Ladies and gentlemen, good day, and welcome to United Foodbrands Limited Q3 FY 2026 Earnings Conference Call. As a reminder, all participant lines will be in the listen-only mode, and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal an operator by pressing star then zero on your touchtone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Bijay Sharma. Thank you, and over to you, Mr. Sharma. Thank you, Rupa. Welcome everyone to United Foodbrands Limited Q3 FY 2026 earnings conference call. For today's call, I have with me Mr. Kayum Dhanani, Managing Director, Mr. Rahul Agrawal, CEO and Whole Time Director, and Mr. Amit Betala, CFO. Before we begin the call, I would like to remind that some of the statements made in today's conference call may be forward-looking in nature and may involve risks and uncertainties. Kindly refer to our earnings presentation for a detailed disclaimer. We'll start the call with Mr. Kayum Dhanani sharing his perspective on overall demand and key highlights for the quarter. This will be followed by a detailed discussion on business and performance by Mr. Rahul Agrawal. Post that, we'll open the forum for a Q&A session. I will now hand over the conference to Mr. Kayum Dhanani. Thank you, and over to you, sir. Thank you. A very good evening, ladies and gentlemen. I take the pleasure in welcoming you to Quarter three FY 2026 conference call of United Foodbrands Limited. Quarter three FY 2026 has been a defining quarter for the company. We delivered highest ever quarterly revenue in our history, driven by record dine-in walk-ins across our restaurants. This performance reflects the strength of our brand, the relevance of our value proposition, and the trust of our guests increasing us. We reported a same-store sales growth of 8.2%, driven by a combination of clear strategy, priority, and relentless execution discipline by our teams. This performance is particularly encouraging as it has been delivered in a persistently soft demand environment, underscoring the resilience of our business model and the strength of our operating execution. As an organization, we are extremely well-positioned to scale all three verticals of our business. The Barbeque Nation India business delivered strong year-on-year growth across both dine-in business and delivery business. Overall revenue and SSSG growth were driven by strong year-on-year growth, dine-in volume growth of 25%. We continued to gain market share, with growth coming from both new customer acquisition and repeat customers. New customer acquisition was particularly strong during the quarter, while repeat customer growth also accelerated. Importantly, the time gap between the repeat visits has reduced, indicating improving guest engagement, loyalty, and brand stickiness. Our international business grew 47% year-on-year, supported by strong SSSG performance and new restaurant additions. We added 3 new sites during the year, have additionally sites under construction. We have successfully entered distinct high potential markets, and our focus now is on scaling Barbeque Nation in these markets and building a long-term platform for sustainable growth. Our Premium CDR segment also continued to strengthen. Penetration of Toscano and Salt brands increased as we expanded into new metro markets in India. We added 10 new restaurants over the last 12 months and have another 5 restaurants under construction. The segment consistently delivered strong SSSG, driven by growth across both dine-in and delivery channels. Restaurant operating margins from the matured restaurants have consistently tracked above 20% across many quarters, reinforcing the strength of the business model. We have systematically built a differentiated portfolio of in-house dine-in and delivery brands through disciplined execution and a consistent focus on superior guest experience, service quality, and value leadership. We remain fully committed to scaling each of these brands while delivering industry-leading margins and cash flow and building a sustainable, high-quality growth platform for the long term. Thank you, and I would now hand over to Rahul to walk you through the performance in detail. Thank you, Kayum. Good evening, everyone, and thank you for joining us. Q3 has been a transformational quarter for our company. We delivered our highest ever quarterly revenue, driven by record dine-in walk-ins, which is a powerful validation of our brand strength and value proposition. Achieving this performance in a challenging demand environment underscores the resilience of our business model and the quality of our execution. Most importantly, it reflects the exceptional commitment, discipline, and execution excellence of our teams across the organization. The quarter was marked by strong same-store sales growth of 8.2% and operating revenues of INR 377 crore, translating into a healthy revenue growth of 14.5% on year-on-year basis and 23.6% on sequential basis. Operating revenue growth for the quarter was healthy across all verticals, with Barbeque Nation India growing at around 10.1%, Barbeque Nation International growing 47%, and Premium CDR segment growing at 19.7% on year-on-year basis. This performance was led by robust transaction growth across both dine-in and delivery channels. We delivered approximately 26% growth in consolidated dine-in volumes and 29% growth in delivery transactions. Barbeque Nation India saw a strong recovery in dine-in segment, delivering 25% year-on-year growth in dine-in volumes. Consolidated gross profit during the quarter grew by 11.4% year-on-year and around 24% sequentially. Overall, gross profit margin improved by 20 basis points quarter-on-quarter. Adjusted restaurant operating profit recorded strong momentum, growing around 136% quarter-on-quarter, and 8.7% on a year-on-year basis. AS restaurant operating margins stood at 15.7%, compared to around 16.5%, in quarter three of last year, largely due to the impact of new store ramp-ups. Mature restaurants delivered higher margins and stable performance, with Pre-Ind AS restaurant operating margins of 17.2%, which was broadly consistent with 17.4% in quarter three FY 2025. During the quarter, we increased marketing investments in brand building and value-led campaigns, with a clear focus on driving transaction growth. At the same time, we maintained a distinct approach to cost management and supported by operating leverage, our overall overhead cost, which is excluding marketing, reduced by 2.1% of sales on a year-on-year basis. Consolidated reporting EBITDA, reported operating EBITDA for the quarter was INR 68.2 crore, with operating margins of 18.1%. This is excluding one-time impact of, non-cash provision created due to implementation of new labor code. Our Pre-Ind AS adjusted operating EBITDA was INR 36.1 crore, growing at 6.5% on a year-on-year basis. Our new restaurant expansion is on track. During the quarter, we launched eight new restaurants, which is 21 new restaurants over a nine-month period, taking the total portfolio to 249 restaurants. New restaurant expansion was broad-based across all three segments, with 10 new restaurants added in Barbeque India, three new restaurants added in Barbeque International, and eight new restaurants in Premium CDR segment. Coming to Barbeque India, Barbeque Nation India delivered revenues of INR 288 crore, with strong 10.1% year-on-year growth and 25.3% sequential growth, reflecting renewed momentum and strengthening customer traction. This growth was driven by strong SSSG of 8.3%, which in turn was led by robust transaction growth across both dine and delivery business. During the quarter, we curated multiple food-led experiences and thematic dining events and launched targeted value campaigns to build demand during low-throughput sessions. We saw strong growth in new customer acquisition alongside meaningful growth in repeat customers. Our guest engagement and loyalty dynamics have improved, leading to decline in our average time gap between repeat visits. We strictly leverage our digital ecosystem and significantly strengthen adoption of our Advanced Module through both app and web, with 53% of overall dine-in transactions now routed through our own digital channels. Overall, Pre-Ind AS restaurant operating margins stood at 14.6%, while the matured portfolio delivered higher margins of 16%, reflecting the aligned strength of our core business. Moving to Barbeque Nation International. Our Barbeque Nation International business recorded revenues of INR 37.2 crore for the quarter, delivering 47% year-on-year growth, supported by robust network expansion and SSSG of 5.8%. Gross profit also grew year-on-year by 47%, with gross margins remaining strong at around 75%. Despite an aggressive restaurant expansion, Pre-Ind AS restaurant operating margins for the international segment remained strong at 23.1%, with mature restaurants delivering operating margins of over 27%. We'll continue to build on this growth momentum through disciplined network expansion. During the year, we have launched three new restaurants. We have another three restaurants under construction in our international business, and four additional locations are in advanced stages of discussion. As we enter new geographies, we have done the foundational work of establishing our first restaurant in these markets, and our focus will now shift to scaling, scaling each of these distinct markets across the Middle East and Southeast Asia. Moving to our Premium CDR business. We are well on track in increasing penetration of Toscano and Salt brands across additional metro markets. During the year, we have added eight new restaurants, and another five restaurants are under construction across key metro markets of Mumbai, Pune, and Delhi. We're extremely encouraged by the guest feedback in these new markets and strongly believe that our sustained focus on guest experience, supported by continuous culinary and service innovations, will enable us to build a strong and scalable Premium CDR franchise. The Premium CDR segment also delivered a strong year-on-year revenue growth of 19.7%, driven by exceptionally strong SSSG of 9.4%. Gross margin for the segment remained robust at 73%. While the ramp-up of new restaurants impacted overall margin in the short term, the matured network portfolio delivered Pre-Ind AS restaurant operating margin of 22%. Our strategic focus remains unchanged. We'll continue to build Barbeque Nation brand in India and internationally through best-in-category guest experience, strong value proposition, and disciplined cost management. In Thailand, we'll continue to scale our existing portfolio of high-potential brands, building strong, differentiated platforms for long-term growth. Thank you. With this, we can open the session for Q&A. Thank you very much. We will now begin the question-and-answer session. Anyone who wishes to ask a question may press star and one on the 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. The first question is from the line of Riddhesh Gandhi from Discovery Capital. Please go ahead. Hi, sir, and congratulations on great set of numbers. Just wanted to understand, look, we've had obviously a number of quarters of negative SSG growth, and first quarter after a long time where we're having it again. Just wanted to know, what is your, like, comfort that this isn't some sort of an aberration and something that we expect will sort of continue going ahead in terms of the SSG growth? And just wanted to understand what exactly, in your view, has driven this change to happen? Yeah. So, one, I think what we are seeing today is obviously not one-off actions. There are a lot of multiple levers that has been created over the last several months. We have spoken about few of these in our previous, you know, calls and our, you know, quarterly updates, and to speak about few of them, we have come up with group dining offers. We have created various food experiences. We have come up with value-led campaigns. We have analyzed our business across various day parts and segments, and then have done targeted value campaigns for these, you know, low-throughput sessions. We have improved our throughputs in some of these sessions. We have increased our engagement through app and web platforms, right? You know, some of these actions that have been taken internally have obviously led to, you know, transactions growth, have led to, you know, higher bookings, very strong repeat behavior, very strong, digital engagement, and, and obviously, great customer, feedback scores. You know, the focused execution on, on guest experience and value has been, has been really, amazing. If I look at data, you know, more than one-off, we have seen positive momentum over the period of last six months, wherein we have seen improvement in, in transaction trend, with all these structural initiatives in place. So, I strongly believe that, this SSG improvement is, is sustainable, and the momentum that we are seeing, should continue. Obviously, this has to be supported by the discreet execution that we are continue to do. Obviously, with operating leverage, you know, things will look very differently in the business. Good. No, but just to push on that, so is it, is it a market thing? Are there some specific activities we have done? Because, look, after eight, nine quarters of negative growth, you can sort of, you know, expect there may be a quarter or so where you will have growth, and then again, we go back to being flat. So what is the key—what is giving you the, like, a comfort now that we should be able to achieve this going ahead? I think you should be looking at last six-month period. If you remember, you know, last quarter also, excluding the impact of Diwali, we were in positive territory. Last quarter, we also reported our numbers for four months, and we distinctly mentioned that the month of October was looking positive in terms of SSG by around 5%. In the entire quarter, we reported eight, so obviously November and December has been better than October. We are seeing this momentum continuing in the month of January. So, if you are seeing something happening for a longer period of six, seven months, we are seeing sequential improvement in these metrics. Obviously, this is not something which is done across the industry. I think there are a lot of internal levers and internal you know intervention that has been made. I spoke about few of them in my previous remark. And those interventions are also reflecting into improvement in measurable operating metrics. That gives me confidence that this will continue. All right. I see. I'll just leave it here. Thanks. Thanks. Okay. Thank you. Thank you. Participants who wish to ask a question, please press star and one. The next question is from the line of Devanshu Bansal from Emkay Global. Please go ahead. Hi, Rahul. Congratulations on a great performance in Q3. Rahul, you did mention that the repeat period has been shortened and the feedback scores are also pretty high from consumers. I wanted to check if you could give us some reference of the past, as in what was the data points earlier and what are we standing at currently, will help us to better understand the change. So, I think without getting into specific numbers, what I can tell you is that the time gap between repeat visits has improved by around 10%. So, you know, if it was, say, 100 days earlier, now it's 90 days. And in terms of transactions, you know, one thing that we have really unlocked is we have unlocked a set of new customers who seems to have also repeated extremely well over the period of last 7-8 months that we have made this intervention into, right? So, that's the metric that I can share at this point of time. On the feedback perspective, Rahul, any color that you can share from a NPS perspective or whatever you're tracking, as in what all the new consumers are sort of suggesting? Because we just want some confidence, as in obviously, you have done good dining offers, food experiences, et cetera, which have led to this pickup in transactions. So we just need some confidence around the feedback that the consumers have had in this transaction, so that we get some comfort on these people sort of coming back and back at Barbeque Nation. Yeah. So our feedback mechanism and tracking this across approximately 200 stores of Barbeque Nation in India is very, very scientific. Broadly, we measure it through three angles. One is our in-house guest satisfaction index score. As you would recall, we call back 20% of our guests every day across all restaurants, across all segments of sections of restaurant, across day parts. And then very critically look at that metric to ensure that the guest scores are high. And as you would recall, almost 95% of organizations, you know, variable pay is dependent on these guest scores, right? So this metric is on an upward trend, that's one. Secondly, we track our digital NPS score through some of the marketing agencies that work with us. Those scores are also trending up. And third is the rating which normally gets given across the Google platform and the Zomato platform, which at a pan-India level across all restaurants have been fairly pretty well. Earlier also, we were standing at anywhere around 4.4-4.5, and those levels are also being maintained. So the feedback is that taking measures is very scientific, and all of these three metrics are on upward trend for us. And this is not just this quarter. I think if you recall, in the previous quarters also we've mentioned about the fact that whatever the scenario is, we are continuing to manage our guest scores, and we are seeing those improvements. Great. And, Rahul, obviously, this quarter has seen very strong trends. And typically with word of mouth, the thing is that, we see a upward moving trajectory, right? So obviously, if you can share some light in terms of how, trends have been so far in Q4, are they, pretty much in line or they are still improving, versus what we have delivered in Q3? That would also be very helpful to understand, the next, say, next, three quarters of your performance. So, like I mentioned, January is almost coming to an end, and the momentum that we saw in quarter three is continuing. I firmly feel that the business has structurally shifted one notch above, right? So if you look at last year's last quarter's performance, on a sustained basis, we are at close to a monthly run rate of INR 125 crores, right? Which translate to annual run rate of around INR 1,500 crores. There is obviously some seasonal, you know, impact of of the business in quarter three. But the way the business is moving now, I think, on a, on a next four months four quarter basis, we are at that level as a company. Also, if you look at the change that you will see in terms of growth, so what was the growth between, you know, quarter two last year and quarter three last year versus quarter two this year and quarter three this year, you will see that there is a structural shift that has happened in the business. That was also minutely visible when you looked at quarter one and quarter two last year versus quarter one and quarter two this year. And this difference is very stark in quarter three of this quarter. So I think this momentum should continue. A lot of great interventions being done, and good thing is that they are also impacting the measurable numbers across our entire business. Great. Sir, from a P&L perspective, obviously, your top-line trend has been very robust. But from a P&L perspective, we noticed that we are also making certain investments, right? So our gross margins are about 200, 250 basis points lower. And then you also attributed some additional marketing spends that have gone behind, particularly in Q3. I wanted to check whether we can sort of move back towards that 67%-68% gross margin in the coming quarters, and whether these marketing spends were one-off and, or these are required in the business to sort of keep up the growth momentum. So thank you, Devanshu, for asking this. So, three, four points here. One, our guidance on gross margin remains unchanged at around 67%-68% range. I know we are short of this in this quarter, but I think we strongly continue to see this as both achievable and sustainable, right? But at this stage, I think we are consciously making major investments in our gross margin and marketing to rebuild our demand momentum, to increase our traffic recovery and strengthen customer acquisition to have as much transaction growth as possible. You know, to be fair, 25% transaction growth is something that was really great, and that's continuing also in the current quarter. So I would not change this at this moment. We would continue to make these major investments across both gross margin and marketing. You mentioned the marketing, so I think the current level of marketing spend is, I think, the new steady state for our business. I'm not seeing this as a temporary spike. I think this is a structural step up. And also 3% of sales, our marketing investment is very disciplined, targeted, and also well below industry average, right? The investment is very focused on high ROI activities, which are leading to driving transaction growth, building traffic. You know, how do you strengthen the brand relevance, and all this. So in the near term, I don't see that changing. Gross margin will slightly inch up. With respect to overall margin, I think given the nature of our format, operating leverage is structurally high, right? While we see these gross margin investments, you know, to drive traffic, the operating leverage benefits for higher volume and sales growth are structurally more powerful than the near-term margin trade-offs, right? We have seen this traction over last two quarters, and our focus will be to sustain this as we move forward. I think as the revenue builds up, operating leverage naturally flows through margins... And the team in the past has demonstrated a very strong discipline on operating cost control, right? Which gives us confidence that the underlying structure of the business is strong, and the margin levers, you know, like gross cost of goods sold or marketing investments, you know, remain well within our control. Fair enough. So, would it be fair, just, if you can, so obviously you have indicated some color from a revenue perspective, any color from EBITDA margin perspective? Because whatever, basic, projections that we have done, I guess, is 8% kind of a margin, EBITDA margin at the company level Pre-Ind AS is even doable, or the operating leverage can help us, even surpass that. No, so, look, despite a very tough operating environment in FY 2024 and 2025, we have delivered 8% Pre-Ind AS operating margin at corporate level, right? Which translates- Yeah. to approximately 14%, you know, Pre-Ind AS operating margin. And if I further scale it down and remove the impact of new stores, we were at 15%, you know, core restaurant operating margin. Right. In this quarter, that number of 15% is actually 17%. I think just because of operating leverage, you know, we may, we may not that number in short term, but I think because of operating leverage and because of our cost initiatives, that 15% mature restaurant operating margin will move towards 17%. And once that happens, I think everything else is will naturally flow down to overall margin. So in the near term, I think the focus is clear. Build transaction growth, drive revenue growth, and through operating leverage, move back to at least double digit Pre-Ind AS, you know, corporate level of EBITDA margin. Thank you, Rahul. All the best to the team. Once again, congratulations on the great performance. Thank you. Thank you, Devanshu. Thank you. The next question is from the line of Naveen Trivedi, from Motilal Oswal. Please go ahead. Yeah, good evening, everyone. Just couple of questions on the growth side. You mentioned about the SSG levels, which we kind of reported this quarter, looks to you that are sustainable. One, how much was there any price hike which kind of built in the SSG number? And how should we look at the pricing strategy for the coming quarters? No, there is no price hike at all in this quarter. In fact, there has been very targeted, you know, improvements in our throughput, which we have managed by looking at low throughput sessions. So effectively, in some manner, because of change in mix, we have seen effective realization being lower. To further break this up, we have strengthened our weekday day parts, we have strengthened our lunch businesses. So that has led to a slight decline in overall pricing that has happened. The SSG number that you're seeing is entirely coming through the volume growth. And while dine-in delivery volume growth, you know, is there and the dine-in is a part also. What I'm really excited about is the dine-in volume growth that we have seen across all our businesses, and we have seen that strongest in Barbeque Nation business. Sure. So, how much, like, Barbeque Nation transactions growth were there for this quarter? And if you can also give us some sense about any specific markets where we have seen more success than other markets. So it's around 25% dine-in volume growth, in terms of, so when I say dine-in volume growth, this is number of walk-ins in across all our restaurants. And in terms of any specific markets, no, I think a broad-based growth was very broad-based. There is no particular market that I can call out that that was an outlier. I think all of the markets have pretty much converged to the national performance trends. Sure, sure. So, any sort of a divergence between the October, November, December, sort of, just to get a sense about how has been our exit of the quarter, which gives us the confidence about the sustainability of these numbers for the rest of the coming quarters. So any sense about the exit of the quarter and any little bit flavor, if you can share about the Jan month also? So, two data points. So one is, like I said, October was 5% SSSG, which you had mentioned in the previous quarter results, and this entire quarter was 8%. So obviously, November and December was better. I can also say that, October, November, December, we have seen sequential same-store cover growth, which is same-store volume growth, at the entire portfolio level. Sure, Rahul. Just one last question, at what SSG level we should kind of proceed the RP index, EBITDA margin expansion? I'm sure typically we, we kind of, see that 5%-6% is typically a threshold level SSG, where after which we start seeing a margin expansion. At 8%, we're still not seeing that sort of a level. But I'm just trying to understand about how should we see the coming quarters' margin trajectory, at a Barbeque Nation level and the consolidated level also? So look, like I, as I mentioned to the, to the previous question, basically, there are three levers on your, on your entire P&L. One is, one is your gross margin, which is cost of goods sold, how can we control that? There are two variables: one is pricing, and one is, absolute cost of goods sold. Over the period, absolute cost of goods sold actually declined. Pricing would have, most likely also declined, so which impacted our gross margin. So like I said, this is a major investment that we are, or that we are planning to do, because, the key focus is to, to build, transaction growth. Just a note aside, I think, we didn't mention this earlier, but, as a company, we have done highest ever number of, of covers walk-ins, across all businesses. So we have done highest in India, we've done highest international, also done highest in PMCDR, right? So that is one lever. The second lever is marketing investments, right? So, how do you, you know, invest in your brand campaigns, you know, value campaigns, and how do you distribute that across, across your consumers? And the third lever is, is largely fixed, you know, costs. So, so that get, advantage from, from the operating leverage, right? We have seen that advantage coming across in this quarter also. So, while there is an overall reduction in gross margin, there is an incremental investment in marketing. Our operating leverage, you know, impact was positive, close to 2.2%, on the entire business, right? And, you know, if you look at our numbers, in detail, we have done a cut around the mature restaurants and new restaurants. Our mature restaurants' performance and margins were stable at 17.2%, you know, versus the last year number, right? So, the point I'm trying to make is, the focus on building transaction growth has led to operating leverage, which has led to managing the margins, and obviously given us a higher absolute operating profits. We are obviously, we have been doing that for last six to seven months now. Month-on-month, quarter-on-quarter, we are seeing improvement in some of these metrics. I don't think we're gonna disturb that. The only thing that we'll do is have absolute focus on further driving our volume growth. And then, I think given the nature of the company and the industry, I think operating leverage will take care of itself and margins will come through. Sure. That's all from my side. All, all the very best. Thank you. Thank you. The next question is on the line of Viraj Mehta from Enigma. Please go ahead. Yeah, hi, Rahul, and congratulations for good set. Thank you. Rahul, my first question is on restaurants. If you remember at end of last year and even in the first quarter, you had mentioned we should end the year at around 270-275 restaurants. But given that we are only 249, now, or end of December, that looks a tough task. Can you give a revised number for that? Yeah. So, you know, as of now, we have around 18 restaurants under construction. I think out of these 18, we should be able to launch around 14, 15 in quarter four. So we should be able to close the year with around 265, right? But frankly, these are just accounting dates, right? So, what I can tell you- Right ... is that, there's 249, which is operational. There is 18 under construction, so that's 267. And we have a very strong pipeline of another 20 restaurants, where we have either the commercial negotiation is finished, these are under legal diligence, these are under project visibility phase or in the design phase, right now. So if I look at my overall, you know, visibility pipeline, restaurant number 287 is clearly visible to us. And I think in the entire year we will be able to definitely cross 300 by end of next financial year. And that's the, you know, that's the aim that we are, that we're looking towards. Sure. Second is, regarding the cash flow. Obviously, it's nine months, so we don't really get it. But if you can talk about what is, the operating cash flow that we have got, say, for nine months, and what is the CapEx that we have done, just to get a fair idea on where the balance sheet stands. So, balance sheet current remains strong. Our net debt, if you remember, last quarter was around INR 90 crore. Right. These have actually come down this quarter. We are around INR 80 crore. There's a net INR 10 crore cash generation in the quarter, net of all the CapEx investments and all. I think the way we stand. And, you And, you know, H1 was very different, right? You have our numbers. H1, you know, the margins were not great, so we didn't generate enough cash flows, but we continued to invest in our new store opening because we could see the improvement trends in transaction volumes. We could see how the numbers are moving, right? So we borrowed some money and invested that. I think that trend has changed in this quarter. This quarter, we didn't need to borrow. As you would remember, historically, we have always built stores by generating internal cash flows. I think we are reverting back to that, right now. We obviously remain very excited about the potential of the brand across all the three segments. And depending on the cash flow generation and the speed of good site that we get, we might go a bit more aggressive on the new store expansion. But overall, I don't see the net debt numbers sort of moving beyond INR 100 crore in short term. If we really sort of increase this, I think that's maybe only because some of the sites are really good, and we don't want to say no to that. But in short term- Right ... I think I'll stick to INR 100 crore guidance of the, on the net debt number. Right. And last one, discussion that we had in terms of some of the stores were not good enough or their locations were not, and we were relocating to the smaller size. And I saw in the presentation that we have not closed a single store this quarter. So- Right. Is that now a fair assumption that we are, like, past that journey now, and we probably are not going to—like, whatever closing of non-profitable or wrong stores or whatever you wanna call that had to happen, has now happened and that's past us? Yes. And in fact, we have been past that for quite some time now. Over the period of last, you know, four, five quarters, whatever we have closed was just being very, very prudent about the bottom number and closing that if it was loss-making. Today also, you know, on a larger portfolio of 250 restaurants, we have some restaurants that are loss-making, maybe because they're new and maybe because, you know, there is some sort of structural change. It's bound to happen. But the losses in those are minuscule, right? And with some minor interventions, you know, we have seen that in many cases where they're converted into profit-making, right? So, I think, now going forward, on a base of, say, 250-300 restaurants, we might have, on an overall basis, maybe two or three restaurants closure every year, for various set of reasons, you know, nothing- Right. -nothing structural there. Right. Apart from that, I don't expect anything to close. Right. Super! And, and one thing on the international part, if, if I look at the SSG growth in our international business, over the last three, four quarters, that has just tapered down, from high teens number to where it is today. Is it because now the stores are matured and our addition is lower, and the base earlier was lower and now the base is now significant compared to earlier international business? Like, can you just make us understand, is this now a sustainable SSG and, and it might not go to where it was? So look, so first, growing at around 6% this quarter on a base of, you know, maybe, 8%-9% in the previous quarter is, is actually very impressive. And these stores where you are seeing SSSG is actually on, on a set of eight restaurants, right? Right. And some of these stores have been around for almost seven, eight years. After that, they've been growing at this rate, with a mix of both, dine and delivery. So I think they have, they have done a tremendous job at delivering the results. I think as an overall market and as overall international portfolio, as some of the new stores that we opened up matures, they will now take the, you know, take the burden of putting the entire portfolio SSG at a, at a, maybe, you know, mid- to high single-digit numbers, right? So the way the, the situation is, my sense is that, these business should do, anywhere between 5%-10% SSG. As long as they sustain it, I'm extremely happy because the margins there are extremely good. I think at such a small base of eight restaurants, I'm not so worried about SSSG right now. I think the focus there is to scale up. I think over the period of last three years, the team has done a tremendous job in opening up, you know, some of the new markets for ourselves. Today, I think we understand, you know, specific countries in Southeast Asia and Middle East. We have been there for almost two to three years, and we have gone through that phase of, you know, experimentation, piloting across multiple locations simultaneously. Right? That was a very slow process. That was a process which took a lot of sort of effort. Right. Now we are in a phase wherein, you know, we'll just keep adding more and more in these markets. So, as things stand, my sense is that, on a base of, say, 12 restaurants, then three more will come by end of this year, and, we'll close the year, hopefully with 15. And then, next year, you know, given the situation, given the, given the rental, maybe transactions, I would definitely want to close it at anywhere between 23-25, by end of next year. Right. As far as Barbeque India is concerned, do you see... You had mentioned this, but I thought it was more on a company level. The strong SSSG, obviously, for you continued in November and December. You're continuing to see that in January, even in Barbeque India. Is that correct? Yeah, yeah, absolutely. So Barbeque India is almost 25% of the portfolio, right? Yes. So, uh- Right. Our other two businesses had always been very strong. Yes. We had some stress in India, and we have been also figuring out and trying multiple stuff over the last two years. Obviously, some worked, some didn't work. But I think today we believe that we have figured out, you know, what works for us, and we have seen this working for us continuously over the last 6-7 months. Thank you. Thank you so much, Rahul. And best of luck. Thank you, Viraj. Thank you. The next question is from the line of Pritesh from Lucky Investment. Please go ahead. Yeah, hi. Sir, just to start with, could you share the nine-month Post-Ind AS EBITDA? I could see on your presentation the quarter three, but what will be the nine months? 9-month Post-Ind AS? Yeah. It's mentioned in the- So adjusted operating EBITDA is INR 36 crore. Yeah, it's on INR 53 crore. 53. The other question is, on the competition side, you know, four quarters or six quarters back, there was this whole comment on the players and the addition. So any update there in terms of the competition? Not much, but the only comment I can make is that, we have not seen the competitive intensity, you know, change. We have definitely not seen this to have increased. And I'm talking about, you know, all you can eat barbecue category. Other than that, on general restaurant additions, you know, we keep seeing new stores keep coming up in the trade areas that we operate in. I think barring that, like I mentioned, a lot of internal levers has worked for us, and that has given us some momentum. Okay. The other question is on the 100 bookings that you get, what is now the cancellation rate? 100 bookings— cancellation rate, Every 100 booking, yeah. Yeah, yeah, yeah. Every hundred. So no, I won't be able to share that number, but directionally, it has come down over last 2-3 quarters. Okay. It's coming down, right? Yes. So conversions have improved. The conversions have improved. Now in the revised restaurant operating model, based on the smaller restaurants and, you know, maybe a slightly lower revenue per restaurant, what should be the revised restaurant operating margin at the matured portfolio level? At a matured level should be the restaurant operating margin in your new model or in the revised model of business? We have delivered around 16%, matured restaurant operating margin. I'm talking about Barbeque India. At a group level, we have done around 17%. The endeavor is to increase it by 2 percentage points. The original 21 becomes something like 18. No, so it's you are talking about India or consolidated, Pritesh? I'm talking about India. If you look at your- Yeah ... old presentations, that used to be +20 as your number, and now is it 18? That's how I should read it in the revised model. Then look, it's a step, right? So, I can wish for 16 currently going up to 21, but my first target would be take it to 18. Sorry, six, yeah, 18. And, obviously, after achieving that, you know, we would not stop, and we would endeavor to take it higher. Yes. And, my last question is, is between the ROM, that is Restaurant Operating Margin, that you report at, 17%, what will be now the corporate overhead line percentage? Earlier you said it would be 5%. Yeah. No, it was not 5%. I think, it was always 6% plus. Currently, it stands at 6%, and this- With the revised marketing, there is a- No, marketing doesn't sit here. Marketing sits on the store level. There's no marketing that is added at a back-end level. All marketing is a part of restaurant operating margin for us. The back-end cost today sits at around 6%. I think back-end cost also is an area which will get benefit of the operating leverage. I think over a period of last one year, we've also strengthened our team. You would have seen the Chief Operating Officer joining, the Chief Culinary Officer position, which was not in the company, now being created and joining. We are strengthening our other team members at a regional level. I think most of these is done now, and they will have a normal growth rate of maybe late single digits. This area will also see operating leverage. My endeavor would be to bring it down at least by half a percentage point. You said 6%, right? 6% is correct. So today, let's say on a nine-month basis, we are at about 56 divided by 26. We are operating at about 7%, 6.5%. And our company level operating margin, ROM, which you mentioned, is about 15. So we have a gap of about 8% versus what you're mentioning at 6%. So that's what I wanted to reconcile. Sorry, you started with mature restaurant margin, and you are comparing that with with overall number. No, I've taken 15.5% as your restaurant operating margin. Nine-month restaurant- Which is for the quarter. What will be the nine-month restaurant operating margin? Maybe around 13%- odd. Our quarter one was around 11.5%, quarter two was 8.2%, and quarter three was around 16%. So the fixed cost is about 6%-6.5%, basically. On the revised basis of numbers, we are at 6% today. Okay. So obviously, if you compare H1 and quarter three, you know, and add it up, you will get that same number, simple math. But if you look at the structural shift in the business and look from that perspective, it's a different math, but the numbers are correct. Okay. And the cash conversion at the EBITDA, at the pre-interest EBITDA, I'm assuming that the cash conversion will be almost 80%-90%, right? Yes. Okay. Thank you very much, yeah. Thank you. Thank you. Thank you. Ladies and gentlemen, in order to ensure that the management is able to address questions from all participants, we request you to please limit your questions to two per participant. The next question is from the line of Pulavarthi Sai kiran from Pulavarthi Advisors. Please go ahead. ... so you can go ahead. As there is no response from the line, the participants have left the queue. We'll move to the next question, which is from the line of Madhur Rathi from Counter Cyclical Investments. Please go ahead. Sir, thank you for the opportunity. And sir, congrats on the recovery and good set of numbers. Sir, I wanted to understand how much of this SSSG growth during this quarter is from the value offers, the value offers and the group offers that we have initiated over the past six months, and how much is the organic one? And sir, clarification would be, sir, this 25% dine-in growth, this is on a quarter-on-quarter basis, right? No, this is on year-over-year basis. Okay, got it. Sir, so, there has been some reduction in overall pricing. Is that so? No. So it is not that simple. I think it's not that we have taken a blanket pricing decline across the entire company. Like I mentioned, there are a lot of interventions being done. Some of these, you know, I had spoken about earlier. There are. We have created dine-in offers that has been created based on the data of groups. There has been, you know, sessions wherein our throughput was lower. We have come up with with a different sort of pricing campaign in that market. We obviously have improved our, you know, our interventions through our app and digital platforms. So I think the overall growth that you're seeing is a mix of all of these levers, you know, that we have spoken about. In some markets we have done curated food experience events, which has given us great results, right? So it's a mix of both all of these put together that we saw year-on-year increase of around 25% in transaction growth. Got it. And, sir, this INR 125 crore monthly runway, runway that we expect to maintain, sir, what kind of margin profile can we expect on this, runway? Then what will it require for us to improve our margin profile? As a previous part, they have mentioned, sir, where does this INR 125 number need to go for us to achieve that 18% restaurant operating margin? So, like I said, there are three levers to this. The higher sales would lead to higher operating leverage, which will flow through in margins. Right. On a fixed cost base, there has been no difference between our cost structures in quarter two versus quarter three, right? But, we have seen almost, almost 25% jump in our revenue. So what was around INR 300 crore in quarter two is now around INR 375 crore in quarter three. And, we see our operating margin moving up from 8.2 - 15.7, right? Obviously, if sales goes up, this will flow through in our margins. I think all of these, these are known, all of these will definitely sort of happen in terms of structural flow-through, right? So, like I mentioned, the focus of the team inside is to keep working on some of these levers that we have created. You know, sharpen the focus on some of these levers. Maybe try and find more structural levers that we can intervene in the business to further increase our transaction growth. And obviously maintain that discipline in cost and you know, and guest experience. So I think we have been doing that for quite some time. We'll continue to do that, and my strong belief is that margin will definitely be an end result of that. Mr. Rathi, does that answer your question? Yes. Sir, thank you so much, and all the best. Thank you. Thank you. Thank you, Madhur. The next question is from the line of Gopinath Reddy from PNR Investments. Please go ahead. Sir, how is the South Indian market doing, sir? Is it improved along with the rest of the country, or how is it going? So, in the recent past, the performance of South has meaningfully improved, and they are now broadly in line with other regions. I think some of the initiatives that we have taken in this market has worked really well. I don't think, you know, and historically, we have called out that South India is a lower performing region for us, but that's no longer is the case. I think, like I said, we have now converged with the national performance trend. Okay. Are we planning any expansions in South also, sir? Yes, so- New store openings. Yeah, yeah, we are looking at, you know, all across. So for example, in Bengaluru, we have opened three, in Chennai, we have two more coming up. So in terms of expansion strategy, we have a long list of, around 100 trade areas, for Barbeque Nation and also for other brands that we manage. And then we keep working on these trade areas to find the best suitable site at the best suitable, you know, operating metrics, right? There are a lot of variables. There is the size, there is, you know, rental, there is, visibility, you know, there is, a distance of the existing ones. And, and out of these 100 trade areas, you know, whichever clicks first, I think we go ahead and do that. I think at a team level, we have capability to execute restaurants anywhere in the country, irrespective of the number of restaurants in that region. Right? Yes. Okay. Thank you, sir. That's it from my side. Thank you. Thank you, sir. Thank you. The next question is from the line of Manjeet Buaria from Saamya Advisors. Please go ahead. Hello? ... Rahul, I just wanted to touch upon the Premium CDR. You know, in that format, we have seen gross margins shrink by about 2%, you know, over the last 12 months. So I just wanted to understand whether that's also a volume-driven strategy which has led to that, you know, outcome, or is it something else? Question one. The second question on Premium CDR was, you know, out of the 10 restaurants you've opened, in the last 12 months, could you give a split between Toscano and Salt? Yeah. So on gross margin, Manjeet, so there are two impacts that has led to this number. One is the impact of new stores. I think wherever you open a new store, you know, setting it up, understanding the menu mix that work in that customer market, there's a time lag for that, right? And that's why you always see that new restaurants are at slightly 2%-3% lower gross margin, you know, in the business area segment. And as we understand customer profile, as we understand customer preferences, we build our menu designs accordingly, and we optimize on that. So that's one. Secondly, specifically, Premium CDR segment, the delivery transaction growth and delivery revenue growth has been, has been far higher than the dine-in revenue growth, right? And delivery, by design, is slightly lower, you know, gross margin business. So mix of these two is what led to approximately 2% lower number on the gross margin on Premium CDR. In terms of mix between Toscano and Salt, out of around 10 restaurants that we opened, around six would be Toscano, six or seven be Toscano, and three would be Salt. Got it. And, just in terms of the new restaurants in the Premium CDR, just wanted to get a sense that what percentage of the system ADS do they start with, and, you know, about how many months does it take, or years does it take for them to reach a system-level ADS, in some sense? So the range is very wide, you know, Manjeet. So in some markets, you know, has reacted extremely positively and have started with an ADS of, as high as INR 2 lakh. And, you know, some has reacted slowly and signed an ADS of INR 1 lakh, right? So, it also depends on, on the trade area, you know, where you're in mall or not in mall, and other factors, right? But, range is approximately they settle down somewhere between, as a starting number, close to INR 1.3-INR 1.4 lakh ADS, which translate to around INR 40 lakh of monthly business. And then they slowly grow and build up. And that's basically true for both the brands. You know, the brand actually rely on a large base of repeat customer base. You know, and that has been one of the inherent strength of the both these brands. So it may take time in some of the new markets that we're entering and, you know, the impact that you're seeing is at least in terms of margin, is also because we're building ourselves in markets like Mumbai, Delhi, you know, Pune for Salt. So Pune for Toscano is built. We're building for Pune for Salt. We are building Mumbai for Toscano. We have two restaurants operating now. The third one is... Sorry, we have three restaurants operating now. We just opened the third one in Nariman Point in Mumbai, and two more under construction, which will come on board soon. So soon, Mumbai also will have five restaurants, Toscano, and we'll start seeing it for this fact. Similarly, we're building Delhi for Toscano. We have the first one operating, the second one coming in this quarter, and then we'll add more. So, I think as we penetrate some of these key metro markets of India, with both these brands, this will build extremely well. I'm actually very excited about about the guest feedback that that this segment has got. I hear you. And last question is on Barbeque Nation. Rahul, you know, the strategy which you are sort of pursuing in terms of, you know, getting higher footfalls, higher tickets, you know, assuming for that strategy, you have to continue with the gross margin at where it is for, you know, let's say a couple of years. I just wanted to understand on the operating leverage piece, which you explained, at what revenue per store, basically, can this go back to about, you know, 2 percentage points higher, even if you assume more, you know, gross margin expansion? Just trying to understand at what scale we need to be for that, for purely operating leverage-driven margin expansion. So look, let me attempt it with you. So, I understand that the current gross margin in Barbeque Nation business is lower than what we have seen in the past. But even at the current level of around 65%, and maybe another 15%-20% of some of the direct costs, that sort of impacts because of sales. So, you know, every sale will lead to higher, you know, service charge that we pay to our employees and all this stuff, right? I think there's a clear 40%-45% flow-through that happens in our business, right? So if you want to add gross additional margin of 2%, there is a base impact of the denominator that comes in. You have to add, you know, say, 3% overall, and then you have around 40% of flow-through. So maybe at 8-9% higher throughput from the current levels will help us reach there. That's a broad sense, right? And that is why when I've been harping on the point that, look, we are focusing on transactions, and once transaction happens, everything will come back. Obviously, we are also excited about the repeat rates in our business, right? Once we acquire new customers through transaction growth, this will give us a really long-term, you know, value base that we are building up in our business. And that is the most exciting part. My strong belief is that, you know, I have to worry about margins if the cost discipline is missing. I think over a very long period of time, you know, the team here has proven that they have very strong cost discipline. I think the rest of the numbers are very simple maths, Manjeet. ... No, I appreciate that. I think the value-led strategy always makes more sense, right, to cover margins or operating leverage. You know, it just seems more sustainable, but, you know, thank you for your response. Thank you, Manjeet. Thank you. The next question is from the line of Palak Shah from Mentis Family Office. Please go ahead. Hey. Hi, Rahul. Good evening. Am I audible? Yes. Yeah. Just wanted to check on two things. So one comment that you made during the presentation was there will be an improvement in gross margins going forward. So wanted to check, well, can you go back to 68, [16], or you are settling anywhere between the two numbers today? And secondly, when you talk about an 18% corporate level margins, right, the, this quarter was 16%, but if you take nine months average, it is somewhere at 13%. So it's effectively talking about a 5 percentage point delta. So if you can just give some waterfall path towards that. But I'm assuming this 18% was more on an annualized basis rather than a quarterly basis. So just to clarify, that 18% was Post-Ind AS, right? Yeah. Yeah. That's the number you're basing on, right? Yes. Yes. Yeah, so see, one is we have to believe that H1 was different, and based on the efforts being taken for the last six, seven months, we have seen quarter three as a structural sort of shift. Quarter three generally is also one of the better quarters. But when I say structural shifts, what I like is the pace of improvement that normally happens between quarter two and quarter three is better this time around, right? And that is the very exciting part for me. And that is why I'm calling it some sort of a structural shift that has happened in our business. Now, listening to margins, look, you mentioned about gross margins. Yes, they are currently at a slightly, you know, subdued level than the past, and that's because we are making major investments in gross margin. The two levers of gross margin is one, pricing that you command from your guest. You know, that will continue to remain there maybe for next few quarters. You know, or we may change based on the data that we see almost on a daily basis, in certain fashion. You know, the company's system are geared to track every day's performance across day parts, across session parts, you know, to the extent that we also try and draw up a session-level P&L to see whether this session is making sense for us as a P&L perspective or not. And all these data is real-time, real-time based on cloud system, right? So we'll keep doing that. The second part to gross margin is cost, right? So, as we scale up, as we generally, you know, increase the volumes in our business, can we do more effective, you know, buying? Can we find better ways of working through our menu design? Can we work through better ways in our supply chain? So those, some of these projects are already identified, are work in progress. You know, we have seen a very small improvement of 20 basis points quarter-on-quarter, right? But directionally, I think we should target to sort of reach 67%, right? It may take, you know, longer than one or two quarters, but that's where the business direction is. And, once you sort that, and you build your transaction volume, I think 18% operating margin on a Post-Ind AS basis is definitely achievable. Got it. We've done that in quarter three, by the way. Yes. Yeah, I agree. The point comes to the fact that while we understand what you're trying to do, but, I think just guide us towards the absolute number, like say 66 margin goes to 67, 68, that gives you 100, 100 - 150 bps of margin delta. And assuming the growth rate continues to be in a double-digit, that gives another 300- odd bps delta. As you said, 45% of your, revenue actually falls to EBITDA. That's the past, so that you operate on, right? So would that match be right? Yes. And, you know, the direction is frankly, very clear. You know, build, build volumes, build sales. You know, we have obviously lost some of these over a period of last 2.5 years, right? Come back to the numbers that we used to do in terms of transactions. You know, get more new customers, from there, drive more repeat business. And once that happens, you know, I strongly believe that margins will follow through, will automatically fall through. Got it. Thank you so much for this, Rahul. Wish you guys all the best. Thank you. Thank you. Ladies and gentlemen, that was the last question for today. With that, we conclude today's conference call. On behalf of United Foodbrands Limited, that concludes this conference. Thank you for joining us, and you may now disconnect your line.