Ladies and gentlemen, good day and welcome to the Allied Blenders and Distillers Limited overview and FY 2024 results 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 touch-tone 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. Sir, hi everyone. This is Manoj from ICICI Securities. It's a wonderful good morning, good afternoon, good evening, depending on the part of the world you are joining this call from. It's our absolute pleasure to host the management of Allied Blenders and Distillers Limited, which was a recent IPO, the first conference call. Over to Mr. Jayathirtha Mukund, Head of Investor Relations and Chief Risk Officer, for further proceedings. Thank you. Thank you, Manoj. Good evening, everyone, and thank you for joining us for our first-ever results in Mr. Gupta's post-listing. I hope you have received a copy of our company overview and FY 2024 performance review presentation. I would like to urge you to go through this along with the disclaimer slides. Today we have with us from the management of Allied Blenders and Distillers, Mr. Shekhar Ramamurthy, Executive Deputy Chairman, Mr. Alok Gupta, Managing Director, Mr. Ramakrishnan Ramaswamy, Chief Financial Officer. The flow of the call would be a presentation on company overview, followed by FY 2024 performance review by Alok. Post-presentation, we will have a Q&A session. I would request everyone to discuss points related to company overview and FY 2024 performance. Also, I would like to highlight that in a couple of weeks' time, we will be declaring our Q1 FY 2025 results, and we would be happy to engage with you for any points related to Q1 performance and Q2 outlook in the Q1 FY 2025 results quarterly earnings call. Now, I would like to hand over the call to Alok for the presentation before we open up for Q&A. Over to you, Alok. Thanks, Mukund, and good afternoon, ladies and gentlemen. Thank you so much for taking the time out today. We have a few slides to cover. So, Mukund, shall we start? Thank you. So here is the snapshot of what ABD is all about. Just a quick background for those who need to understand how this business is done. Our business is done as a state subject. Therefore, it is all about locally producing and locally selling it. And the entire infrastructure that has got built on, which I'll cover in a bit, is extremely important to understand because it helps us deliver our products in the most efficient manner. We are the third largest spirits company in India in terms of annual sales volume. We have 17 IMFL brands. IMFL stands for Indian Made Foreign Liquor. We have 33 manufacturing facilities. One of them is a distillery in the state of Telangana, which is also our largest market. We have 32 bottling units across India, which essentially means that in all the markets, we have a bottling unit. It allows us to deliver our products efficiently. Our retail outlet coverage is about 79,000, translates to a width of distribution of more than 90%. We're pretty much available in every shop and every on-premise, that matters. We are the largest exporter of IMFL for many years in a row. We export to about 14 countries, and we export more than seven or eight brands into these countries. Of the 17 IMFL brands that we have, we have 4 billionaire brands. All of them are in whiskey. Our flagship brand, Officer's Choice, our extension of Officer's Choice is Officer's Choice Blue, followed by ICONiQ White, which is our recent launch, and Sterling Reserve Whiskey. Officer's Choice Whiskey, as you may be knowing, has been the third largest selling whiskey brand globally. ICONiQ, a brand that we launched in November of 2022, now has been rated as the fastest growing spirit brand globally, as has been reported in the Drinks International Magazine. For FY 2024, our total income was INR 7,675 crores. We sold a total of 31.7 million cases with a gross margin of 37% and ROCE of 16.4%. Just a quick snapshot of how the portfolio has evolved. ABD's journey started way back in 1988, 35 years back. Over the last 35 years, we have built a sales, manufacturing, and distribution network that is both sustainable and scalable. In 1988, the first brand that was launched was Officer's Choice, followed by extension of Officer's Choice in 2001 across other flavors. The premiumization journey started in 2011, which was with the launch of Officer's Choice Blue. Thereafter, we launched KYRON, which is a premium brandy which we sell largely in South India. In 2018, we launched Sterling Reserve, which is a semi-premium whiskey, competes with Royal Stag. In calendar year 2023, we also then rolled out ICONiQ White, which I've already said is the fastest growing spirits brand for the survey done by Drinks International Globally. So what have we built over the last 35 years? We have 17 IMFL brands, of which there are 4 million case brands. They have a very strong brand recognition. They have withstood the test of time. Some of the brands are young like ICONiQ. Some of the brands are 35-year-old like Officer's Choice, and they have, in their own way, held on to their rankings and have been found markets beyond India. Our manufacturing footprint, which is 32 bottling units and one distillery, is strategically located. There are significant logistics advantages, both in terms of inbound and outbound costs and access to raw material. Our R&D center is at our unit in Aurangabad. It's where all the magic happens in terms of our blend and all the development that has been lined up for the future. We have an extensive pan-India distribution network. We supply to all kinds of markets, whether they are run by the government, run the wholesale, or the wholesale is private. In addition, we also supply to defense forces, both CSD and paramilitary. Of course, we do export and are the largest exporter out of India. We have an experienced board. We'll cover through 2 slides our board members. We have 7 independent directors based both out of India and overseas. And we have a significantly experienced senior management team with a good blend of both from the industry and non-industry that helps us to do cross-industry fertilization of ideas. I've already covered that we have a diversified portfolio of 17 brands that operate across all the flavors. This chart sort of gives you a view of where we operate. So as far as whiskey is concerned, which is our core strength, 97% of our sale comes from whiskey as a portfolio. We have a significant presence in mass premium through our flagship brand, Officer's Choice. In the prestige segment, the comparable brand is Imperial Blue and McDowell's No. 1. We have Officer's Choice Blue and ICONiQ, which are now significantly well-established brands and gaining market share. In the semi-premium segment, which is the Royal Stag and the Royal Challenge segment, we have two brands. We have Sterling Reserve, and we also have a very interesting new launch called Srishti. Srishti operates at a slightly higher price point than Royal Stag in what is known as the semi-premium plus Royal Stag Barrel Select. Right at the top, we have two brands in premium. This is Sterling Reserve Blend 10, which is an extension of Sterling Reserve, the mother brand, and also X&O, which is a new brand which has just recently launched. We are in the process of understanding how do we take this brand forward. The whiskey stack is pretty full as far as FY 2024 is concerned. On the brandy side, we have an entry-level brandy, which is an extension of Officer's Choice, which is the mother brand. Right at the top, we have Kyron and also an extension of Sterling Reserve. Kyron is our most premium offering in the brandy segment. It operates in southern market and has reasonable shares and is growing. On the rum, our presence currently is in the mass premium and prestige sector, our prestige brands. They largely operate in specific state combinations where they operate on their opportunity brand. In the vodka, we have a mass premium vodka called Class 21. Our most recent launch has been Zoya, which is our first launch in the luxury segment. This we launched in the month of January 2024. So what the slide really is helping us understand is that over FY 2018 to FY 2024, over a period of 5-6 years, the contribution from P&A segment has actually now moved. A significant more contribution is coming from the P&A segment. So from a 25% share that was coming from P&A by FY 2024, the share of P&A is now about 37%. So that's a significant increase. And the products that we've rolled out and the growth that they're demonstrating, you see these numbers only getting better. So our focus on premiumization, both in the whiskey segment, on the non-whiskey segment, will continue. The brands are established across all categories. What is important is in the last 10 years, there are only two brands that have sort of gone to cross the 5 million case segment. Both the brands have come from ABD. One is Sterling Reserve and ICONiQ, which is on way, which is on the right track in terms of reaching that milestone. Able to successfully launch brand largely because we have a pan-India infrastructure, both in terms of manufacturing and distribution. A quick look at how does our manufacturing footprint look like. We have a total of 32 bottling units, of which 9 are owned, 5 are third-party exclusive, and 18 are third-party non-exclusive. We have a distillery in the state of Telangana, which produces 60 million liters. This is running to capacity. So that's an important distillery for us because of the 32 million cases that we sold last year, about 10 million cases were sold in the state of Telangana. So it gives us both complement in terms of our margins and also in terms of supply chain security. In terms of distribution, we are a pan-India player. We operate across all markets, reach out over 79,000 outlets, 12 support offices. ABD is one among the four national players in the country: Diageo, Pernod, Radico, and us. We are the only four companies that have an all-India footprint, have the ability to understand the complex market structure, whether it is supplying to the government as a wholesale or to a private market or to the defense forces. So I mean, it's just the fact that we have a well-laid-out infrastructure in terms of distribution, in terms of our field force. We have roughly 500 people on the field, and that allows us to, that allows in future to launch new brands and reach out in the quickest possible manner. I'm now going to read out the slide. Essentially, this is about our board of directors. I will maybe stay on the slide for five seconds just for you to sort of glance it over. This is a slide on the senior management team, myself, Shekhar, Ramki, and Mukund in this room. My other colleagues, a bit about them in terms of other functional stakeholders, be it marketing, be it corporate relations. So again, I will stay on the slide for a couple of seconds for you to run through it. Like I was saying earlier, it helps us to make the best in terms of the cross-industry experience that the senior leadership team and the board brings onto the table. So we are able to take advantage of that. The next two slides are about awards and accolades that we've been winning. The purpose of sharing this slide is to simply demonstrate that be it in the area of blends or area of campaigns that we run. We've been winning awards, and it also reflects in the fact that we have four millionaire brands which have gone on to get the largest share of the market. We quickly move on from what's happening in the market. The key point here really is that premiumization is here to stay. We have seen that Indian consumer is now driven by a very different value proposition. Consumption is experience-driven. The consumer is okay with the idea of spending a little extra money, provided there is an authentic story. There's a product that matches the promise and is happy to stick to a newer experience. So when we look at the forward forecast for the industry, which has been put at about 9%, I think the important number here is that if it's 9%, it was to be seen by breaking up into the mass premium segment, the P&A segment, and the luxury segment, it's quite evident that the rate of growth in the P&A segment, in the luxury segment, is between 1.5 times to 2 times that in the mass premium segment. So it's quite clear that while the volume growth will be at about 9%, the value growth is going to be significantly higher, thereby giving the entire industry and us an opportunity to move up the value chain. On what's happening on the consumption side, all this is known to you. We are looking at a society which is open to the idea of responsible drinking. There's a greater social acceptance. There is a good combination of both in-home drinking and out-of-home drinking. And post-COVID, we are also seeing a lot more consumption of people sort of enjoying an evening with a drink of their choice with their friends. So I think overall, the consumption, the way it is emerging, is only favorable, driving both the value and the volume growth in the industry. The five or six areas that we are focused on is Officer's Choice, which is our flagship brand. A lot of work has happened over the last 12 months or so in terms of which markets to sell, packaging changes that we've been able to bring about with a singular focus of improving and maintaining its gross margin to a level that it justifies the investment that we are making in these brands. The new products will be largely in the premium and the luxury segment. We already have a strong portfolio in the P&A segment, which is with OC Blue, ICONiQ, and Sterling Reserve. We plan to keep focusing on driving market share in the P&A whiskey segment. The focus in terms of the new product introduction is going to be largely on the luxury side. We've already launched our first luxury product, which is Zoya, which is a small batch gin, which is in the process of getting rolled out across all key markets. There are newer products that we've kept ready and look forward to launching them very soon. Continue to focus on operating efficiencies. We run 33 units, 32 bottling units, and one manufacturing unit, which is our distillery. Continue to focus on the cost, be it in terms of raw materials, be it in terms of logistics. Environment and social practices continue to be part of the DNA. In the earlier slide, there is a reference to the work that we are doing at our distillery in terms of water efficiency and how we've been able to reduce significantly the water consumption for every liter of alcohol that is getting consumed. There are many other ideas that are currently being evaluated. From a brand awareness perspective, all the brands, especially in the P&A segment, in the luxury segment, the focus on digital marketing is going to be an important one. We've augmented both internal and external resources to get the best return on the digital marketing investment. We'll continue to evaluate growth opportunities and selective acquisition wherever we believe it makes sense, either in terms of backward integration or in terms of a brand that we make sense in terms of our portfolio synergy. FY 2024 performance snapshot and financial highlights. I mean, the numbers are right in front of us. We did a net revenue of INR 3,334 crores. Our EBITDA was INR 248 crores. Our margin is at 7.5% and ROCE at 16.4%. We are seeing all the good work that has been happening in the past. We are seeing some critical green shoots in terms of improved realization in terms of revenue per case, which has gone about 5% on a volume base of 32 million cases. Improved P&A saliences, which is now up to about 37.3% in FY 2024. A portfolio that is now getting ready in the luxury category, of which we have launched our first brand, Zoya, and ICONiQ White, which was launched in FY 2022, went on to become a million-case brand in the first 13 months. For the financial year FY 2024, we did roughly 2.2 million cases, and this brand continues to grow and has been rated as a fastest-growing spirits brand globally. We've done significant work in terms of packaging cost, transitioning from glass bottle to PET, and have also explored successfully the use of Tetra in a couple of markets. From an environment and margin point of view, we are rewiring our entire supply chain in terms of malt bottles, and we are looking at almost an increase of about 6%-7% higher utilization of our malt bottles. The chairman has, from 1st of July, stepped down from being an executive chairman to a non-executive chairman, which actually helps in terms of creating a separation between the management and the ownership. Strengthening of the board with seven independent directors brings in the right management practices. The focus in terms of governance and compliance is ever increasing. We are also looking at digitizing our entire risk practice. We have already digitized our board practice, and we are also looking at the compliances to get onto a SaaS platform. So a lot of focus in terms of compliances and governance. I think internally on the team, while we are looking at growing at a fairly fast pace, but we also recognize that we also need to foster a culture where we are focused on cross-excellence. There's greater accountability, and we continue to innovate. Last year for us, in terms of overall volume, was flat for reasons that we've already sort of covered in some of our previous calls, which is largely due to working capital availability, non-availability of working capital, largely on account of Tamil Nadu, which is a large market where receivables went from 60 days to over 150 days. This was an industry-wide phenomenon, as you all know, and that created a bit of a stress for us. So this is all about how our P&A revenues have moved. The P&A volumes have moved, P&A realization per case, P&A realization per case. So the volumes, the P&A salience is ever improving from FY 2018, which was at 25%, now it's at 36.3%. And essentially, the focus on premiumization and growing our share both in luxury and P&A segment will continue. At the cost of being repetitive, the Telangana problem, which was an industry-wide problem, did create a situation for us where the volume growth that we planned for H2, we could not realize. As you're all aware, and you've read in the newspaper that this was an industry-wide issue. It's looking better as we speak today. A quick snapshot of our consolidated income statement, FY 2023 versus FY 2024. Our gross income is up by about 7.8%. Our income from operation is up by 5.6%. This real gap is in terms of, as you know, that in some states, our billing pricing includes excise duty. Somewhere it doesn't. So the real line to look at is income from operation, which is up 5.6%. EBITDA is up at about 26.7%, and there's an EBITDA margin improvement from 6.2% to 7.5%. So this is a quick snapshot in terms of our consolidated income statement. Income from operations grew by 5.6% to INR 3,334 crores. Improvement in realization per case to INR 978 per case. This is at net realization and not gross realization. An improvement of 5.1%. While volume did grow by 1.7%. In H1, FY 2024, we delivered strong growth both in mass premium and P&A. In the H2, we experienced difficulties for reasons that I've already explained with you. It's largely to do with our receivable challenge in Telangana, which was an industry-wide issue. Essentially, as a result, we exited H2, not with the growth that we had planned, but almost at similar level as FY 2023. EBITDA grew by 26.7%. It's heartening to see a lot of focus on cost-saving initiatives. But more importantly, we built in a foundation for our luxury portfolio. We have built a new division called Prem-Brands, which is building both people capability and infrastructure capability in terms of the outlook we have on the luxury segment and the premium segment. So while we had a problem in the market, which is delayed receivables from Telangana, but internally, the readiness on the product portfolio, the readiness in terms of the organization, readiness in terms of the infrastructure to participate in the premiumization story was being worked on. And essentially, as we approach the market incoming financial year, we'll see and hear a lot more about what we plan to do. A quick look at our key brands. Officer's Choice, third largest selling whisky brand globally. Flagship brand continues to maintain market leadership. It's got the highest gross margin in the existing portfolio and, I think, one of the best margins even across the key competing brands. There has been a major shift towards sustainability by moving from glass to PET and also accepting packaging, which is really Tetra. So in the state of Karnataka and Uttar Pradesh, the 180 ml pack and the 90 ml pack, we sell in Tetra. Very happy to share with you that this transition has been done in a manner that the consumer has accepted both the PET format and the Tetra format, and that allows us to expand our gross margin. We did 18.7 million cases in FY 2024. It's the sixth-ranked spirit brand globally and the third largest selling whiskey globally. Again, a view of various awards the brand has won. It's our flagship brand with the gross margin that we've been able to achieve on this brand. Our focus will continue to drive profitable growth and maintain or grow our margins of the brand. Officer's Choice Blue, which is an extension of our flagship brand, Officer's Choice, gives us an opportunity to leverage the equity that Officer's Choice has across the country. We've done 4.3 million cases in FY 2024. It's a regional powerhouse. It operates in a few markets, commands a market share in those markets. And clearly, we're very happy with the markets where it is operating in. Again, the brand has been winning its own awards in terms of the blend. It has a distinctive packaging, and it continues to stand out. Our focus will continue in markets where it has market share. So we see this brand to be a regional powerhouse and continue to sort of foster and invest in this brand on the market where margins are good and the market shares as well are good. Sterling Reserve B7. This brand was launched in the year 2018, so just about a four or five-year-old brand. Went on to reach 5 million cases. Competes with Royal Stag and Royal Challenge in that segment. Again, the brand has been winning its award for blends specifically and for the advertising campaign that it's been doing. It's a challenger brand in the segment. It's a fairly large segment. It's got an exceedingly good blend, really, that comes out from our R&D center in Aurangabad. We have recently launched what we call as the Hippie Pack, which essentially is a 180 ml pack, largely designed for the younger mobile audience. The good thing is that we are able to position this pack at a price point which is higher than the traditional glass 180 ml. So it talks to audiences that are more modern. They could drive the preference for the brand, but the pack also has to make slightly higher margin because it's priced higher than the traditional glass pack. We are more than doubling our capacity for the Hippie Pack in terms of procurement because it's getting exceedingly good feedback from the market. Moving to our next brand, which is the new kid on the block, ICONiQ White. It's achieved its 1 million cases in the first 13 months of launch. It closed at 2.2 million cases in FY 2024, again from 1 million to 2 million very fast, and the brand continues to grow. The national rollout of the brand is just about complete, so many more markets that we've added post FY 2024. Currently, it's on an ARR of about 4-5 million cases for FY 2025, and therefore will more than double the exit volume of FY 2024. Again, in the sort of the short period of the launch, the brand has picked up its award and recognition accolades both in terms of the product and the digital marketing work that we have done. Our ICONiQ White approach is slightly different in the market. It's talking to more younger consumer. It's talking to the consumer in a language which is very different and unique. It's refreshing to the extent it does not carry the traditional power symbol, which is red, blue, gold. If you see, it's a fairly non-whiskey color, but I think that really drives the premiumness of the brand and acceptance of the brand. What we've also done with the brand is that we have price positioned it between an Imperial Blue and a Royal Stag from a Pernod portfolio and McDowell's No. 1 and Royal Challenge from a Diageo portfolio. The advantage is that we are able to get both upgrades from Imperial Blue and McDowell's No. 1, and we also are able to get downgrades from Royal Stag and Royal Challenge. The segment is about 120-odd million cases, and this price point allows us to get consumers from both the semi-premium segment and the deluxe segment, and that's really what is driving the growth. Needless to say that at this price point between semi-premium and deluxe, we also make better margins. Moving on to Kyron. It's a premium brandy from our portfolio. It does about 150,000 cases, largely operates in South. It's been getting its own share of awards as far as blend is concerned. I think consistently you would see a theme that our blends have been winning international awards, and that's something that gives us immense pleasure and immense confidence that as we started putting in a little more A&P behind this brand, consumers would only sort of reciprocate in terms of their love for the brand that it translated into better market shares. We are in the southern market really looking at what we can do with Kyron. I mean, as an example, we have a share of 25%. So what we can do with a premium brand, it's been part of our portfolio for some time, and we are moving it from being a purely distribution brand to now an A&P backed brand as we are seeing premiumization not just in whiskey, but happening across all segments. Moving on to Zoya, our first brand into the luxury segment. We've identified a few price-flavor combinations in the luxury segment where we believe we have both a right to play and right to win. Our portfolio is largely whiskey-forward. 97% of our revenue comes from whiskey. So here we decided to get out of a bit of our comfort zone, and our first luxury brand is in a non-whiskey portfolio. That is gin. It's already launched in two key states of Haryana and Maharashtra, and by end of this quarter, we are looking at being available across all critical gin-consuming markets. And again, the brand is less than eight, nine months old, but it's picked up its award. Especially on the blend side, we are extremely happy. And of course, the campaigns that we've been running under what we call as #ZoyaTales, which is a combination of excellent cocktails that you make with Zoya and also the tales or conversations that you have while you're sipping Zoya. So our entire digital campaign, which is on Zoya Tales, is really getting us the rich dividend, which is reflecting in the tertiary sales and the feedback that we are getting on the brand. So that was on our key brands, Mass Premium and Officer's Choice. Thereafter, our P&A segment in whiskey, OC Blue, ICONiQ, and Sterling Reserve. Kyron, which is a hidden jewel, which we plan to leverage in this financial year and going forward, and Zoya which is our first luxury launch. First, but not the only one. Moving on to the industry outlook, we expect the industry expected to grow at a single digit. However, if you were to look at this growth between the Mass segment and P&A, that's really where the value is. The P&A segment and the premium segment is growing faster than the Mass segment segment and thereby driving the value growth in the segment. And with our portfolio, which is currently available and the new brand that we have in mind, I think we're well positioned to take advantage of the premiumization that's happening in the country. The consumption continues to be experienced given the consumer is, especially in the premium luxury segment, looking for newer brands and, of course, also demanding from those brands constant sort of variety and excitement. So whether it is in terms of flavors or it is in terms of finishes, and that is extremely important. Our R&D center out of Aurangabad will become a big asset for us to be able to constantly provide consumers those experiences. In terms of the outlook on commodity prices, the outlook is that the E&A prices are likely to stay at March 2024 volume, and hopefully towards the H2, there should be some correction. We are already seeing some signs of correction, so that's good news for us. The glass bottle prices will come down after the significant increase that we experienced last year. As far as the company is concerned, I think I've already covered it. We want to drive profitable volume. We want to drive overall growth, which is faster than the industry. In the whiskey segment, continue to focus on Officer's Choice in profitable states, but definitely sharper focus on maintaining and growing our gross margins. Consolidate and grow our market share in the P&A whiskey segment with Officer's Choice, Imperial Blue, and Sterling Reserve. Leverage Kyron, which is a hidden jewel in our portfolio. Expand the luxury segment beyond Zoya on the cost front. Look at line items which are beyond the cost of goods, and we've identified three or four areas where we will do significant benchmarking in terms of both domestic best practices and global best practices and to figure out how can we be more efficient in terms of cost item beyond the cost of goods. The working capital efficiency, both through what we are doing in terms of our procurement, looking at a combination of VMI, which is vendor management inventory, to looking at a better replenishment model across the market is something that is an area of focus that will help us optimizing our working capital. So this is what is going to keep us busy in terms of way forward, which is strengthen our current position, launch newer brands in the luxury portfolio, look at cost beyond cost, and continue to look at efficiencies, which help us optimize our working capital. So that is the last slide from my end. I hope I was able to do a good job in terms of walking you through the FY 2024. And if there was any follow-up question, of course, we'll take it in the Q&A section. Thank you. Mukund, back to you. Thank you very much. We will now begin the question and answer session. Anyone who wishes to ask a question may press star and one on their touchscreen phone. 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. Our first question is from the line of Abneesh Roy from Nuvama. Please go ahead. Yeah, thanks. So given this is the first results as a listed company, I wanted to understand now that your debt issues are resolved, what will be your top three priorities in the next one year? I understand for the industry and for you also, Q4 was challenging because of the overall slowdown, etc. And Q1 also, my sense is the election impact will be there for the industry and for you. But if we see going ahead, how things will change and what will be your top three priorities given the debt issues are now resolved post IPO? Thank you for your question. The top three priorities, first is participate actively at an accelerated pace in the premiumization journey, both at the luxury segment where we've launched Zoya and other brands that are lined up, and you will see announcements from us very soon. Grow our market shares in the P&A segment, and more importantly, on Officer's Choice, continue to grow profitably. So that's one. Second is look at cost optimization beyond cost of goods. We've identified three cost heads in terms of ILPB, forward logistics, and commodity, which is significant in terms of our overall cost. And we are engaging with subject matter experts who will help understand both domestic and global best practices. We believe significant value will get created, and all the savings through efficiency will go down to our bottom line. The third thing I would say is really on process automation, digitization to sort of be a central focus in terms of our decision-making, whether it is in software areas of governance and compliances or whether it is in terms of what we do on the marketing side. So I would say these are our top three immediate priorities at this point of time. Sure. My second question will be on the new government in Andhra. There was this manifesto had put out that a new liquor policy will be there to provide more affordable and better quality liquor. So what will be your sense on that? How close are we to that, if you have a sense? And what could be the benefit for you given this is one of the states where you do have a business? What's the expectation on this? So historically, if you were to go in the past, we have sold 2x the volume that we currently sell. So we are as eager to understand what the new policy would look like. I think all indications are pointing to the fact that there is a very high probability of Andhra Pradesh retail getting privatized, which is good news for the industry and for us because then we get a fair chance to reclaim our old shares. And we're expecting that something to this extent, hopefully over the next 2 weeks, we'll get to here. So we are quite looking forward to the new policy in the state of Andhra Pradesh. Last quick question on Bengal. So there is some increase in the spirits taxes also, but beer taxes seem to have increased much higher. So would you expect that there can be some market share gains from the beer industry and any particular proactive plan to get more market share given the changes in taxes in Bengal? Yeah. So as far as the tax on ENA is concerned, it is only on import. If you are buying locally, there is no change in the tax structure. So that's point one. Therefore, to that extent, it's margin neutral. On the beer prices, in the previous policy, the gap between, let's say, for us, Officer's Choice whiskey and beer had expanded considerably. So while we had a significant jump in our margins, the segment did experience a bit of slowdown. And on the back of what we are currently seeing in terms of the new policy, we do expect that the Mass segment segment, in which we are the largest player, we do expect volume growth with the new prices. Sure. That's all from my side. Thanks a lot. Thank you very much. Thank you. The next question is from the line of Yash from Stallion Asset. Please go ahead. Thanks for the opportunity. So I understand that your P&A share has increased from 25% to 37% in the last 4-5 years. But if I look at the EBITDA margin, they've been constant at about 78%. So we're not getting the advantage of that impact. So I just wanted to understand why hasn't the relation impact not been there on EBITDA margins? Right. Yes, thank you for your question. Essentially, I think COVID hit us a little harder than perhaps it did the rest of the industry, largely because our portfolio was very heavy in the Mass segment segment with very little volumes coming from higher gross margin brands. So it took us a little bit of time to recover. But as you can see that this financial year, there is an improvement in the EBITDA margin. Of course, it's still single digit. And I think FY 2025, we are hoping that there will be a significant change on back of. I'm just connecting back to the earlier question that was asked to me on back of post IPO, we paid off our debts. It's a deleveraged balance sheet. We do not have any further working capital stress. We believe that the true potential of our brand will come to play. Hopefully, this question, if asked next financial year, would have a very different response. Right. Right. Okay. And for your ICONiQ White brand, this is gin right? So what is the sort of the area that you're competing? What kind of brands are you competing over there? IconiQ White is a whiskey and not a gin. IconiQ White operates at a price point between McDowell's No. 1 and a Royal Stag. This segment, all put together, is about 125 million cases of the 400 million cases in IMFL in India. So 25% or more, about 30% of the sale in the 400 million case segment comes from the P&A whiskey and IconiQ White plays right in that segment, but at a price point higher than Deluxe, a little lower than 750. Got it. Got it. Thank you. Thank you, Yash. Thank you. The next question is from the line of Pranav Shrimal from PINC Wealth Advisory. Please go ahead. Hello. Hello. Yeah. I had a couple of questions. One would be, so we saw a little increase in our EBITDA margin. Now, how much of the increase in EBITDA margin can be attributed towards the packaging cost, and how much is because of our efficiency and realization? If you look at our numbers, you would see that okay, let me give you a simpler response that the increase in the EBITDA margin, about 60%, is coming on back of better gross margin, and balance is coming on back of better overheads. 60% is of better gross margins, right? Better gross margins. Yeah. Okay. And would these margins be sustainable going forward, or can we expect some volatility in them? We've already seen the peak in terms of the glass bottle prices and the E&A prices. Our view is that the E&A prices will soften out, hopefully quarter two onwards. Glass prices will soften out, and therefore, we believe these margins are sustainable or maybe even marginally growable. Okay. And one last question. So what would that target share be in P&A? Right now, I think it is around 35%-37%. How much would we want to achieve, let's say, three years forward? So our share in the P&A whiskey segment is not 35%. Our share in the P&A segment would be mid double digit and hopefully on back of the growth that we are seeing on ICONiQ and the work that we are doing in SRB7, we are hopeful that we should be able to see significant change in our shares, hopefully maybe double of where we are today over the period of time. That will, of course, lead to a margin expansion as well, right? I think one added point would be that the P&A sales, which is currently 35%, as a result of this growth, will also be at about more than 50% in terms of volume and hopefully about 60-odd% in terms of value. Perfect. Just one last question, if I may. The new products you are going to be launching, in which segment are you going to launch the products? The work that we've done over the last four quarters in terms of getting our new products developed, one of which is launched, which is Zoya, and a few others that will get launched in time to come, all of them are in the premium and luxury segment. We believe our portfolio in the Mass segment and the P&A, which is prestige and above, I think we have a very good portfolio with Officer's Choice, ICONiQ, Sterling Reserve, and OC Blue. We're not planning any more new launches there. In the luxury side, we'll be doing all our focus on the luxury side. Perfect. Thank you so much. Thank you very much. Best of luck. Thank you. Thank you very much. Much appreciated. Thank you. A reminder to all the participants, you may press star and one to ask a question. Our next question is from the line of Swechha Jain from Whitestone Financial Advisory. Please go ahead. Hi sir. Thank you for giving this opportunity. I have a few questions. My first question is, in FY 2024, we've done 31.7 million cases as compared to 32.2 million cases in FY 2023. This is obviously a contribution from a very new brand, ICONiQ, right? If I understand, our basic brand, the other brands, apart from new brands, would have not contributed in this growth in terms of million of cases. I just want to understand how come our cases have reduced in FY 2024? Yeah. Thank you for that question. I think the challenge that we had in the H2 was really around our funds stuck in Telangana. So the call we had to take was that how do we prioritize our capital? So essentially, the prioritization of capital was done on the profitability of brands in terms of their state and also balancing with what the future promises and ICONiQ being a brand that was growing at a very fast pace. We made sure that it got all the capital that it required, and we had to take a back seat on some of the state-brand combination where margins were lower. So really, in H2, the job on hand was that how do we continuously focus on protecting or growing our market shares in market and on brand that matter from a long-term perspective? Okay. Okay. And so now, since we've paid off the debt, so I want to understand in terms of our interest cost, how much are we going to save on a yearly basis? So we'll talk more about it when we sort of along with our Q1 result. But just to give you a directional response, we're expecting interest cost to more than half, cut more than half in this financial year, largely because Q1, we have legacy interest cost. So that's what we are projecting for FY 2025 and then progressively reduce it out. Okay. Okay. And so. That's the main connection in this FY. Okay. Okay. Then the RHP, we had mentioned that we've done some restructuring of the top management and the committee, which would help us in saving a cost to the tune of INR 93-95 crores. But as I see in this quarter, sir, our employee costs have significantly gone up. So I'm not able to actually connect the dots. So I just want to understand this INR 93-95 crores of cost saving, how much of it is going to get reflected in this year, sir, in FY 2025, and going forward, how it will be? Yeah. So just one clarification, and then I'll answer your question. The cost that you're referring to in the RHP was for the chairman, the cost associated with the chairman, who has stepped down from being an executive chairman to a non-executive chairman with effect from 1st July 2023. So the INR 90-odd crore is the total cost that was associated. Part of that cost was incurred in Q1 FY 2024, and that cost since then we are not incurring. Therefore, we get a full benefit in FY 2025 moving forward. On the people cost, like I explained, and just connecting the earlier question, our focus is on the luxury segment. So we are building a division, which is called Prem- Brands. ABD's strength has been in the retail market. We cover about 90-odd% of the retail market, 79,000 retail units. However, on the on-premise side, because our portfolio was sort of between Mass segment and the P&A segment, there was no need for us to have an organization for key accounts and premium on-premise. So we've been focused in the last few quarters in FY 2024 to build the organization out and build the infrastructure out that will allow us to launch the brands, including Zoya and many other brands that we are already in the pipeline in the current FY. So the people cost increase is largely an investment ahead of the curve to be able to launch our luxury brand in a manner that they need the attention in the premium on-premise. Okay. Okay. Just last two questions. If I look at our gross margins, we are still 3%-4% less as compared to our other competitors. While I understand our interest cost is going to come down, our other cost is going to come down, but all that is going to reflect at the EBITDA level. I just wanted to understand from a gross margin perspective, what levers do we have to increase our gross margin going forward? It's a fair question. I think our stated sort of direction is that we want to get to industry parity EBITDA over the next few years. I think there are two important growth levers. One is that currently, our captive E&A is just about 30-odd% of what we need, whereas most of our competitors have nearly 100% captive E&A. That's roughly it would translate to about 250 basis point gross margin improvement. So we are looking at building capability. We're looking at investing on the E&A manufacturing side, right, and to address the gap. Other than that, on the gross margin, now that we have paid off our debt, we are looking at renegotiating our terms with our vendors. The process has already started, and we are looking at almost about 75 basis point improvement in our gross margin going forward on back of prompt payment, just annual payment. So these are two initiatives. One initiative that I think I covered briefly was in our industry, market bottle utilization plays a very important role. We were at about 10%-12% market bottle utilization. This year, going forward in the next current financial year, we've targeted almost doubling our market bottle utilization. That will also have an impact on the gross margin. So you would see a significantly you would see a significant improvement on what is possible in terms of cost management and market bottle utilization. But over the next 2-3 years, address the ENA, captive ENA to go from 30%-100%, and that will have another massive jump in terms of our gross margin. Okay. Okay. Can we expect directionally gross margin in FY 2025 to go up at least by 2%-3%, and then the rest can happen after that? Well, that certainly is the intent. Okay. Okay. And so just last question. So this receivable issue that I think you were talking about Telangana, right? That is right. What is the status, sir, as of now, if you could just give some clarification, some color to it, sir? Well, the situation is better than earlier, but the full issue is yet to be resolved. The industry, the beer and the spirits industry, through its industry bodies, CIABC, ISWAI, and the new beer industry body, we simply had a meeting with both the current government and the bureaucrats, and we have presented our case to them, and they've given us an assurance that they will resolve the issue starting September. So there is still a bit of overdue left in Telangana, but better than earlier, but not fully resolved. Okay. So can you quantify this? How much is it? Well, at an industry level, if my memory serves me right, between beer and spirits, the Telangana government, so I think the total number is maybe INR 4,000 crores. But in terms of the agreed payment terms are about 45-60 days. We are operating north of about 100 days in terms of receivable. Okay. Okay. Okay. Fair enough, sir. Thank you. Thank you so much. Thank you. Thank you very much. Yeah. Thank you. Participants, you may press star and one to ask a question. Our next question is from the line of Darshika Khemka from AVFinCorp. Please go ahead. Hello. Thank you for the opportunity. I wanted to delve a little deeper into the question that was asked by the previous participant around the INR 93 crore of restructuring cost. So can you help us with the breakdown of this cost? So I believe if we were supposed to incur not I'm sorry, not incur this cost for three quarters, so that is approximately around INR 70 crore. Do you know the breakdown of the INR 70 crore between employee costs and other expenses? That's the first question. The cost is associated with the chairman's office, both in terms of salary and other direct costs. So I think there is no major line item breakup, so to speak, and we expect the INR 69-odd crore saving to accrue for the full year for the current financial year. Awesome. On FY 2025? Yes. Yes. Yes. All right. You have mentioned that a certain portion of employee expenses were incurred for the new setup that you are doing to for the new hiring that you've done. Can you quantify that amount for us? Broadly, about between INR 10 crore and INR 15 crore. All right. All right. My last question is that to increase our ENA captive usage from the current 30%-100%, what kind of investment are we looking at over the next 2-3 years? Because if I am not wrong, it does require substantial investment, right? There are various options that are currently under evaluation, right? So let me try and answer the question to the extent possible today and hopefully more about when we talk next. A typical 150 KLPD plant will take about INR 225 crore. We will need a capacity of about 300 KLPD nationally. But there are many different ways of making this investment. So we are currently evaluating it. Haven't really finalized anything at this point of time, but hopefully in the next few months, we'll have a clarity in terms of how we want to make this investment. That would approximately mean a CapEx of around INR 450 crore, right? Yes. The investment in the two plants will cost roughly that amount of money. But like I said, we are currently evaluating what's the best way of making these investments. Okay. All right. So probably we can get back on the. Yeah. Yeah. Of course. Of course. I think hopefully over the next few months, we'll have a clear game plan on this, but it needs to be done. That we are quite certain. Okay. I was just curious to ask what could be the funding means of this as well? Debt or any other? Yeah. So like I said, I think that's really the point I was trying to make, that why this needs to be done. But there are various other options in terms of how do we go about making this investment. And it's a little premature for me to answer that question, but I think needless to say, from a business operation point of view, we're quite clear that we want to maintain our debt at a certain level, and that's why we want to maybe show that we structure it correctly. Got it. Thank you for me. Thank you so much. Thank you. Thank you. The next question is from the line of Vishal Punmiya from YES SECURITIES. Please go ahead. Hi, team. Thank you for the opportunity and congratulations for the listing. Firstly, just wanted a data point in terms of your P&A contribution in value terms. You did mention volume terms in your presentation for FY 2024 and FY 2018. If you can also share the same in terms of value. It'd be broadly about 40% odd would be the value terms. In FY 2024? FY 2024. That's right. What would that be in FY 2018? I will have to get back to you on that. I do not have that number on my fingertips. Okay. Then would the exit of FY 2024, which is 4Q, would the same 40% would be same for 4Q as well? Sorry. Say that again, please. The exit of FY 2024 Q1, the P&A contribution would be same at 40% or would it be slightly higher? I think it's getting better quarter and quarter. Therefore, FY 2024 contribution will be higher, and it also reflects in our outlook for FY 2025. Okay. And just see your views in terms of an article which came three days back in terms of home delivery of liquor. So the media article states that the states are planning to allow home delivery of liquor through platforms. This was also explored post-COVID. What's your view on this? Is it something which might take a productive shape? Is it something which is just being explored and might take a lot of time to implement? What's your view on that? Well, I think firstly, it's a very progressive step. So we support this government's viewpoint completely. I mean, in FMCG, there are millions of outlets, whereas in Alcobev, there is a defined outlet and for right reasons. Therefore, delivery of home delivery makes a lot of sense. I think it needs to be done with a little bit of care. So things like that the buyer is Aadhaar certified, so there was age verification, address verification. I think there is a structure that will emerge, but I think this is a very, very progressive step. What do you think would be the biggest barrier in terms of implementing this? Would it be basically the tagging of the store because they are obviously paying a huge fee in terms of retail operations? Would that be a biggest barrier or would it be something else? Well, the home delivery currently is working successfully in the state of West Bengal, right? Uninterrupted. It's also allowed in Rajasthan. So I think if we just emulate the West Bengal model, which has been successfully running, I think the niggling challenges that there are can be tackled. Understood. Understood. Thank you. We'll connect again on your 1Q call. Thank you. One trivia on if you look at some data that is published, so you could be here in the state of West Bengal, you can order it off Swiggy. One trivia because we do look at data that comes from Swiggy. I think one trivia is that you will clearly see that this channel is also being used for more by the P&A consumer and by the premium and the luxury customer. So I mean, it also adds to the whole premiumization support if the channel wants to open up. All right. Thank you. Thank you. As there are no further questions, I would now like to hand the conference over to the management for closing comments. Thank you very much once again for taking the time out. This was our first briefing post-listing, and we look forward to interacting with you further and sharing the progress that we're making on the agenda that has already been covered. So I would not be repetitive, but thank you for your time, and look forward to talking to you again very soon. Thank you. On behalf of ICICI Securities, that concludes this conference. Thank you for joining us.