Ladies and gentlemen, good day and Welcome to the Bajaj Consumer Care Q1 FY2022 Earnings Conference Call hosted by ICICI Securities. As a reminder all participants lines will be in the listen only mode and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please an operator by pressing star then zero on your touchtone telephone. Please note that this conference is being recorded. I now hand the conference over to Mr. Aniket Sethi from ICICI Securities. Thank you, and over to you, sir. Thanks, Farina. Hi. Good morning, everyone. Thank you for joining. It is our absolute pleasure at ICICI to host the management team of Bajaj Consumer for Q1 FY 2022 results call. The company is represented by Mr. Jaideep Nandi, Managing Director, Mr. Dilip Kumar Maloo, Chief Financial Officer, and Mr. Kushal Maheshwari, Head Treasury and Investor Relations. Before I hand over to the management for their opening remarks, I just wanted to highlight our view on the business very quickly. We have been longstanding believers of the Bajaj Consumer validation story and like its brand building and distribution expansion efforts, along with the intent to have a comprehensive portfolio of hair oils in the medium term. With that, I hand over to the management. Thank you, and over to you, sir. Thanks, Aniket, for firstly hosting this call, and good morning, everyone. My name is Jaideep Nandi, as mentioned, and I've been joined by some of my colleagues from the management committee over and above Mr. DK Maloo, the CFO, and Kushal Maheshwari, our Head of Treasury and IR. I hope in this period, all of you are keeping safe. That's very important at this stage. As I start, let me take you through the performance of the company during the first quarter before I open the house for questions. As the quarter started, we saw disruption due to the second wave of COVID-19, which led to the lockdown in the month of April and May as well. The impact was very severe for us in April, where our sales really dipped. But by May, the normalcy in operations had resumed. Our business also came back. June saw very good recovery for us when the lockdown restrictions were eased. Sales actually rebounded in the month of June, that saw our highest-ever monthly sale for us for a single month in the month of June. Fortunately for us, July also seems to be continuing the same momentum. The company reported a sales turnover of INR 211.99 crore for the quarter, with a growth of 10.7% over the same quarter of the previous year. The total value growth for the company for the quarter, excluding sanitizers, was 20.4%. The contribution of sanitizers have gone down from 9% in Q1 of last year to about 1% in Q1 FY 2021. The total volume growth for the company was 16.2%, excluding sanitizers was 24.3%. The EBITDA for the quarter was 53.67%, which is a decline of 7.8% this year. The EBITDA to sales ratio was at 25.3% for this quarter. The gross margins were at 58.66%, a decline of 4.9% over the corresponding quarter previous year. The drop in gross margin was primarily due to sharp price increases in LLP and RMO over the quarter. The commodity prices still remain inflationary during the quarter, with strong uptrend in global edible oil prices, which is having an impact on the RMO prices. The MRP price increase of about 2.5% that we took helped to partially offset the impact of raw material prices and packing material inflation. We'll keep a close watch on the commodity prices in the coming quarters and take corrective actions if and as necessary. PAT for the company was at INR 48.87 crores against INR 54.19 crores for Q1 of last year. There has been a recovery in hair oils category as per Nielsen data in the months of May and June, with a 25% value growth in Q1 and June MAT growth of 5.4%. The rural markets continue their strong growth momentum reflected in June MAT growth of 10%, while urban markets have also recovered sequentially, posting a 22.1% growth over last year, though on a low base. For BCCL, both urban and rural markets have shown healthy growth, reflecting in share gains in both. Rural markets continue to outperform urban markets for the fourth successive quarter for the company. As per Nielsen data, there has been a sequential increase in total market share by value for BCCL to about 10.8% for quarter one of FY 2022, 120 basis point increase over the corresponding period last year, an all-time high MAT June market share of 10.7% on the total overall hair oils. There has been also a 120 basis point market share increase in volume terms as well in Q1. The van operations for the company was very badly affected in April as well as a bit in May due to this extensive lockdown in rural markets as well as in urban impact as well. In June, they have recovered to the pre-lockdown levels. In July, we are now back to actually absolutely at the quarter four levels that we were at. While we continue to increase our van footprint and optimize our operations, we expect our non-ADHO portfolio to help improve efficiencies and throughput. We expect our ADHO to remain where it is. We expect the non-ADHO portfolio to take over a little more of the share in the van routes. There has been good growth registered across all zones in the country, but Central zone, which bore the brunt of the lockdowns, so all the states in Central Rajasthan, Madhya Pradesh, and Chhattisgarh. This caused a delay in their recovery, and Central actually was the only zone which had a negative growth in the entire quarter against last year. As Central is a large component of our business comparatively, that also impacted our overall business. ADHO, our flagship brand, continues to do well, recording a sales growth of 20% in the quarter and increasing its market share in the total hair oil category by about 100 basis points. AHO, on the other hand, doubled its turnover in the quarter, albeit on a low base. There has been a preference for large packs in general trade, which has helped drive both ADHO as well as Amla Aloe Vera hair oil. While wholesale business has been a challenge, as most of the wholesale markets were disrupted in the first quarter, our focused retail initiative, which we had talked about and wanted to take over as our key initiative for the next two, three quarters, has been doing well, and this has helped our retail grow by over 40% in the quarter. This will continue to remain a key initiative for the company for the remaining part of the year. Despite most of the Modern Trade stores being partially or fully closed during the months of April and May, the channel has delivered high teen growth for the company. Most of the stores had resumed normal operations in the month of June. Outlook for Modern Trade at this moment looks optimistic. We continue to increase our visibility in modern retail outlets with shelf space display for our products and promotional consumer offers. E-commerce continues with its triple-digit growth figures in the quarter. Our products are now available with more online retailers, while there has been increase in assortments with existing retailers. E-commerce will continue to remain a thrust area for the company as we gear up for escalation the team with a senior resource joining the team to spearhead the business while we prepare for our next phase of digital-first brand launches in the coming quarter while strengthening our presence of our existing range with the e-retailers. International business has shown good growth for this quarter. The travel restrictions continue to hamper the growth in the GCC markets. Despite the strict lockdown in Nepal and Bangladesh, these markets have managed to deliver healthy double-digit growth. The contribution from exports to other parts of the world have also gone up. During the quarter, we continued to invest in our flagship ADHO brand across all mediums of TV, social media, and print media. Taking a break in May, we came back to normal levels in June as the market conditions normalized. The new commercial on TV has been doing well on message communication and other key parameters of likability, relevance, and purchase intent. Digital marketing for ADHO is being continuously dialed up, and we are actively using new-age influencers now to reach out to younger consumers. Bajaj Amla Aloe Vera hair oil relaunched in the last quarter continues to gain market share in key Amla markets despite lockdowns impacting rural van sales. The new TV campaign for rural markets is already on air and has been providing additional marketing support for accelerating trials of Bajaj Amla Aloe Vera hair oils with advertisements in locally. As a part of our initiative to expand our portfolio, we have just launched the Bajaj Pure Coconut Oil in the last week of July. We believe there is sufficient room for all branded coconut oils to grow in this category and gain share from unorganized players. Our strategy in pure coconut oil is to offer a reasonably priced premium product with 100% pure coconut of the highest grade. As a part of the initiative to reduce the overall carbon footprint in the value chain, we have reduced the consumption of glass by 16% by optimization of specification of bottles and paper by 7%. Further initiatives are being taken to optimize the consumption of laminates. We are also taking initiatives to explore the usage of recycled PCR as well as recyclable laminates. As part of extended producer responsibility, we will be collecting and disposing 100% of our consumption of plastic material. In Q1, we have started, collected, and disposed of 13% of the same. One of our primary objectives is also to build an efficient and a capable team in BCCL. A variety of initiatives have been embarked on the company towards this objective. We have also been inducting crucial talents to create a strong management team for the future. The company has received accreditation from GPTW with strong numbers upsides in areas of management credibility, business acumen, and training and development. The company has also launched Bajaj Care Program to assist our employees. We launched it during the second phase of the COVID-19 pandemic, both for our employees and families, and has had good feedback from the employees on that. With the market conditions normalizing and having had a good start for Q2, we are optimistic for our performance for the rest of the year with the planned brand launches that we have for the next two-three quarters. With that, I end my opening remarks and open the session for questions. Thank you. Thank you very much, sir. Ladies and gentlemen, 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. Thank you. The first question is from the line of Vishal from PhillipCapital. Please go ahead. Yeah. Hi, sir. Just two questions. What is the combined price hike that you have taken during Q4 FY 2021 and Q1 FY 2022? The total price hike is close to about 3%. We had taken close to 1% in last quarter and a little more than 2% this quarter. Total comes to about 3%. Okay. Sir, you have taken a lot of cost-saving initiatives, I think that have been mentioned in the PPT. If you can just highlight that, what kind of benefit that we're expecting in the coming years from those initiatives? Typically, we are looking at about 20 odd initiatives that we h ave taken as far as supply chain is concerned. Across both in terms of raw materials, in terms of logistics, in terms of looking at alternate raw materials, et cetera. We are looking at roughly about INR 5- INR 6 crores of cost straight, pure cost benefit coming out of that. Not a large number to start with. Okay This is the direction we want to take going forward in the future. This, we want to make an integral part of our entire efficiency system. Great. The last question is on that you have made a lot of senior management hires. I think new head of e-commerce has come, as well as head for international and modern trade has come. Any more areas left or most of the hiring is done now? E-commerce, we did not have anybody who is specifically for e-commerce. As you are aware, like everybody else, we are looking at e-commerce. We are betting big on e-commerce. The brand launch in e-commerce will happen in this quarter, by the end of this quarter. We wanted to be geared up for that. Our back end is already geared up in terms of digital marketing, et cetera, in terms of sourcing efficiencies. All that work had already happened in the last two quarters or so. Now we have had two hires, which is the head of international modern trade and e-commerce, who's a senior resource who has come from a very large organization. A specific person who will head e-commerce under him, who's specifically only into e-commerce. That, as well as some other team members we have already acquired. This is what we are now going to dial up. There'll be a little more hiring happening in e-commerce itself, but more as junior resources, more to beef up their team for the end launches that we have. Right. Sir, the last question from my side on coconut hair oil. I think in past, have you launched, I'm not aware whether you launched coconut hair oil or not in past? In case you have launched, how differentiated this time the proposition is going to be versus in the past? I think we have had launches in the past, in fact, there the issues were that off takes for the product somewhere could not take place, basically we had to take back a lot of material at that point of time. Which has happened for some of the other products also that we have had in the past. Now, how this is different, et cetera, will be a difficult question to answer. All I can say is that at this stage, this launch has been planned for quite some time. We wanted to look at specific markets. The objective of this launch are twofold. One is obviously, this is a large market, we do not want to completely remain out of it. We understand there'll be challenges as far as gross margins are concerned, so we are also playing the game, exactly looking at how, being conscious of what the gross margins are and be clear as to what our own objectives are. There are two objectives, especially if you look at these two markets of West and South. If you look at West, we already have a limited distribution network, not as strong as the North. We do have some distribution network, and we feel with our learnings from what we got from our van initiative happening even in North, while we were pushing Amla as a part of the assortment which was going in fact even ADHO gained as a result of that. We feel that in some of these Western markets where just through Amla itself we'll not be able to add on to ADHO. We think that coconut can help us generate a little better assortment in terms of market penetration. In the south, it is clearly a distribution game. In fact, with the planned launches that we have for the general trade, maybe coming up somewhere around Q4 and then beyond. Maybe end of Q3, Q4 and beyond. I mean, the kind of launches that we are planning, we would like to have a distribution network as far as south is concerned. Today we have nothing. This will help us have a distribution network to start with. Not only ADHO itself, which we'll try and push through, but there'll be also a set of launches we would like to use that channel. West and south, two different strategies as far as coconut is concerned at this stage. Right as we see coconut happening, we'll come back to you. Right. Thank you, sir, and all the best for the future. Thank you. Thank you. The next question is from the line of Aditya Malpani from Bryanston. Please go ahead. Yeah. Hi, sir. Thank you for the opportunity. My question is related to coconut launch only. Sir, historically, you have always talked about launching a hair oil variant or a product wherein some value addition can be made or which can be differentiated with the existing competitor's product. What really changed? I just wanted to understand the rationale behind getting into a me-too hair oil category. Secondly, what will be the strategy to compete with the key players like Dabur and Marico? Yeah, good question. There are two ways to look at products. One is obviously you look at a differentiated product where even if it's a me-too category, you look at a differentiated product and see where you can have strategic advantages as far as the product is concerned. The other is obviously when you are looking at a very, very large product category, well-established product category, where you have had not only me-toos coming in from one company. This is more a generic category. This is not a branded category. If you're talking of Bajaj Almond Drops and somebody were to copy it, that's actually a me-too because there's no existing category as such. If you're talking of an Amla, if you're talking of a coconut, these are traditional existing categories. While, yes, obviously with an established player, it will be seen as if it's a me-too brand, but it's basically you're entering a category which hitherto you were not at. Second part is obviously, which I answered. The biggest challenge you will see as far as this category is concerned is the gross margins and being a large player in that category, you will have to be a little smart in terms of maneuvering. In our case, very clearly, we see potential for us, as I said, in the South in terms of having a distribution presence, which we are not able to have a foothold today. We require a foothold because not only for coconut, but also for all the brand launches that we would want to have in South. Today, we do not have any operations in South of any realistic estimate. This will allow us that entry into the south as well as I said, in some of the other key markets, and our coconut story is not completely over. This is more a starting launch. We will also want to see how it works, and then we have some more plans as far as coconut is concerned. Maybe in the next three, four months, it will slowly get done. Okay. The second question is with respect to market share. Now, in this quarter, in terms of value growth, we have underperformed both industry as well as the key players like Marico and Dabur. Despite of that, if we see slide number six, the quarter three and quarter four shows all India market share of 11% and 11.1%, but the graph above shows a little different numbers. I just wanted to understand. Have we lost the market share or have we gained the market share? No. What you saw is quarter numbers, and these are basically the MAT numbers. The graph above is the MAT numbers. It's a moving average for 12 months as the market, this thing. The below graph that you see is the specific quarter. As you are aware, Almond Drops typically peaks during quarter three, quarter four, the winter months. I mean, that's a known data point, right? You will always see Q3, Q4 market shares going up, and then Q1, again, a drop, Q2 being the lowest, and again Q3, Q4 going up. The bottom graph is not really can be tallied to the top graph. The top graph is a 12-month continuous MAT market share because that's how you look at the market share. As you said, our apparent performance in terms of underperformance is I completely take that. I think you'll have to look at it a little more in a nuanced manner. One is obviously a 20% growth in hair oils is lower than that you see in the other companies. You'll have to see that in terms of the primaries versus secondaries, the way our secondaries have happened, and we are seeing the result of that in June, in July, et cetera. Because we had gone down in the primaries, specifically in the markets. Just to give an example, let's say Central, which is a large contribution, which we have one of the largest contributions from Central Zone, actually went negative. Even though we had 20% growth in hair oils, Central Zone was negative. I mean, it was a deep single-digit negative as far as we are concerned. Given that our impact of Central Zone is high, it had an impact on the market. Now this is getting stabilized. I mean, June has been very good. July has been even better. April, May was completely cashed out. This is known, Chhattisgarh, Madhya Pradesh, Rajasthan, all that. UP, the wholesale markets of UP, that is the second impact that we have. Also wholesale markets, again, that is the other deep negative we have. While retail has had a 40%+ growth, wholesale for us has been negative. As you again are aware, wholesale for us has a larger contribution than most of the other companies. We have had a deep negative in April and May, which is getting started into getting normalized in June and again in July. Really speaking, I am not very concerned about those numbers of getting negative because in terms of where we wanted to grow, whether be it in retail, whether be it in the sub-Ds, et cetera, those markets have been doing pretty well. This temporary growth, I see by quarter two, it will all get neutralized, and so not really concerned. Central wholesale markets, I mean, clearly are the two big temporary Q1 drops that I see. Yeah. Okay. Thank you so much, sir. Thank you. Thank you. The next question is from the line of Abneesh from Edelweiss. Please go ahead. Yeah, thanks. My first question is on D2C and the digital stuff. I know your company size is much smaller than many of your peers who are investing in the D2C companies, in the startups, taking up stake. What would be your thought process? You do have a lot of cash in the books. Any thought process on that, or you want to do it through the own organic route? Now it's actually a nuanced question in that way because these are multiple layered questions. Let's first take this cash in books first. Cash in books is obviously that is there, but that needs to be utilized. I mean, whether there were cash in books or whether we borrow and leverage ourselves, the business parameters will not really change. I mean, you will not take a decision based on cash on the balance sheet for taking a business call. As you asked, whether we'll go for a ready-made M&A for a smaller e-commerce brand, whether we develop it ourselves, et cetera, we'll have to also look for opportunities. Yes, we will keep scouting for opportunities in the e-com space if such an opportunity does arise. On the other hand, we'll also look at what we want to do ourselves. As far as D2C is concerned, before I answer your D2C, let me take you through the journey of our own e-commerce, et cetera. E-commerce, as a company, you would have seen that we have started late. As I keep saying, e-commerce is a more of a democratic world. You can quickly catch up and ramp up. That is exactly what we are trying to do. Our results are quite better from 0.5%. Now we are close to about 3.5%, 4% of our turnover. Still lower than some of our competitors. I think the direction seems to be correct. Now we want to really press the pedal on that. What we are planning to do at this stage is launch our own brand. It will be our own digital-first brand with a plethora of products which are coming in. That is something that we'll go on. We'll also scout for, as you asked, whether we'll scout in the market for any opportunity there. Yes, that is a journey that we will continue. As far as D2C is concerned, that is something I think is a little more evolved, and while we have been already discussing that, we have been having our internal discussions on that. I think we would first want to have our portfolio ready, because the moment you get into D2C, as a consumer, I would be looking at what kind of assortment and what kind of portfolio you are having to offer. Unless you have a portfolio, really speaking, D2C will not happen. D2C is something, it's not a question of if, it's only a question of when. It will happen, but it will maybe a few quarters away. That's helpful. My second question is on the broader leadership level. You had joined the company around 18 months back from a extremely large, formidable company like Asian Paints. When you had joined and now, if you see versus initial expectation, how has been the journey and where still there is room to improve? In terms of the second line leadership or the leadership at the top, are there more hirings which will be required? See, as far as the second rung is considered, if you look at individual level of my direct reporters, you will see them. They are absolutely top-notch resources and comparable to any other company. I mean, today, at least I'm proud that we have a management committee which can actually sit shoulder to shoulder with any of the best in class. That's what we had aimed to do, and 18 months later, at least we have that across all functions, whether it be in sales, marketing, any of that. What we are moving towards is N- 2s, basically their direct reporters, because two things that we want to address, which is basically not only the strategic thinking at the company level, but also operational excellence. While that is being dialed up through system processes, we also require strength in people. That is something that we are focusing and maybe in the next five, six months that will happen. I think as far as manpower is concerned, I think good progress and the team now has started working towards in terms of what they want to do strategically and so and so forth. That is more or less in place. What we are now also started doing in the earlier stages was system, processes, governance, et cetera. A lot of good work has happened in that, but I think that's a longer journey. Whether we're talking of a manufacturing footprint, supply chain footprint, IT footprint, et cetera, that's more of a journey where good start has happened, but I still think we are still two years away from the final end result that we would want to have. I would also not want to fast-track it too much, because we would rather want to keep investing slowly and start building strength rather than want to jump into something absolutely five-star overnight. Slow and steady is how we would want to go there. Yes, all of them seems to be at least in terms of our whatever benchmarks we have picked, they are seems to be on track on that as well. Sure, that's very helpful. Last question. A lot of questions on Coconut has happened, but I'll be very specific here. One is, does sourcing advantage economies of scale matter here? Because the number one player sources almost 10% of the coconut in the country. Does that matter? Second, your packaging color is exactly similar to the market leader. Does it make sense to do that? Third is in terms of pricing, are you differentiating or is it just that you just want to be there on the shelf, it helps the distribution? Will there be marketing support for this from a medium long-term? The first is the easiest question. Obviously it helps. I don't think even I need to answer that question, does sourcing and economies of scale help? Being a large player, being for such a long time invested in this with the kind of backward integration, you can't even dream of questioning that. Obviously it does help, but as I keep saying that it's such a large market, there is always space for some other players also. We have to give credence to Bajaj as a brand and its strength, and that is what we want to ride on. A lot of questions are also is the me too going to erode the Bajaj brand or not? Really speaking, no, because finally at the end of it, Bajaj Almond Drops on its own equity stand. Bajaj itself is a much more of a conglomerate brand because of whatever the family and so and so forth. That and hair oils is something that people clearly relate to, and our initial responses from the retail, this thing is also the same. Even a little bit of consumer study that we have done overall clearly says that, yes, we have a right to also play in this market. With the right to win or not, maybe a too much of a statement to make at this stage. Right to play, definitely. As I said, we also have a strategic intent for launching the Coconut. This is also to not only establish the brand, but also get some headway into some of the markets where either we are underrepresented or not represented at all, or maybe sub-optimally represented. With the larger portfolio that I have in mind, we require vehicles, and we think that Coconut will help us as a vehicle. As far as pricing, et cetera, are we differentiated? Yes, we are differentiated. In terms of consumers, we are offering a price which is obviously more attractive for the consumer for a first trial, et cetera. This product is given as that. In terms of whether the brand looks deceptively similar or not, if you were to look at the actual packaging, there are a lot of differences. Really speaking, I don't think there is too much of comparatives between the two brands as far as physical look, feel, et cetera, is concerned. Yes, the only thing that you can talk of is the blue color. Obviously now, if you look at all the coconuts which are there except for the eastern part of the world, all the rest of Pan-India, all of them are in blue color because that's how the leader is. If you look at, let's say, almond oil, all of them are in that golden yellow, which is the typical golden yellow. You can make almond oil in any color if you wish, but almond oil is the golden color in a transparent bottle. I think leader does have an impact in terms of influencing what happens. That is how it does tend to. I will agree to that point that, yes, are we in the blue color? Yes, we are in the blue color, but so is everybody else. That's very helpful. That's all from my side. Thank you. Thank you. Thank you. The next question is from the line of Prakash Kapadia from Anived Portfolio Managers. Please go ahead. Yeah. Thanks. I had two questions. Yes, sir. You mentioned rural is better than urban in terms of growth. Is it just the COVID impact being lower in rural in the second wave as compared to urban? Is that the only reason or anything else you can attribute to? This year, actually, rural was also very badly impacted. It is not that rural was not impacted. Last year, for example, urban was absolutely impacted. Rural was not impacted at all. Last year we flew in rural. Last year, actually, if you look at our urban-rural balance, actually the imbalance that we had positive towards urban actually got neutralized. This year, you see rural has gone ahead of urban. Now we are looking at rural having a higher share than urban as far as the markets are concerned. I think what has happened is last year, which we did with this entire van drive and with the entire increase in penetration in terms of distribution, I think that helped. In spite of muted van sales that happened in the months of April and May, where rural actually also suffered. The moment we came back in June, and we are seeing that also happen in July, as we came back, rural really bounced back. That is what gives me a lot of confidence and comfort, saying that as the market stabilizes, we can come back and basically reap back our gains that we have created in the last year. Rural is actually, that is the reason. Rural impact was as bad, we have been able to survive rural much better. Okay. If I look at the gross margins, they are almost at a seven to eight year low. Yeah. Obviously, these are unprecedented times in terms of inflation and input costs. Yes. In the near term, what will be the focus? Will it be driving growth at slightly lower margins than what we've been doing over the last two, three years? Would you want a balance of margin also bouncing back and volume growth being lower? This is more from a midterm perspective, because these costs could remain high in the near term also. Right. I think that's a very good question. In fact, I think there we will not veer from our stated objective, which while one side, we are driving two things. One is assortment of portfolio, because we want to actually ensure that Almond Drops is also supported by some few other brands. We will continue to invest heavily on Almond Drops. That's our only cash cow at this stage. Obviously it's a no-brainer that Almond Drops will always take our lion's share of everything. We would also like to give it some more support by the side. Amla is one of the products. Coconut is more a strategic launch. There will be some more products which will come in. That effort will always continue. On the other side, because some of these will be gross margin burners or EBITDA burners, we'll also try and ensure that we put a guardrail on the total EBITDA that we make. In terms of a long term or at least in the midterm, the 2, 3 years period, we would want to ensure that the EBITDA remains as an absolute positive. Even as a percentage point, two points drop in, I'll really not be worried. I'll try and ensure that the EBITDA as an absolute number keeps growing. If I am in the process while maintaining this EBITDA, if I am able to establish some of these brands, I think then we are good to go for the next few years. Understood. That will be the focus. That is helpful and very clear. Thank you. All the best. Yeah. Thank you. Thank you. The next question is from the line of Pathanjali from Mirabilis. Please go ahead. Hello, sir. Sir, my first question is, what is our margin for ADHO on a year-on-year basis? If my understanding is right, our rough ADHO as a percentage of our revenue is around 91%-92%. Is that right? That is correct. As a percentage, see, I would not want to get into the exact percentage of ADHO. As you can understand, with a 90% contribution, obviously ADHO's percentage contribution is higher than the overall contribution of the company. Amla, Coconut. Coconut anyway is not there in Q1. These products will not really have a higher or lower gross margin than ADHO. More importantly, at this stage, their contribution being much lower does not really impact the overall contribution of the company. You can take roughly the contribution of the company, add a few percentage points, and that will be the gross margin as far as ADHO is concerned. You do the math, 90%, so you can get it. Okay, sir. Sir, with respect to the newer category launches, you had mentioned that pharma store presence is something you were looking at increasing. Has it showed any good benefit? Pharma? Sorry, I missed that question. Pharma what? Like product placements at pharmacies, that kind of a strategy. Okay. Pharmacy is not. Last year we did two experiments on pharma as well as institutions. Those are not one hour growth drivers. Those are more tactical operative things that we'll keep trying once and for all. The two drivers as far as new products are concerned, other than hair oils, where we would want to complete our portfolio. Not only with coconut, with a few more launches in hair oils. The two other large areas that we are focusing on is this entire e-commerce digital first launch, which we'll take it on a completely separate track, and basically the general trade launches, which mainly, not mainly I would say is some part of it is the Bajaj drop extensions into haircare personal care formats, and some of them will be in the relevant hair oils, et cetera. We'll see where we fit into the hair oils. These are the two main lines that we'll take. This will mainly go through the e-commerce, will obviously go through e-commerce, and maybe some of them may come through the modern trade format stores. The general trade will be through general trade and modern trade. These are the main two approaches that we'll take. The pharma, et cetera, we'll see as it goes. Not really big revenue generator plan for the next quarters. Yes, sir. Sir, directionally, can we tell that the worst is behind us with respect to margins? This quarter, I think it's one of the relatively lower performing quarters. Can we expect that to improve in July than the next quarter? That's an interesting question. If you had asked me this question a year back, months back, the answer would have been an unequivocal yes. If you see today, and fortunately, we may not be the only ones impacted because of that. While LLP prices, the crude prices had been going down, we were getting buying, but the exchange on the other side has been nullifying the impact. LLP, do not think immediately you will see a benefit. Maybe Q3, yes, Q4, yes. Q2, immediately, we don't see huge benefits coming out to you. Some softening, but not really major softening happening. As far as RMO is concerned, on the other side, we see RMO prices have been on rocket high actually. Because of the demand situation as far as edibles are concerned, which is in shortage, RMO prices have remained high, and we don't see that softening in the current quarter. People who have products with, let's say, mustard, et cetera, they will have a little more impact. Yes, whatever the impact has of RMO is there, we'll have impact. We will monitor the market. We will see two things. One is in terms of consumer behavior, whether we are able to take price increases further or not. Obviously, we'll monitor the competitive landscape. We see that others are going that path, we'll also follow suit. Yeah. Thank you, sir. That is it. Thank you. The next question is from the line of Shirish Pardeshi from Centrum Capital. Please go ahead. Yeah. Hi, Jaideep. Manu, sir, thanks for the opportunity. I have three questions. The first question is that, if I understand correctly and what we know for sure, when I add Rajasthan and MP, these are roughly about 30%, 35% of our contribution, and if I add UP, which is a larger contribution. The question is specific. You said May and April was affected in this market. Yeah. June has started recovery. Also there was an impact of van sales operation. Could you talk something about how this market has performed in the second half of July? Is it back to normal, ahead of normal, or still there are some more room? Just follow up on that, how many vans we have deployed in these markets? Okay. Yeah, that's an important question. You are right. These markets actually is about two-fifths of our business, and that got impacted in April and May very badly. In fact, April was actually a disaster for us. May recovered pretty well. May was higher than April for us. In spite of May being more COVID impacted, our business in May was better. June, as I said, was the best month we have ever had. That trend continues in July, so all the pent-up that got created, where secondaries were far higher in April and May in these markets, which got little neutralized in June, not completely. By July, it had already got neutralized, and we see growth in both Central as well as UP being much higher than the rest of the country. That's not surprising to us because we knew that is a matter of time, that the primary will catch up with secondary. Having said that, I would still say that the wholesale markets, some of the mandis have not completely recovered as yet. That is something that we also see as a trend. While our rural has been doing well, our retail has been doing well, wholesale, some of the markets are still not completely back. Our growth rates are good, but if wholesales were to happen, we'll be actually flying. That's still not happened completely. Yeah. How many vans we are flying out of whatever number we have published last time, seven and a odd vans? We are back to the Q4 numbers, and now with some more assortment coming in, we are looking at some of the zones where we would want to actually go beyond what we were doing in Q4. One of the key things that has happened, one of the great things I see that has happened even during the April, May, and the June period is the throughput per van, fortunately for us, has gone down. A lot of cost benefits that you see, some of the cost work that happened as far as even the ASP costs are concerned. In the van cost, which sits in the ASP cost, the throughput of the vans have been managed very well by the team. Operational team has done a great job, and we have had better throughput in the Q1 than that we had in Q4. Obviously, the van numbers had gone down. By June, we were nearly close to what we were doing in Q4. July, we are equal. August, we are looking at exceeding that. Okay. Wonderful. The second question, again, on the coconut hair oil. You did mention that you have right to participate. Could you just tell me which market we have launched this product? In a medium to short term, what is it you are expecting? Are you benchmarking that distribution to a certain level, or you are expecting some contribution as a benchmark to overall, some more quantitative data points? I'll only be able to share with you the markets that we have launched in. We have launched in the west and the south, as I told you, with two clear objectives that we have. We have also launched in a particular one state in the east, which is Bihar. At this stage, Bihar and Jharkhand is where we have launched this product, because it's a blue coconut, that's where we think we have rights to participate, as I said, and the objectives I just told you. In terms of numbers, I think it's a little too early to discuss numbers, at this point I'll refrain. Maybe by another three months when we again talk, we'll have some numbers to share with you. Okay. Just one follow-up on the coconut again. You mentioned that MAT number says that it is INR 4,800 crore category. Could you please help me, how much is the south contribution in this INR 4,800 and net? Exactly. INR 2,100. Roughly about a little less than half, 45 odd%. That's south? That's south, yeah. The west? If you look at, I'll tell you overall the top markets, if you look at south as one market, the number two market will be Maharashtra, and the third market will be West Bengal. The threev put together will be about 70%. Okay. Wonderful. My next question is on the international foray. You did do about 3% odd contribution in this quarter. In a medium to long term, like four to five quarter, how are you seeing your international strategy? What is it that we can expect in terms of participation in the markets, or what are the products which you are planning to get into? Once again, Shirish if you recall, we had discussed that even, let's say, four quarters back or three quarters back, that e-commerce and international will remain two of our growth drivers. MT, new products, et cetera, will always be there. Both of this clearly is something where we think we have rights to win, and I think we are also building capability to win. Because only rights to win and knowledge to win will not help. Capability, and I think, in my mind, we are in the right direction as far as that is concerned. Anuj, who has joined us to head this international business, is already working on the strategy. I am also with a little bit of experience in international. I am also lending my bit on that. I think we want to. In short term, you will not see anything, but in medium term, which is maybe four quarters from now, five quarters now, you will see our movement in international, because we want to go a little this thing. We know the pitfalls that are there, what happens in Middle East, what kind of money is possible or no money possible in the Middle East, et cetera. Being aware of that, scoping the market, we see there are some sweet spots which exist. We would like to make some progress in those. I think I will like to share that as we move forward. There is no point at this moment sharing what our strategic intent and what we want to do. Rather, we have something to talk about and then Okay. My last question is on the e-commerce. You did mention that there is a team which is there, which is responsible. Could you talk something about the Zero Grey and how many products which we have now on e-commerce and some more color that how this business will look at, which are the other platforms we are using for this e-commerce platform? Okay. E-commerce, again, right question. Zero Grey has been doing well. Obviously, it is not a large brand in terms of value markets that we want to do some huge, make a big difference to our top line or bottom line. It was supposed to be a statement. I think the statement has got well. Consumers have had a good liking for the product, and the product has again grown well in this quarter. Is it at the kind of levels where it'll move and shake? The answer is no. It is part of a larger portfolio. The other thing that has happened out of this Zero Grey launch, which is more qualitative than quantitative, is basically a lot of learnings for us. How do you manage a premium brand with a premium packaging? A lot of learnings which will help us maybe with the launches that we are planning in the next quarter or so. As far as the next two quarters as far as e-commerce is concerned, yes, there'll be a number of products that we'll be launching in that, because as we discussed in the earlier question, the final end goal will be to have a D2C, which is a credible, sustainable D2C. We understand the value dynamics as far as this business model is concerned in terms of how much of cash burn, et cetera. We are also managing that kitty properly. It'll not be in the WOW, Mamaearth range, obviously, as you can understand. I think still there is a viable business model there. This is something that we would support. As far as the existing range is concerned, all of it is being channelized through the e-commerce, and as we are getting more and more registered with newer e-retailers, ADHO itself is showing good growth, but also some of the products like Brahmi Amla, et cetera, which is basically on the higher end. We wanted to consciously push Brahmi Amla because we see potential for that product, and those have been doing pretty well. Zero Grey, Almond Drops, Brahmi Amla, et cetera, has been on that platform. A bit of Nomarks as well, but more importantly with the newer range coming in, I see good potential for that. Thank you, Jaideep and all the best to you and the team. Thank you, Pardeshi Thank you. The next question is from the line of Tejas Shah from Spark Capital. Please go ahead. Hi, sir. Thanks for the opportunity. Sir, my first question pertains to margins. You spoke about the near-term pressure, I was coming from slightly longer-term perspective here. If I see FY 2016, we had 35% margin. Then obviously there's an impact also in between. We exited last year with somewhere around 25% margin. This quarter, because of all the pressure that you spoke about, we are actually at one of the lowest. Some of this was designed based on the commentary that we have been hearing from the management for last many years, that they wanted to operate at a lower margin. Then to make the balance between growth and margins sustainable. Where do you see this point now? Because 25% is something which is not very high versus the rest of the industry. You believe that at this margin, you can actually balance the growth aspirations versus profitability aspirations of the company and the management? You believe that you want to take it back to mean revert to 30% in due course of time? See that 30%. Am I audible? I think there's been some change in the system. Yes, sir. Sorry. I just wanted to understand. Yeah. Coming, you see that 30% is a nice number to have if you have, as we discussed, only ADHO kind of products with that kind of equity and that kind of margin. Ideally, I would like to have that, but is that really plausible and feasible? ADHO, whatever stance we take, beyond a certain point, growth in ADHO will have to mean that either the market itself booms, the hair oils markets, which being a mature market, there is a limit to which it can boom, or the LHO as a category itself takes a large leap, which again sounds a little difficult to achieve. You may reach 11%, 12%, maybe 13% if you have every single activity right, whether it be your assortment, whether it be your placements, whether it be everything, your marketing strategy in terms of reaching out to the new age customers. If you have a larger than that aspiration, you will have to play in all the categories, not only hair oil, but also in some of the other adjacent categories where Bajaj has a right to win, which is the strategy we are taking. The fact that is assuming that Bajaj Almond Drops cannot be attacked at all, which itself is a thought process. It very jolly well be attacked, even though it's the best possible brand in hair oils with the best equity, it can always be. It had been attacked till we started some of the rear guard action. Given that situation, that 30% is a nice utopian thought process, may not be sustainable and realistic approach. Given that the options that we have, I think you will have to come to something where the top players are at in terms of EBITDA, maybe keep it yourself at a little higher because your starting point is a little higher, also build brands to ensure that keeps getting supported. I think we now are working towards that, I'm confident that we will be able to build that three brands as I keep talking about, which is that INR 100 crore plus for our size today. Which will keep supporting Almond Drops. Almond Drops continues to grow at the pace that it has to keep gaining some few percentage points, few decimal percentage points quarter by quarter, while some of the other range companies. If that has to happen, your margins will fall, I would like to stabilize at that 25 odd percent margin. With this kind of healthy growth rate that I am pretty comfortable. The board at least is comfortable with that strategic direction that we have. Sir, interestingly, we have reached that 25% without making a lot of diversification or visible diversification in our revenue pool yet. If I see the 50% of erosion of margin actually came from 1 line item, which was employee as a percentage of sales. Should we believe that as growth comes from new products or growth revives in core ADHO also, this 5% erosion which happened from employee cost will actually shift to other expenditure to support new brands, hence 25%, despite all the initiatives that we take in the new brands will remain at that level and there won't be further dilution because of those new launches. See, if you do the maths on Q1 and take that percentage on the lower base, yes, this percentage will look exactly like the way you put it. You just shift the scale to, let's say, Q4, which was more of a normal quarter. You look at the HR costs and you will see for yourself how many percentage points it is lower there. I think that is what you will have if the market situation remains normal, and that will always be an assumption. If market situations do not remain normal, then nobody can help you. If you look at the market situations remaining normal, which was, let's say Q4 of last year, your employee cost that you talked about was about 2.17% lower, right? As sales grows, these percentages, economies of scale will follow. Being a smaller company, every single blip that happens, the percentage goes haywire, both positive as well as negative. I accept it can also go positive and negative. I think as you build scale, these numbers will get a little flattened out. Just to give an example, the fact that sanitizers with a contribution we had was of 9%. I am not sure whether many of the other FMCG companies which just started sanitizers would have a 9% contribution, the growth for us has a 10-point difference of a 10% growth going to a 20% growth without sanitizers. As size increases, these numbers will have lower impact. That's what we are planning on. I'm pretty comfortable that is the direction that these basic fundamentals seem to be in order. Very helpful, sir. My second question is, you spoke about interventions that you made in last 12 months in the talent pool of the company, and now we are ready for strategic interventions. Any one or two strategic measures you would like to talk about which you'll pursue in this fiscal or next fiscal? These are the ones that we talked about in terms of three things. One is obviously in terms of the brand launches that we are looking at in terms of portfolio expansion, both in e-commerce as well as GT, I just talked about. That is one. e-commerce as a business itself, which we want to push through. This is, I am talking pure from the business point. Third is obviously in the area of basically international, which we want to talk of. Maybe in the next fiscal you will see some things moving. This fiscal will be more scouting the thing. Unfortunately, we are not able also make these visits, which will be very necessary for making any international forays. At least we seem to have our thought process in order, and at least we are going in the right direction. This is as far as the business, the front-end side of it is concerned. At the back end, there are a lot of activities that are happening which is not maybe visible to the eye directly, but in terms of ESG, there are a lot of work that is happening in ESG initiatives, in terms of securing our manufacturing systems, making it far more robust, safety initiatives, et cetera. I mean, making efficient use of scale. In terms of IT infrastructure, which is not really very strong for this company, we have been making it as close to any of the best in practice. Those are the back-end work that is happening just to strengthen this organization's backbone and structure. Those are the work that is also happening presently, and these definitely would not have been possible without the talent pool that we have got currently. Fair enough, sir. Sir, if I may try my luck here. If we have to convert these measures into some strategic number and not near-term, let's say slightly medium-range planning. We have been stuck in INR 800- INR 900 crore turnover range for last almost five years. If, let's say, even in next seven years, which is just 10% CAGR, if we have to add INR 800 crore turnover more, what should that composition be? What would be required from your side, interventions to make that number achievable in next seven years also? Firstly, our ambition is a little more than that. I am always very wary of making these number commitments because, again, as I keep saying, that we need to walk the talk before you start believing us that these numbers are possible. Really speaking, some of these measures that we see and whatever our common learnings, and most of these people that we are talking about who's in the management committee today, come from very large, successful organizations. I come from one, but others also come from equally successful organizations in FMCG as well. Most of the things that we see as to what they have also gone through this journey, is this getting the basics right first and having a strategic direction, initially will be in the first year, second year, and then in the third year, fourth year, it comes. It will not happen by magic. I am very comfortable not having any magic and having a 20%-25% growth itself. If we have these basic processes in place and we have that belief and consistency, I think the numbers will be achieved. These little steps that I talked about is basically in that direction. I am pretty comfortable with that. The numbers that you talked about, or at least in terms of direction, I think we have a little more ambitions than that. Great, sir. This was very helpful. Thanks and all the best. Thank you. Thank you. The next question is from the line of Ekta Sanghvi from Vallum Capital. Please go ahead. Hello, sir. Thank you for the opportunity. Hi. Hi. I just wanted to know that our rural growth has benefited in the last few quarters because of the expansion of distribution and very good strategies like the van sales. How sustainable is this rural growth? Just wanted to know your view on the rural growth going forward. In fact, if you ask me, That's again a good question. Rural growth, as I said, after the April fiasco that happened for us, and May just was more consolidation. June, July itself is telling us that is clearly a sustainable thing, because the way we were able to bounce back so quickly and come back to exactly the levels that we were at. As we ended April and as we were in the middle of May or ending of May, we were really worried as to how the quarter will look like. The kind of recovery that happened, that continues in July, even August, looks like that seems to be sustainable. Now what has also happened as a result of the van sales is the kind of learnings that has happened as of that, is letting us go even one mile further. That's why some of these launches that you are seeing happen because it makes us believe that we have a better assortment. I think this penetration can further go up. I think in terms of numbers, we are still not completely exploited as far as rural is concerned. Having said that, we also, which was decided by the team here, which is basically that while our rural drive continues and rural will continue, I think in urban, we have been more a wholesale-dominated company, and our retail presence has remained weak, which we have talked in the last two quarters. Which is where the focus had started Delhi, Mumbai initially, and now into 10 cities, and that has been giving some fantastic results. As I said, this 40% growth is clearly, last year, yes, I accept that retail was low, but as you say, even wholesale was low. This year, wholesale is negative, retail has gone 40% positive, and clearly those initiatives that have been taken as far as retail drive is concerned is gathering momentum, and we are seeing positives. Both rural as well as urban retail will remain continuous focus for the company, and I think the company's GT strength will obviously accrue out of that, as well as with the assortment, which will only help augment a bit. Pretty sustainable in my mind. Yes. Thank you for that. Also, you had mentioned earlier that the ADHO premium quotient will only be upped for the growth margins to be at the existing levels or probably even above. The other competitors have also launched premium products. What is your outlook on the demand for such premium SKUs? There are two categories then if you look at, because of what ADHO has done in the past, in the last 15 years or so. I think it has created a new category of light hair oils. I will still like to keep, while light hair oil is premium, it's not like super premium. It is on the higher side of the, let's say, of the normal oils. That category will keep existing, and we'll keep upping our tempo because we feel that if ADHO has to keep demanding the kind of premium, it has to mean something extra for the consumer, be whatever equity it has. We have to keep maintaining that equity, and that is the drive that you will see continuously happening in ADHO. Communication will change. Our entire approach towards ADHO will change, and maybe next year even the product will go through some kind of a revamp because we want to keep it continuously making exciting. On the other side, as you are saying, is the, let's say, the resurgence or insurgence or whatever is the word you want to use for the premium hair oils, which you are seeing through this entire drive on e-commerce, et cetera, premiumness happening across all categories in FMCG. That niche category, whether it will explode tomorrow or not, we don't know. That category clearly exists. There is one obviously large player which is pushing that category in the GT itself, but there is obviously a large number of e-commerce players who are there. That is a category we feel that will happen for the niche nuanced customers. That is something that will always be there, and you will see us also getting into that category as well. I will still keep almond category not really in the premium category. It is in the high-priced category, but the other is the premium category. Both different. Really speaking, interplay between them may not be too much because the price difference will be quite high. There'll be some bit of interplay, but that happens across all categories. Yeah. That's helpful. My last question is that, we've recently launched a lot of variants like Zero Grey and Amla Aloe and also Coconut Oil and all. What will be the strategy to drive growth and to gain market share for these kind of products? Are we looking at acquiring any regional brand to gain market share? Again, good question. Three products, very three different strategies. Amla Aloe Vera, I'll start with that. That is clearly today our second flagship brand after ADHO. Flagship may be too much of a word, but yeah, clearly something that we can drive. We feel that we have good rights to win in that. That's not a right to participate. That's a pure right to win. Whatever initial signs we have, we see that that business has been going well. I should not be talking of July, but July was the highest ever sales of Amla by a fair distance. I am not saying that it coincides with the TV ads which have started coming in, but we see that Amla has a great potential, and it is doing well for us. No worries about Amla is concerned. Zero Grey is a product which I said our foray into premium end through a digital-first brand. A lot of learnings coming out of that. It has had good impact, but we were never expecting the kind of numbers that we are talking about as far as Amla or any other product is concerned. We are pretty happy with the kind of learnings, kind of market understanding that we have got, and kind of business that we have got in that. We'll keep it like that, and then the other products that we launch will have a lot of learning and help from that. Zero Grey fulfills our strategic intent there as well. As far as Coconut is concerned, I have highlighted why we want to get into Coconut so that it helps us in distribution as well as also the brand. We'll play Coconut like that. Three different products with the three different strategies because we are looking more at the future and how these products fits in the future context rather than these products in isolation. Amla is in isolation, but the other two is more for the future, what we are looking at our basket and how these fulfill. That's more for that. Yeah. Okay. Thank you. Thanks. Thank you. Reminder to the participants to ask a question, you may please press star and one. The next question is from the line of Abhijeet Kundu from Antique Stock Broking. Please go ahead. Yeah, hi. Thanks for the opportunity. My first question was on getting into a new category. You have entered into categories like coconut oil, the larger ones, coconut oil, amla, almond oil, you have here. Do you plan to get into the natural anti-hair fall category? That is one where in your geographies, your strength geographies, that has got a bit salient. Anything on that? You're talking anti-hair fall? Yeah. If you look at one of the biggest claims for Almond Drops itself is anti-hair fall. I mean, that is what we have been dialing up. If you look at our entire directional stance that we have taken on Almond Drops is to make it a more functional brand. One is make it a funkier brand in terms of making it attractive to the newer age customer, but also make it more functional. Earlier, it was more an aspirational brand, a luxurious brand, so luxury, styling and so on and so forth. Slowly, we have taken the stance of it being a functional brand because people paying that extra premium for a product need to see a value add. You see these YouTube ads that are coming up in terms of lab tests coming up, showing how it is stronger, how it is reducing hair fall, et cetera. Almond Drops is clearly on the hair fall stance. That's why you see Amla, where we have subtly changed the thing. That's talking of silky luxuriousness and so on and so forth. If you were to look at both of our ads, that's how it is very different. This is what we are pushing as far as brands are concerned. If you're looking at specific, just only anti-hair oil, yes, we might be looking at some of the premium range of products which- Exactly not only be anti-hair fall, but there'll be many other criteria as we're looking at. Whether you're talking about these argan oils or the onion hair oils, et cetera. Obviously, being a hair oils player, we are also scanning those markets and also looking at where we feel we have some rights to win. There, unlike, let's say, coconuts, where we look at how can we offer a differentiated product in a cluttered market, so that at least we can have some consumer eyeballs there. That is what we are looking at, and that will give a curated content as we go forward with the launches. Yeah. Okay. Just some data points. What would be your rural contribution to overall sales, and rural contribution and also wholesale contribution to overall distribution? In terms of direct distribution, you have been penetrating markets or servicing markets better through your van operations. Are we also appointing sub-stockies, or what would be the number in terms of distribution now versus 1 year back, or whatever period you can take? Okay. Abhijeet, let me start answering before I forget. Yeah. The first question is rural to urban. As I said, rural have now overtaken urban, so it has a higher than 50% contribution. Urban is lower than that, but that's it. Just a little higher than 50 as far as rural is concerned, just a little less than 50 as far as urban is concerned. Thereabout. Percentage points. I don't want to get into the exact number. If you want the exact numbers, just a little higher, let's put it that way. About a 3%, 4%, 5% difference between urban and rural. This is where we are. 52 and 48, let's say, if you want the exact number. Okay. The other question is very important to me. In fact, that's a far more important question to me. The distribution of retail and wholesale in the business. Out of that 50% in urban, we typically used to operate with a 15%, 16% to about 30%, 32%, 33% kind of a thing, which is really close to half of the thing. That, in my mind, is one of the, let me put it the way, key area of improvement for the company. That retail needs to touch wholesale in terms of overall numbers. That is a base strength that you would want to put in as a company because you would want to have a control on the channel that you have. That is the right direction we have got into. That number is now up to 20% and 30%. So 20% and 30%. We are now having a 20% coming out of retail and 30%, or rather 40/60, if you want 100 being urban. 40/60 in this thing, which we now push for 50/50. Not by reducing wholesale, but by upping retail the way we are doing. That is going in absolutely the right direction. Sorry, you had asked a third question. What's the third question? Yeah. In terms of pure direct distribution, appointment of maybe sub-stockies, increasing sub-stockies or distributors now versus one year back or two years back. Yeah. Correct. Again, distributor numbers remain over 1,100 or so. If you ask me, has there been a large increase in the number of distributors or not? The answer is no. What we are looking at in terms of rationalizing some of these distributors, the underperforming distributors, et cetera. I mean, those corrections have already been done. Not major number changes happened. Yes, we are looking at foot on ground, increasing the number of sub deals. That is something that we are wanting to do as our van sales have improved and our direct distribution went up from INR 5.5 to about INR 8.5, 9 odd lakhs, as far as numbers are concerned. We are also looking at how we can have a little better direct non-van approach towards that. That strategy will keep on working. Obviously, situations like COVID and rural, et cetera, does not help in that. On the medium to long term, that is what we would want to do. Have more sub deals directly for us, feet on ground so that we can control that network, and not only through van sales. This is a gradual upgradation that will keep happening, and we are in the right direction for that as well. Yeah. Okay. Any sense on expanding your penetration in your non-core geographies? There are geographies which are large for you, there are geographies which are smaller for you. Have you found some promise in newer geographies and there you have expanded your distribution? I know last one year, one and a half years, has been really a difficult scenario to really do that. Anything on that? Again, this will be in two parts. If you're looking at increasing distribution, there'll be two parts to it. One is obviously where you are represented poorly or suboptimally. Obviously, the upside is high, but the difficulty of entry is also high. That is what we are trying to address with some of these launches that we just talked about. At least be able to have some presence in this network. Southwest, where we are a little less represented. The other part of it is also while we are doing that, it is also looking at also increasing penetration in places where you have high market share, because at 20% is not high market share. When you have 50% market share, then you can talk of high market share. Right. There we still see potential, and that's what has come out. In places like Punjab, et cetera, many other states, I don't want to mention all of them. All of these, we have seen great upsides happening because of just our ability to go further deep into the distribution, into even lesser villages. L ast mile we have been able to cover all those advantages. That is something that we'll continue to exploit further and further. With the SKUs that we had launched in ADHO or the smaller packs, the INR 20 pack, et cetera, as well as on the other side, Amla, that has pushed. It has helped in the northern belts where our market share was high, but still good distribution advantage. Now we are pushing the ones which is with a lower market share. Okay. That's it from my side. Thanks a lot. All the best. Thanks, Abhijeet. Thank you. Ladies and gentlemen, this was the last question for today. I now hand the conference over to the management for their closing comments. Over to you, sir. Thank you so much. First of all, thanks all of you for an engaging interaction. I think a lot of interesting questions, all of you must be, I would think, a little set back by the kind of growth that we have had. As I said, I am not really that concerned because the reasons why we saw this lower growth with central and wholesale, et cetera, has all come back in June and July. I would be more keen to see how our Q2 and Q3 goes, that seems to be right on place. Also, I'm happy that all the plans that we have stated at the beginning of the year, even though there was this two-month impact, none of the timelines of any of the initiatives have changed. Our initiatives exactly remain as per plans. While April has been a disaster, the total overall in terms of keeping track of where we wanted to go as far as top line is concerned remains. Bottom line, we knew would be under pressure. It is under pressure. We will continue to monitor that. I don't think further bottoming out is possible, but we'll have to come back a little bit as far as the bottom line is concerned, which is what we will try and do, both in terms of looking at what kind of price increases, if any possible, and in terms of sourcing, but lot of this supply chain efficiencies that we will start slowly building into the system, which will have its own impact on the bottom line. Overall, more or less, we sit in a comfortable position. The team is in place, we are just rearing to see what happens in the balance part of Q2 and Q3, let's see how the balance of the year. Thank you all for joining our meet, stay safe. Thank you. Thank you. Thank you, members of the management. Ladies and gentlemen, on behalf of ICICI Securities, that concludes this conference call. Thank you for joining us, and you may now disconnect your lines.