Krishival Foods Ltd — Q4 FY26

Krishival Foods Ltd Q4 FY2025-26 Earnings Conference Call https://www.youtube.com/watch?v=vFsuPZUt53M Published: 9 days ago

0:02 2 seconds Ladies and gentlemen, good day and welcome to the Q4 and full year FI26 earning call of Cishual Foods Limited. 0:10 10 seconds Today we have with us Mr. Sujit Bangal, chairman Cishual Foods Limited, Mr. 0:15 15 seconds Abhishek Purani, CEO Melton Melo ice cream division and Mr. Nana Mazke CEO 0:22 22 seconds Kishual Nuts dryfruit division. We will begin with opening remarks from the management followed by an interactive 0:28 28 seconds Q&A session. Please note that this discussion may include forward-looking statements which should be viewed in 0:36 36 seconds conjunction with the risk and uncertainties that the company faces. As a reminder, all participant line will be 0:43 43 seconds in the listenon mode and there will be an opportunity for you to ask questions after the presentation conclude. Should you need assistant during the conference 0:52 52 seconds call, please signal an operator by pressing star then zero on your touchstone phone. Please note that this 0:58 58 seconds conference has been recorded. I now hand the conference over to Mr. Sujit Bangal, chairman for opening remarks. Thank you and over to you sir. 1:08 1 minute, 8 seconds Thank you. Thank you very much. Good evening everyone. Thank you for joining us today for the quarter 4 and FI 26 1:16 1 minute, 16 seconds earnings conference call of Crucible Foods. It is a pleasure to welcome you all and I sincerely thank you for your 1:24 1 minute, 24 seconds continuous trust and engagement with the company. FI26 has been a defining year for visual force. Our investments in 1:32 1 minute, 32 seconds capacity, distribution and brand building are now beginning to translate into both scale and profitability. 1:40 1 minute, 40 seconds Now let's talk something about our business model and our positioning. As you aware, Crucial Foods operates with a 1:47 1 minute, 47 seconds dual brand strategy. Crucial nuts in the healthy snacking segment and melt and meow in the indulgence category. This gives us balanced and resilient model. 1:57 1 minute, 57 seconds The nuts business provides stable year round demand and cash flow while the ice cream business offers high growth potential and strong consumer 2:06 2 minutes, 6 seconds engagement. Together these position us as a scalable ATMC platform in the 2:13 2 minutes, 13 seconds consumption space. More precisely I can call it a discretionary consumption space. Now we can talk something about 2:22 2 minutes, 22 seconds industry the context for merles and ice cream both. So let me briefly touch upon 2:29 2 minutes, 29 seconds those these two topics. India's consumption story remains strong particularly in premium and branded food 2:36 2 minutes, 36 seconds categories. We are seeing a clear shift from loads to branded, from unorganized to organized with increasing preference 2:44 2 minutes, 44 seconds for products that combine health, quality and convenience. In nuts and dry foods, consumption is moving beyond 2:51 2 minutes, 51 seconds festival occasions and becoming part of everyday diets. While India is one of the largest consumers globally, per 3:00 3 minutes capita consumption remains relatively low especially in tier three, tier four 3:06 3 minutes, 6 seconds and uh seal areas and towns and places indicating significant headroom available for growth or critical nuts. 3:17 3 minutes, 17 seconds The India market is approximately 45,000 cr and at global level the category is significantly larger and continues to 3:26 3 minutes, 26 seconds grow steadily. This highlights a long-term opportunity for organized players in India. 3:33 3 minutes, 33 seconds Similarly, in ice cream segment, the category continues to expand at a healthy pace supported by improved cold 3:40 3 minutes, 40 seconds chain infrastructure, rising disposable incomes and increasingly impulse consumption. 3:47 3 minutes, 47 seconds While the category is be becoming less seasonal and higher temperature which we are experiencing nowadays in currently 3:56 3 minutes, 56 seconds in this month of April and May these higher temperatures are driving a strong 4:03 4 minutes, 3 seconds near-term demand in India the ice cream market is expected to reach approximately 1.5 lakh cr by 2034 4:13 4 minutes, 13 seconds compared to a global market of over USD 160. 65 billion. This underscores both 4:21 4 minutes, 21 seconds the scale of the category and significant growth headroom in India. 4:27 4 minutes, 27 seconds There is some near-term volatility in input cost and supply chains particularly for global sourced commodities. However, our diversified 4:36 4 minutes, 36 seconds sourcing model positions us well to manage these risk and we do not see any structural impact on our growth trajectory. 4:46 4 minutes, 46 seconds Today only we have declared quarter 4 of FI26 and financial year FI26 results. So 4:53 4 minutes, 53 seconds let's talk something about our financial performance. 4:57 4 minutes, 57 seconds Against this backdrop, FI26 has been a year of strong growth with improving profitability. Our nuts and dry food 5:06 5 minutes, 6 seconds business has delivered steady growth with healthy margin supported by demand distribution expansion and consistent 5:14 5 minutes, 14 seconds product quality. The more defining milestone has been in our ice cream business. Molton Melo the brand in which 5:21 5 minutes, 21 seconds we sell ice cream has achieved profitability at that level ahead of expectations. A significant achievement 5:28 5 minutes, 28 seconds in a category where many emerging brands are still scaling without profitability. 5:36 5 minutes, 36 seconds What differentiates us is clear. We are building scale with profitability not at the cost of it. We are also investing in 5:45 5 minutes, 45 seconds brand building through internal approvals rather than burning cash. 5:50 5 minutes, 50 seconds Coming to our financial performance for the full year, total stood at 304.41 5:57 5 minutes, 57 seconds cr reflecting a growth of 48% yearon year. Digit increased by 66% to 41.95 cr with a margin of 13.78%. 6:10 6 minutes, 10 seconds While the profit up tax uh means PAT increased to 22.2 cr with a growth of 64% 6:18 6 minutes, 18 seconds yearon year and a pack margin of 7.99% which is up 89 basis points year on 6:27 6 minutes, 27 seconds year. Overall both businesses have contributed meaningfully to revenue growth while improving the quality of 6:36 6 minutes, 36 seconds earnings and importantly we are beginning to see benefits of operating leverage as the scale improves. 6:44 6 minutes, 44 seconds Operational highlights we'll speak about a couple of minute. 6:49 6 minutes, 49 seconds During FY26, we centered execution across both businesses by expanding 6:55 6 minutes, 55 seconds distribution, scaling our portfolio and enhancing manufacturing and supply chain capabilities. The Melton Meno now 7:03 7 minutes, 3 seconds reaches 34,200 retail outlets supported by cold chain 7:10 7 minutes, 10 seconds network of 15,490 deeper enabling deeper market penetration stronger last mile 7:19 7 minutes, 19 seconds availability in the nurse and food segments. We are present across 11,000 retail touch 7:26 7 minutes, 26 seconds points supported by diversified sourcing model and strong focus on product 7:32 7 minutes, 32 seconds quality. Overall footprint of crual now spans 300 plus towns and places across 7:40 7 minutes, 40 seconds India and also 300 plus retail place retail places in Singapore. 7:47 7 minutes, 47 seconds We also continue to expand our product portfolio with over 189 SQS in ice cream 7:54 7 minutes, 54 seconds which is almost third highest amongst the ice cream brands in India and over 67 in nuts and drivers 8:03 8 minutes, 3 seconds reflecting our focus on innovation and evolving consumer preferences. 8:10 8 minutes, 10 seconds On the manufacturing side, we commissioned new 35,000 foot processing unit with a which commence production in the month of April. 8:21 8 minutes, 21 seconds Our growth remains focused across key markets Mumbai, Pune, Benu, Hyderabad and core states including Maharashtra, 8:30 8 minutes, 30 seconds Karnataka, Telangana, Uttar Pradesh and Goa. Overall, this disciplined approach is enabling us to scale efficiently 8:38 8 minutes, 38 seconds while maintaining strong control over execution and profitability. 8:43 8 minutes, 43 seconds Now, we'll talk about some strategic progress and how we uh look at the way forward. 8:51 8 minutes, 51 seconds In FY26, there has been a year of building for future with a strong focus on our direct 9:00 9 minutes to consumer presence. Multano remains a key growth engine with a clear aspiration to build it into one of the 9:09 9 minutes, 9 seconds top three ice cream brands in India over the next seven years. As part of this, we are launching Manen Co. with plants 9:18 9 minutes, 18 seconds Manen Co. as a ice cream partner under the name Melo and Co. We are launching roll out around 25 such franchise owned 9:26 9 minutes, 26 seconds company operated uh Mel and Co. uh ice cream outlets will be open in the current financial year at Pune and 9:36 9 minutes, 36 seconds Mumbai. This will strengthen our direct to consumer presence, enhance brand visibility and improve consumer engagement. 9:44 9 minutes, 44 seconds Deep Friser network we have already expanded from 10,000 plus to 15,000 plus during FY26. 9:53 9 minutes, 53 seconds These continuous investment in deep prisoners will further continue and expand in current financial year that is the 527. 10:02 10 minutes, 2 seconds We'll keep enhancing capacity utilization the of our existing capacity is of one lakh liter per day in ice 10:11 10 minutes, 11 seconds cream. So we'll continue to enhance uh capacity utilization with a target of full capacity utilization by Q1 FY29. 10:22 10 minutes, 22 seconds Q1 FY29 we expect complete full utilization of the capacity. Just to have glimpse to the scale which we have 10:31 10 minutes, 31 seconds achieved in the financial year 26 we have sold cones magic cones around unit 4.74 units 10:41 10 minutes, 41 seconds we have sold in financial year 26 around 3.5 cr units of choco bars we have sold 10:48 10 minutes, 48 seconds in FI26 around 1.78 cr units of cups and Sundays we have sold in FI26 this is the kale 10:57 10 minutes, 57 seconds which we have invites in isolation and all these factors gives us confidence that Melan Yellow uh 11:07 11 minutes, 7 seconds will grow further and also another important thing that Melano is the only 11:14 11 minutes, 14 seconds major emerging uh multi-state ice cream brand which is scaling with incremental branding and marketing spend while 11:22 11 minutes, 22 seconds generating profit this year 7% on the top line 29 cr has been achieved which 11:29 11 minutes, 29 seconds is ahead of uh uh our planned profitability which was uh planned in FY 11:36 11 minutes, 36 seconds 27 one year ahead this profitability has been achieved by Melton. All these factors gives us strength and makes us 11:43 11 minutes, 43 seconds aspire to make uh to to strive for making melt top three ice cream brands 11:50 11 minutes, 50 seconds in India in coming seven years. In parallel, our nurse business continues to remain strong and stable foundation. 11:58 11 minutes, 58 seconds We are progressing on capacity expansion with a clear road map to scale over next few years. Visual nurse aspiring 12:07 12 minutes, 7 seconds a player in India with a long-term goal of achieving 10% market share while maintaining profitability. This will be 12:15 12 minutes, 15 seconds driven by product innovation, strong quality control, supply chain strengthening and deeper penetration across tier 2, tier three and tier four 12:22 12 minutes, 22 seconds markets. As we move into financial year 27, our priorities remain clearly defined. 12:30 12 minutes, 30 seconds In future months, we will deepen distribution, strengthening supply chain integration and expand capacity. In 12:38 12 minutes, 38 seconds Melton yellow, our focus will be on expanding distribution, improving capacity utilization and investing 12:45 12 minutes, 45 seconds behind the brand. Across both businesses, we will remain disciplined in exe execution while maintaining profitability. 12:54 12 minutes, 54 seconds At the broader level, we are building visual force as a true engine growth platform driving scale, profitability, and long-term value creation. Our 13:03 13 minutes, 3 seconds expansion will continue to be funded through mix of internal acurals, existing equity and debt. To summarize, 13:11 13 minutes, 11 seconds FY26 has been a year of strong execution, early validation of our strategy and the creation of solid 13:20 13 minutes, 20 seconds foundation for future growth. We remain optimistic about opportunities ahead while staying focused on disciplined 13:29 13 minutes, 29 seconds execution. With discipline exe execution has led us to achieve 10% level margin 13:36 13 minutes, 36 seconds in future world which we uh which we aspire to continue in the coming years 13:43 13 minutes, 43 seconds and uh 7% which we have achieved in Iceland which will keep progressing to enhance it further to the uh to the next 13:52 13 minutes, 52 seconds height in coming financial year 27 we hope to continue to maintain growth trajectory 13:59 13 minutes, 59 seconds and we see around 50% topline growth growth and 50% plus bottom line. On 14:05 14 minutes, 5 seconds behalf of board and entire cruis team, I thank you all once again for continued 14:12 14 minutes, 12 seconds trust and support. I now look forward to your questions. Thank you. Over to you. 14:18 14 minutes, 18 seconds Thank you so much sir. Ladies and gentlemen, we will now begin with the question and answer session. Anyone who wishes to ask a question may press start 14:26 14 minutes, 26 seconds and one on their test on 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 question. 14:38 14 minutes, 38 seconds Ladies and gentlemen, we'll wait for a moment while the question Q assembles. 14:48 14 minutes, 48 seconds The first question come from the line of Mishrica from Sapphire Capital. Please go ahead. Yeah. Hello. Am I audible? Yes, you. 14:56 14 minutes, 56 seconds Yeah, you're audible. 14:57 14 minutes, 57 seconds Yeah. Congratulations. Uh the result has been quite phenomenal. I have a few questions on both the business segments. 15:05 15 minutes, 5 seconds So firstly, you mentioned that we're increasing our capacity to 40 m ton um I think permanent capacity. So when do you 15:14 15 minutes, 14 seconds expect us to reach the peak utilization like once the kex is being completed? 15:21 15 minutes, 21 seconds See our our earlier capacity as of March 31st 20 26 was 10 metric t per day 15:29 15 minutes, 29 seconds finished nuts production. This capacity has been has been enhanced as on today to 20 metric t per day uh finished nuts 15:38 15 minutes, 38 seconds production. the enhanced capacity the current financial year we are going to utilize 25% current financial year 15:47 15 minutes, 47 seconds and going forward our already uh two lakh square foot uh factory construction is going on in Hulkarnney MIDC out of 15:56 15 minutes, 56 seconds that 35,000 square foot uh premise will be has been made operational which has 16:03 16 minutes, 3 seconds added this 10 metric uh capacity to the existing then And our plan is that in the coming next 16:12 16 minutes, 12 seconds two financial year further so slowly this capacity we will we will keep adding like 10 to we got we have gone 20 16:19 16 minutes, 19 seconds this year next year we'll go 30 and again next year will be 30 and also continuously in in a manner we'll 16:28 16 minutes, 28 seconds continue to utilize uh capacity going forward like this year we have gone 25% further enhanced uh capacity next year 16:37 16 minutes, 37 seconds we'll increase another 25% or 50% uh of the enhanced capacity. So in this fail manner we are going so that our 16:46 16 minutes, 46 seconds profitability and everything uh remains intact and supply chain and all uh engines are uh working in a sync. 16:56 16 minutes, 56 seconds Okay, great. So as for FI26 if you could help me out with the utilization on the 10 metric ton per day if that's possible. 17:04 17 minutes, 4 seconds Yeah, sure. 17:06 17 minutes, 6 seconds In FI26 our existing capacity as I have spoken in earlier call also 70% was the utilization of the existing capacity. 17:17 17 minutes, 17 seconds Now current financial year current 70% was the utilization of the existing capacity. Now this financial year the 17:26 17 minutes, 26 seconds existing capacity 10 metric t will be utilized almost fully. So fully means uh 17:31 17 minutes, 31 seconds we can have a 90% utilization with some balance 17:38 17 minutes, 38 seconds space available and the new capacity of 10 metric ton will be utilized. 17:45 17 minutes, 45 seconds Okay. Yeah. Got it. Um secondly on the nuts and dry fruits what sort of aa margin do you target once this capacity 17:53 17 minutes, 53 seconds reaches like 90% optimum utilization? So is this a mix of a higher value SKUs and also operation operating leverage? So 18:02 18 minutes, 2 seconds like a steady stage a beta basis of that what would you be quoting for two three years down the line? 18:10 18 minutes, 10 seconds Uh this year has been uh FY26 has been phenomenal in achie consolidating the profitability n segment. So we if you 18:19 18 minutes, 19 seconds can see our financials uh in FY26 we have maintained we have achieved 15% 18:27 18 minutes, 27 seconds uh init margin 15 and 10% in the pack margin. So we the 18:35 18 minutes, 35 seconds way we look at uh going forward is that key in the short term in coming next two 18:41 18 minutes, 41 seconds years we will try to maintain this 15% plus IBITA and 10% plus uh uh 10% plus 18:52 18 minutes, 52 seconds PA. So going forward this IBITA may increase uh a couple of months but that 18:59 18 minutes, 59 seconds will remain 10% plus because depreciation and uh other things may add up because our expansion is going on. So 19:07 19 minutes, 7 seconds in the pack level 10% plus uh we will maintain but ITA maybe uh 15% plus 19:14 19 minutes, 14 seconds couple of uh points but our main target is that maintaining this level and not ensuring pack doesn't go below 10%. 19:25 19 minutes, 25 seconds Means that means we have to balance further depreciation which will come because of enhanced uh expansion. 19:33 19 minutes, 33 seconds Correct. Okay. And uh on the ice cream side, so we're also uh ramping up our 19:39 19 minutes, 39 seconds capacity and you expected to reach 100% by 1 QFI 29. So at that stage, what margins do you expect the ice cream business to quote on the EIPA? 19:52 19 minutes, 52 seconds FY 26 7% we have achieved. uh that's quite uh phenomenal because it has ahead 19:59 19 minutes, 59 seconds of uh target has been achieved and uh this coming FY27 20:08 20 minutes, 8 seconds FY28 this two financial years will keep on adding to the IITA. Our rig now will 20:16 20 minutes, 16 seconds keep on adding but at the same time we we are going to uh investing into 20:23 20 minutes, 23 seconds branding and uh marketing activity but that we will do from the enhanced IITra. 20:30 20 minutes, 30 seconds So Ira will not go below 7%. It will keep on increasing. Our expectation is 20:37 20 minutes, 37 seconds the ideally uh 3 years down the line when the full capacity utilization happens then should be 14 to 15% minimum. 20:48 20 minutes, 48 seconds 14 sorry keep 20:55 20 minutes, 55 seconds so 14 to 15% should be the ITA once the complete capacity utilized till that 21:01 21 minutes, 1 second time what we are going to do is that ITA will keep on increasing but at the same time we will keep investing in our 21:10 21 minutes, 10 seconds branding activity s certain percentage of sale this and this has a positive impact in 21:17 21 minutes, 17 seconds increasing our uh revenue potential our margins will also enhance. So both will go hand in hand. 21:25 21 minutes, 25 seconds Correct. And uh this year for 26 what sort of utilization we had on the ice cream side 21:33 21 minutes, 33 seconds around in ice cream ice cream side the utilization in FY26 is a 26 25% almost 21:40 21 minutes, 40 seconds you can say 25% 25% and this kind of increases once the seasonality hits so 4q and 1q are 21:50 21 minutes, 50 seconds expected to be I think that ice cream season is that correct I or what you said seasonability I don't 21:58 21 minutes, 58 seconds so for ice cream you see a seasonality also coming in for expecting the fourth quarter and the first quarter being 22:04 22 minutes, 4 seconds better in sales for this business so the utilization will be quite higher for these two quarters is that correct 22:12 22 minutes, 12 seconds yeah see uh in ice cream Q1 and Q4 will be higher than Q2 and Q3 so obviously this this sort of 22:22 22 minutes, 22 seconds similarity will always be there in any ICM uh business in case of Melan Melo. 22:29 22 minutes, 29 seconds One good thing which is happening is that our uh certain premium [clears throat] SQL production 22:36 22 minutes, 36 seconds just promised in the month of May this month. So and we are uh we are scaling 22:42 22 minutes, 42 seconds up. So probably quarter two and quarter three will give us additional strength of uh incre increasing topline because 22:52 22 minutes, 52 seconds of these some premium yeses which we are bringing in the market which are all season sort of. 23:00 23 minutes Oh okay that is great and you also mentioned this new initiative of focus stores that is coming up in FI27. So uh 23:08 23 minutes, 8 seconds these 25 stores are they all launching quite linearly across the four quarters and uh what sort of financials are we 23:17 23 minutes, 17 seconds expecting from these stores? So like revenues or like EITA break even break even on that 23:24 23 minutes, 24 seconds this obviously these are the franchise you own but company franchise you own because we don't want overheads in our 23:32 23 minutes, 32 seconds books right so there is no question of break even as there are no overheads in our books but at the same time we have 23:39 23 minutes, 39 seconds seen in many franchisee franchisee related expansions the 23:45 23 minutes, 45 seconds casualty brand So not to do that we have done company operators. So company will 23:52 23 minutes, 52 seconds uh company will operate those uh outlets. So each outlet will be uh break even from the third month only because 24:02 24 minutes, 2 seconds our overheads will be very minimal in these outlets. So therefore that uh that challenge we don't see it will not have 24:10 24 minutes, 10 seconds any impact on IITA or rather it will have positive impact on our IBITa because the realization uh of the 24:19 24 minutes, 19 seconds product in the parl will be uh quite higher. So if it will add to the IITA 24:27 24 minutes, 27 seconds but it will not have any pressure on IITA and this will be planned over the period of this financial year. We we are 24:34 24 minutes, 34 seconds we are planning to start this uh uh this task in the month of July and August we are going to start the Mumbai and Pune 25 we are planning. 24:46 24 minutes, 46 seconds Thank you great and FI 27. So now with ice cream kind of uh ramping up what proportionate of sales do you expect 24:55 24 minutes, 55 seconds coming from ice cream and do you also expect us to have a pat break even in FI27 for ice cream? 25:05 25 minutes, 5 seconds So FY27 as we see the IITA will be enhanced beyond 7%. Sorry. 25:13 25 minutes, 13 seconds And the the PAT in FY uh 26 PA was almost 1 uh 7 or 1.8%. 25:22 25 minutes, 22 seconds So PA will also enhance beyond uh 3%. 25:27 25 minutes, 27 seconds Minimum I'm saying this conservatively minimum on that. And uh uh what was your second question? 25:36 25 minutes, 36 seconds uh is the proportionate of sales coming from ice cream uh will that kind of ink up because we already had 41% sales coming from ice cream in quarter 4 but 25:45 25 minutes, 45 seconds that is again seasonally a stronger quarter for ice cream so on like a console basis for the entire FI27 how do 25:53 25 minutes, 53 seconds you see the proportionate of ice cream growing proportionate of ice cream will continuously increase that you have seen 26:00 26 minutes in FI25 and FI26 comparison in the presentation also you and see how the uh proportionate of ice cream is 26:08 26 minutes, 8 seconds increasing. So proportionate of ice cream in the total sale we will we will see in this financial also and going 26:15 26 minutes, 15 seconds forward in FI 28 and FI 29 uh we will see almost uh uh 26:22 26 minutes, 22 seconds equal of ice cream and at 26:29 26 minutes, 29 seconds this fourth quarter we had a dip in the margins any reason for that? 26:35 26 minutes, 35 seconds So if it there are two things. First is that in the if you see n segment uh Q4 26:42 26 minutes, 42 seconds uh profitability is always under pressure. So rather this year profit uh 26:50 26 minutes, 50 seconds if you see quarter wise quarter four to quarter four of 25 the profitability has 26:57 26 minutes, 57 seconds increased. So quarter four profitability is I because quarter four is mostly B2B 27:04 27 minutes, 4 seconds demand because of uh varies and uh these uh other uh this thing uh uh functions and uh all those things. 27:13 27 minutes, 13 seconds So that's why quarter profitability is always under pressure. it better to compare Q4 Q4 to Q4 profitability and 27:22 27 minutes, 22 seconds then uh you will find uh the that has been proper to give you uh proper uh 27:30 27 minutes, 30 seconds understanding uh Q4 Q4 to Q4 the margins went down why 27:38 27 minutes, 38 seconds that's what that's what that's what I am saying that's what I'm saying to give in Q4 Q4 26 there is a 2.88 88 cr almost uh 27:48 27 minutes, 48 seconds this thing the uh piece of cost which has come into the books 2.88 United. 27:55 27 minutes, 55 seconds So if you take if you take take our ITA in Q426 which is uh including this adjusted to 28:04 28 minutes, 4 seconds this uh uh uh of expenses then our EITA margin is 12.21% 28:12 28 minutes, 12 seconds in Q4 Q426 and the IITA margin in Q425 was 12.05% 28:19 28 minutes, 19 seconds 02 03%. So that way if you do appleto apple comparison the iita has increased. 28:27 28 minutes, 27 seconds Okay. And many more esop cost coming in for fi 27 fi 27 uh certain esop cost will be there 28:36 28 minutes, 36 seconds that we have not yet worked out but obviously it will not be more than this. Again the three cr figure will be there. 28:46 28 minutes, 46 seconds No it will not be it it will not be it will not be it will be less than uh this amount what has uh come in FI26 it will 28:55 28 minutes, 55 seconds be less than the is of cost which we have debited in FI26 it will be less than but but as on today there is no any 29:03 29 minutes, 3 seconds but current financial year our scheme rollout is going on certain cost may come but it will not be more than what has come in FY 2016. 29:12 29 minutes, 12 seconds Okay. Okay. Um thank you so much all. 29:16 29 minutes, 16 seconds Yeah thank you. 29:20 29 minutes, 20 seconds Our next question comes from the line of Savas from Systematics Group. Please go ahead. Hello. 29:30 29 minutes, 30 seconds Yeah. 29:35 29 minutes, 35 seconds S you may please proceed with the question. We can hear you. Hello. Uh yeah. Hi. Uh congrats. 29:41 29 minutes, 41 seconds Congrats. So the good set of numbers I just had two questions. Uh one that I can see that the raw material cost for 29:49 29 minutes, 49 seconds the on consolidated level was increase in the Q4 itself like uh it's somewhere 29:56 29 minutes, 56 seconds around seven uh odd percentage uh percentage regions. So uh if you could throw some light on that uh the 30:05 30 minutes, 5 seconds big so uh you you are talking at console level right 30:12 30 minutes, 12 seconds console level yeah so so uh Q4 has this year's Q4 has a particularity of 30:20 30 minutes, 20 seconds enhanced ice cream of operation so almost the first 9 month ice cream sale 30:26 30 minutes, 26 seconds is 47 cr and last three months ice cream same is almost 43%. 30:35 30 minutes, 35 seconds So that now you can understand the how the the ice cream has contributed in Q4. 30:43 30 minutes, 43 seconds So and these one of the reason for this uh raw material related uh issue is uh this 30:51 30 minutes, 51 seconds enhanced uh R&PM requirement and this uh ice cream proportion has increased a lot 30:58 30 minutes, 58 seconds in this quarter and that's why that uh that that is operating in the uh 31:05 31 minutes, 5 seconds consumption cost and second is so what type of feed that they're going for the uh uh utilization. 31:18 31 minutes, 18 seconds I'm sorry to interrupt you, S but your voice is breaking. 31:21 31 minutes, 21 seconds S voice is breaking. So audible. Hello. I'm audible. 31:28 31 minutes, 28 seconds Just your can. 31:32 31 minutes, 32 seconds Yeah. So, so if I can see on a segmental basis, I can see that the margins have uh fallen in margins have been quite 31:42 31 minutes, 42 seconds scary for the dry foods and the map segments like uh in the four segments you can see that there is only 10% on a 31:50 31 minutes, 50 seconds on a Q on Q on a Y1 basis and ice creams have been sharply fallen for 4%. So now 31:56 31 minutes, 56 seconds going forward you guided for the uh the PBIT margin will be in the range of 3 to 4%. So going forward the consolidated 32:05 32 minutes, 5 seconds level at what percentage of margin are we looking at for ice cream in FY 27 or 28 when will we be having the full capacity? 32:15 32 minutes, 15 seconds Yeah I'll tell you that is actually uh margins are very good in Q4 in ice cream. What has happened in the Q4 ice 32:23 32 minutes, 23 seconds cream this is cut which I said 2.8 net crate cr is of cost has been uh debited in a 32:33 32 minutes, 33 seconds Q4 of ice cream melan. So okay the Q4 Q4 IITA uh sorry Q4 ITA of 32:43 32 minutes, 43 seconds ice cream for uh FY uh 26 has to be increased by 2.88 88 cr to 32:52 32 minutes, 52 seconds bring it as adjusted to is of cost 2.88 cr is the isop cost which has gone in a Q4 in ice cream melon this research is 33:02 33 minutes, 2 seconds of course that has gone in the Q4 in ice cream so in the Q4 2.88 cr 33:10 33 minutes, 10 seconds shall be added to the IITA to bring adjusted IITA net of soft cost. 33:18 33 minutes, 18 seconds Got it. You understand what I'm going to say? 33:20 33 minutes, 20 seconds Yeah. Got it. Uh so last question on the demand side for the ice cream sector like we have uh achieved the 15,000 mark 33:28 33 minutes, 28 seconds uh of the refriger uh could you highlight what what states or which part of the country are we seeing major 33:36 33 minutes, 36 seconds tractions coming like uh towards north uh towards towards the south side of the basically from the Maharashtra's 33:44 33 minutes, 44 seconds Maharashtra region or from the three cities uh just uh highlight how the demand is actually going on for 33:53 33 minutes, 53 seconds this uh yeah so the big fever expansion is going 34:01 34 minutes, 1 second across these five states Maharashtra Karnataka Telangana Andhrag and Goa 34:09 34 minutes, 9 seconds if you want to see uh and measure metro wise uh how it is proposed so Mumbai Pune Hyderabad 34:18 34 minutes, 18 seconds and Bangalore these are the four metros which are being uh targeted or focused focused upon. So this and sales demand 34:27 34 minutes, 27 seconds our majority almost majority demand has been if you see more than 50% demand is from Maharata and the remaining demand 34:36 34 minutes, 36 seconds is from these posters Andhra Pradesh we started in the month of November and that is really uh doing 34:44 34 minutes, 44 seconds well and picking up well Hyderabad we have a quite a good presence we have a for last two three 34:51 34 minutes, 51 seconds years and Karnatak south of Karnataka we have started Bangalore we started uh uh in last year in Octo October November that is also going there. 35:04 35 minutes, 4 seconds Okay. And just one more question uh in the season promotion expenses uh you said going forward for making sure that we expand our demand across the country. 35:17 35 minutes, 17 seconds So how will there be any sharp uh sharp uptakes? 35:23 35 minutes, 23 seconds Your voice on breaking site was now your wife your voice breaking. I'm audible now. 35:31 35 minutes, 31 seconds Huh? Now it is uh okay you can talk. 35:34 35 minutes, 34 seconds Okay. So my question was regarding the season expense like uh going forward when we will be expanding our presence 35:42 35 minutes, 42 seconds across the across the country. So how is the how are we looking at this season promotion experience panning out like 35:50 35 minutes, 50 seconds will be and there will be any sharp uptakes or we'll be taking it from the we'll be keeping it uh constraint across 35:58 35 minutes, 58 seconds in the coming at least two to three four quarters yeah that's see sales sales promotion expenses there's a quite 36:06 36 minutes, 6 seconds difference what we are doing at cruual as far as sales promotion or branding expenses is concerned we are not doing 36:13 36 minutes, 13 seconds branding expenses is to bring customer uh to our uh to our product. Customer is already coming to the product. 36:22 36 minutes, 22 seconds What we are doing is that key to validate the confidence in the minds of customer to bring recall value and to 36:31 36 minutes, 31 seconds bring primalization which will increase our per SQV uh realization also. that function is being 36:40 36 minutes, 40 seconds assured to branding [clears throat] which we are doing or we are we which we are proposed to doing. So whenever we 36:46 36 minutes, 46 seconds are doing the branding activity in the ice cream segment for example we are doing consciously with a certain 36:54 36 minutes, 54 seconds percentage of sales and simultaneously in the next year there will be impact on 37:02 37 minutes, 2 seconds enhanced uh ITA. 37:05 37 minutes, 5 seconds So going forward next year of commercial expenses will be from the again enhanced 37:12 37 minutes, 12 seconds IVITA. So every year ITA will see continuous secular increase also and 37:20 37 minutes, 20 seconds also at the same time sales promotion or branding expenses will also keep on increasing along with the in absolute 37:28 37 minutes, 28 seconds number because stock line will also be increasing. So this way we are doing. So there will not be unreasonable jump in 37:35 37 minutes, 35 seconds any quarter or there any at the at the sacrificing IITA or profitability that will never happen. 37:45 37 minutes, 45 seconds Got it. Got it. Thank you so much sir and all the very best for K. Thank you. 37:56 37 minutes, 56 seconds Thank you ladies and gentlemen. Anyone who wishes to ask a question may press star and one on the dash telephone. 38:03 38 minutes, 3 seconds Our next question come from the line of motivala from Amala funds. Please go ahead. 38:13 38 minutes, 13 seconds Yeah, good evening sir. Can you hear me? 38:16 38 minutes, 16 seconds Uh your voice is low sir. If you can just uh turn on your volume please. 38:23 38 minutes, 23 seconds Yeah, actually um my phone is actually and your voice is breaking. 38:31 38 minutes, 31 seconds Why is this breaking? Why is it breaking? Okay, sir. 38:36 38 minutes, 36 seconds Would you like to rejoin the mobile phone? One second. Let me try to go in another corner in the office. One second, please. 38:43 38 minutes, 43 seconds Yeah, you may rejoin. Meanwhile, we'll take the another participant. Yeah. Is it better now? 38:51 38 minutes, 51 seconds Hello. Now it is better. Now it is better. You can try. 38:56 38 minutes, 56 seconds Yes sir. Uh I have a few questions. U I'll start off with the over the last 39:03 39 minutes, 3 seconds about 3 years from IPO. So you made cumulative about maybe 200 crores including the IPO proceedings. 39:16 39 minutes, 16 seconds uh understand how please continue. 39:21 39 minutes, 21 seconds Yeah. Yeah. So I would like to understand how these are being deployed from your investment in the ice cream business uh strategically and then some 39:29 39 minutes, 29 seconds advances including working capital. Uh it would be very helpful to get a picture of that. I've been able to read the last couple of annual reports but 39:38 39 minutes, 38 seconds just to get a complete picture uh will be very helpful over the cumulative money including the recent 100 crores that has been raised in the understood 39:47 39 minutes, 47 seconds understood understood. Yeah. So it's very simple. So in the IPO we raised 20 cr and that was in working capital March 39:54 39 minutes, 54 seconds 22 we raised for the working capital uh and there was no ice cream segment. So we were enhancing the the net segment 40:02 40 minutes, 2 seconds only. Then in a preparation we raised uh 60 around 65 cr and that 65 cr 65 odd 40:11 40 minutes, 11 seconds figure or something please minus something 65 we raised in because I'm just going on memory exact paper is not 40:18 40 minutes, 18 seconds in front of me around 65 cr we raised from a preferential that time also it ice cream segment was not with us total 40:27 40 minutes, 27 seconds 65 cr we used for enhancing in working capital in enhancing Our nurse division 40:34 40 minutes, 34 seconds in this period our nurse division has gone from uh March 2020 22 50 cr topline 40:42 40 minutes, 42 seconds to 70 cr to 103 to uh 173 cr. This 40:50 40 minutes, 50 seconds topline growth has been achieved uh during this period. Also during this period if you see our balance sheet 40:57 40 minutes, 57 seconds continuously we have been enhance investing in our plant and machinery and that was from our internal acroles for the n segment. Yes. 41:05 41 minutes, 5 seconds So the the capacity expansion we have done from our internal acroals continuously and this scale has been 41:13 41 minutes, 13 seconds achieved in the nerds and tycoon segment business. Now the rights issue which we have raised in 100 cr recently. Out of 41:20 41 minutes, 20 seconds that 35 crs we have we received in the month of January and this 35 cr 25 cr is for the 41:31 41 minutes, 31 seconds the uh new facility in the first question which I said the lax square foot factory which is being constructed along with uh for the nursing division 41:40 41 minutes, 40 seconds over there. So this 25 cr is for that plant and machinery over there that has and 10 cr is for the working capital of 41:50 41 minutes, 50 seconds the n division. So this 35,000 remaining money is able to receive to us that that 41:59 41 minutes, 59 seconds will be received in a uh two calls which we'll do in the current calendar year then we will receive and uh then utilization will be uh done. 42:11 42 minutes, 11 seconds Oh okay. So so these are partly received proceeds is what you're saying 35. 42:15 42 minutes, 15 seconds Yeah. Yeah. 100 100 cr out of this is a out of 100 cr first call we have we received 35 cr 42:24 42 minutes, 24 seconds will receive in the subsequent two calls yeah right okay that's very true now uh 42:31 42 minutes, 31 seconds the IT division has uh grown rapidly and turned around brilliantly uh we've seen that over years and years that a great 42:40 42 minutes, 40 seconds and large company like this are struggling with the ice cream business uh but our principal basic supply chain 42:47 42 minutes, 47 seconds for sourcing link and the customer group being a cold chain product is totally different from your B2B and B2C max business. 42:56 42 minutes, 56 seconds So uh where is the synergy and the leverage uh that you have seen in this 43:03 43 minutes, 3 seconds business? You have taken on uh uh this uh this ice cream business which has done very well for you in terms of 43:11 43 minutes, 11 seconds growing as well as turning around and now contributing into the net profit. 43:18 43 minutes, 18 seconds Uh regarding the ice cream business uh and it's uh procurement of milk and other uh raw materials uh ice cream 43:26 43 minutes, 26 seconds business we have we acquired in September 2024 and this Melton Miller brand uh it co-ounders 43:34 43 minutes, 34 seconds uh has started in 2014 and it has been uh continued uh continued on that 43:41 43 minutes, 41 seconds period. So there there is a quite uh invisible asset in form of this uh 43:48 43 minutes, 48 seconds procurement of raw material and supply chain. So that is one of the strength of the inner strength of the melano before 43:57 43 minutes, 57 seconds we achieve that was the strength which has achieved which which has been attained by melano. So we didn't do 44:05 44 minutes, 5 seconds anything new for supply chain in Melan that was already intact there even there 44:13 44 minutes, 13 seconds at sales level uh there very good network of distributor has already been there so as far as your question was 44:23 44 minutes, 23 seconds specifically related so there was nothing which was required to be done and secondly uh the ice cream business 44:31 44 minutes, 31 seconds is different from the typ ical milk and milk for business. So in milk and milk for business milk collection is a very 44:39 44 minutes, 39 seconds critical thing in ICM business milk is one of the raw material like milk ski 44:46 44 minutes, 46 seconds powder and other many other products are the uh raw material ingredients for the ice cream business. So in that sense uh 44:56 44 minutes, 56 seconds that I think uh that is addressed regarding the synergies. So most important synergy in Melton Milo which 45:04 45 minutes, 4 seconds we have seen is that key Melton Milo when we acquired that time it was having 25,000 45:12 45 minutes, 12 seconds retail uh outreach and as of today it total retail touch point is 37,000 and 45:20 45 minutes, 20 seconds this 37,000 retail touch point of Melano we have not fully utilized for nuts yet 45:28 45 minutes, 28 seconds slowly slowly that network we are leveraging for the consumer. So we are getting a very wide network of uh this 45:38 45 minutes, 38 seconds retail touch points retail outlets across these states. That is one of the very uh important uh uh uh things which 45:47 45 minutes, 47 seconds which we have achieved. Another important thing is there is a working capital cycle of nuts and dry fruits is 45:55 45 minutes, 55 seconds very complimentary. When there is uh when there is a peak of uh uh nuts then 46:02 46 minutes, 2 seconds there is some slack perian ice cream right and when there is a and that's used a very good uh complimentary uh 46:10 46 minutes, 10 seconds positioning for working capital. So these two two things have been very much critical and third most important thing 46:19 46 minutes, 19 seconds he the product gives the the founding team has been very uh wellversed and has 46:28 46 minutes, 28 seconds deep insights into the product and the uh R&D related to product because in IT 46:36 46 minutes, 36 seconds that is very much required. So these were the important points while uh going for the uh ice cream acquisition that time. 46:47 46 minutes, 47 seconds Right. So now going to the traditional uh or the first business which you started which is the first business and if you look at about a composite picture 46:56 46 minutes, 56 seconds of retailers uh and just taking a simple sales manus net raw material which is minus the closing stock as we said in the annual 47:04 47 minutes, 4 seconds report uh what was looking like 18 20% sort of gross margin they have actually improved first uh quite a bit in the 47:13 47 minutes, 13 seconds last uh two two and a half years and there is you know commen good achievement by the company and then recently in the last two quarters there 47:22 47 minutes, 22 seconds has been a little bit of a challenge on that account which for which the questions have already been asked on a day to margin basis. So uh firstly going 47:31 47 minutes, 31 seconds back what has led to the improvement in the margins and the nut business uh from 47:38 47 minutes, 38 seconds sourcing to the field mix itself because certain ming margins etc. It'll be very helpful to learn the nature of that business change 47:47 47 minutes, 47 seconds over the last two years because the vener as we pointed out are going from 300 crores to 70 and now to maybe close to 170 180 crores. 47:58 47 minutes, 58 seconds So your question is that what led to enhanced margin in segment isn't it? 48:04 48 minutes, 4 seconds Yeah. what what has led to event margin in the in the uh in the next. 48:10 48 minutes, 10 seconds So exactly in the next segment if you see uh my answer in in the initial capacity utilization question so 48:18 48 minutes, 18 seconds existing plant we have utilized almost uh 70% capacity in FY26 48:27 48 minutes, 27 seconds and current financial year it will be 90% capacityization of the existing capacity so almost operating leage has 48:36 48 minutes, 36 seconds started to come into picture and due dividend in segment and that's why the 48:43 48 minutes, 43 seconds profitability of 15% and 10% has been achieved in FY26. 48:51 48 minutes, 51 seconds Secondly, in the material we have ah yes sorry in the nut business in the nut 49:00 49 minutes business the operating capacity utilization is so pertinent to drive up margins uh only on uh because I from 49:10 49 minutes, 10 seconds what I understand it's not a very uh high sort of fixed cost operating business. So the operating leverage that 49:18 49 minutes, 18 seconds you are explaining uh it will be interesting to understand that at B maybe in in another forum uh but right 49:25 49 minutes, 25 seconds now I I accept your answer that the operating leverage is the utilization run from 70 80 to 90% as you said 49:35 49 minutes, 35 seconds yeah and the second along with that the continuously what we have been investing in our supply chain and also at the back 49:44 49 minutes, 44 seconds end and in the front our distribution to tier 2, tier three and tier four towns and there we give 49:52 49 minutes, 52 seconds and that gives uh pricing power in that segment. The pricing power which crucible has is one of the strength 50:02 50 minutes, 2 seconds which festival is having and that has translated into this consistent margin in the net segment and as I said in the 50:09 50 minutes, 9 seconds earlier question going forward we are our our target is to maintain this 15% 50:17 50 minutes, 17 seconds ITA and the 10% pack and if you see my answer to the question is that our 50:23 50 minutes, 23 seconds execution our capacity utilization is going to be in a failed manner and the reason for that is that you have to 50:32 50 minutes, 32 seconds continue to maintain this margin while going while scaling up. That is the reason for that and they are doing the 50:39 50 minutes, 39 seconds operational business in the nation and certainly operational business is quietly 50:47 50 minutes, 47 seconds getting available because we are not doing trading buying nuts and rebranding and selling. So if we are buying nuts 50:55 50 minutes, 55 seconds and uh rebranding and training then in that case uh varied uh operational usage 51:02 51 minutes, 2 seconds is not a major point over there. In our case, the nuts we are processing at our 51:08 51 minutes, 8 seconds end and also raw nuts performment is being done by ourselves. We are 51:15 51 minutes, 15 seconds investing uh quite a lot into that in last many years and that has translated 51:22 51 minutes, 22 seconds into this leverage and this uh profitability in the nut segment. 51:29 51 minutes, 29 seconds Sure. Yeah, that's very interesting. Uh luckily on on the net itself there is now a data box of pretty uh large sales 51:37 51 minutes, 37 seconds of MPG players uh which which we are noticing as as we see uh as a customer on Amazon. You can 51:45 51 minutes, 45 seconds see people like Tat consumer and few of the larger players are are coming 51:52 51 minutes, 52 seconds into this business now. uh how how do you see the competition uh shift the market in terms of 52:02 52 minutes, 2 seconds profitability as well as more people coming and creating a positive environment will grow as well 52:11 52 minutes, 11 seconds that's very valid question in and uh I will refer to the earlier uh point which you have raised regarding operation 52:18 52 minutes, 18 seconds leverage because that is relevant here in that segment uh you can you cannot do a 52:26 52 minutes, 26 seconds business in all India basis just by purchasing n branding in your packaging 52:33 52 minutes, 33 seconds and selling that's way you cannot create a profitable you can do sale but you cannot do a profitable scalable 52:42 52 minutes, 42 seconds long-term business you cannot do and then the most important thing is that from the January to December customer 52:50 52 minutes, 50 seconds should get a assured quality of nut which is possible only if 52:58 52 minutes, 58 seconds there is strength in sourcing. So what I feel is that key in India uh unless 53:06 53 minutes, 6 seconds there is a back end of sourcing processing in house we cannot give a 53:15 53 minutes, 15 seconds quality net on table to the customer so that's why I feel there is a quite a 53:22 53 minutes, 22 seconds good head room if there is a integrated pair player who is working on it so from 53:31 53 minutes, 31 seconds that angle I feel confusual going forward uh human as a numero you 53:38 53 minutes, 38 seconds know player in India there is a lot of chance I know I'm not saying that it is easy but there is a 53:46 53 minutes, 46 seconds quite a good chance and we are very confident of achieving it because we are going we are going at a three level as a 53:55 53 minutes, 55 seconds supply chain we are working we are working at a processing level and as far As sales is considered, we are going to 54:03 54 minutes, 3 seconds the customer to tier 2, tier three, tier four towns and in B2B also directly to the players who are using it as an ingredient. 54:16 54 minutes, 16 seconds Sure. Uh these are very good uh to the question. Thank you very much. If I can just ask you one question on the pet adoptment shareholders, as you noted, 54:25 54 minutes, 25 seconds they don't seem to be there uh on the shareholder list now. 54:30 54 minutes, 30 seconds uh and u you know there there is there seems to be uh a sort of cloud on that 10 odd% share 54:39 54 minutes, 39 seconds has been 10 11% which was there so what are your comments on on on that that is happened and that inquiry etc is there 54:47 54 minutes, 47 seconds anything that the company has got any questions we don't yeah yeah so as I said we don't 54:54 54 minutes, 54 seconds have any uh thing to comment on that we don't have any relation related to that company has uh those people have 55:03 55 minutes, 3 seconds invested and uh uh those are one of the shareholders more than that we don't have any any team involvement or any 55:10 55 minutes, 10 seconds comment on that with the prepotment you would be knowing these potential shareholders actually or the ones who bought and then sold. 55:21 55 minutes, 21 seconds So see we are being your companies uh when your company is growing company is fun company goes and uh does marketing 55:30 55 minutes, 30 seconds and uh there's the investment right and the and like that the things happen. So 55:37 55 minutes, 37 seconds now if any investor of the company has done anything wrong then uh we don't 55:45 55 minutes, 45 seconds have anything to do with that as long as that investor is not involved in the company management or operation. So we 55:52 55 minutes, 52 seconds don't have anything to do with that or completely limited to that specific 55:58 55 minutes, 58 seconds that have done anything that go on that continuously. 56:06 56 minutes, 6 seconds Yeah, I I'll stop you for some more thoughts, but I'll stop you in the context of Thank you very much. I really appreciate. 56:14 56 minutes, 14 seconds Yeah. Yeah. Thanks. Thank you so much. 56:19 56 minutes, 19 seconds Ladies and gentlemen, that was the last question for today. I would like to hand the conference over to Mr. Sujit Panga for closing remarks. Thank you and over to you sir. 56:29 56 minutes, 29 seconds It was very great uh to talk to all and I thank uh everybody for participating 56:35 56 minutes, 35 seconds uh in this call and thanks for the for the arrangement to the team for making 56:42 56 minutes, 42 seconds it possible. Thank you. Thank you very much. 56:46 56 minutes, 46 seconds Thank you so much sir. Ladies and gentlemen on behalf of Cishual Foods Limited that concludes this conference. 56:53 56 minutes, 53 seconds Thank you for joining us and you may now disconnect your lines.