Ladies and gentlemen, good day, and welcome to Zydus Wellness Limited Q4 FY22 earnings conference call hosted by ICICI Securities. As a reminder, all participant lines will be in the listen only mode, and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal an operator by pressing star then zero on your touchtone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Manoj Menon from ICICI Securities. Thank you, and over to you, sir. Hi, everyone. Welcome to the Q4 FY22 results conference call of Zydus Wellness Limited. It's a wonderful, good morning, good afternoon, good evening, depending on the part of the world you are joining this call from. The management is represented today by Dr. Sharvil Patel, the Chairman, Mr. Tarun Arora, CEO, Mr. Ganesh Nayak, Director, and Mr. Umesh Parikh, CFO. At ICICI Securities Institutional Equities, we cover Zydus Wellness, and we have a constructive view on the business and the stock. Now over to the management, sir. Hi, good evening, everyone, and welcome to the post-results teleconference of Zydus Wellness Limited for quarter four financial year 2021-22. We have with us Dr. Sharvil Patel, Chairman, Mr. Ganesh Nayak, Director, and Mr. Umesh Parikh, CFO. As the economy is witnessing high inflation in the food and commodity prices, our key imports like milk and refined palm oil are on continuously rising trend and see no sign of abatement. The rising level of inflation has impacted consumer sentiments and affected consumer demand. Since the company commands reasonable pricing power for most of its brands, it has been able to take calibrated price increases over the last couple of quarters and balance the cost and profitability. During the quarter, the company has posted net sales growth of 5.7%, which includes volume growth of 0.4%. Our gross margin as percentage to net sales has sequentially improved by 265 basis points on the back of price increase and cost improvement measures. Amidst the spread of COVID-19 during the last two financial years impacting the summer-heavy brands, our net sales on the two-year CAGR basis posted a growth of 7.1% despite the erosion of around 8%-9% of total annual revenue each year. For the financial year 2022, we have achieved a growth of 7.3% on net sales and 7.6% on total operating income respectively over previous financial year. Despite the challenges like COVID-19 and inflation, company has been able to navigate through these headwinds by taking appropriate measures and match last year's performance and in terms of EBITDA. Let me take you through the highlights of the consolidated financial performance of quarter four financial year 2021-2022. During the fourth quarter of financial year 2021-2022, our total income from operations grew by 5.6% to INR 639.8 crore. EBITDA was down by 2.7% year-on-year to INR 1,415 million. PBT was down by 0.9% year-on-year to INR 1,314 million. Net profit was up by 0.1% year-on-year to INR 1,333 million. Coming to annual consolidated financial highlights. Our total income from operations increased by 7.6% year-on-year to, sorry, 2,009.1 crore during the year. Our EBITDA was up by 0.1% year-on-year to INR 344.8 crore. EBITDA margins as a percentage to total income from operations stood at 17.2%. PBT after exceptional items was up by 172.7% to INR 306 crore. Reported net profit was up by 160.1% to INR 308.9 crore. Adjusted net profit was up by 23.1%. Our consolidated cash position stood at INR 196.8 crore, including investments made in liquid funds. Our consolidated CapEx for the year was INR 66.9 crore. With that, let me share some of the highlights of operations for the year gone by. We continued our thrust on marketing initiatives to grow the categories and increase market share of our brands during the quarter. To narrate a few, on the Glucon-D front, as highlighted earlier, there was a steep shortfall in sales due to second wave of COVID-19 in the peak summer season. However, early second summers in the last quarter of financial year in the key markets has helped the brand recover and post a double-digit growth for the financial year. ImmunoVolt, which continued to deliver steady business, was supported with TV campaigns and distribution drives. Glucon-D has maintained its number one position with a market share of 58.5% in the glucose powder category as per MAT March 2022 report of Nielsen. On the Complan front, as per Nielsen, the health food drinks category has slowed down over the last three quarters with flat to negative growth over comparable pre-previous year. The category reported 2% de-growth in the last quarter for the financial year, which impacted the business. During the year gone by, the brand has relaunched with an improved taste and pack design, and strengthened the position by not just focusing on growth but also on memory and concentration. The relaunch was supported with its new campaign, which communicated the key benefits of the brand. During the last quarter of the financial year, we relaunched the new campaign, Pack Palto, Fark Dekho, emphasizing on its narrative focused on right nutrition leading to better growth. The brand's market share stood at 5.0% in the health food drink category as per MAT March 2022 report of Nielsen. On the sweeteners front, the overall sweeteners portfolio grew at mid-single digit growth owing to higher base of the previous financial year. However, the portfolio posted a good double-digit growth on a two-year CAGR basis. The category is facing challenges as higher proportion of diabetics succumbed to COVID wave two, thereby putting pressure on related consumption. We onboarded a new brand ambassador, Miss Katrina Kaif, along with a new campaign. The future-focused stevia-led range of Sugar Free Green registered a high growth rate, and it has helped drive the e-commerce first approach. The Sugar Free brand is firmly holding the ground, and the company market share stood at 95.7% as per the MAT March 2022 report of IQVIA. Sugar Lite continues to grow at a high double-digit during the year with consistent support on above-the-line and digital front to recruit new consumers into the healthier sugar segment. On the personal care front, Everyuth brand outweighs the category growth and registered a strong double-digit growth during the financial year gone by. The brand launched a range of body lotions in quarter three and continued to build new range along with a good portfolio of skin cleansing with consistent ATL inputs on TV and digital platforms. Everyuth scrub has maintained its number-one position with a market share of 39.0% in the facial scrub category, which is an increase of 367 basis points over the same period last year. Everyuth peel-off has maintained its number one position with a market share of 76.2% in the peel-off category. Everyuth brand is at a number five position with a market share of 6.5% at overall facial cleaning segment level. Nycil brand sales got impacted for second consecutive year due to second wave of COVID-19. However, the brand continues to maintain its strong leadership position in the prickly heat powder category, supported by consumer offers and ATL initiatives. We are looking forward for a good summer season this financial year, which will help us continue gaining market share. Nycil has maintained its number one position with a market share of 33.7% in the prickly heat powder category. On the dairy and spreads category front, Nutralite brand delivered a strong double-digit growth during the year. In the spread category, mayonnaise double Business has doubled compared to the comparable year. Nutralite DoodhShakti dairy portfolio, which was impacted immediately after launch due to COVID second wave, has started getting traction in second half of the year. It was well supported with TV, print and digital campaigns. Nutralite DoodhShakti Professional Ghee was launched in March 2022 to expand its presence in the institutional and food service channel. On the international business front, the company continues to expand its international footprint by entering new geographies like Hong Kong, Lebanon, Zimbabwe, Muscat, Ethiopia, and Australia during the financial year. The company also launched new extension to Sugar Free, that is Sugar Free D'lite Cookies and Sugar Free D'lite Chocolate Spread in international markets. The international business continues to grow at high double digits. Unlike the last two financial years, the company anticipates normalized year with good summer season, aiding its summer-heavy brands like Glucon-D and Nycil, and consolidate the performance of other brands. The company expects to see improvement in gross margins through a mix of initiatives outlined earlier in the coming quarters. Though the inflation will continue to be a concern, company is confident of navigating the challenges with a clear focus on driving growth and balancing the bottom line aspirations, with a combination of cost improvement measures and calibrated price increases. Thank you, and we will now start the Q&A session. Over to the coordinator for the Q&A. Thank you. Thank you. Ladies and gentlemen, we will now begin with the question and answer session. Anyone wishing to ask a question may please press star and one on your touchtone 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. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question is from the line of Kapil Jagasia from Edelweiss Financial Services. Please go ahead. Thank you for taking my question. Sir, can you throw some light on the Complan market share? If I believe it was 5.5% when we had acquired it, and now it is down to around 5%. Are we losing value market share over here, or is this a case of the segment itself not performing as the expectations? In the second quarter of 2019, soon after acquisition, we had touched 5.0%. We have seen share going up to 5.5% and 5.7% and coming back to 5.0%. We have seen a little bit of yo-yo and more so impacted over last couple of quarters. We have had a good double-digit growth prior to that, and I think it's largely impact of two factors. One is the category growth has slowed down, but our own performance also impacted by price drops taken by the leader in launching their pouch pack. We are pretty confident by our relaunch actions that we will be back at regaining market shares. There has been a little bit of back and forth on the shares, but it's in the same zone as we acquired it. Would we be following the leader strategy over here? Would we be also going for price cuts in this segment? We are not following the leader's strategy. What we are doing is actually two or three things. One, in the relaunch, we are focused on the brand building, where we are focusing on the proposition around overall growth, which is beyond physical growth that we stood for. We are focusing on memory and concentration. We have also improved our taste and impact of the brand. However, to navigate the changes, changing market scenario, we will be addressing the pouch and sachet, but we will do it not exactly following the leader, but we are testing some pieces. We have already launched a pouch pack in West Bengal for our Creamy Classic, which addresses part of the pricing challenge, but not exactly following the leader. Okay. Thank you. Sir, my next question is, how is the traction in your seasonal products like Glucon-D and Nycil? We lost two summer seasons because of COVID. Now this summer has really turned on well and, you know, there has been no COVID cases, especially in March, April, and May, this May. How has it turned out? Because ice cream and carbonated players, carbonated drink players are doing really well. Your inputs on this. Summer season came a little later, but I think. Well, I cannot share beyond a point, but yes, what I can say is, our experience in the end of the last quarter was very positive. We are hopeful that we still have some time to go for the season to complete, but it has started off well, and we'll see how it plays out. Okay. Sir, just last question from my side. Would you continue to take price hikes to maintain your margins? If not, would there be cut in A&P spends going forward? We are looking on the prices brand to brand, and we have covered cost issues for each of the brands other than Complan, where we may have to respond to the competition and the milk prices are zooming higher. There we may take a portfolio call and balance it out, but we are consciously looking at calibrated price increases to balance our portfolio and hold on the margins, gross margins and EBITDA margins. I think the focus on advertising is to continue building the brand, and therefore it is usually the last call to manage the operating margins. I believe if at all, those tend to be temporary or calibrated again. sir, can we expect like, gross margins to revert back to around 55%-66% by end of FY 2023? Our intent is to be doing that, but hard to say because every quarter we've seen some new challenges and very hard to predict the way the world is. It's absolutely very, very volatile and non-linear, so very hard to, you know. Our intent, yes. Guidance too hard to give at this stage. Okay, great, sir. Thank you for answering all my questions. All the best to you. Thank you. The next question is from the line of Pritesh Chheda from Lucky Investment Managers. Please go ahead. Sir, just two interconnected questions. On the summer portfolio of the summer brands, you know, let's say the competing product class, not the competing product classes, but seasonal product classes, unlike you had even a tougher time for the last couple of years. You know, for us, it's not grown. Is it fair to assume that, you know, we are at least for this year, we are in for a fairly stronger growth in this portfolio and they form a significant part of your portfolio and hence the overall growth. By virtue of the fact that they are a higher gross margin vis-à-vis the company level gross margin. Your initial feedback which you gave that, you know, you don't want to guide on the, you know, reverting GM back to 55%. Considering that they are a fairly high gross margin, you have that lever in terms of product mix, this year as well. You are asking two things. One is the seasonal products performance and its impact on the gross margin. Seasonal products have started off well, and we are quite hopeful that the whole season will play out. Very hard to say how the demand happens, because just for you to, and for everyone to see, that seasonal products have a very inherent thing, that they have a short window. Typically, say a consumer buys one and a half pack in a season, and it is recruitment. We are hoping that we'll be able to recover back a lot of those lost consumers over last couple of years, and we are quite hopeful of that. We remain as optimistic as you suggested. We were also hopeful that there will be operating leverage and a positive margin impact on that. It has to play out as we hope it plays out in the top line. Your comment on. You have covered cost issue on each brand except Complan. For this 350 basis points drop in gross margin, do you want to indicate that the costing, the price increases on brand, all brands except Complan has been taken care of? That's how we should interpret as on date, based on whatever the material prices are? Yeah. Largely, we have covered most of them at a, individual brand level. There may be a small here and there, but largely we have covered most of them. These would have happened in the preceding quarter, which is the current reported quarter, whose benefit should now flow in. That's how it is? It has already happened in the last quarter, and substantial benefits are flowing. Some more benefits yet to go, but substantial benefits are flowing. sir, despite that, there was a 350 basis points gross margin drop, so I couldn't interpret that from. There are also product mix impacts which come. There are a mix of two or three factors. We also seen across FMCG and us, like similarly, that there is a certain reduced volume impact, and therefore that's also a mix impact where certain product categories also play out. I think we largely covered. We had taken at an estimate level of about 7%-8%, 7.5% price increase, of which 5.3% has played out. Let's see how this remaining plays out. Assuming the same mix and planned numbers play out, we'll see. We are also conscious of tracking each of the product because there has been further cost increases. We will act anywhere we see there is an opportunity to take further increases. It's a very dynamic situation given every day we have new news. Like mid of the last quarter, we saw this Ukraine crisis. We've seen packaging price going up because of lead pipe crude. Some of these are dynamic in nature. We are conscious and acting on each one of them as we speak. Okay. Sir, our hypothesis that Nycil and Complan, Nycil and Glucon-D are higher than company-level gross margin, at least that assumption is correct? That's correct. Okay. Lastly, what will be your debt repayment schedule or plan for FY 2023? Debt repayment schedule will be on a gross debt basis. We'll be debt-free by mid of the next year, mid of the next calendar year. Middle of FY 24, which means? Mid of the next calendar year, I am saying that, in calendar year 2023, by June, July, we'll be debt-free. You'll be debt. On gross debt basis. Okay. Thank you very much. Thank you. The next question is in the line of Tejas Shah from Spark Capital. Please go ahead. Hi, team. Thanks for the opportunity. My first question pertains to market share. Among our portfolio, which brands would have gained market share in this year and which would have lost market share? Clearly, Sugar Free and Everyuth have gained market share. We have also marginally, I think, maintained volume share on Nutralite, while value has slightly dropped, but that's a pricing, as captured by Nielsen, but their volume has maintained closer to 37-odd%. Similarly, Glucon-D, the shift is about 0.1%-0.2%, so largely maintained. Complan has dropped a little bit, a few basis points. Okay. Sir, second question is that since the acquisition happened, we did not have a single summer which was a normal one. As the previous participant also alluded that the large part of our profitability is also summer-dependent. Now with a very normal summer, in fact, more than normal summer going along, do you feel that ambition of our EBITDA margin also moving back to 22% will have some definite directional move in this year? If it has to happen, this is the year where it should actually surface. Or you believe that there will be some headwinds which might derail us from achieving that ambition? I think, like I said, intent-wise, yes. I think when we get the full revenue, the operating leverage also plays out. We are acting also on the gross margin. These are the things that will matter for us to play out. The revenue, addressing the cost through taking a calibrated price increase in cost and the operating leverage to play out. We're working on all three of them. We are hopeful that directionally this year should move in the right direction at our operating margin level. I mean, last few quarters have taught us that you can plan for something and it can be different. I would say I'll stay cautiously optimistic. Okay. Sir, are you optimistically cautious or cautiously optimistic? This is what I'm trying- Play on words. Beyond a point I can't. Yeah. I'm really working. We are really committed on that. The challenges are at multiple levels, both from a demand side and the supply side. Therefore, it's a hard journey for the entire management team to navigate it, holding our market shares and profitability together. I think, maybe I... Let me add to what he Tarun is saying. I think what we have to all understand and what we are also getting to see somewhat in the market is that two bad summers, obviously the... We are seeing good traction this year, but we have to wait and see that these businesses remain sticky because you know, two years the habit formation method may have changed in consumers, and they would have moved away from something. I think it's been a good start, but we have to wait and see. That's why I think it's very difficult to predict what happens for the full summer. But the brands are very strong and strong market leaders, so we believe that they will do well. The second thing that is a challenge is with the inflationary pressures, the price increases and overall increases, and cost of living increases that is happening to any consumer. You know, the consumer has only a certain amount of money that they can spend. While many of our products are not discretionary and almost, not I won't say essential, but near to essential category, we would see less disruption, but we still have to wait and see how this inflationary pressure affects the consumer demand and consumer uptake. I think looking at all of those things, I think it's very difficult to predict how the year would go. I think the brands being market leaders and mostly being in the areas of not only being essential but they're important. I think we would hopefully tide over this difficult inflationary pressure that we are seeing. Fair point. Sir, last one, on CapEx. In FY 22, we did a CapEx of INR 75 crore, which was materially higher than our past run rate of INR 25 crore - INR 30 crore. Any mega CapEx which we missed out on earlier calls? Yeah. One mega CapEx that we did talk about it earlier, that it was building, you know, R&D center, which is a state-of-the-art R&D center, and we consolidated our Rabale unit and Ahmedabad unit into one, and we now have Ahmedabad R&D center, which is newly built up, where we have spent INR 40 crore. If you take that out, then the CapEx is almost normal, which is INR 20 crore-INR 35 crore. Okay. Okay. That's all from my side, sir, and all the best. Thank you. Thank you. The next question is on the line of Kaustubh Pawaskar from Sharekhan by BNP Paribas. Please go ahead. Yeah. Good evening, sir. Thanks for giving- Sorry to interrupt, Mr. Pawaskar. We are not able to hear you. Is it fine now? Hello. A little better. Please proceed. Yeah. My question is on Everyuth face wash. Have we gained any market share in Everyuth face wash this year? Yes, a small percentage. It is few basis points. We are seeing a face wash growth excluding the last financial year improving over earlier years, but it's too small for us to make a large point to the investors at this point. We do see some of the benefits of distribution coming over to face wash, but I think it's too early to be satisfied with it. Right. Thanks. What was our raw material inflation in FY 22? Up to 3%. 2.5%-3%. Yeah. In FY 2022-2023, the raw material inflation on a- FY 2021-2022. 2021- 2022. Uh. This is about 2021-2022, right? Yeah. Yeah. In FY 2021-2022, the raw material inflation is 2.5%-3%. Okay. In quarter one, it has gone up by another 4%, so you have taken 7%-7.5% kind of a price increase. Is that the right- Yeah. My last question is on the distribution. How much is our current distribution reach and you know for last couple of years I think we have been focusing a lot in expanding our reach. What is our current reach, and where do you see you know our reach going up in another two years? Distribution we measure at two levels. One is our internal actions, which is direct distribution, and the overall reach as reported by Nielsen. I think if we consolidate all our brands, it's reported at close to 2 million. My estimate is it'll be higher, and we'll work with Nielsen to get the right numbers at a total level. Our own direct distribution is more than INR 0.5 million, about INR 5.5 lakhs, and we have planned to increase in the coming financial year by another INR 100,000 direct distribution points. INR 100,000. I think our aspiration is to hit 1 million direct distribution over the next couple of years. Okay. Thanks for giving that information. Thank you. Thank you. A reminder to the participants, anyone wishing to ask a question, may please press star and one. The next question is from the line of Selvam Muthukumar, an Individual Investor. Please go ahead. Hi, team. Thanks a lot for providing the opportunity. Just I have two questions regarding how much debt we have as of now. My second question regarding DoodhShakti Ghee. What kind of strategy you are planning to capture the market share because most of the ghee market share is regional fragmentation oriented. What kind of strategy you are planning to capture the market share? Can you elaborate on this? Thank you. Thanks a lot. Debt, currently we have about INR 250 crore in the books. About the DoodhShakti, I'll hand over to Mr. Tarun Arora for... For DoodhShakti, our focus is two parts. We are focusing more in the areas, regions surrounding the north and west because that's where it is produced largely in Aligarh, so we are not going everywhere. We're also focusing better on the organized trade because that's where our strengths are. Our aspirations are still very small given the size of the category because we have limited production. Our fundamental focus is that we provide good quality ghee, which is sourced from the land of Braj to a more discerning consumers. I think we've got good response so far. Okay. Thank you. Thanks, sir. Mr. Alok Shah, your line is in the talk mode. Please go ahead. Yeah, hi. Thank you for the opportunity. Sorry to interrupt, Mr. Shah. Sir, there's a lot of disturbance from your line. Yeah. Is it better? Much better. Thank you. Hello, team. Thank you for the opportunity. My first question is on Sugar Free. In the slide deck, you mentioned that Sugar Free has the potential to become amongst top three global brands. Wanted to check, apart from Splenda, which would be the other brands in the artificial sweetener category? From a global brands, there is Equal, Canderel, Splenda, which are the top three players. There is also some regional players like, what is it? Something from Indonesia which comes, and there is a European brand. Sugar Free will be in the top five to six players globally. I think as we scale up in India and also in our focus international markets, we do believe that we will be able to scale up. These are the brands. Equal, Canderel. Got it. My related question was actually, in terms of penetration, right? Now some sort of 20%-22% kind of penetration in India, which otherwise would be You missed in between. Hello? Yeah. Can you hear me? Alok, your voice got missed in between, so could you just repeat? Yeah, sure. Sorry. So my related question is that the penetration of sugar-free or artificial sweetener in India is, you know, around 20%-22%. Now, wanted to check what were the penetration of artificial sweetener in some of the countries where, say, Equal, Splenda, et cetera, are quite high. You know, what is it that we will need to do to increase the penetration? So is there a different playbook that we will need to use now going ahead, or how is it like? I think one of the largest markets for sweeteners or sugar substitutes is largely U.S. and part of Europe, which are anyway more developed markets. There it's not just as sweeteners, tabletop sweeteners, but also a lot of consumption happens through the culinary route as well. In India, I think we've actually got the right approach of balancing between diabetics and passive health seekers, which is balancing on the lifestyle and the diabetics. Our portfolio right now is split between 50-50 between the two. We are taking actions on both sides, on the diabetics as well as the health seekers. Some of the biggest headwinds that we face in India, which is largely, you know, a thing that comes from U.S.-led information, is the negative impact of using some of these sweeteners, which impacts the belief in or trust in sweeteners. We are taking sufficient actions to drive that by reaching out to diabetologists, circulating, you know, information on the safety of these products, as well as the consumer consumption, trial generation, and distribution expansion. I think our playbook is already in place. It's just these negative headwinds which we have to keep overcoming, which we have taken a concerted action over the last three to four years. We've seen some improvements. I hope it will snowball into a larger number as we move forward. Got it. Any plans to then also, you know, accelerate the presence in the HoReCa or the culinary segment, where our share, I think, will be quite low currently? HoReCa actually is negligible. It's a very small thing. Largely HoReCa uses sugar substitutes in two ways. One is with the tea and coffee, the sachets that get sold, where we do reasonably okay. Of course, some local brands come in between. Our major effort right now is, as we're building our food service portfolio, to also get sugar-free consumption in terms of making those culinary dishes, which is a hard journey because typically it costs 2x- 3x for some of these guys to switch from sugar to sugar substitutes. Also, sugar is a good filler of some of these desserts. It's a little bit harder journey, but we are at it. I don't see it as a big revenue driver, but I see it as a major influencer in conversion for retail. We stay on course on that as we move forward. What I was trying to get at is because, you know, these days we see a lot of products, you know, food products which sugar-free or low sugar, etc., so they would be substituting it somewhere, right? I thought any of the revenue for them or the cost to the consumer for them is, you know, at least 1.5, 1.8x the normal variant. Yeah. Correct. You know, if that's why I was just checking that is that a big potential that we are tapping into or? That's what I wanted to check. Okay. I think there is potential there. We've been working with some of these players, including, for example, we have a tie-up with Havmor Ice Cream, where they put a sugar-free branded product and we supply to them. There is clearly potential, but they tend to buy a lot. Several players tend to buy from local players and more at ingredient level. We're working on it. We'll see if we can tap that potential also substantially as we move forward. Got it. My second question was on the prickly heat powder category. You know, these days on the shelf I see a couple of new brands like Candid, Clocip by Cipla, and now Emami has acquired Dermicool, right? Mm-hmm. Now, of course, you know, maybe the competition may not heat up in this summer, but, you know, next summer, you know, maybe we may be seeing a different competitive landscape. How do we plan to maintain our shares over here under Nycil brand? Alok, the good news is that Nycil is one of the strongest brands in the category in terms of equity value. In fact, before acquisition, the brand was doing 29% volume share. In three years of our acquisition, it has touched 37%. Our direct distribution has gone up. Its total reach has gone up, which shows that because of the limited reach, Heinz was a good company. With a limited reach, it was struggling. With the support and the focus that we have on this brand, we've been able to scale up. Of course, competition will come, and we do see what you are saying, and I think somewhere that may also help us grow the category faster, because earlier the focus on category building was much lower. I'm quite, if you ask my point of view, I think I'm quite optimistic of this brand driving the category growth up and also gaining market share because our distribution reach has started building up. Earlier, our numeric was, despite being a much larger player, you know, almost closer to the number two player, now our numeric is shooting up. Our weighted distribution is much higher. I'm quite optimistic of how we will be able to navigate the competitive situation, and if it grows the category, it's great for everyone. Absolutely. My last question was on, you know, while Dr. Sharvil did allude that, you know, Glucon-D and Nycil are sort of essential, but they are in some sense quasi-essential also. I just wanted to check what would be the rural saliency for this product? Because if there's some sort of an income distress, then, you know, this quasi-essential product also sort of, you know, there's cutbacks over there also. Just wanted to check that number, if at all. I think, first of all, I think our rural saliency is highest in Glucon-D and Nycil. They used to operate at 30%+. In fact, Glucon-D used to be 33%. As the categories shrunk in last two summers, it went up to 39%. And even Nycil was 32%, 33%+, the prickly heat category. Now, the point is that should I take the last two years or maybe 2019 full year? It's hard to say. The fact is that rural saliency is reasonably high, and we are quite conscious of the impact it will have on these brands. We will see how it shapes up. The rural saliency of Sugar Free and Everyuth and Complan is on the rise over last four to five years. We've been growing the rural saliency of these brands, and we have seen a much higher growth, whether it's Everyuth scrub and peel-off sachets are driving the growth because of the small pops data and the rural. Sugar Free has grown from 14%- 18% over the last four to five years in rural saliency, and so has Complan grown. Rural will become increasingly more important, and it therefore worries me if the rural is struggling. I think by our focus on improving our distribution, doing the right things, we may be able to overcome this in short to medium term. Got it. Thank you very much, and good luck for the future quarters. Thank you. Thank you. The next question is on the line of Nikunj Gala from Sundaram AMC. Please go ahead. Good evening, everyone. I have just one question on your trade payables. You know, we have seen the last three years it is continuously declining. Just want to understand, you know, the exact reason for this, and, like, is this a number to work with going forward also? Yeah, you know, last couple of years, we were very cautious during the COVID times, and we were controlling the payments because we were prioritizing the payments, which are very critical for the business. This year being the usual year, especially in the month of March, I mean, we paid out on time to all our suppliers, and therefore the payables have come down. Therefore, this could be a trend you could assume. Fair trend to assume. Okay. Is it fair to assume that, you know, earlier we were negative working capital cycle company, now 24-25 days of working capital positive and that would be, you know, sustainable number going forward? Actually, earlier also we are not working capital negative. Last year, if you talk about, we were at INR 20 crore. Yeah. Apart from the last year. I asked last year. Apart from last year, yes. Now, you know, there are a couple of things. With the new modern businesses like modern trade and e-commerce, which is growing faster than the GT. Then, you know, it gives rise to the working capital. That is number one. Number two is that, you know, there is a receivable. At the end of the year-end, we did give some credit to our receivables, which is a one-off incident and, which, you know, for which you can reduce your payables, you know, working capital number. Just to add to what Umesh has said, I think March, while for us is a financial year closing, but it's also peak of the season, where our stock levels actually shoot up for the summer products. Some strategic reserves for post-festive season on the milk-based products also go up. Therefore, we tend to have a closing of the financial year with a higher working capital, but which comes down substantially in the later part of the year. It's cyclical in nature, but for the end of March, you will see this as a trend. Also, like I understand that point, sir, but that's an every year phenomenon, right? Yes. Yes, that is how it will be. Plus the what is driving the numbers up is also the structural movement up of the organized trade, which we are dealing directly with. These are two key reasons for moving our closing year working capital. Yeah. Structurally, yes. Right from current, you know, number of days of 26, you can assume around 20-22 days. Okay, sure. Okay. Yeah. Thank you. Thank you. The next question is from the line of Ekta Sanghvi from Vallum Capital. Please go ahead. Hello, sir. Thank you for the opportunity. I just have two questions. One being that, after our Heinz brand acquisition, have all the distribution or synergies been fully leveraged? Earlier we had some issues in the healthcare professional channel. Can we say now that all of that, all those issues have been smoothened out? What is the-. Yes, Ekta Sanghvi. I think all the distribution synergies have been fully leveraged from all retail environments, REs, as we call in our distribution terminology, both grocers, chemists, cosmetics, modern trade, e-commerce. In fact, we've been able to leverage everything. Healthcare also, where we have leveraged the group's you know strength in the healthcare professionals for Complan toddler-based product. I think we're leveraging in terms of at least outreach with them. We are at a full value out of them. Sir, the muted volume growth that we saw this year, I mean, this quarter, so, like, I mean, this distribution expansion has not really contributed to volume growth. Is that a correct way to look at it? Or, like, would it come in the coming quarters? I think what we need to look at is one quarter standalone will not be an impact. The last distribution drive was almost a year back, where we had added from INR 3.4 lakh to about INR 5.5 lakh. We'd completed almost 13-14 months before back from today. We have been able to gain reasonable value out of it, where we have seen almost high double-digit growth on Complan over three to four quarters. We have seen good growth in Everyuth. Even Sweeteners has gained value out of it. I think the last couple of quarters has seen the impact of what is really happening on the demand side, which is impacting, like I explained to you earlier on the call, how the HFD categories has practically degrew by 2% in the last quarter. Now, some of these factors are very hard to, you know, overcome in this short period of time, and therefore to see the full impact of our distribution, you have to see as a full year. Also, GT generally across the industry has seen muted numbers over last couple of years, where the organized trade has actually grown. If you'll look at our presentation where we've talked about a substantial increase of modern trade from 14%-18% as a share of our business has been driving growth for us more than general trade. That is the impact of a mix that has got impacted. I think distribution we will continue to drive, but it's not that linear from that point of view for at a quarter to quarter level. Okay. Thank you. Understood, sir. Also just one last question. So going forward, which brands like in our portfolio do you think are the strongest and would be the biggest growth drivers? It's a hard question to answer. I think because I actually have aspirations of double-digit growth for each of the brands. Complan has been Complan Sugar Free in last two, three quarters have had a harder journey, but I think they should be back on track basis of actions that we've talked about. With the summers, I think even Glucon-D and Nycil should have a good run. Nutralite and Everyuth continue to have a double-digit growth despite all the challenges. If you ask me, I don't see a big challenge at a sweetener or any, I think any of the brand levels. I think we should be in next 12-24 months should see a double-digit growth across all brands. Thank you so much. Thank you. The next question is from the line of Shirish Pardeshi from Centrum Capital. Please go ahead. Hi, good evening, Tarun, Dr. Sharvil and Umesh. My thanks for the opportunity. Just two questions. The first is that finally we are seeing. Sorry to interrupt, Mr. Pardeshi. Sir, we are not able to hear you clearly. Yeah. Good evening. Thanks for the time. Just two questions. One is on the international front. Finally, we are moving something. Tarun, my short question on the international front is that what product assets we have introduced in international market? And in the medium term, maybe two to three years, what kind of revenue share we are expecting? I think for international business, our key drivers for this business are two brands, Sugar Free and Complan, which are driving this business. Sugar Free franchise constituting both Sugar Free sweetener, the tabletop sweeteners, as well as the extensions, which was chocolates, and now we have launched cookies and spreads. Complan by itself has different offerings across markets from Africa to Middle East and New Zealand. These two are the key drivers of our business. We will be looking at more extensions around these two brands, of course, while growing other franchises as well. We have touched about 3.5%, 4%, closer to 4% in last financial year from international business. Our aspiration is to organically take it to 8%-10% if we can. We will look at some bolt-on acquisitions if they come for these markets to drive these numbers higher. The top five markets constitute about 70%-75% of our portfolio, so we're focused on that. Wonderful. My last question, you mentioned that modern trade has moved to 17%-18%. That's correct? That's modern trade plus e-commerce, so I would say organized channel. Modern trade, alternative channels, basically. Yeah, yeah. Okay. What I gathered. It's about 14%-18%. 14% to 18% over. You mentioned the current inflation is running at 7.5%, and you have taken 4.5% price increase, or you've completed 7%. We have taken a price increase, which we informed last quarter of about more than 7%. However, the results show an increase, the benefit of 5.3%. This is missed out by the fact that some of it may play out even in the Summer quarter. Following quarter. Yes, following quarters as well as some mix impact also. Largely we've taken a 7%+. Sure. It'll play out. Sure, Tarun. Thank you and all the best to you and the team. Thank you. Thank you. The next question is from the line of Kapil Jagasia from Edelweiss Financial Services. Please go ahead. Thank you for the follow-up, sir. Sir, like, which brand across your portfolio would have gained in distribution reach over the last two to three years? I believe you had mentioned, Complan had reached around 5.7 lac outlets. Like, Complan would be one, and what about, like, Nycil or Glucon-D? Like, where would have they reached? Complan has gained post-acquisition by almost 25%-30% in terms of distribution reach. Sugar Free has gained, not to my expectation, but it has increased. Everyuth has substantially increased in distribution. We were about INR 4.5 lakh. We've touched INR 6 lakh, so we've gained there. We have seen Nycil gaining substantially despite the challenges. Glucon-D has reduced the numbers from a peak of 2019, and the reason being that the category shrunk 30% in 2020 and not fully regained. From a peak of INR 16 lakh- INR 17 lakh, it was last year trailing at INR 12 lakh. I'm hoping that this year we will see the highest ever numbers. That will happen. Nutralite has gone up in terms of directly. Actually, distribution enhancement has happened across all brands and we're quite happy with the progress on that. Okay. Thank you. My last question is, like, some of the companies have started mentioning, downgrading, some of the consumer companies like Relaxo and also some of the air conditioner companies. Any downgrading being witnessed in our product segments like Nycil, Everyuth or any other product segment? We've seen the LUP is doing well across segments and, but that's a larger trend if you ask me. In Nycil, we have seen our 20 g portfolio, the INR 10 price point doing very well. It did well last year. It is doing, continues to do well this year. Early days. We'll have to see how it plays out. We've also launched in limited way sachet for Glucon-D to see if there is a certain on-the-go consumption that it can drive. We've seen our sachets in Everyuth continuing to grow over last several years. I won't say just one-off as a downgrading. A little bit of downgrading, which is driven by competitive actions I have seen in the HFD category, health food drinks category. That is because the leader taking price down and driving a certain direction of movement. Otherwise I think in any case at a overall level there is a movement towards lower unit price packs which may some may see as downgrading and some may see as a point of consumption because it's also measured doses and there are several other reasons which drive those consumptions. Okay, sure. Thank you. Thank you so much. Thank you. Ladies and gentlemen, that is the last question. I now hand the conference over to the management for the closing comments. Thank you everyone. Thank you for taking time and asking these questions. Wish everyone safe and safety and health, and see you next quarter. Thank you very much. Thank you. Ladies and gentlemen, on behalf of ICICI Securities, that concludes this conference call. We thank you for joining us and you may now disconnect your lines. Thank you.