Ladies and gentlemen, good day and welcome to the Q2 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 Q2 FY25 performance followed by a question and answer session. We have with us today Mr. Ashish Dixit, Managing Director; Mr. Jagdish Bajaj, CFO; Mr. Vishak Kumar, Director and CEO, Lifestyle Business; and 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 today's discussion may include certain forward-looking statements and must be viewed therefore in conjunction with the risks that the company faces. Please restrict your questions to the quarter's 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 afternoon and welcome to the Q2FY2025 earnings call of our company. At the onset, let me wish you a very happy festive season and a prosperous year ahead. I will first take the opportunity to set the context in view of the operating environment during the quarter. The overall demand environment continued to remain. Subdued consistent with trends observed in previous quarters. However, there were some positive indicators primarily driven by festive spending and an increase in wedding-related shopping activity. As we approach the wedding season for this year, these positive upticks are in line with the trend we have been seeing over the past many quarters where occasional late shopping drives sales favorably impacting sales for certain categories. We expect improved conditions in the second h alf of the year. Amidst this, we maintain our focus on executing the plan we had set out. For this year where we drove good. Quality sales, rationalized less productive channels and markets and consistently drove margin improvement. As you would have seen, the business has consistently improved the margin profile year on year for last three quarters. While the larger business reported an improvement in profitability, the smaller and rapidly growing businesses such as Ethnic and TMRW maintain a range-bound losses though improving on margins on YoY basis on a much higher scale, the profitability improvement were mainly driven through better planning, product enhancements, stringent markdown management and deprioritizing poor quality channels. Each of our brands reported a positive like-to-like growth this quarter. Also noteworthy to mention that our sustained efforts toward improving our planning and merchandising process and our tight inventory control led to a marked improvement in our working capital profile leading to better capital efficiency. Let me also give an update on the corporate actions. The last step in the acquisition of TCNS has been successfully completed and TCNS has been fully amalgamated with ABFRL from 1st September 2024. Hence the results are consolidated. Considering TCNS as a division on the parallel demerger process, the company has completed the first step when it received NOCs of the demerger proposal from stock exchanges. The application has been filed with National Company Law Tribunal as the second step and will now go through the process as prescribed by the Honorable Tribunal. We expect to complete the demerger process before the end of this financial year. Coming to the financial performance of our company for quarter Q2FY25, our company delivered consolidated revenue of INR 3,644 crore in this quarter growing 13% over Q2FY24. Consolidated EBITDA stood at INR 410 crore growing 11% YoY in absolute terms with 11.2% margin. This includes the TCNS business this quarter which was not there in the base last year. Our established businesses continue to drive delivery of robust margin while high growth segments like Ethnic and TMRW achieved substantial revenue increases with marked improvement in margins. Let me explain to you the exceptional items appearing in this quarterly results. First, company has decided to restructure the operations of Forever 21 taking a one time hit of INR 98 crore towards impairment. The same has been reported as exceptional item. Secondly, the Company increased its stake in Tarun Tahiliani couture business from 33.5 to 51% resulting into one time upward revision of its holding value on account of mark to market revaluation of historical stake to the tune of INR 121 crore. Adjusted for these two items, the net gain in exceptional items in the P&L is INR 23 crore. Company's consolidated PAT was negative INR 215 crore impacted on account of higher depreciation amortization of brand and retail assets due to inclusion of TCNS this quarter along with elevated interest cost on high borrowings in H1. Our company recorded consolidated revenue of INR 7072 crore growing 10% over H1 FY24. Consolidated EBITDA was INR 816 crore growing 13% YoY in absolute term with 11.5% margin. The net debt as on September 30th stood at INR 3759 crore as on September 30th 2024 our store network stand at 4538 stores spanning across a total retail area of 12 million sq ft. I will now take you through the performance of individual businesses starting with proposed ABLBL segment. The segment in Q2FY25 posted revenue of INR 1975 crore with EBITDA of INR 302 crores. The EBITDA margin stood at 15.3% for the segment. First lifestyle brand grew 3% YoY to a revenue of INR 1,636 crore in Q2FY25 with an EBITDA margin of 18.4%. Retail like-to-like growth for the brand stood at 3.4%, primarily impacted by lower demand in smaller markets. Continued focus on product innovation, casualization and markdown management combined with elevated retail experience and consumer insights has supported profitable growth. Emerging growth businesses which include Youth, Western Wear, Innerwear and Athleisure and Sportswear segment posted 7% growth at an overall level with the segment posting another quarter of positive EBITDA. Now let us discuss the demerged ABFRL segment. This segment has grown by 31% to INR 1,838 crore in Q2FY25 validating our portfolio expansion strategy to build meaningful size businesses in large consumer spaces of the future. EBITDA for the segment grew by 66% with margin expanding by 170 basis points to reach 8.1% this quarter. All businesses within this segment grew well with profitability improvement across each of them. Let me start with Pantaloons. Pantaloons delivered yet another quarter of significantly improved profitability. The business model improvement initiatives which have been mainly around focus on key markets, improved product propositions and retail experience and better planning and merchandising are reflected in improved financials. Its record revenue of INR 1082 crore growing 3% YoY with a like-to-like growth of 1.3%. EBITDA margin expanded by notable 560 basis points to reach 15%. In absolute terms it delivered EBITDA of INR 162 crore, a 65% increase YoY. Enhanced operational efficiency coupled with trend-driven offerings and refined aesthetics has enabled us to achieve high sell-through rates which has driven growth and profitability. Our Style Up retail format has now scaled to 35 stores and is receiving strong consumer traction. The business has already started to deliver store level profitability across the current network. Based on this success, we plan to accelerate store opening in the coming years, then the ethnic business overall portfolio grew more than three times versus last year to reach INR 454 crore primarily led by inclusion of TCNS and Tarun Tahiliani Couture business. Organic growth of existing businesses stood at healthy 10% with EBITDA margins improving significantly. The luxury brand's portfolio which includes Sabyas achi, Shantnu & Nikhil, House of Masaba and Tarun Tahiliani grew by 32% on YoY basis. House of Masaba more than doubled its revenue within which its beauty brand LoveChild grew to 10 times of last year. With Tarun Tahiliani Couture. Our already comprehensive ethnic portfolio is further strengthened as another marquee luxury ethnic brand gets added to our portfolio. Premium ethnic wear brands including Tasva, Jaypore and the TCNS portfolio delivered robust overall like to like growth rates. The TCNS brands recorded a solid 13% growth with a 3% like for like increase marking the third consecutive quarter of positive L2L growth. This has been achieved with significant product upgrade, harnessing synergy benefits with larger ABFRL and focusing on retail productivity. As far as the wedding related consumption is concerned, the first half of this year has been fairly muted with the onset of festive and advanced purchase of wedding related categories. The end of the quarter saw encouraging demand for Tasva which achieved remarkable year on year growth of 79%. We expect this momentum to continue as the rest of the wedding season plays out during H2 of this fiscal. Luxury retail comprising the multi-brand format, The Collective and other monobrands maintain profitable growth with a YoY revenue increase of 9%. The total network now encompasses 40 stores coming to our digital brand portfolio of TMRW. TMRW portfolio more than doubled compared to last year with the inclusion of TIGC acquired inorganic growth. The portfolio organically also grew by 30% plus with a portfolio of brands targeted at the Gen Z and Millennials. TMRW adds freshness to the ABFRL portfolio and gives scale to its relevance for the Gen Z and Millennial customer base which will be one of the most important consumption segments in this country. To conclude, despite a challenging demand environment, our company has demonstrated resilience and strategic agility, achieving notable growth across various segments. The successful integration of TCNS and the expansion of our new businesses have announced our brand portfolio. Our focus on operational efficiency, product innovation and customer experience has yielded positive results as evidenced by the robust performance in both established and emerging businesses as we look ahead. We are encouraged by the response during this festive and are very optimistic for the upcoming wedding season which for a premium brand portfolio like ours would be significant. We plan to sustain the impetus on each of the initiatives we have been running to drive operational efficiencies to consistently improve the business outcomes as the second half of the fiscal unfolds itself. With most of our stabilized actions already executed well, we will be very favorably placed to reinvigorate our growth channels to pick up the momentum with tailwinds from broader market improvement during the rest of the year. We wish to accelerate the pace of execution of our long-term strategy of building a leadership play in most of the large discretionary consumption segment in Indian fashion and retail industry. We are open to questions now. Thank you. Thank you, 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 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 will wait for a moment while the question queue assembles. The first question is from the line of Gaurav Jogani from JM Financial. Please go ahead. Thank you for the opportunity, sir. So, my first question is with regards. To the demand conditions. How have they been running into this first month of October in the testing season for both the brands, i.e., Pantaloons as well as the lifestyle brands. So that is the first question. And so the second question also is with regards to, you know, post the demerger between, you know, that ABL and ABFR, how do you plan to scale up things in the ABFR piece of business given that you know that business will have a certain amount of debt. So. How the growth will be planned in that piece of the business? If you can answer that, that will be helpful. Thanks. I'll get Vishak and Sangeeta to respond to the overall market conditions. Vishak, can you come? Yeah. Hi, Gaurav. You know, so far we've had a decent start. I wouldn't say, you know, I don't. Want to jinx it. But decent start to Diwali it's been, you know. What is important is the combination of wedding shopping as well as Diwali shopping that we've got. We still have to watch out how it stands out to during November, December. And the good news is there are a lot of wedding dates through this period. So I do believe that it should be a decent quarter in that sense. At least for our brand. Is there anything different so very, very. Similar for us, Gaurav? I think festive. You know, we had a good start, just about closing, and I think it's like a mid single digit performance in terms of growth. Of course the market conditions overall have been tough but we've had an encouraging fest. Just one thing, you know, we have been hearing some eastern based players that you know, while the Pujo has been good but you know, the Pujo hasn't been that great as for the expectations, at least for them. So is it similar for you too? Yeah, so I'll come in again. So Pujo as you know is a very important period especially for Pantaloons because East is a very important market for us and we've had a low single digit Pujo. I think largely there were two or three external factors which disrupted the demand. The local protest that continued through Pujo, the fact that certain markets saw unprecedented rain, the disruptions in Bangladesh, there is a lot of purchase from customers who come in from Bangladesh during Pujo period. All of these factors actually impacted demand. But through that period we saw some disruption in Kolkata but very encouraging to see those markets which behaved in a near normal fashion in terms of no disruptions. We in fact saw very good high single digit growth in those markets. The rest of West Bengal for example did extremely well. The other markets in East did very well for us. So I think it's a combination of disruptions that we saw in Kolkata but very good performance in the rest of the markets. Gaurav, to your other question regarding how do we fund the growth of the demerged ABFRL which will have a fair share of debt post separation. As you know, at the time of demerger and announcement the board had also approved the fundraise exercise and as we go forward at appropriate time we would look to raise capital which we had announced even at the time of demerger itself. We wanted to look at how the merger process is going and then time the fundraise. So we will do that and we'll fund it adequately to sort of drive the growth of the high growth segments that exist in the demerged entity. Sorry, I just deepened my question. I mean we are aware of, you know, the fund based planning that you have. Does that, you know, will that in any way impact your growth plans, what you have right now versus you know, what you would have told this fundraiser? I mean would there be more curtailed and more, I would say more profitable focused manner as it is right now or we would continue to be aggressive in terms of growth there? I think there is some inherent dilemma in your mind about growth and profitability. Choices that we are making. We are quite clear that over the last four or five years we have expanded our portfolio very strategically with long term consumption segments which are meaningful for our business. And that's the portfolio expansion excitement as far as profitability is concerned. It will remain a very large focus for us in many parts of the business. We recognize that we have somewhere to go and our major businesses, it's already in good place in line with our long term strategy. I think a lot of growth businesses and very high growth businesses would need capital. There is also debt sitting on it and therefore that's the reason for the fundraise in short term or longer term. I don't think our strategy is changing. The only part we have said is our strategic acquisition piece is now that phase which we went through between 2020 to 2024 where we entered many new emerging segments. The entire digital portfolio got created of tomorrow. We acquired rights of Reebok, built the entire portfolio of ethnicwear business in a short period of time to become the largest ethnicwear company in the country with very, very iconic brands in the portfolio. So that is a phase of our portfolio expansion with a very long term strategic outlook on where the consumers of tomorrow will be. I think once we have completed that excites the next phase of capital growing East businesses. Thank you for answering my question and best greetings to everyone. Thank you. The next question is from the line of Nehal from Ambit Capital. Please go ahead. Yes, thank you so much and good evening. I had two questions. One was in Pantaloons. Obviously we've highlighted that lower markdown led to an improvement in the margin profile just in case of lifestyle brands. Despite the positive LTL, was it a s tep up in marketing spends or maybe a channel shift which is let's say margins being flat or slightly lower. Two, three factors. First is we kept discounts very very tight. Okay. And we were able to squeeze out significant amounts on discounts. We were able to create superior product cost engineering solutions as well which gave us gains. There was an overall cost improvement drive across the system which gave us benefits and of course some amount of network rationalization. Also we did which also further improved overall profitability situation. So these are the key pieces we have. Absolutely. The thing is that maybe on a YY the margins have been flat or slightly lower for the lifestyle brand. So that is where I was just coming from that. Why was that before? Okay, specifically last year, same quarter we had a one-off gain. So that had an impact. JB can probably quantify that, but we had a one-off gain in last year which we didn't have this year which would have impacted margins. Second is, you know we are going through a situation with Centro where they are scaling down their business. So we had almost zero business with Centro last quarter which again took away, you know they've been a very large trading partner for us in the past. So that also impacted our overall business in Q2 and that explains the wholesale contraction. That's right, that's right. A significant part of our, you know it's, it's been a big four partner for us in that sense. So it made a big, big impact. Brother m aybe later if you could clarify on that one-off or I'll take it separately. The second question was on the debt part. Currently we are at INR 3,800 crores. I'm guessing this is a build up because of, just to understand say by the time we reach Q4 we'll have the planned INR 2,500 crore QIP. We'll obviously have I think around INR 1,000 crores left for ABFRL. So what is the planned debt with which say the new entity will start with after the QIP? If you could give a ballpark sense and would the pile up expansion that you're targeting be significant in terms of the CapEx outflow or overall CapEx and working capital outlook? So Nehal, at this stage unless the board has formally approved a fundraiser I w on't be able to comment on it. I would therefore speak of the debt from operating performance point of view. As you know second half of the year is where the retail sales picks up and much of our portfolio is also heavily skewed towards wedding and festival related periods. While all of the fashion industry like that, our portfolio is particularly more heavily skewed around that. So we expect the debt to come down by 400 odd crores, INR 400 to INR 500 crore in the second half of the year. As we said there is a part which is April 1st 2024 into the two entities. All I would say is we'll sufficiently fund the demerged ABFRL to drive aspirations of the growth opportunities that we have created with the portfolio. I'm not at liberty today to talk about either the size or the timing of the fundraise, and we'll do that at an appropriate time. That is it. Thank you so much. Thank you, Ladies and Gentlemen. You may press Star and one to ask a question. The next question is from the line of Garima Mishra from Kotak Bank. Please go ahead. Yeah, thank you so much for the opportunity. The first question is on Pantaloons. Now this is with reference to the EBITDA margin expansion for the business that you talked about in the opening remarks. Now I note that over the last few quarters Pantaloons have posted a negative EBITDA. How do you view this? And I'm asking this also in the context that EBITDA margin does not give a complete picture, giving some rental costs below EBITDA. First thing is that improved performance is with on a like to like basis with the same principles that we applied last year versus this year. So I hope you agree with that. This is indeed an improvement therefore over last year because this is same comparison that we give. Also as per accounting standard these are same standards that apply by anybody in the industry. So it's very close to what everybody else supports. On the question of Pantaloons segment, Pantaloons also has Style Up as a part of it, a small portion, very small contribution today, the size of Pantaloons on the revenue side but obviously slightly larger contribution in pulling down Pantaloons segment profitability which is what you're talking about. Okay, let me ask this another way. This Pantaloons segment generates cash in 1H FY25. Absolutely. We've said that before. Pantaloons was a free cash flow operating business before we went into COVID. Post-COVID, it took time to recover. We are back to the same situation. Okay, I understand our next question and this is again on Bangladesh. Ongoing demand environment remains sort of tepid. Maybe not as tepid as it was i n 1H but maybe still remains a l ittle lower than what we've seen in the past. What steps can be taken to drive up the LTL. So I think Garima, I'll get Sangeeta t o come in, but honestly, the drivers of improved productivity for us remain the same, good or bad market, because we are not using discounting as a lever. And therefore it comes down to, apart from the external conditions, about store improvement, merchandising improvement, superior consumer experience, and which are more fundamental drivers and they are more sustainable over a period of time. I don't think we will do things which will create one-time improvement and it's going to be more organic. And as you've noticed over the last couple of quarters, this organic sustainable improvement is what Pantaloons' business is driving and it's showing up in all places. The stores are looking better, the product aesthetics have improved, product quality has improved, gross margin has improved and overall effectiveness of the network. Some of the pressure on the Pantaloons business and that's true even for some part of Madura businesses. Are the smaller markets underperforming? You know Pantaloons is one of the most expanded retail format and it is not just in top cities. It travels pretty deep and we did some of the rationalization last year. The lower end of the markets, which are smaller markets, continue to underperform which is sort of putting pressure on that. We'll have to deal with it as we keep going forward in a more sustainable manner. Understood. Next, I have a question on the innerwear business. Now in the PPT you have talked about exploring this as a multi channel strategy. So is there any thought of expanding operations of your innerwear business in the quick commerce channel as well? Yes, I think innovation is probably in fashion, the first and the most amenable category to quick commerce. We have just started or just about to start right now with one of the players and we hope to expand with other players in this quarter which is Q3, quarter three of this year. We'll see how the performance is. But early signs from what we hear from channel partners are that it's a category which has got a good pickup and we'll see if, if it goes further from there. Understood. Last question from me, if I may. Is there any progress on getting an external investor on board for TMRW? In case there's no investor comes in, how much more capital will ABFRL. Need to invest into TMRW? So Garima, we had mentioned that as far as ABFRL is concerned we had board approval of close to INR 750 crores which is what we have invested this point of time. We don't plan to increase that nor does the business need it at this point of time with the capital that they have got. Our plan was always to get an external investor at some point in time. However, we'll have to time it appropriately so that the business is sizable and attractive for an incoming investor itself. As you can see from this quarter or from previous quarters, the business scaling up very, very fast. We have now pretty attractive portfolio of brands. We are clocking close to 1,000 crores run rate. As far as the revenues are concerned. We are still some distance away from portfolio level profitability. But many brands are profitable at brand level. So we think in the right period of time we'll be able to get an investor to fund the next phase of growth. Till then we don't plan to make any acquisitions. Got it. Ashish, thank you so much and wish. You the very best. Thank you. The next question is from the line of Devanshu Bansal from Emkay Global Financial Services. Please go ahead. Yes, sir. Hi, thanks for the opportunity, sir. In continuation to Garima's question, I j ust wanted to understand this increase in net debt better i n H1 the debt has increased. By INR 800 to INR 900 crore from the cash flow statement, we have invested about INR 500 crore, half of which has gone to CapEx, investment in subsidiaries, additional stakes, ICDs. Working capital is actually reduced by about 75-odd crores. So there is OpEx funding of about 400-odd crores in H1. So I just want to check which are the business segments as of now. Where we have to support operationally the business for them. So I think as far as H1 is concerned and you're probably commenting on H1 Pantaloons segment to further answer Garima's question and your part has been free cash flow generating. I'm keeping ABL related businesses out because they have historical track record of free cash flow generation. So that's out of it. Although this half there's been some consumption of cash in that part of the business but Pantaloons is being free cash flow generating. Most of our cash has gone into ethnic businesses which is largely in the subsidiary part. Then there is which included TCNS also. Then there was investment that we made in remaining acquisition of Tarun Tahiliani. We also had partial commitment of equity which is which was planned for TMRW investment. So a part of investment went into that, a part of which was used by TMRW to make further investments, which is investments in TMRW that we made. So it's a combination of investments that we have made and operating businesses which is largely ethnic which is consumed cash. Understood. And since specific to TCNS I guess it has seen healthy growth of about 39% right in Q2. I guess Q3 is a seasonally heavy quarter for this particular segment. So any thoughts on initial traction for the festive season and if you could just update on the margin profile of the business. So, I think as we had said, TCNS business when we took over, that will take us a couple of quarters first to focus on fundamentals, which is product enhancement and shape of the business. I'd also commented we begin with the year by Q3 we'll break even which i s pretty much on track as far. As that is concerned. Business profitability has improved significantly from where it was, and as we had projected by Q3 it will become profitable in terms of growth. I don't want to comment on specific month or so, but as you've seen, as the new product has started to come in, the business has started to improve in terms of revenues as well. Not just absolute revenues but even the quality of revenues have been improving and we expect to slowly improve, continue to improve on that trajectory. Just a small follow up. So out of all these TCNS we are expecting profitability to improve or break even I guess etc. Are profitable businesses. So Tasva is the only part where it may be operationally making some losses for us. Is this the right understanding? So Tasva and Jaypore are today Tasva being the largest one followed by Jaypore. And to some extent we are still making investments in some of the high growth segments particularly in House of Masaba, the Love Child which is the beauty business. So some of those, but those are I would say smaller pieces. The biggest piece will be Tasva. This 38 crore loss that we have incurred in Q2 is this the peak as in which we can expect some normalization from these levels? Going ahead To say so early, I won't give that sort of indication today. We will wait for the full year and then have a sort of more balanced picture with that. Thanks for taking my question. Thank you. Before we take the next question, a reminder to all the participants. You may press star and one to ask a question. The next question is from the line of Aditya from CLSA. Please go ahead. Hi, good evening. So two questions for me. So firstly on the ethnic business, can you give us a sense of how much of the growth is organic? The second question on the lifestyle b usiness, any sort of indication of store additions over the next two quarters and then also for fiscal 2026 and if you can break that by brand. So just a quick comment on the ethnic business growth. We wanted more organic growth of the business which is without addition of TCNS and couture business of Tarun Tahiliani. I think the vision is talked about 10% growth for the remaining business which is the organic part of the business. Sorry, what is the second question? I'll take that. Ashish, he wanted to know about expansion. Aditya, hi Vishak here. Expansion I think you know first half we have primarily focused on consolidating especially to you know, to take away unviable stores. We've pretty much completed that exercise and hence as we go into Q3, Q4 all the expansion would result in a significant net positive to the network. The only part where we'll still stay guarded for maybe a couple of more quarters is small town expansion. As you know, the kind of business recovery that we need in small town, I think, will take a little longer. So we've been very careful in expanding in small town. Urban and middle India expansion will continue significantly. So you will see that as the quarters unfold. I understand. So just to follow up, actually on both, but firstly on the expansion. Any sort of commentary on numbers. What we should expect for expansion in 2H and within that would the understanding then be right that maybe Van Heusen, Louis Philippe and Allen Solly see more expansion than Peter England and Peter England. Right. Peter England Red perhaps might be a little more slow but all the other brands would go stronger, including Reebok which is also catching up on expansion because we started with a smaller network and we have a lot of catching up to do, a lot of locations where we don't have Reebok stores. So that expansion will also continue full steam. So I think you would see all of these brands, especially urban and Tier 2 India growing their network in Tier 2. Understood. Thanks, Vishak. And I'm sorry it could be belaboring this, but any numbers to give on? How much expansion we should expect or you don't want. To discuss? You know, in our business sometimes a few months slip in the way network comes. But my sense is about 100 stores is the kind of number that we should look at initially. Perfect. Thank you so much and thanks Ashish. Thank you. The next question is from the line of Ashish from Citigroup. Please go ahead. Hey. Hi team. Thank you for the opportunity, so the first question is, you know, on the franchisees because we have seen it has almost been now more than two years since the demand has been kind of subdued and we operate a lot of franchisee stores both in lifestyle as well as in standalone, so you know what you are seeing there, are you seeing any kind of a stress with the franchisee partners and especially in case of new stores, what is the kind of interest you are witnessing? Hi Ashish, I'll take it. And Vishak, if you have something more to add. Ashish, you know we have our relationship with franchisees have been long term. We have always believed that their capital is as important as ours and therefore we have been very balanced in the way we look at it. In times of crisis, we see how we can support that. Last year and a half or so has continued to be weak, and that's why some of our expansion. If you look at the previous question, the reason Vishak mentioned about slowdown in some of the small town expansion, primarily because we don't see. We don't want to grow to markets at times when franchisees don't see possibility. Most of our expansion, at least in lifestyle brands, is driven through franchisee business, and therefore our slower expansion is reflective of the franchisee situation today. But it is normal, and we've gone through these cycles multiple times over many years. So I don't think there is anything extraordinary to worry about. Sure, thank you. Thank you. The next question is from the line of Tejas Shah from Avendus Spark Institutional Equities. Please go ahead. Hi, good evening and thanks for the opportunity. First question is pertaining to Pantaloons. So with Trent appearing to take a very cautious approach on Westside expansion, how should one assess the growth potential of Pantaloons? I'm assuming that both cater to the same audience. How are we approaching the growth runway? Or expansion only for this format? Hi Tejas, this is Sangeeta. So Tejas, as Ashish and Jagdish alluded in his talk as well, I think one of the shifts that we made, and we talked about it in the previous calls as well, is today Pantaloons is a large format which is distributed extensively across 200-odd towns that we are present in with our 400-plus stores. As we have assessed our performance over the last few quarters, we have recognized the fact that of course our right to win and our performance has been better in the larger towns. And therefore, as we had called out earlier, our focus in terms of expansion is more in terms of metros, mini metros and Class 1 towns. Also, I think where we have strengthened our guardrails is in terms of the quality of stores that we open. We are opening bigger stores, better stores, better representation of the labels that we have. We still believe there is a huge opportunity for us to grow. But of course in terms of the numbers, you know, anywhere between 200 to 250 stores. Is what we have called out. We continue to stay with that plan of opening about close to 20 stores. In terms of square footage, we are looking at bigger stores. We may end up doing more than what we had planned for. Opening the right stores and then making them perfect from an operations and an execution standpoint is what we are focused on. I think to some extent this reflects the shift in strategy which you are alluding to. We earlier used to aspire to open 62-65 stores. There was a year in which you opened 70 stores. We are now looking at 20 to 25 stores. More urban centric, better, more ready markets because the effect of productivity, etc, we found is much higher here and fortunately with the very promising start to Style Up, we feel the entire value retail format will be better served through many of these markets being served by Style Up as we go forward. Very clear. Thanks. Second question is on Innerwear and Athleisure. So after many quarters the leader actually gave a very positive commentary on the segment recently. So are we seeing any similar trend shifts in our segment? Yes, to some extent. I think the first signs of Athleisure continuous decline has stopped. This was the Q1 or maybe first or Q2 where Athleisure has started to at least come back to its base level, and once that happens, because innerwear had come back couple of quarters back, athleisure which is pulling down the growth, and so from here onwards I think you will see stronger growth in the innerwear. Perfect. The last question is for Vishak. Vishak, personally, as a consumer, Reebok seems to be one of the most under-indexed brand in our lifestyle portfolio. So, could you share some medium term aspirations? You spoke about that there's a huge room and you are looking for locations. But can you throw some more light on how do you see this brand in medium term and what are your aspirations of goal here? Thank you for that, Tejas. Yeah, you know we just had a review in the first half on Reebok and we're looking at how we can accelerate expansion. We still want to be, you know, very short on locations as we do that. But I do think that our footprint has to go through a significant enhancement over the next few years. We have a lot of catching up to do. What we are also making sure is that it is backed by a whole lot of solid products both in footwear and in apparel, that we're doing some really good stuff to make sure that these stores are viable from day one. Also working a lot on multiple brand building initiatives to strengthen the brand. I do think that the next few years are going to be very significantly strong growth years for Reebok just by footprint expansion and also by throughput improvements across the board on the brand. If I were to just add to that, the whole BIS implementation meant that we had to strengthen our capability in terms of local sourcing and product development, which Reebok team has done a wonderful job. We had to make sure that we have intrinsic capability and deep knowledge of the category, which we have done very well. So Tejas, it's just a matter of time. If BIS happened, perhaps we would have accelerated even faster. But now we have to make sure that we have enough sort of back end capability to drive the growth. And you will see a shift in momentum on that. Sure. And just one follow up there. The route to market will be COCO, FOFO or mixed. We've always had a combination of these. You know, there is a lot of very strong franchise partners that we have on Reebok who are keen to scale up. There are of course specific locations, some mall locations etc. where we do COCO stores if required. So it will be a combination. We are largely franchise driven but we do combination. So you know, so that the momentum on expansion continues strongly. Sure. And the last one, if I may s o this October has been one of the warmest October in recent times and n on-South India portfolio is usually known i n fashion for being winter-oriented. So how are you seeing and how much of our portfolio is exposed to that risk? Ashish? Okay. Shah, you can talk about. Okay. We are very well prepared for winter. We do believe that, you know, there will be a strong winter. There are a lot of signs of that. If you read up on weather commentary, there is a lot of signs of a strong winter. So we do believe in that. Having said that, you know, it is an important part of our assortment in North India, eastern parts of India, some parts of Central India, etc. And we figured ways to manage for the ups and downs of. Usually it's not strong versus weak winter, it's when it gets timed up early winter versus late winter etc. We're fairly prepared for that. And my sense is that it should be a decent winter quickly from portfolio point of view. I think other than lifestyle brands, and particularly I'd say one or two brands which have higher exposure, rest of our portfolio in the second half is actually not that expensive to winterwear per se. Of course the wedding relevance and reliance is much higher. Got it. Thanks. All the best for coming quarters. Thanks Tejas. Thank you. The next question is from the line of Raj Kumar from Nuvama Institutional Equities. Please go ahead. Thank you for the opportunity, ma'am. In this quarter on the consolidated basis, Madura Lifestyle brand sales are INR 1,975 crore with INR 33 crore PBIT, and the Pantaloons brand sales are INR 1,082 crore with INR -42 crore of PBIT. In your Madura Lifestyle brand, the sales as well as the PBIT is decreasing, and the Pantaloons brand, your PBIT has been negative for the last couple of quarters. My question is what is the reason behind this? I mean in both the segments they are very old and repetitive segments, so we expect 10% to 15% sales growth from both the segments, but why they are not giving that kind of sales as well as PBIT? Just want to know, and the second part is when the Pantaloons PBIT comes into profit. So I think in Pantaloons segment there is impact of course Style Up business which is in incubation phase at this point of time. Pantaloons on its own in response to earlier question has delivered positively but the combined operation therefore is negative. Okay sir. So my second question is regarding employee expense and other expenses. Both the expenses are increasing rapidly on quarter-on-quarter basis. I mean both that quantities are increased by 20% in standalone basis, quarter on quarter and 10% in consolidated basis. Is there any specific reason behind it? Give some light on it. So I think there is a lot of additions which are inorganic in nature. We keep looking at our overall manpower expenses at overall level adjusted for acquired business which is removing the cost that comes through acquired businesses. The overall growth on that account is about 6% to 7%. Thank you. The next question is from the line of Naitik from NV Alpha. Please go ahead. Hi sir, I just needed a clarification in terms of when you see your margins in lifestyle brands; they seem to have come down. So can you please explain why they have come down? I think Vishak had explained the response to earlier question. To some extent it was impacted by absence of one large important customer and that reflected in both lower sales and some loss of profit on account of that. The second reason was a one-off last year same quarter which was primarily due to reversal in minimum wages in Karnataka where most of our factory operations are, which gave us one-time gain last year which obviously was one-off. Net of the one-off event, the margins are pretty steady and improving. That's it from my side. Thank you. Thank you. The next question is from the line of Vaishnavi from Anand Rathi Institutional Equity. Please go ahead. Hi. Thanks for taking my question. I had a couple of questions for Vishak on Madura's growth. Because if I look at the H1 numbers, the numbers are flat and I understand that the demand environment is subdued. But how should we look at the growth going forward and what would be the drivers for growth in the same? Hi Vaishnavi. Yes, it's been a tough H1. But having said that we've used it as an opportunity to become stronger in the way our portfolio is organized, et cetera, consolidating our network to drive retail profitability, building further on product innovations, driving further on premiumization, casualization, a whole lot of things that have been built for positioning ourselves better for growth. I think in any case, as we get into wedding season now, etc., we should see the calendar effect being positive to us. But going forward also, Vaishnavi, multiple, you know, we've been a double digit CAGR business for two decades, you know, and that's the kind of trajectory that we should keep going at. And there are enough levers for growth in every brand and every part of our business. So I would say that yes, we should keep that growth engine going. Okay, so in the longer term, can we build like a 10% to 12% sort of a revenue CAGR for the lifestyle brand? Absolutely, I think we should. Definitely a double-digit growth CAGR is something which we should drive these brands for. Absolutely. Okay, understood. And in terms of premiumization. Right. Since you said that, that's been a focus of what we've been working on, premiumization and casualization. Can you provide some insights in terms of what was the percentage, let's say a couple of years ago, like pre- COVID and what it is now in terms of contribution? Maybe Rachna, we can send that separately to you. But I would say that significant shift and it's just that, you know, I'll have to do this brand by brand for you. Different brands have different portfolios. For instance, Allen Solly is largely anchored around casualization there. It's, you know, it's not such a relevant thing. In other brands, it's more so there are brands which needed significant premiumization. There are parts of it which are already high there. I think it will need you to. For me to give you a second level double click on this to give you a better answer. But at a ballpark level, here's what I can say to you. You know, there are, let's say in brands like Louis Philippe, and so on, there are opportunities which are emerging at price points of INR 4,000, INR 5,000, etc. per shirt, which we have significantly scaled up. We have a line which is Luxure by Louis Philippe, which is also scaled up which is INR 5,000 to INR 10,000 rupee price points. So that's significantly strengthened. We're looking at retail formats where there. It's a larger composition of premium products, very top-of-the-line products that we have, so it's very contextual to each brand, but yes, in some of these brands it's been a strategy which has helped significantly. Okay, understood. Thank you. Thank you. The next question is from the line of Rachit Agarwal from Atharva Investments Manager. Please go ahead. Hi, my question is related to TCNS and if you can maybe help me with a slightly long-term kind of view on this. First up, has that brand stabilized and from now on do you see the brand only clocking profitable growth? And a related thing would be, are you further looking at any one-off cost related to TCNS in the next couple of quarters, be it related to rationalizing of stores or do you see some duplication in certain sub-brands of TCNS? Any thoughts on the same please. So thanks. I think TCNS as we have been communicating in our previous quarter previous communication we worked on three dimensions. The first one was product improvement and that the team has done very well. The new product is certainly performing at a level that we had expected. Most of the old inventory which led to the one-time write-offs that we had to take, we have already done. We don't expect any change in that. In fact the TCNS team has delivered outstanding improvement in their inventory both in quality in absolute numbers and this is both including the new inventory as well as old inventory. Most of the old inventory is behind. There's no further one-time cost coming there. As far as store expansion is concerned, I think as we grow in a normal course of the business there will be rationalization that happens in all businesses. No significant sort of different versus other brands. As far as store expansion is concerned we are working on elements of synergy between the two companies, the two parts of the businesses and that's playing out well. In terms of your question about longer-term trajectory, we had said this year we will make sure that the business has got stabilized in all dimensions on one-time cost structure changes are obsolete. Those have been taken. The policies are fully aligned and we'd look to start to probably the first profitable quarter. From this quarter and next year onwards we look to come close to profitability with the longer-term ambition of getting into mid-double-digit profitability EBITDA margins. Great, great. Thank you sir. But just small follow up. I mean I did allude to certain sub brands of TCNS, for example, let's say W and Aurelia. I mean I think they do and I'm just talking from perspective of a consumer. They do have a similar product range and hence the two may have very very similar locations as well. So do you think that's the correct picture of it? Do you see something more distinctive being carved out between W and Aurelia and do you see across the portfolio, do you see certain similarities between various brands and there may still be some work to be done to make them more distinct? From a consumer point of view. Well, fair point. I think there is to our best judgment and cumulative experience of the TCNS management team. There is distinction of W being both more aspirational as well as more fusion and therefore more contemporary versus Aurelia which is slightly sharper price more traditional works for more conservative consumer in that sense and therefore there is an element of fashion difference and target customers slightly different. We'll continue to evolve the positioning to make sure that it is sharper and well seen by consumers as you're alluding to. But that's a more ongoing exercise. I don't think at this point of time there is any thought of having one versus other. We are very, very mindful that these two both together as well as individually are the largest among the largest brands in the ethnic wear industry. And that's the whole sort of purpose of acquisition. We'll sharpen the positioning as we go along. Well done. Thank you. Thanks, sir. Thank you. Thank you very much. The next question is from the line of Chintan Mehta from a Family Office. Please go ahead. What is the PBIT margin? We are looking in lifestyle businesses. So we don't give numbers at that level. So therefore, I don't think I want to disclose the numbers of that but over a longer period of time. The portfolio of ABLBL brand we have talked about EBITDA margin range north of 18% which is really what we are targeting from that portfolio, and that's the number that we have for you. Thank you very much ladies and gentlemen. On behalf of management, we thank all participants for joining us. In case of any further queries, you may please get in touch with Mr. Amit Dwivedi. You may now disconnect your lines. Thank you. Thank you.