Ladies and gentlemen, good evening, and welcome to the Allied Blenders and Distillers Limited Q1 FY25 result conference call, hosted by Antique Stock Broking Limited. 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. Abhijeet Kundu from Antique Stock Broking Limited. Thank you, and over to you, sir. Thanks. Hi, everyone. It's our absolute pleasure to host the management of Allied Blenders and Distillers Limited, which had a recent IPO, and this is their first quarterly results call post-listing. Over to Mr. Mukund, Head of Investor Relations and Chief Risk Officer for further proceeding. Thank you. Thank you, Abhijit. Good evening, everyone, and thank you for joining for our Q1 FY25 results conference call. I hope you have received a copy of our Q1 FY25 results 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. Now, I would like to hand over the call to our Managing Director, Mr. Alok Gupta, who will give you the summary of the company's quarterly performance before we open up for Q&A. Over to you, Alok. Thank you, Mukund. Good evening, everyone. Thanks for taking the time out today and participating in our first ever quarterly earnings call for quarter one, financial year 25. A little bit on the economy. Essentially, the overall macroeconomic environment, as we are seeing, is that they're pretty much mixed signals. While consumption growth remains soft due to persistent food inflation, along with higher interest costs, now we are seeing some positive signs, especially in the rural areas and consumption has begun to recover. Also, we are seeing a monsoon, which was a normal monsoon, so hopefully that will bring in some good news. The rural resurgence provides hope for a broader consumption revival in the coming months. As far as the alcohol-based sector is concerned in the Q1 25, here are some of the highlights. In the mass premium category, where our flagship brand, Officer's Choice Whisky, has a dominant share, witnessed a lower single-digit decline at the backdrop of softening of consumption growth. However, in the P&A segment, the industry witnessed a low single-digit growth and the ongoing trend of premiumization continue, on back of growing consumer preference for high quality and innovative offering. Election and policy changes in the key states, especially in the Q1, had a slowdown impact. However, we stay optimistic on the recovery in the coming quarters and there are some early trends that we are able to see. Now, let me first update you on our two new brands that expanded during the quarter and related initiatives before discussing the overall quarter financial performance. The first brand I'd like to cover is Zoya. We successfully launched Zoya, ABD's first luxury gin, and the inaugural product in our ten-brand portfolio, which focuses only on the premium and the luxury portfolio in the state of Maharashtra. In just five months after its initial launch in Haryana, post a successful introduction, Zoya is now accessible in Mumbai, Pune, Nashik, and Nagpur. This expansion aims to meet the growing need of the premium gin in the Maharashtra major urban market, particularly in Pune and the bustling metropolis in Mumbai. As we speak, brand is under rollout across all key gin markets. To ensure the success of this launch, we have established a dedicated key accounts team under the ten-brand division. Our robust digital and on-ground strategy includes community engagement, which runs under the banner of hashtag Zoya Tale, with the right target group to foster strong word-of-mouth. We are also investing in on-premise and social media to boost brand awareness along with impactful signages and in-market events. Iconic White. We are excited to share that Iconic White continued its steady expansion, now available in three new states and union territories of Madhya Pradesh, Meghalaya, and Chandigarh. Additionally, we have successfully launched in paramilitary services channel. This expansion reflects brand commitment to quality and its ability to cater to evolving consumer preferences. We also launched a very innovative Iconic Hippie pack, which is a 180 ml PET packaging format, catering to the young, trendy, mobile customers. This new format is now available in the state of Uttar Pradesh, Maharashtra, and Tamil Nadu. The key to success of Iconic White, which also achieved the milestone of the fastest growing spirits brand, in the world, is in addition to the brand, its attractive packaging. We've also implemented now a tech-led, consumer activation to build loyalty and reward references for Iconic White. Our storefront branding and high-impact visibility in retail outlets ensure our key brands stand out in relevant market. Retail influencers in a browsable retail outlets are engaging and converting premium customers. Furthermore, activation in on-premise channels, key account tie-up, and blogger engagement are driving brand awareness. House parties and community engagement initiatives are fostering trial and word-of-mouth promotion for our brand. Currently, the annual run rate for Iconic White is between 4 to 5 million cases, and it's expected to double its volume from last year's base of 2.3 million cases. We expect the brand to be available pan-India by Q3 FY 2025. So this was about our two brands. On our consolidated performance, here are the key highlights. Income from operation was at INR 759 crore in Q1 FY 2025, which is lower by 1.4% over INR 770 crore in Q4 FY 2024, and lower by 6.8% versus INR 815 crore in Q1 FY 2024. However, the EBITDA is at INR 76 crore. It grew by 22% as compared to INR 62 crore in Q4 of last financial year, and it grew by 44% versus the Q1 FY 2024, where the EBITDA was INR 53 crore. We also delivered a double-digit EBITDA margin at 10% in Q1 FY 2025, as compared to 6.5% EBITDA margin in Q1 of FY 2024. The PAT for the quarter stood at INR 11 crore. Moving on to the top line. From volume perspective, overall, we delivered 7.6 million cases in Q1 of FY 2025, a growth of 2.7% over 7.1 million cases in Q4 of FY 2024. However, it was lower by 12% versus 8.2 million in Q1 of last financial year of FY 2024. From ABD's perspective, we look at the performance through two perspectives. First, is that despite strong demand for our product, persistent delays in receivables from a key market since H2 of last financial year has impacted, which has impacted the industry as well. It continued to affect our overall servicing needs and short-term volume growth in Q1 of FY 2025. However, we have continued to focus on quality of revenue and focus on optimal stand state brand mix. While this has resulted in slightly lower volume as compared to Q1 FY 2025. However, on quarter-on-quarter basis, we have delivered a volume growth of 2.7% versus Q4 of FY 2024, with improved profitability, which I cover in a bit. Second, despite the above challenges, the momentum on premiumization, the focus on PNA segment and on the premium and luxury segment continues. Our P&A volume sales has increased to 37% in Q1 of FY 2025 as compared to 33.5% in Q1 of FY 2024. That is an increase of roughly 3.5%. And the value sales has increased to 46% in Q1 of FY 2025 as compared to 43% in Q1 of FY 2024. So on the P&A side, we continue to grow both on volume and the value side. Now, coming to our EBITDA performance. We delivered a strong growth in EBITDA through a combination of strong improvement in gross margin and OpEx savings. The gross margin improved to 38.7% in Q1 of FY 2025, as compared to 34.5% in Q1 of FY 2024, and broadly in line with 39% delivered in Q4 of FY 2024. So the Q1 FY 2025 margin is in line with the Q4 FY 2024 margin. This improvement is mainly on account of the packaging material cost saving initiative, which progressively expanded in phased manner, identified markets over FY 2024 as well as in Q1 of FY 2025. Some of these initiatives are removal of Mono Carton being extended to Officer's Choice Blue, Sterling Reserve B7, and also our new millennia brand, Iconic White in state, where it has completed 12 months of presence, is now an established and a growing brand. The PET conversion of Officer's Choice Whiskey, which was initiated in May 2023, has now expanded in 6 states in a phased manner. In Q1 FY25, we got the full quarter benefit of the same. On other packaging material savings, it includes continued improvement in market bottle utilization, low prices of various packaging materials, and other items. Also, on the gross margin improvement is on account of routine price increases in different states during the course of the previous years. Along with the above initiatives, with the right strategy of state brand mix, even with lower volume, we were able to deliver a better gross profit with a better gross margin as compared to Q1 of FY 2024. Overall, despite the increase in ENA pricing as compared to Q1 FY 2024, the overall gross margin improvement is driven on account of the above initiatives. At the OpEx front, the savings were led by broad restructuring undertaken in Q2 of FY 2024 and controlled advertising and marketing A&P spend, which was largely offset by increase in employee costs on account of new hiring, mainly on account of setting up the vertical catering to our premium brand, focused on premium and luxury portfolio, and in general, increase in the overhead, which is in line with the market. Moving on to the interest cost. The overall interest cost for quarter was INR 44 crores as compared to INR 45 crores in Q4 of FY 2024, and INR 39 crores in Q1 FY 2024. The interest cost includes interest in certain government overdues, in addition to the interest on deb- on debt, including working capital facility. As already stated, we have paid all that outstanding in a phased manner to ensure adequate capital is available to service the consumer demand. Moving on to the outlook. With the successful completion of the IPO process in July 2024, in line with the main purpose of use of the IPO proceeds, being repayment of debt amounting to INR 720 crores. Accordingly, all the bank debt has been repaid. Also, we have cleared all the VAT overdues. Subsequently, with the strengthening of our balance sheet, our ability to meet demand and cater to the customer servicing needs has significantly improved. Now we are in the process of raising low-cost working capital facilities required as growth capital. Now, we are more confident in our ability to deliver sustained growth and well-positioned to capture a tailwind in the I MFL and overall spirits industry through a combination of leveraging strength in the mass premium segment, and launch of new products in the premium and luxury category. In the whisky segment, we are targeting to grow market share through our three millennial brands and sustain profitable growth in Officer's, Officer's Choice, which is our flagship brand. In the premium and luxury segment, we strengthen our presence in high-margin segment, both in whisky and non-whisky categories. We are evaluating expanding the portfolio by launching a BII, and a BIO Scotch, expand category offerings, and develop products in whiskey, rum, and gin, white spirits. These initiatives will be done through our own brand and through our partnership model. Along with the top line growth, there is a continued focus on improving profitability through optimization of scale brand mix, continued cost-saving initiatives, input costs, and building process efficiently, driving automation and optimizing working capital cycles by improving supply chain efficiency. From a CapEx perspective, in addition to the regular maintenance, replacement, and regulatory-related capital expenditure for our pan-India manufacturing plant, we are evaluating growth CapEx options on improving backward integration capability through a combination of building or acquiring facilities with the objective of limiting supply constraints, securing ENA, which is our primary raw material, and a driver for margin improvement. Finally, I would reiterate that with the successful IPO on July 24th behind us, we are more confident in our ability to deliver sustained growth and enhance shareholder value creation. We remain dedicated to advancing excellence and achieving new accomplishment. Now, we can open the floor to the Q&As. Thank you for your time. Thank you very much, sir. We will now begin the question and answer session. Anyone who wishes to ask a question may press star and one on their touch-tone 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'll wait for a moment while the question queue assembles. The first question is on the line of Hiten Boricha from Frequent Investments. Please go ahead. Yeah. Thank you for the opportunity, sir. I have a couple of questions. So first is on the revenue side. So sir, just a small clarification. We have a revenue of around INR 760 crores, and we have a breakup into PNA and mass premium revenues. So when you add this PNA revenue and mass premium revenues, INR 322 crores and INR 376 crores, it comes anywhere between INR 700 or INR 698 crores. So there's a difference of INR 60 crores in this quarter, and this, what is the difference? If you can explain me on that, sir. Can I get Ramki to just look at these numbers and respond, please? Yeah, sure. Yeah. So what we have captured there is only the ENA, say, what you call the Prestige and Above and the Mass Premium segment. We have other categories in the break-up of sales, which includes, ENA sale, by-product sale, export entitlement, scrap, and others. So all these together aggregate for the balance. Okay. Okay. So that was also. Okay. Okay, understood. Understood. Thank you. Okay. And, sir, other question is on the gross debt. What is our current gross debt, and what will be our finance cost in FY 25? As you mentioned, we have repaid all our debt in this year from the IPO proceeds. Yeah, sure. We repaid around INR 800 crore of gross debt, which was there from the IPO proceeds. And as on date, we have around INR 325 crore of working capital debt, which is a fresh debt after repayment of all the debt. Okay. This debt has been raised at a lower cost, which is at around 8.5%, as compared to the earlier cost of around 10% to 10.5%. So this INR 325 crore includes long-term capital, long-term debt as well, right? No, it's only working capital debt. Okay, okay. We don't have any long-term debt now. Okay. No. Okay, okay. And sir, your PPT includes that we have some receivables issues. I guess, the industry itself has some receivable issues. So can you quantify what is the number of receivables, and any update on that, sir? Is it coming or not, any update on that? I think your question is not there. Can you, if you don't mind, please repeat it. Am I audible now? Yeah, you're audible now. Thank you. Yeah. So my question is on the receivables, sir. So your slide mention, your slide number 6 mention, we have delayed in our receivables from some of our key market. And so just wanted to understand what is the update on that, sir, and if you can quantify that number? ... The delayed receivables is largely from one of the government markets, which is the state of Telangana, which is impacting the entire industry. We have seen some improvement on the payment cycle. But our view is that it will take maybe another quarter before we can see the receivables to fall in line with the agreed norms. Okay, it will take one more quarter. But can you quantify the number, sir? Number in terms of total receivable? Yeah. Or in terms of number paid? Alok, in case you want, I can reply. The total receivables from Telangana outstanding as of 30th June is around INR 384 crores. Okay. Which is overdue. Does that answer your question? The overdue amount is roughly INR 380 crore, as shared by Ramakrishnan. Yes, sir. Yes, sir. Understood. Understood. Okay, I'll get back to the team. Thank you. Thank you. A reminder to the participants that you may press star and one to ask a question. The next question is from the line of Dheeraj Mistry from Antique Stock Broking Limited. Please go ahead. Yeah. Good evening, sir, and very congratulations on good set of profitability improvement. So first question is on volume, that had it been no working capital issue from the state govt from Telangana state government, what could have been the volume growth trajectory in this quarter? And is it safe to say that our aspiration of double-digit volume growth on overall basis, both in regular segment and in P&A segment for FY 2025 should be maintained, would remain there? First of all, thank you for your, for your, for your compliments. And yes, our outlook for double-digit growth for the financial year FY25, we are of the view that, we are on the right track. Had it been no working capital issue in this quarter, what could have been the volume growth in this quarter? So if you look at the volume growth in Q1 FY25 over Q4 FY24, it's about 2.7%. I'd like to believe that if we had the right working capital excess in Q1, which of course has been resolved post IPO, we should have been in a double-digit growth. We should have been able to post a double-digit growth. Got it. A larger challenge has been demand servicing, which is what we are from Q2, that is getting addressed. Okay. So I was looking at your volume performance. The volume decline, which is there in mass premium segment and in P&A segment, there's a stark difference in that. Is it that you have preferred the growth, or working capital funding was much more skewed towards PNA brand rather than mass premium end? Is my understanding correct for this quarter? The way we look at our working capital deployment is to have both short-term and long-term view of the market in terms of what is our eventual market share aspiration. And clearly in line of the premiumization agenda, the P&A segment in the right markets need to have full access to working capital. So I think it's a balance between short-term and long-term, but I think the objective of premiumizing continues to be one important facet of what we are doing. Got it. Got it. And sir, you, in your opening commentary, you highlighted that there was a price hike which you have got in, select states. Can you mention that state and what kind of price hike you have received at a portfolio level and at a state level as well? Well, there are multiple states from where price increases have been received. And, the total aggregate price increase on an annualized basis, Ramky, can I lean on you if I'm if my number is off? But I think it's just about INR 40 crore on an annualized basis. Ramky, can you just reconfirm this number, please? Yeah, yeah, sure. If we compare the price increase benefit quarter-over-quarter, the price increase benefit has been on the EBITDA; it has been around INR 18 to 20 crore in the first quarter as compared to the previous quarter, corresponding quarter, sir. Okay. And is there any state which is likely to give price hike in this financial year? So as we speak, as we speak, there are a few states where price increases are yet to come through. We are all reading the newspaper about possibility of Telangana, West Bengal, hopefully, and Maharashtra. So there are only a few states from where we are expecting a decision this year, but yet to have a confirmed price increase from these states. ... Got it. Got it. And, so lastly on, gross margin, the, there's a good improvement in gross margin, but what, can you split your gross margin expansion or benefit in two parts, on pricing front and also on the raw materials, front? That what is the gross margin expansion because of your raw material price or, packaging revamp, because of the saving from packaging revamp. And for the full year as well as for the next year, this is what kind of saving we can expect from the packaging material. Ramki, will you take this one? Yeah, yeah, sure. It's around a 3.1% on the price and around 1% plus on the overall costs. Okay. After netting off the incremental cost. Okay, this is for the current quarter, right? That's correct. Yeah. Over previous quarter or quarter one of the previous year. Okay. If I say that the states in which we are yet to implement mono carton discontinuation or PET bottle, what kind of benefit we can witness in gross margin going ahead? I think the process of mono carton removal has pretty much been completed on brands like Sterling B7 and on Officer's Choice Blue. Only on Iconic, for an agreed period of, let's say, a year or an agreed market share in that market, we do keep mono cartons. Otherwise, mono cartons thereafter discontinued. And as the brand is getting nationally rolled out, this phasing will also happen. But on the bigger brands, like SRB7 and OC Blue, the entire mono carton removal is now complete. Exercise is complete. Got it. But, would you like to quantify what kind of saving we can have from Iconic White discontinuation? Or a large part is already been realized. Your question is that on Iconic, what is the incremental saving that will accrue towards this year on account of removal of the mono carton? Is that your question? Yes. Right. Ramki, do we have any number on this? Alok, it should be a range. I would put a range of anything between INR 6 crore-INR 8 crore. Got it. Okay, that's it from my side. Yeah, that's it from my side. Thank you very much. Thank you. Thank you. The next question is from the line of Bhaskar, who's an individual investor. Please go ahead. Thank you, sir, for giving me opportunity. Sir, I want to ask, how much interest cost we will save on yearly basis after paying, as you mentioned, INR 800 IPO proceeds you have paid? And second one is, effect of interest cost in quarter two, we can see in our P&L side, and how much? Ramki, over to you. Yeah, sure. For an annual basis, the interest cost from what was earlier to what would be in the current year would be lower by around 50%. So that is one thing. And on a quarterly basis, the same trend would continue, because in the first quarter, we have to pay the... I mean, sorry, the loans were paid in the month of July. So, and the current cost of borrowing, what we are having is around 8.5%, as compared to around 10% plus of earlier for the bank borrowings. So proportionately, the interest cost will come down in this current quarter. Okay. And sir, second one is a working capital, as you say, that we have, it's, before IPO or it's after IPO working capital loan? Working capital, what we repaid has been after the IPO. We got into zero debt position for about, some days, maybe a week or a fortnight. After that, we sourced additional working capital to the extent of INR 325 crore. Thank you, sir. Thank you. Next is a follow-up question from the line of Hiten Borija from Frequent Investments. Please go ahead. Hello. Yeah, thanks for the follow-up, sir. My question is again on the volume side. As you mentioned, we are looking for a double-digit kind of volume in this year. So if you can give a breakup between P&A and Mass Premium, because I believe our Mass segment has hit a lot. We have so like 15% kind of degrowth in volume in this year. So maybe you can give some breakup. Are we looking for growth in P&A in high teens or Mass Premium? Our current outlook is that Mass Premium segment will grow at a single digit, and the PNA segment for us will grow at double digit, mid-double digit. That's our outlook for the balance quarters. Mass Premium at high single-digit? Mass Premium at a single digit, mid to high single digit, right. And, the PNA segment will grow at double digit, mid-double digit. ...to make double digit. And sir, what will be our tax rate this year? We have opted for the new regime of taxation, which is 25%. So the first year of shift, there will be some deferred tax, so it could be marginally higher by 1%, but other, after that, from March 23rd onwards, it will be 25%. Okay. Understood. Sir, my last question is on that. You mentioned some cost, cost saving initiatives you have taken in packaging side. So if you can throw some more light what exactly we are doing here, what measures we have taken, et cetera. There are four or five critical initiatives. One is Officer's Choice, which is our mass premium brand, to move from glass bottle to PET. I think, roughly 10% of volume is in glass, about 80% in PET. Sorry, sorry to interrupt you, I lost you in between. From glass bottle to what? Sorry. To PET. PET. Okay, okay. Glass bottle to PET, and I think about 10% of our volume is in glass bottle, about 80% is in PET. And we've also successfully transitioned to Tetra in the state of Karnataka and UP. So that's been one significant packaging initiative. Secondly, as you already covered, is removal of mono cartons on the PNA segment brand, which is Sterling B7, Officer, Officer's Choice Blue, and now we are starting to do that on Iconic as well. Third is in terms of our market bottle utilization. We are this year planning our market bottle utilization at about 20%, which was about 12 to 13% last year, so that's about a 7% increase on our market bottle utilization. Third is in terms of respecting our glass bottle rate, glass bottle and PET bottle rate, in terms of grammage. So these are three or four critical initiatives, which has helped us bring down our cost. Understood, understood. So considering all these costs, which is, especially the bottling cost, the utilization is going up. So can we consider, margin, which is at 10% level in Q1, it is going to remain at this level, 10% anywhere between 10% to 12% for this year? Well, our outlook is that we should exit the year better than the Q1 EBITDA, maybe early double digits. Early double. Okay, okay. Thank you, sir. That's all from my side. Thank you. Thank you. The next question is from the line of Karan Bhuwania from ICICI Securities. Please go ahead. Thank you for taking my question. So firstly, I just wanted to ask about the demand environment. You mentioned the demand environment continues to be soft. Given that lot of FMCG companies have highlighted that there is some recovery happening, especially in rural, right? Also, how do you see the demand environment? Because I think I assume that will be critical for your growth trajectory for the mass premium segment. And secondly, a follow-up on that would be you mentioned about the market share gains in the mass premium segment. So what are the steps you are taking towards that? And also, if you could talk about the profitability of the mass premium segment, how are you going to improve the profitability going forward? Yeah. Thank you. Thank you. So the Q1 for current financial year was a bit disturbed, largely on account of you know, restricted movement on back of elections and various new policy initiatives. So we had a sluggish Q1. The overall industry growth was about 2% to 3%. We are seeing some sign of recovery in early July, so that's a good sign for us. We are seeing demand growth coming from all markets. So to that extent, that's good news again. From a premiumization perspective, adoption of sort of adoption of brands that operate in PNA and premium and luxury brand is something that we track. There are clearly some green shoots, and that over a period of time should create another, sort of growth driver for the P&A segment and the premium segment. As far as the mass premium, segment is concerned, for us, it's Officer's Choice. Officer's Choice operates at about a 40% gross margin. Thank you, sir. Thank you. Hello. Secondly, can you hear me? Yes, I can. Yeah. Secondly, regarding, you mentioned in your opening remarks about the backward integration towards, to, towards production of ENA. If you could talk a bit about it, what would be the CapEx requirement and what kind of savings you can see through that, through that flowing into the gross margins? So currently, for every 100 liters of ENA that we need, about 30% is captive. That comes out from our distillery in Telangana, where we produce 60 million liters of ENA, both for captive consumption and some bit for third-party sales, and we run that distillery at 100% capacity. We need another 300 KLPD, 300 KLPD worth of capacity, which will get us to a near 100%, captive ENA, and that should have an impact of about 150 basis points on gross margin and, and therefore, on EBITDA as well. The capital required for this is we believe that what we need are two distilleries of 150 KLPD each, and the capital required for this will be roughly INR 450 crores. ... Thank you. Thank you. That's very good to hear. Lastly, on Iconic wise, right, you mentioned that this quarter also the growth was good. If you could highlight what kind of growth they will going to witness this quarter? And how do you see would the growth would have been if you didn't have the servicing challenge for this particular brand? And also, if you could give some idea about what are the kind of targets you're looking in terms of volume growth by FY 2026? Yeah. In the Q1, FY 2025, the brand is operating at about a 4 million ARR, 4 million plus ARR, right? Since it's a growing brand, you know, growth number quarter-on-quarter, quarter are high. But important thing is that we exited the last year at 2.2 million. Q4 of last financial year, the ARR was, three million cases, and Q1 FY 2024, the ARR currently is near 4 million cases. So that's really the growth trajectory on the brand. We are looking at the brand to, more than double its last year volume of 2.2 million cases. Thank you. I'll come back in the queue for further questions. Thank you. Thank you. The next question is on the line of Himanshu Shah from Dolat Capital. Please go ahead. Hello? Hello. Hello. Yeah, thanks. Yeah, yeah. It's clear. I can hear you. I'm audible, sir? Yes, you are. Thank you. Thanks a lot. So just couple of questions. One is, the AP policy change, if it happens, can you help understand how will it benefit us as a company? And what is the variance of AP in our volumes and revenue? You're talking about the state of Andhra Pradesh, am I right? Yeah, that's right. Andhra Pradesh, policy is yet to be out. As and when it is announced, it will be effective first October. But from what we understand, there are three important elements of the policy. The first element is privatization of retail, which is a positive, for a company like ABD. The second is, the fact that it will be opened up for national brand. Currently, we do not sell Iconic in the state of Andhra, therefore, that's good news for ABD again, because we'll be able to, also introduce Iconic in the state of Andhra. So overall, the contour of the policy are favorable for the industry and for ABD, particularly the fact that retail is getting privatized, which means, you know, brands will just be sold on merit. And secondly, the ability to sell national brand, which is an opportunity for Iconic, to participate in the state of Andhra. We currently do about, last year I think we did about 1.9 million cases in Andhra. We're already seeing some positive signs and, therefore, hopefully we should be able to see significant growth to come out of Andhra in back of the policy. However, we have to wait for the policy to be announced. Sure, sir. This is very, very helpful. So secondly, what would be our CapEx in Q1 and guidance for FY 25, excluding the new distillery that we are planning for? Our CapEx guidance is largely in form of our strategic CapEx, for our distillery in the state of Telangana, which is about INR 15 crores on an annualized basis. Okay. So more like maintenance CapEx for the distillery of around INR 15 crore-INR 20 crore on an annualized basis? That's correct. So thirdly, there has been a media article where we are looking for tie-ups with global companies. I've forgotten the name, but one of the Russian and one of the Thai companies for distribution of their brands in India. And if we are looking for any such thing, I would like to understand the rationale and why get only into distribution business instead of focusing on our own brands or launching our own brands, and how can it benefit us? Just trying to understand the rationale. Are we planning for any such thing? Just to clarify, as regards the specific article, I do not want to comment on any speculative news about these two companies. Moving on, we have maintained, we have maintained our position that we are looking for a partnership model and not a distribution model. In the partnership model, we are looking at global companies which have serious intent about India as a territory. We are looking for a partner who can give access to pan-India distribution and who are willing to participate in the investment that a brand requires. So we will continue to focus on the premium and luxury segment through a combination of our own brand and through brands that we partner in India. Okay. And so in partnership models, still the profitability, because the investments might be limited from our companies and it may accelerate the go-to market or time to market from a product and distribution perspective. Try to assume the ROE, ROC to be similar or even better compared to an organic launch of a brand. I think one of the benefits of a partnership model is that the brands are globally proven. They come with excellent heritage. They come with a proven track in terms of the brand, the packaging, consumer acceptance. So it allows us to participate in the luxury segment more effectively. And like I said, the key difference between a distribution model and a partnership model is that we expect the brand owners, the principal owner of the brand, to also participate in the market building and brand development exercise. So that is when you know, it is a little A, you're looking for the right partner, and B, you're looking for a ready brand, and third, you're looking for AMP contributions to come in. So in a way, it accelerates the entry into the premium luxury segment. Awesome. Very helpful. Can I take a couple of more questions? Yes, please. Maybe one or two more. Sure. So one is, any particular update on India UK FTA? Any further progress or anything that you can help us out? India-UK FTA is still in a discussion stage. Of course, the new Prime Minister of UK has made a positive statement about the FTA, but timelines seem to be not. The timelines are not yet formed. So I think we are as eager to hear about the closure of FTA because as India's largest importer of bulk scotch, other than Diageo, of course, for our consumption basis, it has a massive impact on our overall cost of goods. So we are also hopeful that this will get announced soon, but as of now, there are no firm times. Yep. And so, and color on ENA, what has been the ENA inflation both on a QOQ and a YOY basis in Q1 FY25? As we shared earlier, our outlook was that the ENA prices for FY 2025 would be range bound. This is the exit price of Q4 of FY 2024, which is the last financial year. And so far, the prices are holding on to that level, maybe marginally lower. Okay. And lastly, sir, so we are guiding for a double-digit volume growth, and I believe the receivables challenge still continues in Telangana, which is one of our larger market, and it may continue for a quarter or so, as outlined by you. In this backdrop, are we confident on delivering our guided or stated intent of double-digit growth? Yes, we are confident. As regards Telangana, we have already seen directional improvement in the payables in Q1. Also, the industry bodies are very actively engaged with the government of Telangana, both at the policy level and at the ministry level. I think the assurance from the government is that we will start seeing improvement from September onwards, month on month. So I would say this is a temporary sort of situation which is impacting the entire industry, including ABD. But quarter one has been better than what we experienced in the second half of the last financial year, and this is the assurance being given to us by the government. We expect this issue to resolve over the next quarter or so. Just last follow-up in this backdrop. So, how has been the current quarter going on July, August, quarter to date? Maybe some color. Are the trends better than Q1 on a, at a company level or at an industry level on a pan-India basis? Yes, I think on back of the IPO, and addressing the issue of working capital, we have already seen, double-digit volume growth and more when we sort of talk about the quarter, once we have the actual quarter end numbers with us. But yes, the volumes and the performance is certainly better than Q1. Sure, sir. This is very, very helpful, and thanks a lot for all the detailed answers, and all the best to you, sir. That's it from my side. Bye. Thank you so much. Thank you. The next question is on the line of Harit Kapoor from Investec. Please go ahead. Yeah. Hi, good evening to you. I just had two questions. One was, you know, how do you think about, you know, realization improvements going forward? This quarter TNA has been kind of flattish. Mass Premium has grown a little bit, but, if, you know, in an industry where, you know, pricing is, you know, 1% to 2% average, at best, you know, do we expect, you know, mix improvement even within TNA to give us higher than, you know, 1% or 2% kind of realization growth? My question is not from a near-term perspective, more from a one to two year perspective. Sorry, I missed the last two sentences that you said. If you can be a little louder and slower, there's a little bit of lag involved in. Sure, sure. My question was on PN, on realization growth, both in TNA and mass premium. I just wanted your view on, you know, how do we kind of think about this from a 1 to 2 year perspective? Pricing is typically 1% to 2% only on an annualized basis, mostly in the industry. So, do we expect kind of, you know, mixed improvement in both mass premium and TNA going forward, to drive some of this realization improvement? Or how do we kind of, you know, think of this? So for us, mass premium is Officer's Choice, is operating at a gross margin of 40%. Our outlook and our focus would be to maintain that gross margin through a combination of, you know, picking up the right, state brand mix, the right FPU mix, and continuously working towards lower cost of sale. So as far as the, the PNA segment is concerned, we see, headroom for us, which would come on account of, A, high level of market bottle utilization. This year, we have targeted about 20% market bottle utilization, which is up from about 13% to 14% last year. And, going forward, we'd like to get this number to about 25%. Secondly, the second is in terms of maybe lower cost of sales over the next two or three years on back of better P&P investment. And thirdly, once we are able to get to 100% PNA, we see another 2.5% gross margin improvement on back of our own captive ENA. Of course, both mass premium and PNA segment both will gain from that. So headroom in the mass premium is largely on back of captive consumption, captive capability on the supply chain side. But in the PNA segment, we see there is headroom both on account of our own captive ENA and on account of lower cost sales and lower cost of goods. Okay. Just to follow up on the returnable bottle side, is this 20% number that you mentioned, you know, is there a certain industry average to what returnable bottles mix it, or, or, you know, it's very each their own in terms of every company? I just wanted to understand that, you know, is 20% in line with industry average? Is it better? Is it lower? No. I think it is in line with the industry, but could it be 25%? The answer is yes. Understood. Understood, understood. The other thing was on Karnataka. Just wanted to get a sense on, you know, with, you know, MRPs coming down for the PNA segment. You know, given your early thoughts on, you know, how this market could shape up, especially for your P&A industry, P&A side, and if you could just have some, you know, some view from your end on this one. So certainly, MRP coming down on the PNA segment is a very welcome news. However, the gap between the P&A brands in Karnataka and the mass premium and the medium segment, which is the largest segment there in Karnataka, is still very large. It'll definitely encourage some upgrade. Our view for now is that it will not materially impact the structure of the market. Got it. Those are my questions. Thank you very much. Thank you. Thank you. The next question is on the line of Kritika from Sharekhan by BNP Paribas. Please go ahead. Good afternoon, sir, and thank you for the opportunity. Just one question from my end. This is with respect to the CapEx. So I just want to confirm that for FY 25, we guided for maintenance CapEx of around INR 15 crore. Is that right? Sorry, ma'am, you'll have to be a little slower because there's a lag in volume. Okay. Okay. Is this better now? Much better. Thank you. Okay. So for 25 CapEx, we guided for a maintenance CapEx of around INR 15 crore. Is that correct? That is right. Yeah. And so the growth CapEx for the backward integration, when are we, you know, do you have any timelines for that? As in, when that will come in and, you know, how that will be exactly deployed. Any, any guidance on that? Well, currently, it's a very important initiative for us at ABD. So a lot of work is going on. We've identified the states, and both the states, we've also looked at the geography, the geography location, what will make sense in terms of both raw material availability and in terms of logistics cost. We're also in discussion with the EPC partner, so a lot of progress. So for now, I would say a lot of work is being done. Can I provide you a timeline? Well, I will see benefits of this coming largely in FY 2027. But we are also looking at possibility of acquiring, subject to a right plant being available, a ready plant being available. If that happens, then maybe we can accelerate the savings that we're projecting on account of captive PNA. But for now, it is looking like maybe 18 months to 2 years from today. Okay, that's very helpful. Thank you very much, sir. That's it from my side. Thank you. Thank you. A reminder to the participants that you may press star and one to ask a question. As there are no further questions, I would now like to hand the conference over to the management for closing comments. So thank you, thank you, everybody, for your time, and for your questions. Much appreciate the interest that reflects in the quality and the questions being asked. So thank you again, and hopefully we'll see all of you again, at the end of the quarter two. Mukund? Yeah. Thanks, everyone, for participating in this call. Now we can close this call. Thank you. On behalf of Antique Stock Broking Limited, that concludes this conference. Thank you for joining us, and you may now disconnect your lines.