the first portion will be to go back to the normal demand of the production. So what we are 37:17 37 minutes, 17 seconds currently seeing is that the production of the demand of agrochemical has come back to 201920. So that is the normal consumption norm. 37:25 37 minutes, 25 seconds So most of the pipeline stocks inventories have moved out of the major geographies. Some geographies will be there that there might be some one 37:32 37 minutes, 32 seconds season stock but that would not impact the overall consumption patterns. Price pressure is there because the competition is there because of the over 37:40 37 minutes, 40 seconds capacity in China but that is also little bit coming down. So it is not it is more or less flattened out. So now we we are playing evenly and within one or 37:49 37 minutes, 49 seconds two years we have also also invested in terms of the process improvement and those things. So that that's why if you see in this quarter 37:57 37 minutes, 57 seconds you will find movement in in terms of the volume as well as the margin also we are improving. I think next season as of now the indication is the demand should 38:06 38 minutes, 6 seconds be normal. That's why we are optimistic for the next coming season also. And secondly the same applies for the CDMO businesses also. So most of the demands 38:14 38 minutes, 14 seconds are coming back which were in the earlier last two years were little bit fluctuating. So overall it seems we are stabilizing out. Price pressures will be 38:22 38 minutes, 22 seconds there for some season but it is stabilizing. It has almost bottomed out. 38:26 38 minutes, 26 seconds So now we will see a little bit of improvement there and we are doing the best on our side to improve margins despite the price outlook through raw 38:34 38 minutes, 34 seconds material price reduction sourcing advantages process improvement yield improvement all the R&D steps we can 38:42 38 minutes, 42 seconds take but we are monitoring the situation in China carefully. There are expected to be some announcements on change in 38:49 38 minutes, 49 seconds the export tax benefits. So we'll see how that plays out and what impact that has on our business. 38:57 38 minutes, 57 seconds Sure. Lastly on the poultry business uh I understand you have made a significant transition towards the branded business 39:06 39 minutes, 6 seconds but in terms of the pricing the live bud prices has is the improvement across geographies or is it specific to few 39:15 39 minutes, 15 seconds states and in terms of overall supply dynamics in the poultry business at the country level would you like to give some comment how are you seeing overall 39:24 39 minutes, 24 seconds uh poultry business supply dynamics very Second one, I would not take a shot at it, you know, I'll be honest because, you know, let me give you an overall 39:32 39 minutes, 32 seconds poultry business point of view because strategically it's a business which does not play out for us in the future and 39:38 39 minutes, 38 seconds it's a pretty large uh play with lot of dynamics on the poultry side and we are focused on reducing that part of the business. Our focus is clearly on being 39:48 39 minutes, 48 seconds a branded retail player going forward and that's where the margins lie. That is where the growth lies. In fact, the whole play to my mind in the poultry 39:56 39 minutes, 56 seconds business is that India is a country which has a huge amount of you know demand right now and there's a huge amount of chunk of proteinled products requirements which is panning out. 40:06 40 minutes, 6 seconds There's a huge awareness which is playing out across pop strata where people are coming to a realization that hey we need to maybe add a little bit 40:15 40 minutes, 15 seconds more protein or definitely significant more protein to our diets and the way we see our role being played if you want to play the branded detail is it is a clear 40:22 40 minutes, 22 seconds category creation game that what better source of protein than chicken in this country which is reasonably priced and 40:30 40 minutes, 30 seconds which in a in a country which theoretically also kind of 70% of India eats nonwet multi obviously It varies from state to state. They are not 100% 40:39 40 minutes, 39 seconds non-vegetarians with a mix of veg and non-veg. But there are 70 odd% Indians who do have non-veg in their diet. So I think our play is to keep making sure 40:48 40 minutes, 48 seconds that we become over a 5 years period uh this 30% keeps on increasing and we become a full-fledged branded retail 40:56 40 minutes, 56 seconds player. So I would not even hazard a guess on the overall piece of poultry play overall. The question which asked was this live bird price increase 41:05 41 minutes, 5 seconds uniform across regions? Yes, it was that I can tell you. 41:09 41 minutes, 9 seconds Okay. Sure. Uh lastly uh you spoke about the uh value creation exercise. Uh so 41:17 41 minutes, 17 seconds can you give some context of what are we talking here about in terms of value creation? What is the core objective we 41:23 41 minutes, 23 seconds are trying to achieve? Is it sort of uh demmerging the business into multiple segments or is it sort of u making sure 41:32 41 minutes, 32 seconds of capital allocation into different businesses? Uh can you give some sense on that? 41:37 41 minutes, 37 seconds Yeah. So I think again as I said we will have a very detailed conversation definitely just uh it's a matter of maybe you know a month or so away we 41:45 41 minutes, 45 seconds will meet and we definitely want to share with all of you as to how everything is but clearly in this portfolio crisis what are we doing? What 41:52 41 minutes, 52 seconds we want to make sure we want to focus on we we have picked up certain criteria. 41:56 41 minutes, 56 seconds The criteria is very regularly we want to play markets which have attractiveness to it in each of segments. So we have gone and put together market attractiveness criteria 42:05 42 minutes, 5 seconds on each and every business and within that even some segments we have gone and checked. Then we are putting together on that actually a filter is what really is 42:13 42 minutes, 13 seconds our right to win or play even in subsegments and that is one piece which is going to lead us to say okay where do we want to really go after and those 42:23 42 minutes, 23 seconds that will be the choices the businesses that we prioritize will obviously get a significantly larger and very very in fact I would say focused share of uh 42:32 42 minutes, 32 seconds capital allocations there's no debate and that's where we want to put together so the criteria for us would be we would like to see how the growths are whether it is the volume growth in some 42:40 42 minutes, 40 seconds businesses. In some businesses is revenue growth because some of our businesses have more volume focus. And the second piece will be we obviously 42:49 42 minutes, 49 seconds while we invest behind the growth we'd like to keep filters of you know mid-term profitability and return on capital employed also in mind as 42:57 42 minutes, 57 seconds filters. So I think that is the way we'll come back uh to you but those are the p pieces we are keeping in mind regarding whether there'll be a de 43:04 43 minutes, 4 seconds merger or whether value unlock. I think those are pieces which are right now maybe premature to call. I think the first piece for us is uh that how we 43:12 43 minutes, 12 seconds going to choose portfolios and what we'll do with them and obviously some places at some structural calls would happen but when and where it will maybe be premature to talk about it. 43:23 43 minutes, 23 seconds Sure. Uh thank you so much. 43:26 43 minutes, 26 seconds Thank you sir. The next question is from the line of Abijit Aka from Kie. Please go ahead. 43:36 43 minutes, 36 seconds Thank thank you for taking my follow-ups. Um just on the animal feed segment um you know the 43:43 43 minutes, 43 seconds Yeah. Yeah. So just on the animal feed segment you know the what's the reason for the very strong growth in cattle feed volumes uh this quarter 21%. Also 43:52 43 minutes, 52 seconds if you could please share the volume growth for the 9 months and uh how much of the animal feed volumes are actually coming from cattle feed at this point in 44:00 44 minutes time. I guess it's not a 50% but if you could please just quantify that. And one last thing also uh uh the presentation 44:08 44 minutes, 8 seconds speaks to a change in product mix which has dragged on the margin. So is that referring to basically a swing in favor of cattle feed or something else? Thank you. 44:17 44 minutes, 17 seconds Okay. So overall cattle feed for 9 months volume growth is 16 and a half%. 44:23 44 minutes, 23 seconds So it's been a steady state growth. It's a very strong growth in this 9 months. 44:27 44 minutes, 27 seconds So obviously it's peaked into a 20% growth but uh if you see the 9 month number is still a very very strong 6 and a half%. Second is what is driving this? 44:36 44 minutes, 36 seconds Okay I would classify this into two factors. Some part obviously in our industry there are always some external factor but some very internal controllable. So I think external what 44:45 44 minutes, 45 seconds hap what one factor which is I would say maybe an enviral factor playing out is that when the milk procurement prices are very uh you know good the it the 44:54 44 minutes, 54 seconds farmers tend to take advantage of by upgrading from unbranded to branded compound feed and that's you would have 45:00 45 minutes seen across in every in I almost see some parts of this business like any other consumer B2C business you know that's the length I'm looking at and 45:08 45 minutes, 8 seconds putting it on this end I want to see this business a little differently is that uh that say same true which have we have seen happening in coconut oil that we have seen in you know uh you know in 45:17 45 minutes, 17 seconds staples that the same thing we've seen happening in even soaps so I think the same phenomena pans out when the milk prices are going up the pharmacy yields 45:25 45 minutes, 25 seconds going up they are willing to get more uh you know conversion into uh branded compound feed that's one second the 45:32 45 minutes, 32 seconds internal pieces which are played out is that we have actually launched three four very uh you know differentiated 45:38 45 minutes, 38 seconds products across state specifics so there is a product called dudi which has come uh which is focused towards the eastern part of the country. There's a product 45:47 45 minutes, 47 seconds called Dhan Lakshmi which is doing pretty well in the western parts of India. We have a product called Bipro 45:54 45 minutes, 54 seconds Plus which is gone into south which is actually very conditioned and suited for the southern uh you know market requirement. So there is a little 46:02 46 minutes, 2 seconds definitely more focus coming in into statewise breed wise focus products and I think those products have started doing have 46:10 46 minutes, 10 seconds done pretty well for us in the middle of this tailwind is happening. So I think I would say there's definitely both a 46:17 46 minutes, 17 seconds external but also an internal uh thing at play 55% failure and the salience of the cattle field business for us is uh is now in this 46:27 46 minutes, 27 seconds quarter is around 54% and 9 months is almost similar around 40 54 odd%. 46:35 46 minutes, 35 seconds on volume. 46:38 46 minutes, 38 seconds Got it. Got it. And the last thing was just uh this the shift in product mix. 46:42 46 minutes, 42 seconds Does that refer to the swing in favor of cattle feed or is it something else we are alluding to? Yeah, it's in favor of cattle feed. 46:49 46 minutes, 49 seconds So let let me give you maybe one more insight of going forward. I mean again maybe a a sneak preview into what we will be thinking is that we believe that 46:57 46 minutes, 57 seconds within animal feed also right there are segments we want to really go after right and I would say cattle feed is one 47:04 47 minutes, 4 seconds that segment that we believe in India it has more of an ability to create brand it has a more of an ability to command 47:14 47 minutes, 14 seconds premiumization if you get the right products and it is a market where we believe a large chunk of our strength 47:20 47 minutes, 20 seconds lies And uh uh maybe you'll see a bit of a work more and more towards excellating some of these ships you know. 47:30 47 minutes, 30 seconds So the bit per turn on cattle feeds or how much would that be? I mean compared to the annual seed overall level of 2,000 would cattle feed be you know where exactly 1500 or lower than that? 47:42 47 minutes, 42 seconds Sorry what was the question? Bit per ton. A bit per ton. A bit per ton. I think we can take that uh offline. 47:50 47 minutes, 50 seconds Yeah, because this is a bit of a I mean it's maybe little bit of I would say competitive information while we give overall but yeah it's a obviously pretty 47:57 47 minutes, 57 seconds healthy one you know I would say okay sure no problem sir uh the other one I just had was on the crop protection side um margins obviously 48:06 48 minutes, 6 seconds have been coming off there but where do you see sort of sustainable margins in that business over the next uh you know year or so and uh also within the 48:15 48 minutes, 15 seconds domestic crop protection piece could you please help us with the revenue salads of in licensed and in-house. How how much do these two categories comprise? 48:23 48 minutes, 23 seconds Yeah. Okay. So these in licensing and inhouse contribute to roughly around 60 61% of our total business and uh we expect that given the work that we're 48:32 48 minutes, 32 seconds doing it should be in that range of around 60 65% or in that brand ballpark will play. So that's a pretty healthy 48:39 48 minutes, 39 seconds close to 2/3 of our business you can say. Uh so that's one piece and that's our direction we would like to keep on. 48:45 48 minutes, 45 seconds Uh uh the other question is where do we see the margin going forward? I think we had earlier also given a guidance of that we'll play at around you know 48:52 48 minutes, 52 seconds anywhere between 28 to 30% margin and we know actually we are on the upper end of you know the industry on this but uh one thing if you see even in this quarter 49:01 49 minutes, 1 second three our margins have been pretty healthy despite the shift of the businesses which we had done tactically only towards more generic in specialtity 49:09 49 minutes, 9 seconds which was a conscious tactical here and now quarter choice that we took and which we may again take a little bit in you know quarter four but I think in the 49:17 49 minutes, 17 seconds long in the midterm We are pretty confident of holding on to the range of 28 30%. 49:24 49 minutes, 24 seconds Thank you. Thank you so much. Just one last thing uh on the oil palm business, what percentage of uh segment EBIT comes from value added products and where do 49:32 49 minutes, 32 seconds you see that heading as your uh you know new capex project would have come online. 49:38 49 minutes, 38 seconds Okay. Where I see headed that number I'll have to kind of calculate to where I don't have that ready. So we can share that separately with you. But where it 49:47 49 minutes, 47 seconds is today we have moved in to around 8% now in quarter 3 for us. 49:51 49 minutes, 51 seconds But yes my intent obviously when these refineries come into play is this is a number which will actually start you know galloping rapidly you know. 50:02 50 minutes, 2 seconds Perfect. Yeah. Thank you so much sir. I wish you all the best. Thank you. 50:06 50 minutes, 6 seconds Thank you sir. The next question is from the line of Siddhart Nandhi from Chanaka wealth creation. Please go ahead. 50:14 50 minutes, 14 seconds Hey. Say hi Sid. Hi Sunil. How are you? Good to have you on the other side. 50:21 50 minutes, 21 seconds Yes. So Sunil just wanted to get some sense on the uh dairy business. Uh you 50:29 50 minutes, 29 seconds know one sees that there have been challenges on the milk procurement. Uh would you attribute this to you know the 50:37 50 minutes, 37 seconds competitive intensity increasing in terms of more dairies coming up or or is it more a structural deceleration 50:46 50 minutes, 46 seconds uh in in uh output uh at the industry level? That was uh uh that was the first 50:53 50 minutes, 53 seconds one and and given you know the uh likelihood of El Nino and warm weather sort of playing out in the 51:02 51 minutes, 2 seconds quarters to come uh you know h what is your outlook on on uh milk procurement uh for for the next year? 51:14 51 minutes, 14 seconds Okay. So said uh I think you know I think on the premill procurement piece let me tell you I think there's some structural changes which the team had done uh in the last couple of years that 51:23 51 minutes, 23 seconds we have moved to almost 85% of our procurement being direct procurement. So that is one big shift which has happened. Today we do almost 85 to 51:31 51 minutes, 31 seconds almost close to 90% of procurement is directly in a controls and I think there's a very strong network which has got created uh in the states of 51:39 51 minutes, 39 seconds Maharashtra specifically AP Telangana and uh and then some parts of Tamil Nadu where I think we are very confident that 51:46 51 minutes, 46 seconds given the our growth ambitions and given our aspirations that should not be a constraint for us. So that is one piece. 51:54 51 minutes, 54 seconds The second part is the question is whether this inflation of milk that we saw whether it has got to do with more number of dairies or something else. 52:01 52 minutes, 1 second Okay. While there's a piece a lot of us have been debating about what our understanding is largely it is driven more by butter prices across the uh 52:11 52 minutes, 11 seconds globe and what we have seen is that this has been a pretty large export of butter which is happening for India because of 52:17 52 minutes, 17 seconds inflation high demand in global uh markets. It could be linked to some pieces which are playing out towards maybe Australia and New England some 52:26 52 minutes, 26 seconds pieces toward and we have not obviously we're not able to put exact finger but clearly India has seen a sharp shift toward a sharp export of butter and that 52:33 52 minutes, 33 seconds butter prices have led to uh milk inflation. We are expecting this to maybe continue maybe for this quarter 52:41 52 minutes, 41 seconds and then hopefully it should start stabilizing you know. 52:44 52 minutes, 44 seconds Got it. and Sunil your outlook on milk procurement given the likelihood or the probability of El Nino next year. Yeah, 52:52 52 minutes, 52 seconds as I said you know given the our network and given our requirement and aspirations we we as for us we don't see any challenge of procurement for ourselves. 53:03 53 minutes, 3 seconds Helpful helpful uh thanks thanks so much that was helpful thank you. 53:08 53 minutes, 8 seconds Thank you sir. The next question is from the line of sin Vora from Premium Crafts. Please go ahead. 53:17 53 minutes, 17 seconds Hi uh thanks for the opportunity. Uh first of all many congratulations to the team at Astic Life Sciences. After about 53:25 53 minutes, 25 seconds 10 quarters of losses we've turned around barring 4Q which is a seasonally strong quarter. So many congratulations 53:32 53 minutes, 32 seconds finally see out of the team here. Great work by the team you know. Yeah. 53:36 53 minutes, 36 seconds Yeah. Yeah. Thank you. Uh just firstly on Aztec uh so uh Sil you reiterated uh the AITA break even guidance for F26 and 53:46 53 minutes, 46 seconds on topline our guidance was about 5 billion in uh turnover. So broadly around that 53:54 53 minutes, 54 seconds yeah yeah broadly around that yeah okay I would say if we looking for something maybe I mean we'll be a little short of maybe that but in ballpark range but 54:03 54 minutes, 3 seconds we'll still hold the guidance on a beta break. Got it. Got it. Just on F27 uh Mr. 54:10 54 minutes, 10 seconds Burgess mentioned uh we're targeting about 15% growth. So that sounds a little underwhelming to me because uh on 54:18 54 minutes, 18 seconds a larger base of uh 650 odd crores we used to guide for 25 30% topline growth. 54:25 54 minutes, 25 seconds So are there any concerns that we see for a 27 which uh keeps our guidance a little tepid? 54:33 54 minutes, 33 seconds Okay. Okay. Let let me tell you. I think you know honestly uh I mean this is the first cut guidance which mergers has given and we put it on the table for 54:40 54 minutes, 40 seconds you. We are still in the middle of our annual operating exercises and that normally happens in the period of February and we close it towards March. 54:48 54 minutes, 48 seconds Our aspirations obviously would be higher but it's very premature to kind of give it because we're just in the middle of it but I think that is 54:55 54 minutes, 55 seconds something we would put together as a base case for ourselves. 54:59 54 minutes, 59 seconds We'll be doing detailed planning to understand the price outlook for next year and the volume increases that we can you know manufacture and sell so 55:07 55 minutes, 7 seconds then we can give better guidance going forward. This is just a first look. 55:10 55 minutes, 10 seconds Yeah, got it. Got it. Got it. And uh just uh finally on uh a growette uh 55:17 55 minutes, 17 seconds could you just uh highlight uh like the drivers for the foods business for the next two three years? What kind of growth we see? what would be our focus 55:26 55 minutes, 26 seconds areas and uh uh margin expansion trajectory. 55:31 55 minutes, 31 seconds So this is my entire strategy presentation. Okay. 55:36 55 minutes, 36 seconds What whatever color you can give uh how you think about this. 55:40 55 minutes, 40 seconds Yeah. Yeah. So I'll give a color of how thinking because finally we'll answer all these questions. We in the middle of pretty much taking calls on some of these questions and we have made very 55:48 55 minutes, 48 seconds advanced progress on this you So we are not in in impan state that is as I said uh but let me tell you broad color I think themes are very clear to us that 55:57 55 minutes, 57 seconds you know we want to definitely make foods a meaningful play for our group you know so that's I think one point of 56:04 56 minutes, 4 seconds view you know that we have secondly uh we clearly want to take our journey towards value added branded play which 56:12 56 minutes, 12 seconds is what you're seeing whether it's in yummies or whether it will be in dairy business that's the second theme that we want to play we also See some of the 56:20 56 minutes, 20 seconds work that we'll have to do towards to make that happen is that there's a large uh work that we will do towards uh you know go to market investments go to 56:29 56 minutes, 29 seconds market execution focus because that matters a lot in all these businesses and there will be a play of uh 56:36 56 minutes, 36 seconds definitely building products which uh will be differentiated and then backing them up and hence we will look at you 56:43 56 minutes, 43 seconds know food innovation and food uh NPDS in a pretty big way and the last is we believe that we also need to invest in certain capabilities in these businesses 56:52 56 minutes, 52 seconds in these areas and that's a piece we have started doing so maybe one thing I can tell you is that we have for example both our foods businesses new members 57:02 57 minutes, 2 seconds from very very strong uh you know pedigree who are now holding positions in marketing and sales both switches 57:10 57 minutes, 10 seconds have happened already we already have a very robust uh you know team in place on the back end in both the businesses 57:18 57 minutes, 18 seconds So I think these are the themes which are playing out as a color. You're saying yes this will be a journey which will play out over 3, four, five years I 57:25 57 minutes, 25 seconds would say. Uh but we will play this journey and we hope that we will be able to succeed in this you know and pretty 57:33 57 minutes, 33 seconds confident that right and just lastly on the any update you can share on the pet food business and uh thank you so much uh for the 57:41 57 minutes, 41 seconds opportunity and uh and uh many congratulations to both the teams for a stellar performance. 57:46 57 minutes, 46 seconds Thank you. Thanks so much. The pet food business is that we have put up the plant for the uh the pet food business of the group and uh that plant is ready 57:55 57 minutes, 55 seconds to get commissioned in a matter of a month or so from now. Got it. Thank you. Thank you. 58:04 58 minutes, 4 seconds Thank you sir. The next question is from the line of Sumant Kumar from Motilal Oswal. Please go ahead. 58:12 58 minutes, 12 seconds Yeah. Hi. uh can you talk on uh Aztec CDMO business how it is growing and how is the outlook for the segment? 58:20 58 minutes, 20 seconds Yep. A habit. 58:22 58 minutes, 22 seconds Yeah. So CDM business I will like to explain it in two ways right one is what is our involvement in R&D because if you 58:30 58 minutes, 30 seconds see from March onwards we have almost doubled the number of inquiries we are getting. So one hand is the future looks 58:37 58 minutes, 37 seconds to be a little bit again China plus one is slowly coming into being because the number of enquiries have started coming both from the western world as well as 58:44 58 minutes, 44 seconds Japan. Secondly the CDMOS which we are currently doing. So most of the volumes have come back to the original one and few volumes are growing. So overall it 58:53 58 minutes, 53 seconds seems CDMO to be back on track in terms of uh pre-COVID time also in terms of demand and those things and coming back and it being a price plus model. So 59:03 59 minutes, 3 seconds margin wise also it is intact. So that way we see a relatively next 2 three years will be a good for us for CGMO growth. 59:15 59 minutes, 15 seconds Hello. Yes sir. 59:17 59 minutes, 17 seconds Yeah. What what about what about core business trial trial chemistry business where we have a losses and higher 59:24 59 minutes, 24 seconds volatility how that's that segment is performing and what are the key uh changes we have in the molecule side and 59:32 59 minutes, 32 seconds new product side so trile so for trial businesses the main worry 59:39 59 minutes, 39 seconds if you remember was the say inventory huh in inventory there so inventories 59:46 59 minutes, 46 seconds have moved out. So more or less the demand is back and in the process of being more competitive we have also got involved in terms of the process 59:54 59 minutes, 54 seconds improvement better supply chain management. So that is that has improved our margin. Secondly strategically we 1:00:01 1 hour, 1 second have shifted our registration from being source registered now we have got our own registrations. So most of the geographies like Europe and Latin 1:00:09 1 hour, 9 seconds America we have started getting registration. So Europe also we have got registration for three growing trios and 1:00:16 1 hour, 16 seconds in Brazil we have got two registrations and there will be another three which are in pipeline for next year. Next year I think next one and a half years we'll 1:00:23 1 hour, 23 seconds get those registrations. So overall we seem to be back to normal in terms of the trials both in terms of margin as 1:00:30 1 hour, 30 seconds well as the volume part and we'll be adding few more chemistries this year. 1:00:34 1 hour, 34 seconds So there will be two more new molecules which will be coming up at least this quarter. We'll be adding two more tones. 1:00:40 1 hour, 40 seconds So overall the portfolio is increasing also. So after a long back we have added up new molecules in trio. 1:00:46 1 hour, 46 seconds So if you see that whole theme of diversification that we are talking of in a way that is playing out for even this business in the trial side as well. 1:00:54 1 hour, 54 seconds So that we also derisk ourselves and we in fact in a way we expand our addressable market. 1:01:02 1 hour, 1 minute, 2 seconds Still we have a bare minimum profit or loss in the schedule business. 1:01:07 1 hour, 1 minute, 7 seconds So no now we are back to the normal margin. So 201920 we take it as a as a base year where the margins were normal. 1:01:15 1 hour, 1 minute, 15 seconds So we are mostly coming back to that normal margins. 1:01:19 1 hour, 1 minute, 19 seconds This is going to come in Q4 because Q3 has a bare minimum profit. 1:01:27 1 hour, 1 minute, 27 seconds I'm telling of the contribution margin Q4 will be better off because this is the export market we open sir. Okay. Thank you. 1:01:36 1 hour, 1 minute, 36 seconds Thank you sir. 1:01:38 1 hour, 1 minute, 38 seconds Ladies and gentlemen, in the interest of time, that was the last question for today. I would now like to hand the conference over to Mr. Godidge for closing comments. 1:01:49 1 hour, 1 minute, 49 seconds Thank you. I hope we have been able to answer all your questions. If you have any further questions or would like to know more about the company, we would be 1:01:57 1 hour, 1 minute, 57 seconds happy to be of assistance. Thank you once again for taking the time to join us on this call. 1:02:04 1 hour, 2 minutes, 4 seconds Thank you sir. On behalf of Securities Private Limited, that concludes this conference call. Thank you for joining 1:02:12 1 hour, 2 minutes, 12 seconds us and you may now disconnect your lines.