Ladies and gentlemen, good day and welcome to the Q4 and FY 2022 earnings conference call of Aditya Birla Fashion and Retail Limited. The call will begin with a brief discussion by the company's management on the Q4 FY 2022 and full year FY 2022 performance, followed by a question-and-answer session. We have with us today Mr. Ashish Dikshit, Managing Director, Mr. Jagdish Bajaj, CFO, Mr. Vishak Kumar, Director and CEO, Lifestyle Business, Ms. Sangeeta Pendurkar, Director and CEO, Pantaloons. I want to thank the management team on behalf of all the participants for taking valuable time to be with us. I must remind you that the discussion on today's earnings call may include certain forward-looking statements and must be viewed therefore in conjunction with the risks that company faces. Please restrict your questions to the quarter and yearly performance and to strategic questions only. Housekeeping questions can be dealt with separately with the IR team. With this, I hand the conference over to Mr. Jagdish Bajaj. Thank you, and over to you, sir. Thank you. Good evening, and welcome to the earnings call for our company. The year gone by has been a roller coaster in terms of COVID waves and lockdowns. As you are aware, the H1, and especially Q1 of FY 2022, was severely impacted by the Delta wave. The H2 witnessed unprecedented growth as offline stores opened, and had it not been for the Omicron wave in January and February, it would have been a record-breaking period. Before I dwell on the result, let me, you know, tell you about the announcement which we have made today. We are very excited to inform you that the board in its meeting held today has approved raising of INR 2,195 crore of primary capital through a combination of equity and warrants on a preferential basis to GIC Singapore, a leading global investment firm. GIC will infuse INR 770 crore on closure of deal by H1 FY 2023 once all approvals are in place towards 1.02 crore equity shares, at INR 288.75 per share, and 25% upfront payment for 6.58 crore warrants to be converted into equity shares at INR 288.75 per share. The balance capital of INR 1,425 crore will be infused in one or more tranches within 18 months upon exercise of warrants. Post the entire investment, GIC will own 7.5% equity stake in our company. Aditya Birla Group will hold 51.9% stake in the company post the completion of this transaction. ABFRL plans to use this capital to accelerate its growth engine built around the strength of its current businesses, along with a rapidly evolving play in emerging high-growth business models, and fortify its position as one of the leading player in the industry. The fundraise is a testimony to GIC's faith in the strength of ABFRL's branded portfolio, its proven business model, and its future growth potential. Now let me take you through the performance of Q4 and H2 of FY 2022. Q4 has turned out a very good quarter for ABFRL, despite the shock of Omicron wave which disrupted business in January and February. Sales in Q4 is INR 2,283 crore, a growth of 25% over Q4 FY 2021. EBITDA for the quarter is INR 401 crore, a growth of over 58% over Q4 FY 2021. The net profit after tax for Q4 is INR 32 crore compared to a loss of INR 196 crore last year. E-commerce during the quarter has grown by 18% from Q4 FY 2021. I would just like a minute to reiterate that ABFRL has had an excellent performance in Q4 on top of a very strong performance in Q3, and let me narrate H2 performance, as this will help you in understanding our results in a better perspective of how they would have been in a normalized scenario. Sales in H2 FY 2022 is INR 5,270 crore, a growth of 35% over H2 FY 2021. EBITDA for H2 is INR 1,010 crore, a growth of 50% over H2 FY 2021. The net profit after tax for H2 is INR 229 crore compared to a loss of INR 137 crore last year. E-commerce has also grown in H2 FY 2022 by more than 21% over H2 FY 2021. Now let me take you through the full year performance. The sales for full year stood at INR 8,136 crore, an increase of 55% compared to FY 2021. EBITDA for FY 2022 has been INR 1,203 crore and has witnessed a growth of 91% compared to INR 628 crore in FY 2021. Net loss for the company is INR 118 crore after taxes compared to loss of INR 730 crore last year. We have been able to maintain our net working capital at same level this year despite 55% higher sales. The net debt of the company stands at INR 504 crore, down 5% from last year. We have significantly ramped up our digital capability and our e-commerce operations. The digital channel sales have grown by 52% over the past year. We have also enabled close to 50% stores with omnichannel functionality. The e-com revenue for the full year is INR 1,000 crore approximately. We also continued to grow our physical network with addition of 606 new stores. Along with that, we also rationalized 10% of our network by cutting off unviable stores. I will now take you through the performance of individual businesses, starting with Lifestyle Brands business. Lifestyle Brands have turned out an exceptional performance in Q4 on the back of a strong growth in its retail and trade segment. Our brands have continued on its journey of significant market share expansion. Sales in Q4 were INR 1,342 crore, a growth of 34% over Q4 FY 2021. EBITDA for the quarter is INR 312 crore, a growth of 77% over Q4 FY 2021. The Lifestyle Brands reported a stellar growth of 25% on last year's sales in its own retail channel, highlighting growth in its market share. This stands testimony to the strength of our brands and their versatility to fulfill consumer requirement in all market conditions. Sales in the wholesale channel of MBO and departmental store side growth of 71% compared to Q4 FY 2021 of last year. Let me also highlight the strong performance of Lifestyle Brands in the H2 of the year. Sales in H2 is INR 2,931 crore, a growth of 44% over H2 FY 2021. EBITDA for the H2 is INR 658 crore, a growth of over 79% over H2 FY 2021. E-commerce has also grown in H2 by more than 21% over H2 FY 2021. For the Lifestyle Brands, the sales for full year now have been INR 4,522 crore, which is about 64% higher than last year's sales. The EBITDA for the full year is INR 788 crore with a margin of 17.4%, which is higher by 510 basis points over FY 2021 margins. E-commerce sales continue to rise significantly for the division, 61% growth over last year, and our brands are available on all leading e-commerce platforms. Lifestyle Brands have continued their expansion into both existing and newer Indian towns and cities, exiting FY 2022 with 2,522 stores, which has given its unassailable lead over its peers in this market and is contributing to its market share expansion. Business significantly improved its working capital management and achieved revenues of INR 4,522 crore with an EBITDA of INR 370 crores, excluding goodwill and right of use assets. This reflects strong asset productivity and high return on capital for the business. The Pantaloons business, despite a relatively higher impact of COVID-19 on its business, owing to its higher share of business in malls, Pantaloons recorded revenue on Q4 of INR 675 crore, a growth of 13% over Q4 FY 2021. EBITDA for Q4 FY 2022 is INR 82 crore, a de-growth of 6% over Q4 FY 2021. E-commerce in the quarter has grown by 81% over Q4 FY 2021, past FY 2021. Pantaloons' H2 results show its potential performance in a normalized period. It has seen a growth in profitability despite being more affected due to Omicron. Sales in H2 is INR 1,741 crore, a growth of 24% over H2 FY 2021. EBITDA in H2 is INR 298 crore, a growth of 8% over H2 FY 2021. E-commerce has also grown in H2 by more than 73% over H2 FY 2021. This profitability was achieved on the back of excellent inventory management and lower discounting, leading to higher gross margin, along with company's focus to leverage its operating cost. For the full year, Pantaloons reported an annual revenue of INR 2,626 crore, a growth of 41% from last year, while the EBITDA extended to INR 368 crore, witnessing a growth of 33% over FY 2021. The business focused on working capital management and improved NWC by INR 45 crore. It achieved this revenue of INR 2,626 crore, with operating capital employed of just INR 325 crore, excluding goodwill and right of use assets. Pantaloons also ramped up its store additions during the year with 49 new additions, 18 of which opened during the quarter. We plan to significantly accelerate retail expansion of Pantaloons network in the coming year. Lastly, our other business segment, which include Active Athleisure, Innovators, Youth Dress Concession and Super Premium Brands. Revenue from other business segment extended INR 217 crore, marginally higher than INR 214 crore achieved in Q4 FY 2021. Active Athleisure, we expanded our distribution network and now selling across 27,000 MBO outlets and on the path to build a strong retail network. Youth Fashion and Super Premium Brands continue to work on profitability and bring in more freshness to their merchandise. American Eagle grew 45% over Q4 FY 2021 and is gradually establishing itself as a premium denim wear brand for its consumers. Forever 21 grew 13% over FY 2021. We are expected to continue to grow profitability in the coming years. The Super Premium Brands business segment, which includes The Collective and international brands, continues to grow strongly and profitably. Let me talk for Ethnic business. ABFRL is now one of the strongest and most comprehensive portfolios of brands across price points, consumer segments and occasions. ABFRL has made a constellation of partnerships with leading designers Sabyasachi, Tarun Tahiliani, and Shantanu & Nikhil to add to its first investment in Jaypore. The revenues of the segment of Q4 are INR 101 crore and an EBITDA of INR 5 crore, a margin of 5%. This is nascent business for us, and FY 2023 will see ABFRL make investments to grow the business both offline and online. We expect this business to grow rapidly over the coming year in line with our aspiration. In FY 2023, in all these brands put together, we plan to add 70 stores, including a store in New York for Sabyasachi. These forays will propel ABFRL to be leading player in the large ethnic wear market. Now let me brief you the progress on new partnerships. House of Masaba, ABFRL has announced a partnership with House of Masaba and is taking a 52.4% in the company. We signed a definitive agreement and plan to integrate into our fold shortly. Acquisition of Reebok, as informed, FY 2023 will see the addition of the world-renowned sportswear brand, Reebok, in our portfolio with effect from October 1st, 2022. Way forward, building on the momentum at the end of FY 2022, we as a management are optimistic about FY 2023 and plan to focus on the following areas. Significant capital expenditure to fuel the growth across all the brands in the portfolio. Significant increase in spend on marketing activities for improving strength in each of our brands. Number three, sharp focus on increased investment in areas such as IT and digital, extending our omnichannel and backend infrastructure. Number four, increasing focus on overall digital play through recently announced D2C entity, wherein we would invest in building a portfolio of digital first brands through organic and inorganic route and accelerate on e-commerce play. ABFRL has emerged much stronger out of the pandemic and is now operating on a much stronger foothold at the back of robust balance sheet, comprehensive brand portfolio and industry-leading talent, which enables us to realize our long-term ambitions of playing a leadership position in the apparel sector in India. Thank you, and we will now take your questions. Thank you very much, Mr. Bajaj. We will now begin the question and answer session. Anyone who wishes to ask a question may press star and one on their touchtone telephone. If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. First question is from the line of Tejash Shah from Spark Capital. Please go ahead. Hi, team. Thanks for the opportunity. I have many questions. I'll just try to club couple of them for efficiency. First question is regarding the fundraise. Last March, when you made this presentation for our FY 26 vision, we had in fact said a very detailed capital employment plan also which was not around any raising further capital. When I look back FY 22, it actually went very well for us in terms of recovery, in terms of numbers. What triggered this sudden such a big fundraise? That's first question. Okay. Hi, Tejash. Can you hear me? Sorry, yeah, I can hear you. Okay. Tejash, our long-term plan was made in January of last year and was presented to the investors around early March. What happened in April, May, June, all of you remember, all of us remember, has been one of the most devastating periods for life in general, but I think consumer retail, specifically fashion retail, and all of H1 of the year was significantly different from what we had imagined. We had come out of the first wave in January, February, when this plan was made. To that extent, your contention that nothing has happened in FY 2022 is actually very far from our own assumptions of how FY 2022 will turn out versus how it did. Over this period, we also realized that a long-term, competitive position would require us to invest deeper because many of our growth initiatives which we had started on, starting from Pantaloons, where we had laid out a plan to expand 70-80 stores a year, that ended up with close to 40-45 stores. Innerwear, their expansion was held back. Ethnic Wear, many of the business that we acquired were relatively sort of underinvested from expansion and growth point of view. If I were to summarize this, two things happened. One is FY 2022, unlike what you're seeing, is dramatically different from what we had imagined FY 2022. FY 2022, in our plan at that point of time was better than H2 that we have delivered this year. We had a similar view of H1 last year, and therefore the full year would have been much, much better. Number two, because of what was happening around and the conditions, our expansion plans were held back quite significantly. At the same time, we continue to believe both in the long-term growth potential of the market and intrinsic strength of our brands. We feel now the time is to accelerate, to catch up on what we've not done over the last 12-18 months, and I would go back almost till the beginning of the COVID period from 18-24 months, where some of our growth initiatives had held back. We have made investments in acquiring platform, but commensurate investments in actually scaling up those platforms have been lesser than what we would have ideally liked. Therefore, there is an accelerated need to grow these platforms. These are very significant opportunities. Tejas, you've seen how Pantaloons business has turned around in the last 3-4 years, and it's strong fundamental economic model. Ethnic Wear business that we've acquired, now there is no doubt that the strength of these brands will allow us to grow them much faster. 2.5 years back, this business didn't exist. Now we are talking in terms of business in about INR 400 crores, INR 450 crores a year. We had laid out a plan for INR 1,500-2,000 crores of that. To realize all that would require long-term capital and a balance sheet which is strong, and we don't have to keep looking back. It is the plan that we've been working on from the time the COVID phase two happened, on how do we strengthen significantly that for next two to three years, we don't have to take our organic growth expansion plans. That's really how we see it. Yes. Second, how should we think about now FY 2026 vision? Does it mean that we'll participate in many more categories, because capital is also now available? Or does it mean that we'll go more aggressive in the existing categories that we have identified already? Answer to that is latter what you said, which is we have, as I mentioned, very, very strong platforms. Pantaloons story is still to play out fully. Innerwear is still long runway. Ethnic Wear we just acquired. Reebok is a large opportunity that will play out over. Our existing strength of platforms, brands and portfolio has a very large capacity and capability to actually grow. That's where most of our investments go. I don't think, Tejash, you should look at this investment as a one-time, you know, infusion to solve current problem. This is more a long-term strengthening of balance sheet, which will allow us to fulfill exactly the strategy that we've laid out earlier. Sure. Sir, who do we consider our competition now? Because since pandemic, we are seeing that conglomerate retailers are getting very aggressive across categories. Unfortunately, fortunately, most of those retailers are either part of the big house, so their dilution, if at all happening, is not visible, or they are unlisted in India, so we are not able to track that infusion that closely. Just wanted to understand, are we competing some of those big names, or are we actually still playing or marking our competition as which was the case, let's say, in pandemic? I think, Tejas, we have always stated, and you saw that in our strategy that, the opportunity is what excites us more than competition. It's a very large market. Depending on who you ask, it's $70 -$75 billion. How much of it could have recovered? When it normalizes, it's, Indian apparel market is perhaps one of the largest, if not the largest consumer space in this country. The extent of, branded play is still limited, reflecting the fact that even a major player like us, is less than $2 billion in revenue, $1.5 billion in revenue. That tells you how large the fashion space is and how little is the penetration right now, and what is the large runway available to us. More than looking at competition, because each of our competitors or each of our segment that we are playing in serves a different set of competition. Our strategy need to be guided by opportunity, our own intrinsic strength, our capability to execute and vision that we have for the business, and not really looking at competitors and looking at what they're doing and who's the competitor. Each of them, they obviously will have their competitors, both national and international, and we'll have to deal and compete with them. Sure. The last one, sir. Was Flipkart strategic investor already considered or approached for this round of fundraise? This fundraise was our idea to get really long-term financial investors, but whose outlook is into future on and a partnership that we could build on over the next decade or so as the company grows and expands its strength in the fashion market. Therefore, the idea was to get somebody whose investment strategy proven discipline, ability to have long-term partnership in India proven over a long period of time and that's how GIC filled most of these criteria for us. To that extent, this is really how this partnership was conceived. Thank you. That's all from my side, and thanks and all the best. Thanks. Thank you. The next question is from the line of Aliasgar Shakir from Motilal Oswal. Please go ahead. Yeah. Thanks a lot for the opportunity. I have a question first on, you know, your fundraise and your, you know, growth initiatives that you mentioned. I'm coming from the point of view that, you know, we are a company which has an ability to, you know, generate probably more than INR 1,000-odd crores of operating cash flow. I hear your comments that, you know, we want to accelerate our growth initiatives. When I see Lifestyle, you know, largely franchisee-led growth, even Pantaloons, you know, we are now increasingly moving to that model. In fact, the kind of free cash flow generation we have, you know, I thought we have sufficient capital to drive growth in our existing portfolio. Correct me if I'm wrong. I just want to understand what are the broad areas of, you know, investment of this new capital? Would it be, you know, used for further inorganic growth opportunity that we see in any new areas? And a related question there is, you know, what should be your, guiding force in terms of your margin profitability metric that we should see during this phase of, you know, investment? Thank you. I think, Aliasgar, fair point in terms of our some of our businesses having strong cash flow generation capability. As I was explaining earlier to Tejash's question, I think the way we see our potential and what has happened in last two and a half years, many of our platforms haven't really played out to the extent that we wanted to do, and rightly so, considering the situation that the industry was, consumer was, and the overall landscape was. We believe, coming to your question, where would the large part of these investment go? I would say the largest parts would go in singularly expanding Pantaloons franchise to get it to the potential that it has. Ethnic wear portfolio is also. Contrary to what you're suggesting, we have always maintained that Pantaloons will probably stay at 20%, at best 25% of its expansion through franchising. 75%-80% of Pantaloons expansion would be own capital. Our entire ethnic wear portfolio we've acquired some of the most well-known and strong brands in the portfolio. We now need to do justice to them by expanding those. Reebok is a large opportunity. Our international brand business, whether it's American Eagle or international brands, they are growing very, very profitably and have a very strong runway. Reebok is probably a very long-term large opportunity that we're playing out if you look at that market dynamics. If you really look at what we have in our hands, other than Lifestyle Brands, which obviously has consistently been cash flow generator and need very little capital to grow, even there we perhaps at some stage 18-24 months, we'll have to build up a little bit capacity on the manufacturing supply chain side. Most of this would go to strengthen the accelerated growth trajectory that we have created for the portfolio that we have. That's our primary goal. Needless to say, a part of the capital will also have to go as the consumers are pivoting and digital is getting more important, both in infrastructure ability, building own platform business, which is required to actually have adaptive platforms where consumers shop from you instead of today, about 80% of business come through third-party platforms. That's the other thing that we need to invest in. All these are, I would say, part of the organic plan and pretty much part of the plan successfully done. Dynamics have affected our both our growth investments as well as our capacity because it has significantly dented the balance sheet versus what we had imagined. Got it. This is very detailed and insightful. Just quick follow-up here: should we build more than INR 1,000 crore kind of CapEx in our existing organic business? Are you saying that we don't have any inorganic possibilities in the near term? As far as organic CapEx is concerned, I think 1,000 would be aspirational for us. We would love to spend. I don't think we have the capacity to spend that kind of capital. The number would definitely be what we would like to do is something like INR 700+ crores, which we would invest in this year as we go forward. I was just asking, Ashish, you know. Sorry to interrupt, but I was just asking this, Ashish, because we already have that kind of, you know, operating cash flow to fund our business, you know, and therefore I thought that, you know. No, Ali, I think we are looking at this fundraise, which is a long-term strengthening of balance sheet to take us through next three to four years of growth with the CapEx of one year. I don't think that's the right way to look at it. Okay. Your suggestion that our CapEx will be significantly higher this year and perhaps for next couple of years is correct. That number perhaps will be INR 700-INR 800 crore at best if we wish, and maybe on the lower side, about INR 600-INR 700 crore, will be a function of our execution and scale at which we can build this. That's where it would be. Okay. On inorganic, any near-term possibilities? Inorganic, I don't see an immediate thing. As I have learned over the previous time in an industry like this where there are so many opportunities available, I think at any point to say there will be never any inorganic would not be a right thing. It would be incorrect for me to suggest that. As and when these opportunities come, we evaluate them both with strategic alignment with where we want to go, as well as the right sort of value that it is there. As of now, that's not the purpose of this fundraise, which we think around a longer-term balance sheet strengthening, which currently requires most attention as far as our organic businesses are concerned. Understood. This is very helpful. Just last one, you know, question on balance sheet, if I can just ask Jagdish to address. You know, inventory payables yet look higher than pre-COVID levels, even if I adjust for the new store additions. Is this due to the new ventures in ethnic wear or else should this reverse? You know, Ali, primarily this is a function of building up the inventories in the Q4 for the next season. The payments will flow in FY23. Another reason is the inventory buildup for the expansion plan in all our business segments, including the ethnic business segment. Got it. Thank you so much. Thank you. The next question is from the line of Gaurav Jogani from Axis Capital. Please go ahead. Thank you for the opportunity, sir. Also the first question is with regards to the sharp margin expansion that we have seen in the Madura brands. Just wanted to know how sustainable this is and what has led to this sharp margin expansion during the quarter? I'll let Vishak to comment on this question, but I would only suggest that please look at margins over at least two quarters and, you know, because there is some shift in sales quarter to quarter. Vishak would be in best position to explain this to you. Hi, Gaurav. Gaurav, first things first, yes, like Ashish said, we've been on a very good momentum. Q4 also, even in spite of a January which was Omicron affected, we had a very good like for like sale. That significantly helped. The costs are largely fixed, and when that gets spread over a larger sale then it flows straight to EBITDA. Also I think because of a very strong wedding season, discounts were tighter and hence gross margins also expanded a little more. Some parts of it will not sustain. You know, one is I think we will get to a much larger advertising spend as we look at the quarters ahead. That one come. There was some part of it which was still one-off gains of last year with the kind of cost reduction initiatives that we had. That's broadly the math of where we are. The momentum is good, the EBITDA percentage looks good, but perhaps there are a couple of things where we will invest more in the quarters ahead. Sure, sir. One follow-up to this, I mean, in terms of the store expansion plan. If we see, we have opened around 145 odd stores during the year. Again, we have been guiding to add around 350, 400 stores for the year. Anything on that front? Gaurav Jogani, this year also we actually added about 400 stores. Okay? We closed roughly 250 stores. Okay? Now closure also, some of it was real closure, some of it was also some term changes, customer code change, et cetera. net-net, we did expand close to about 400 stores. Please remember this was also a period of COVID, wave two, et cetera, where some parts of retail network had to be rationalized, where we were not able to get rent concessions from landlord partners, et cetera. We had to do that also. What it has done is not only has the expansion momentum continued, it has also created a more, you know, it has churned out a more robust retail network as well in terms of sales per sq ft of the network which we have now. That momentum of about 400 stores per year, I think we'll be able to continue for a few more years. For sure. Sorry, the next question is with regards to the Pantaloons business. I mean, you know, I do understand that the Pantaloons business was impacted due to the COVID-19, Omicron impact. How do you see the overall performance as if it has not seen this impact. What kind of a performance internally it's tracking about, and how the team is looking, if you can help us with that as well. Sangeeta, you want to come in? Just give a context a little bit about, the large format stores have been particularly most severely affected- Yeah. -by COVID, and you would have seen it, right? Go ahead and explain. Yeah. Yeah. Sure. I think as Ashish mentioned, we've seen, given the fact that our businesses are over-indexed to malls, we've seen through the year the fact that large format stores have had a deeper impact. It's true for us, it's true for the other players in the industry as well. Largely, we've had a start-stop with Omicron kind of coming in wave two, wave three, Omicron coming in. We've seen a start-stop, and as said the business got impacted. However, I think we feel good about our overall performance given all the headwinds that we've had. You've seen the numbers that Jagdish has talked about. We've ended the year with a 41% growth over last year. Had it not been for January and February, I think our performance would have been even better. When we normalize for that, our numbers look. We've lost about ballpark INR 150-INR 160 crore just in quarter four on account of the shutdowns that we saw in January, February. I think what's encouraging for us is that everything that we have shifted in terms of strategy over the last three odd years, we've seen impact of that. We've made a lot of changes and investment during the pandemic to make sure that we are a much stronger organization. We've had headwinds with the shutdowns, some headwinds with our supply chain issues, which have led to some supply-led issues. Overall, looking at our performance through the back end of February, March and April, gives us terrific confidence in terms of both our strategy and the return to momentum that we have seen. I think if it wasn't for the closures and the fact that we are over-indexed in terms of malls, our performance would have been even better. Sure. One follow-up to this, I mean, with this, like, as you know, as Ashish has also mentioned that, you know, looking for a robust CapEx plan going ahead in all formats, including Pantaloons. How should we consider the store opening momentum here, and what kind of CapEx could we see for the Pantaloons team? Right. This year again, we've opened close to about 50-odd stores. Just as Vishak explained, you know, we obviously had some challenges there. We would have opened more number of stores if it wasn't for the closure of a few months in the year. We have stated this very clearly in terms of our intention to open stores. We see Pantaloons as a format that works across town classes. In the past we have clearly said a number of, you know, 70-75 stores per year, and that's the acceleration that we will see going from this year to next year. I mean, this year we would have opened more if it wasn't for the challenges that we faced. In the coming years and the years to come, we would take that as the number anywhere between 65, 70, 75 stores is what we'd like to open. Sure. The CapEx that we would need for that is what we will factor in our strategy. Just one last question from my end is, with regards to the other businesses. If you see during the quarter, the other businesses, it has grown marginally by 1% year-over-year and actually declined on a quarter-over-quarter basis. If you can highlight how has been the performance, particularly for the Innerwear and Apparel business and Q4 specifically. Innerwear business continues to grow rapidly. There are other parts of the business like Forever 21, which hasn't grown over last year, which formed a substantial part of the business. Innerwear, I think, has grown at about high double digits, 15%-16% for the quarter. Okay. Thank you, and that's all from me. Thank you. The next question is from the line of Nihal Jham from Edelweiss Capital. Please go ahead. Sir, thank you so much, and good evening to the management. A couple of questions from my side. First on the quarter, specifically for our lifestyle brands, the SSG performance has been impressive and definitely industry leading. You have highlighted certain aspects, whether it is on extension of various brands which have in a way helped this. I just wanted a little more sense, Vishak, if you could bifurcate that, is it maybe the brand extensions or what is the improvement of the share in e-com, which can, you know, bifurcate and give more clarity on this growth? Also, there is talk of obviously a wardrobe refresh kind of a trend currently happening. Yeah, are you seeing that trend? That would also reflect in terms of your formal and casual share, how that is played out. That will be the first question. Yeah. Nihal, I think it's a lot of questions. First things first, the momentum on growth was overall good in the market. I think we did a little more, but yes, there was a lot of wedding season and all of that which we were able to capitalize quite well on. We in fact built it very well. We have built a very strong wedding line, et cetera. As you know, during the periods of pandemic, we had also built a very, very strong casual line and sports lines, et cetera. Now, that also came very nicely into the party. With the third impact, which is a back to work happening and a very strong comeback of a lot of people when they're going back to offices, buying new clothes for that, all of this together, I think we were able to capitalize on all three segments. That is what created a good, strong momentum. I think we also were able to. You know, our many initiatives which we've been taking over a long period of time, you know, including a 12-season model which allows for greater flexibility and ability to put what is required in the market at that point of time. Some of those things also, you know, they are very hard to put as a silver bullet, but they contributed significantly. Many supply chain initiatives, including a lot of technology in terms of retail assortments that also helped. It was many things which went together, Nihal, to be able to deliver. It's not just Q4. If you look at Q3 also, that same trend continues. It is in that sense an extension of many of those initiatives bearing fruit. Could we point out any one of these aspects standing out, or it's all equal mix as you say? If I were to say, I think, one would be hard, but if I were to say the top three, it's a very, very strong wedding assortment, a strong formal assortment, and a strong sportswear and casual assortment. All three together I think came very strongly, which were enabled by multiple things at the back end to be able to create a force multiplier as well. That's helpful, Vishal. Thank you so much. Yeah. Second question, Ashish, was on the fundraise. Just considering the quantum in terms of, you know, how our CapEx has been in the past and also the average ticket size of our recent investments, is it by any chance possible to give a bifurcation? You mentioned Pantaloons will be the first in order. Of you know where this INR 2,000 crore could be incrementally invested in. Second related question to that is, does it change our targets which we laid out for FY 2026, considering the pace for Pantaloons and all the other brands accelerate versus the earlier thought that we had? Nihal, it's harder to give exact breakup, but clearly this is meant to strengthen balance sheet to a point that next three to five years our expansion is sort of well supported. A large part of our growth story is built around growth of formats that we have. The two very strong ones, which are Lifestyle and Pantaloons, are sort of well positioned, but they still have a very large runway. There are new ones like Innerwear, which needs to double and triple over the next couple of years. There is whole ethnic wear portfolio where we started from zero and we have committed about INR 1,500 crores by FY 2026. In terms of where we stand in that journey, I think our current confidence is that we will do well above that number, and that's the strength of the platforms. Reebok has additionally got added. Some of the confidence around our ethnic wear also comes from the new launches like Tasva. Jockey coming on its own. Therefore, at this point of time, we feel that the projection that we had made for FY 2026 a year and a half back, despite the fact that we have lost almost six to nine months, we feel even more stronger that we not only achieve but exceed those numbers. A large part of our capital will have to go into that and into growing and therefore Pantaloons and Ethnic and Innerwear production. That order would take largest amount of investment as far as capital is concerned. Ashish, I look forward to more details in the coming calls. Thank you. Best of luck. Thank you. The next question is from the line of Ankit Kedia from Phillip Capital. Please go ahead. Sir, first question is, regarding the fundraise. Why did you select the warrant option and not direct equity? Ankit, we were looking at long-term solution for our capital needs for three to five years, at least five-year horizon. We came up with a number. As you can make out from the previous questions, that it's not that we need all that capital today. We wanted to make sure that our balance sheet is strengthened over a period of time, and capital infusion is more in line with what we think would be our requirement as we go forward. That's really how we needed to stagger it, and Warren came up with the best solution to do that. Sure. Sir, my second question is regarding the D2C, you know, strategy which you laid out last quarter. Just wanted to know what the capital infusion will be because few of your press interviews last quarter suggested INR 250-300 crore investment. Does it change after the fundraise or that, capital remains at the same level? No, I think, as far as, D2C is concerned, let me first state very clearly that we have said after initial infusion of capital we would look to raise capital externally in that entity directly. That plan doesn't change at all. This fundraise is not to fund D2C business directly from this side. We have a clear strategy on D2C which we laid out. We'll stay consistent with that. We have mentioned an amount at that point of time between INR 300 crore and INR 400 crore, but that might change a little bit because the idea is to get eight plus, eight, 10 investments made in this year and then go out and raise capital on that. That, that's on a separate track. I think it will have its own investment profile, and it'll also have its own funding profile. Our current investment or current fundraise is primarily targeted to accelerate the growth of businesses that we currently have and the ones that we have in the portfolio as a part of Pantaloons, ethnic wear, or innerwear portfolio. Sir, my last question is regarding the debt equity. You've always mentioned you're comfortable with one to 1.5 times debt-to-equity. Is it safe to assume you will continue with that or you want to be debt-free going forward? I think, for the sake of prudence long-term guidance which we can consistently sort of go by, Jagdish Bajaj had given that number in the long-term plan that we have, and we'll stay with that. There's no change in that. Of course, there will be periods when cash flows will be such that it may just exceed marginally or there'll be periods in which they will be debt-free. Our business will go through those cycles, but we will stay within the boundaries that Jagdish Bajaj had laid out earlier in his long-term plan. Sure. That's helpful. Thank you so much. Thank you. The next question is from the line of Devanshu Bansal from Emkay Global. Please go ahead. Hi, thanks for the opportunity and, congratulations on the recent fundraise as well as, strong margin performance during the quarter. Sir, Pantaloons, we were doing close to about INR 8,000-INR 8,500 revenue per sq ft pre-COVID. Can we get back to this run rate in FY 2023? Debita, do you wanna come in here? Yeah, sure. Pantaloons, productivity pre-COVID and projections for post-COVID. Yeah. Yeah. Hi, Devanshu. As I mentioned, before in terms of our strategy, I think all the things that we have done to strengthen the proposition of Pantaloons, and if you've seen during the pre-pandemic, we were on a good trajectory to strengthen our productivity through the store. What obviously we've seen over the last two years is a disruption on account of lower footfalls, and that story has been told by us and many of the other players in the industry. In FY 2023, our endeavor will be to absolutely improve the performance over this year. I think both with demand coming up and with supply chain issues you know being settled, we feel pretty confident. In the interim, I think we've done a lot of things, as I was alluding to before, in terms of strengthening our proposition. If you look at it, a lot of our large stores have been renovated. Our entire effort is to get to a much stronger customer experience, both offline, online and omnichannel. Our endeavor would be definitely to get as close as possible with a better product proposition, with investments in marketing, with expansion in distribution, which of course does not improve the same-store productivity. All in all, a better proposition for our customer and a better customer experience built on a stronger brand, a better product aesthetic, and an improved in-store experience with the new retail identity and the investments in the brand. Our endeavor would be to definitely get back to the pre-pandemic levels. Thanks. This is helpful, ma'am. Secondly, for these 75-80 store additions that you plan, what is the estimate CapEx that you expect to do in Pantaloons? This question is because I guess the store sizes that you have been opening are relatively low and small. These stores, again, it is a function of the size of the stores. I think with the new retail identity that we've built, our investments in CapEx per square foot have been higher. Ballpark, the investment should be in excess of about INR 150 crores that we are looking to invest in Pantaloons purely from a store expansion standpoint and from the renovation standpoint. Sure. Ashish, just wanted to understand what is the rest INR 550 crore sort of CapEx that would go into other segments like Innerwear and Ethnic. Can you sort of break up or segregate the CapEx for each of the divisions? I don't have the number right now. Maybe Jagdish can share with you later we can. A lot of it would be Pantaloons renovation, which would be over and above the expansion plan that we talked about. There'll be a lot of investments in digital and backend, which is warehousing and supply chain. There'll be subsequently a large investment that we have planned in our ethnic wear business, particularly Tasva. We plan to launch 65-70 stores next year. Sabyasachi, where we're expanding globally. Jaypore, where we'll be opening 50-20 stores this year on the base of 10-15 stores. Part of lifestyle brands would see its investment in manufacturing as we scale up the backend of that business as the front end is scaling very, very aggressively. As you might know, this is only business where we have a manufacturing largely to ensure that the premium quality is kept in-house. It's a whole bunch of initiatives around both growth refreshment, like Sulabha mentioned for Pantaloons, for renovation and for backend, which is both digital IP being one side and supply chain and manufacturing on the other section. Sure. Lastly, we have delivered about 19% EBITDA margins in H2. I request you to provide some color on margin trajectory going ahead, given the investments that you are going to make. Does this 19% sort of EBITDA margin can be sustained going into FY 2023? I don't want to at this point of time give an indication on the margin. I think you've seen the trajectory over a period of time. FY 2023, 2022 H2 was buoyed by two factors. One is there's significant cost compression that we had done through efforts right across the organization, store network refresh, closing down a lot of low productivity stores, driving hard rental negotiations and other cost measures that we have taken. To that extent, the cost base itself has got slightly deflated for the year. Some of it would come back. A part of our advertising investments, as Jagdish had mentioned in the opening speech, will need to go significantly higher than where it had come down to in FY 2021, 2022, where we had to take deep cuts on that. That will come back to the level before the pandemic, the pre-pandemic levels. These are two effects which will probably moderate some of the good outcomes, which is a more growing market, relatively stronger position in the market compared to other brands, at least in the lifestyle segments. The benefits of the refresh that we are doing in Pantaloons, both on the product and experience, the store investments that we're doing. To that extent, some of that will be offset by, with costs coming back to the levels that they were pre-pandemic. That would probably indicate a margin which may be slightly lower than H2 that we have indicated. Thank you, Ashish. That's really helpful. That's it from my end. Thank you. The next question is from the line of Ankit Babel from Subhkam Ventures. Please go ahead. Yeah. Good evening, sir. A couple of questions. First is in this D2C business, should we expect some cash burn in the initial years? There might be. There would be because, while what we would acquire would be largely profitable, businesses, though subscale. To get them scale would require investments which may have to go through a period of losses in that business that you'll have to do, to grow these D2C brands. Some of them would be seller brands which are intrinsically profitable and hopefully will remain that way. Some of them are direct-to-consumer brands which require deeper investment in early phase to acquire customers, create stickiness around that, and they will go through a period of losses in that. It is fair to expect some degree of losses in that business initially. Okay. Sir, my second question is you did mention that you people are now confident of exceeding your FY26 guidance with so many new brands coming in and scaling of the CapEx also. Now I understand that from top line point of view, there is a visibility of exceeding the guidance. But from bottom line perspective also, you feel that you'll exceed the guidance about 23%-50%? Well, it's very hard to say, but I would say we should at least stay where from what we had come indicated at that point of time. This whole investment into growth is meant to create a very profitable business. That's what drives our thinking on these. Therefore, there is no reason at this point of time to change that. Okay. Thank you so much, sir. Thank you. The next question is from the line of Abhisri Bank from JHP Securities. Please go ahead. Hello, sir. Thank you for this opportunity. My question is, it is mentioned in market update that inflationary pressure is offset by price increase. How is the response that company got for this price increment? Many of these price increases have been more continuous in nature than a one-time. If you follow textile value chain, the raw material prices have been going up now for last 9-12 months. Of course, the intensity may have gone up of late, but there's been a continuous price inflation in raw material prices. There's also been, therefore, a consistent sort of matching of that at least from the H2 of last year. Much of that will play out and will depend on how rest of the inflationary environment plays out in the country across other consumption baskets over next 6-12 months. We'll have to keep a watch on it. Too early to say that it would. In the past, there have been times when most of these price increases have been passed on, and the consumer has had very little volume impact. I think this time we'll be guided by overall macro situation as far as our inflation is concerned. That may have some repercussion, but we will continue to keep an eye on it. At this point of time, we remain hopeful from the current trajectory that most of this price increase will be absorbed by the consumer. Abhisri, do you have any further questions? No, that's it from me. Thank you, sir. The next question is from the line of Yash Kenka from Yashvi Securities. Please go ahead. Good. Thank you for the opportunity. I just had a question that what will be your guidance across segments in terms of revenue for FY 2023, if you can throw some light on that? We don't give guidance of that nature. At this point of time it's hard for us to give a number to it. We have an internal target, but I don't think it'll be fair right now to put it to give out a guidance on that. Okay. Okay, thanks a lot. Congratulations for a great set of numbers. Thank you. Thank you. The next question is from the line of Rajiv Gandhi from DAM Capital. Please go ahead. Good afternoon, sir. Thanks for the opportunity. On Pantaloons, you said that you had lost INR 150 crore in Q4. Can you provide what are the, like, lost sales in H2, just to get a trajectory? I think, the number would be probably similar or a little bit, more around that. Effectively, we've lost closer to INR 300 crores in this period, due to various impacts that happened. Of course the number is much higher as we can recover it in H1, but overall number for H2 also would be in the strength of INR 250 crores-INR 300 crores. Sure. On the Innerwear side, if I heard it right, you said we grew 15% YOY in Q4. Can we break this number for Q4 and 23% for the full year number in terms of volume as well? What is the volume growth? I won't have that number right now. I think we can share with you separately. Okay. Lastly on the sourcing side, on the innerwear particularly, did you see any disruption due to the issue in Sri Lanka and? No, we don't have much sourcing from there. While initially it was an important part of our early years, but over a period of time we've been able to diversify into other countries, and to that extent we've not got impacted or have a large business coming out of Sri Lanka. That hasn't affected us. Yes. That's all from my side. Thank you, sir. Thank you. The next question is from the line of Vaibhav Agrawal from Basant Maheshwari Wealth. Please go ahead. Hello. Yeah, thanks for giving me the opportunity. Sir, my question is, we are raising about INR 2,200 crore in capital, and assuming that we deploy this capital over the next three years by FY 2026, what is the kind of asset turnover ratio that we can expect from this? See, we have, Vaibhav, we have laid down a plan, very clearly, which was given at the beginning of last year, where we have created, both revenue profitability overall projections on that. That plan has got appended to certain extent because of losses that we have incurred in H1 particularly, and to some extent part of H2 in FY 2022. A part of the capital would strengthen the balance sheet which has got impacted by last year. The rest of it would be plowed back to actually accelerate some of the plans which have not got played out last year. Also, as I indicated, with the strength of platforms we have, with the addition of Reebok now and some of the other, ethnic wear, opportunities that we've played out, we are looking at exceeding those numbers. Projections will remain roughly in line of, hopefully ahead of what we had predicted around FY 2026 numbers. To some extent, this capital is making up for lack of acceleration that we've missed out in FY 2022 and to cover up the losses that we had in the H1 of H1. Would it be right to assume that the kind of momentum that we lost in FY 2022, we would have to dilute our equity to the extent of 7.5% for that particular loss in momentum in FY 2022 for the remaining- No, not at all. Not at all. I think it would be totally incorrect to see it that way. Equity is built with a long-term point of view with four, five, six years growth trajectory, ambition and opportunity point of view. Therefore it cannot be linked with one quarter, one half. All I was commenting on was our projections for next four, five years. They have been pulled back in last 12 months, and some of that needed to be re-accelerated. See, equity is a long-term capital, and we need to be seen with that light. What happens in one half or one quarter would obviously impact some of those, but that's not the most critical element when we think about long-term capital gains. Right. Sure. Thanks a lot for the answer. Thanks. Thank you. The next question is from the line of Ankit Kedia from PhillipCapital. Please go ahead. Sir, just on Reebok, you know, the consolidation was supposed to happen from Q1. Has there been a delay given that globally the deal is actually completed? When can we see that happen in India? The deal starts really from quarter one of this year. The deal you're rightly saying has got completed. We'll get the consolidated numbers from quarter one this year. Thank you. Thank you, sir. Thank you. Thank you very much, ladies and gentlemen. On behalf of the management, we thank all participants for joining us. In case of any further queries, you may please get in touch with Mr. Rahul Desai or Mr. Amit Dwivedi. You may now disconnect your lines. Thank you for your participation. Thank you.