Ladies and gentlemen, good day, and welcome to the Campus Activewear Limited Q1 FY24 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. Before we proceed on this call, let me re-remind you that the discussion may contain forward-looking statements that may involve known or unknown risks, uncertainties, and other factors. It must be viewed in conjunction with our businesses that could cause further results, performance, or achievements to differ significantly from what is expressed or implied by such forward-looking statements. The Campus Activewear management team is represented by Mr. Nikhil Aggarwal, Whole-Time Director and CEO, Mr. Sanjay Chhabra, CFO, and Mr. Piyush Singh, Chief Operating Officer, Mr. Krishna Kumar, AVP, Investor Relations. I now hand the conference over to Mr. Nikhil Aggarwal, Whole-Time Director and CEO, for his opening remarks. Thank you, and over to you, sir. Thank you very much, Seema, and welcome everyone for joining our Q1 FY 24 earnings call today. Campus Activewear adeptly navigated a challenging market landscape, registering a 4.8% YoY revenue growth at INR 353.8 crore. In terms of volume, the company sold 5.6 million pairs in Q1 FY 24. The ASP in Q1 FY2 4, stands at INR 629 compared with INR 644 in Q1 FY23, registering a YoY growth of 4.1% in ASP. While the trade distribution has de-grown by approximately 5.5% on account of higher base, due to lower primary uptake on account of channel partners, our D2C channels-online and offline- have delivered growth of 10% and 82% respectively on YoY basis versus Q1 FY 23, supported by sustained secondary consumption by the end consumers. The company continued its premiumization journey through new product offerings and enhancing its retail footprints in new geographies. The Indian sports and leisure footwear is a sunrise industry, with sports and fitness quotient grabbing a significant mind share amongst consumers across India, including metros, tier two cities, and hinterland areas. Campus Activewear is well placed to appreciate the evolving consumer demands, and create value for its stakeholders in the coming years, with its robust business model based with vertically integrated manufacturing ecosystem, growing omni-channel presence, premiumization focus, product diversification across product segments, and categories backed with strong balance sheet positions. I will now hand over to our Chief Operating Officer, Piyush Singh, for his remarks. Thank you. Thank you, Nikhil, and greetings, everyone, for attending this call. We are content to say that demand scenario is gradually improving, with Q 1 FY24 delivering mid-single digit growth vis-à-vis the last quarter and the same quarter last year. Now, while we are witnessing green shoots of recovery predominantly in the eastern belt of UP and parts of Bihar, we expect a full-blown recovery with the onset of festive season itself. During the quarter, our D2C business continued to demonstrate robust growth of more than 20% on a YoY basis. Our trade distribution business has narrowed the degrowth gap and is expected to get back to the growth trajectory in the upcoming festive season. With resurgence in demand in the Tier 2, Tier 3, Tier 4, and semi-urban centers, we are already seeing early signs of that recovery happening in some parts of the country. Business by segment, our sales trend in Q1 FY24, has exhibited sustained premiumization, wherein sales contribution from semi-premium and premium categories have increased to 72%, as against 68% as witnessed in Q 1 FY23. Similarly, on a category basis, revenue mix across men, women, and kids have stayed at 80:20 in the quarter, in the current quarter, driven by our continued focus towards growing these categories. The company benefited from favorable channel mix, product mix, and sourcing efficiencies, which results in a material improvement in material margin from 49.6% in Q 1 FY23, to 53.4% in Q 1, FY24. Subsequently, the gross margin has also shown subsequent improvement, substantial improvement from 36.6% in Q1 of last year, versus 39.2% in Q1 of FY24. We continue our planned investment towards brand building, B2C network infrastructure expansion, and talent acquisition, which is key to our growth in the coming quarters, all of which is expected to generate margin accretive impact in the subsequent quarters. We are confident of restoring our trendline growth trajectory and margin profile in the coming quarters. I'll now hand it over to CFO Mr. Sanjay Chhabra, to take you through more details on the Q1 FY24 performance. Over to you, Sanjay. Thank you, Piyush, and good evening, and welcome, everyone, on board. During the quarter, our revenue from operations grew by 4.8% on a YoY basis to around INR 354 crore. EBITDA stood at INR 66.4 crore versus last year INR 62.2 crore. EBITDA margins stood at eighteen point eight percent versus 18.4% last year. Net profit during the quarter stood flat at INR 31.5 crore, and PAT margin stood at 8.9% in Q1 FY24. On the balance sheet side, our net debt stood at INR 135 crore, which is a reduction of roughly 22 crore versus March 31, 2023, wherein it was 157 crore. Net debt to EBITDA ratio stood at 0.5x in Q1, as against 0.6x in FY23. Our balance sheet demonstrates the position of strength with robust return ratios such as ROCE and ROE of 23.5% and 22%, respectively, as of June 30. With this, I'll conclude and hand it over to the operator for questions and answers. Thank you. Shall we begin with the Q&A session, sir? Thank you very much. We will now begin with the question and answer session. Anyone who wishes to ask a question may press star and one on their touch-tone telephone. If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. Thank you. We take the first question from the line of Ashok Srivastava, an individual investor. Please go ahead, sir. Hi. Thanks for taking my question, and I really appreciate the management, the way we can see the recovery happening in the market. And if I compare the same with other peers, we are in a very good- I'm sorry to interrupt you, Mr. Ashok. Sir, are you on a handset or a headset? Okay. Let me, Please repeat your question. We are unable to hear you, sir, please. Am I audible to you right now? Yes, please go ahead. Hello? Yes, sir, please go ahead with your question. Yeah. So first of all, congratulations to management for providing a good set of numbers. And if I compare the same with others, peers, it seems to be in a decent stage where we are right now. Only two questions from my side. As a retail investor, I just wanted to know that I came really, and I have visited a lot of stores, the physical stores, and I can see that there is much more time people are—means the demand as per what we are expecting from Campus is not there. Means buying, is it happening because of the older stock, which is still going on? Because I'm quite young, and I have a lot of friends whom I used to discuss about the feedback of Campus and Bata. So what I am getting a pretty much feedback that in Campus store, whenever there's youth, which is aging between 25-35, they go to stores, but they do not find a trend which is going on in the market. So whether the demand slowdown is happening just only because of cost of raw material, or is it because of designing of the products? This is my first question. Hi, Ashok. Nikhil here. So, you know, we actually take pride in, rather, one of the biggest USPs of our brand is the fashion forwardness and the way we bring the latest design, latest trend, latest color palettes across the world to India first, in the most cost efficient manner, and the most price sensitive manner for our consumer set. So, you know, we actually... Like, for example, the sneaker range that we've launched. So this is a very trendy range. And similarly, you know, we launch about 300 new designs every year, along with an existing portfolio of 300 designs. So in total, at any point of time, we would have a portfolio of 600 designs. This is by far the largest portfolio of designs across any such company, be it multinational, be it Indian. This is by far the largest portfolio. So, you know, I would just like to say that, you know, we are totally committed to providing the best value for money products and the most fashionable and the latest designs and technologies to our country first here, before anybody else. And that's the, you know, the USP of Campus that we bring to the table. Okay. Thank you so much for answering my first question. My second and last question will be: When, management is eyeing that we are going to be, pre-IPO operating, revenue front offside, means EBITDA margin and everything, when we are expecting to return back, seeing the current scenario? Yes, we are pretty much aware that there is inflation in cost of raw material and everything, but what exactly management is perceiving and how we are going to hedge all those things in future? Because if we see the economic scenario, which is demographically happening throughout the world, Russia-Ukraine war is going on and everybody, but still, that, that's the quality of management, that what exactly you people see that in how many quarters, in next upcoming quarters, when we are expecting to get the exact operating leverage or operating margin which we are receiving pre-IPO kind of a thing? Hi, Ashok. Piyush Singh. Great question. So, let me just surprise you that, while we refrain from giving any future looking guidance in this matter, but, directionally, we can assure you that, on a pre-IPO basis or just after, after the IPO, our margin was trending in the range of 19.5%-20.5%. That's the kind of 1% trajectory we typically follow as of now. As you can see, in the current quarter, our EBITDA margin is close to 18.8%, which is in close vicinity to our long-term trending trajectory. While we, the endeavor is to improve this with the help of operating leverage in times to come. We can assure you that with an improving macro scenario and with all the input matrices that we have worked on over the last few quarters, we'll very soon be in the same trajectory as you expect us to be. Well, I mean, the same numbers that we kind of entered the market during, especially on the margin side, with the IPO, with the IPO. So but we are not very far off from that set of numbers. Sure. Thank you so much, sir, for answering my question. And only if, if I can, ask you last very small question, when we are expecting Challenger brand to get launched? Because in last concall, I think we had a discussion regarding Challenger brand, which will be served for one month. We had that discussion. We have a particular strategy in place that we are still testing it out in the pilot phase. As you rightly said, it's going to be a challenger brand. It has a certain specific objective in place. The mothership will continue to be Campus. Our entire focus, management, bandwidth, and energy is towards this flagship brand only. Challenger brands serve a certain purpose, and let's not get too carried away with the challenger brand concept, because the whole, the entire growth and the entire build out and the entire outlook is based around Campus for us as a management, as a platform. Sure. Thank you so much, sir. Thanks. Thank you. The next question is from the line of Mehul Desai from JM Financial. Please go ahead, sir. Yeah. Hi, Nikhil. Hi, Piyush. Thanks for taking my question. First question on gross margin front. Now, how do you see this trajectory sustaining in coming quarters? Do you see this kind of gross margin sustaining, or is there any kind of one-offs in this? And also, typically, the second half margin, my understanding is second half margins are better than first half. You see that playing out, given that you have already have a very strong margins in the first quarter. So is it fair to assume that, you know, second half can be better than first half in terms of margins also? And, related to gross margin also, given that you have certain benefits now, will you look at, you know, some pricing corrections to drive volume growth? That's my first question. Yeah. Hi, again, great question. On the margin side, so, if you have to dissect this entire thing, this improvement in gross margin is actually driven by three important factors, which is favorable improvement in channel mix, favorable improvement in product mix in terms of sell- through, and, again, sourcing efficiencies that we have kind of realized over the last couple of quarters, which we had already discussed in our previous commentaries. Just to answer your question around the sustainability piece, there are no one-off in these margin improvement, but at the same time, this margin improvement is kind of linked with the growth profile that the company and the team is able to demonstrate quarter- after- quarter. Now, prima facie, first half of the year is slightly lower on the margin side empirically because of a relatively higher mix of open footwear, which is which is pivoted towards relatively lower margins compared to the closed footwear, which is our forte so far. So as we enter deeper into the season, we believe that we do have an opportunity to improve this margin profile further. There could be a one-off in a month or so, depending on the unpredictable macro. But I can assure you that as a team, we are very much focused on or improving and correcting and optimizing all the input matrices that goes towards margin improvement. See, macro is something that is out of control, but at the same time, our endeavor is to ensure that whatever is within our control, we should optimize that and pass on the benefit to all the stakeholders from here on. Sure. And on the ASP front also, how do you see ASPs then moving down? Would you like to pass on some benefit, or do you think this 2%-4% kind of ASP growth can sustain? So again, see, if you notice that, we have very reasonably priced our portfolio. The pricing is very, very sharp so far as, a brand in our category is concerned. We have, shied away from the temptation of increasing pricing, some, like some of our competitors over the last few quarters. That, that's the sole reason why we have sustained the momentum, and, and people have kind of rewarded us with with whatever little growth, in a difficult macro that you can expect of. As of now, see, while we haven't taken any price increases, which are unreasonable in nature, we don't see any opportunity, or we, we don't see any, any kind of, a scenario where we, we would be taking any price surge as of now. The portfolio is very sharply priced, and this has taken care of all the permutations and combinations and the scenarios wherein a certain growth has been baked in at this pricing. Got you. Secondly, on this B2C online business, this 10% kind of growth, how, and how do you see this... Don't you think, there's, I mean, are you targeting a much higher growth? This business, obviously, in Q4, you had some issues. How are those issues now largely normalized, and how do you see the trajectory for this B2C online business? See, so far as the robustness of the business is concerned, we see absolutely no concerns around the sustainability of the growth profile of this particular business segment. Yes, there were certain issues, and in quarter four, for this, we had to reset. We have recalibrated, and in the coming quarter, in the coming quarter, especially with the onset of the festive, we see this business getting back to its the prime of its growth. So from a from a full year growth perspective, orientation, the business is very much on track. ... That's good. And, lastly, on any comment on working capital? How is it versus March? So fine, our DSOs, as far as working capital is concerned, there is, a slight increase in investment in working capital, but our DSOs are very much, in line with, both March and, last, last year's same quarter. What we see, what we see is a slight increase in the DPO, which, which is, a good contribution. And, with a subdued or muted, demand scenario, we, we are sitting on some inventory, but we, take that as a, we will leverage that investment in inventories in the upcoming festival season, and, that would help us to, sort of push more volumes in the market. Sure. Great. Thank you so much, and good luck for coming quarter. Thank you so much. Thank you. The next question is from the line of Harsh Shah from InCred Capital. Please go ahead, sir. Yeah, hi. Hi, Piyush, and hi, Nikhil. Thank you for taking my question. Very impressive, volume performance this quarter. And given that there are no one-offs and a seasonally weak quarter, and, I mean, good margin. So I just wanted to understand one thing on margins from a medium to longer term perspective. Now, if, given the current quarter's performance and as we go into the second half, where we have much better margins, both at gross level and the benefit of leverage paying out, the EBITDA margin as well, I, I think that the 20% margin kind of guidance, barrier can be broken very easily this, this year. But going ahead, you know, let's say three, five years from now, how do you play this thing, right? Like, kind of, do you want to keep the margins at 20% levels and invest, whatever incremental margins you get behind to get more volumes in market share? Or is the endeavor for us to kind of, keep increasing our margins by, let's say, 50 to 100 basis points every year until we reach a particular threshold? Yeah. Hi, hi, Harsh. Nikhil here. So no, great question, Harsh. You know, like we've also mentioned in our previous call, the end objective and the long-term objective for us as a brand is to make it the most number one top- of- mind recall brand in the country. And therefore, you know, for a longer-term objective, we'll keep on investing behind the brand. So far, we've been investing about 5 to between 5% to 6% of our revenue in the ATL spends. And, you know, we've grown this from about 3% to about 6% over these last three to four years. Therefore, you know, we strongly feel that as the company scales up, we'll continue to invest behind the brand, and we'll maintain the marketing spend at about 6% going forward as well. So therefore, you know, in terms of margin accretion and the margin profile, we've certainly taken a number of measures to improve the margin profile that you see today. The ones that we've spoken about earlier as well, in terms of premiumization and the channel mix, and the cost savings that are now coming in. So we certainly believe that second half should lead to better margins in terms compared to first half. In the long term, while we would refrain from giving you a specific guidance around the numbers, what we can tell you with surety is that the long-term objective of the company is to make the brand bigger and stronger. In doing that, you know, along with very, very good margin profile. So we'll, you know, continue working on that objective. I believe that answers your question. Yeah, I mean, thanks for the explanation. Basically, directionally, I'm not asking for a guidance, but directionally, basically, we do see the margin, some of the second margins kind of as the business grows, right? Would that be a fair assessment? Yeah, Harsh, Piyush this side. Yes, that would be a fair assessment over a longer term horizon of, say, four to five years. Directionally, we'll be improving our profile from here on, but at some point in time, that's a balancing act we will need to play as a brand, wherein, as Nikhil rightly mentioned, we will continue our sustained investment towards making the brand more robust, more likable, and more reachable for the Indian diaspora out in the country. Okay, got it. And, the second question was more on the trade distribution part. I mean, the decline was 5% this quarter. So how would the split be for north and east, which is our core market, and versus the emerging markets of, let's say, south and west, for trade distribution specifically? While we have seen improvement in parts of core North India territories, which were earlier deeper into the woods, especially parts of eastern UP and Bihar, they are gradually recovering, and hence we are narrowing the gap between, say, a growth profile and a slight decline quarter after quarter. West continues to do well for us, so that's the rest of the country. It's just that some of the core markets in the northern territory, especially UP and Bihar, were not performing as per expectation because of severe macro downturn and people witnessing a kind of a recovery in these markets, especially Tier 2, Tier 3 markets were very, very sluggish. They have started bouncing back, and with the onset of festive, the real hope is the macro would gradually improve, inflation will subside, and with more farm income coming into place, along with the elections, we, we expect these markets to also bounce back. Okay, okay. No, I was just trying to understand the difference between the industry decline in North and East... and our performance in North India? See, we have largely maintained the same performance, because a 5% decline in value terms is somewhere in the vicinity of INR 10 crore here and there, which is like a couple of days of billing for us. So, see, directionally, we don't see any significant decline happening in any of the markets. It's just that growth is still elusive in some pockets. They are also gradually coming back, and with festive onset right around the corner in the coming quarter, we expect these markets to also come back into their full glory as previous years. Okay. Okay, and could you offer any comments on how July and let's say just the 10 days of August were, compared to June quarter? I mean, we would refrain from giving any mid-quarter guidance. I hope you'll understand from that. I hope you'll understand, because it's too early for us to comment on a quarter or a half-yearly performance. This is just a month's output. Still a long way to go. So we refrain from any guidance on that part right now. But we'll certainly come back to all our stakeholders once the quarter has gone by and the numbers are out. Got it. it. Got it. Thank you so much, Deep, anyway. Thank you. Thank you, sir. The next question is from the line of Yash from Steinberg. Please go ahead, sir. Yeah, am I audible? Yes, Yash. Yeah. Yes. Thanks for the opportunity. Our D2C offline channel is actually the fastest growing channel for the company today with an aggressive addition of studios across India. So wanted to understand what is the unit economics for a store and how do you kind of get confidence in terms of the ramp up in the middle of, let's say, what you are putting out as a macro slow down? Yeah, a great question, Yash. So let me first add more color to it. D2C offline is a combination of our own stores, COCO, franchisee stores, and a large part of it comes from key accounts. So majority of this growth that you see in D2C offline, up to the tune of 82%, is driven by key accounts and franchisee stores. Because now we are in a stage where we are not opening a lot of company-operated stores. Actually, this is the phase three posed in us by most of our franchisee partners, which are master franchisees for multiple states, and who are witnessing the, the ROI-based proof in terms of the return on investment that they, they are generating on the current network, that they are adding their own capital to the scale-up. So for example, some of the states like, Gujarat, Maharashtra, Rajasthan, parts of, or you can say parts of Central India, they are doing, better than, better than average performance across retail, you can say, retail spread, across various other brands. So it's in fact their investment, which is coming into play right now. I hope that answers your question. Understood. So, out of the 225 odd stores, how many would be company-owned stores? It's roughly 90 to 95 stores are our company-owned stores, and most of these stores are bigger stores. Over the last couple of years, franchisees have added roughly 135 to 140 stores for us. Understood. Incrementally, you don't plan to add, We'll be, we'll be moving ahead with, with addition of stores in a ratio of, say, 70:30, in the favor of franchisee to company. Understood. And the other question is, on the group meeting, you mentioned that, let's say, 22% margin, EBIT is aspirationally a target. Just want to-- this is back in March, like few months ago. Want to understand, what is going to be the bridge from, let's say, 14% odd today, to achieving the 18%, 20%, and then 22%, that kind of EBIT margin from here on out? I believe you are referring to EBITDA here, not EBIT, because directionally, what we've been maintaining across our calls and investor interactions is, while we are currently trending at close to 19% -20% EBITDA, the idea is that over the next three to five years, we should incrementally add on to EBITDA margins, like 1% accretively, year- after- year for the next five years. I mean, there could be plus and minuses between one or two years here and there, depending on how the overall economic scenario is. But basically, that's what we are aiming at. And eventually, the... I mean, we, we-- this is not a very capital-intensive industry. At some point in time, we, our endeavor is also to become debt-free. We should take care of the interest part. So, we have a certain milestone so far as EBITDA is concerned, EBIT is concerned, DSOs are concerned. We are heading very much in that direction, quarter after quarter. All the input matrices that are requisite for this kind of an improvement are very much in play. So the roadmap is very well laid out for us. We just need to focus and we have to stay disciplined, gain more market share in the current scenario, wherein people are going for downgrading and some kind of postponement. The idea is to gain more and more market share in shelf space, rest everything else will fall in place with the help of operating leverage... and to some extent, we need, you know, the market to sort of start back up again, you know, by at full throttle. One question on, let's say, margins that you've reported. If I were to look year-on-year, it's probably flat on, let's say, EBITDA and EBIT. But let's say we've seen a very sharp improvement in RM business gross margin, but that gets offset by something in the other expenses. Just want to understand, is it that we get higher gross margins in online, but since you report marketplace commissions in other expenses, that largely that benefit gets knocked out? So because you mentioned in the call earlier that gross margin improvement is because of product mix and channel mix. So just want to clarify that. Yeah, yeah. So, essentially, there are a couple of fixed expenses which increases year after year, which we all know. This includes employee expenses, some bit of ESOP expenses which have come into play, and sustained investment towards advertisement and brand building. So these are primarily the expenses which has led to kind of a flattish EBITDA margin on a year-over-year basis. While the improvement, as you rightly mentioned, is on account of favorable channel mix and the product mix, and largely on account of sourcing efficiencies that we have witnessed over the last couple of quarters. It's not the largest, largest part of the increase in other expenses is coming out of marketplace commission. That's what I wanted to kind of confirm. Not really. I mean, there is some increase in marketplace commissions because of the overall change in mix of online business, wherein we are moving more and more towards marketplace model compared to the outright managed marketplace teams. But that has already kind of contributed with the higher net realization in the top line. So it's kind of, I mean, in a way, that increase in realization or increase in subsequent gross margin, kind of takes care of that slight increase in commissions on account of marketplace sell-throughs. Understood. And on in terms of, let's say, how do we think about ASP going forward? Because frankly, there seems to be a certain price point within which, let's say, increasing the prices may kind of cause us to lose competitiveness on some of these platforms. So how are you seeing, let's say, your ASPs moving, let's say, four to five years out in terms of the growth rates, rather than a near-term picture? But can you move beyond this INR 600-INR 700 rupee range if you were to grow at, let's say, the aspirational target of 20% plus or whatever number that you at least plan for? Yeah, yeah. So, you know, we see a good opportunity, like we've been growing our ASP consistently over the last 10 years at about 6%-7%. But going forward as well, you know, it's not that we need to take a big MRP increases or we need to enter categories above INR 3,000. We do still believe we have a pretty big opportunity within the spectrum of INR 1,000- INR 2,000, due to the channel mix and the premiumization that we'll be doing within these price points, INR 1,000 to, let's say, INR 3,000. So, the market... And given that, you know, the BIS, the way it's coming in now, and it will be implemented from the first of January 2024, with a lot of clarity that is coming from the government so far. It will be the primary objective of BIS again is to better and ban the imports from China, Vietnam and Indonesia into the country, the similar way, the way they've done it for the toys industry, and tires and so on. So, we are extremely excited about the prospects of BIS as well, contributing towards not just the growth in margins, but also towards this ASP increase. Because a lot of the materials or the finished goods that's coming from China today are in this price point of INR 1,000-INR 3,000. And, you know, those, a lot of that will be pretty much leaving the market very soon. So, that's the way we are looking at ASP. So we are pretty much in that very sweet spot of INR 1,000-INR 3,000 bucks. We really don't need to enter into 3,000+ categories, in order to increase our ASPs. All right. Thank you very much for patiently answering my question. Thank you. Ladies and gentlemen, in order to ensure that the management is able to address questions from all the participants in the conference, please limit your question to two per participant. Should you have a follow-up question, we would request you to rejoin the question queue. We take the next question from the line of Vatsal Dujari from CLSA. Please go ahead, sir. Hi, thanks for the opportunity. I just had one question. How are we performing in the southern regions? According to you, what characteristic of the southern market makes it a little more challenging versus the other markets for us? Hi, if I understood your question correctly, you are talking about our performance in southern markets. We have pretty much held forth, maintained our market share in southern India market. Speaking about last 12 months, our contribution from North and Central India is close to 50%- 55% with West India contributing roughly 23% of our sales, East contributing another 17%, and 16%-17%, and South India is contributing roughly 11.5%-12%. We have managed to gain traction in these markets. We are steadily gaining market share, and currently, our mix is mimicking the industry mix of sports footwear all across the country as well. We are truly mimicking the contribution mix of a pan-India brand. Okay. Yeah. Okay, that's so much. Thank you. We take the next question from the line of Gaurav Jogani from Axis Capital. Please go ahead, sir. Thank you for the question, sorry, the opportunity. Myself, my first question is with regards to, you know, in case you have validated that, you know, you would like to drive market share. So in that event, would you also be open, you know, to maybe readjust the price and drive the volume growth in the near term? Because, you know, we have seen increased competitive activity from many new players coming into the market, as well as the slower growth has pushed early EOSS also during the year. Hi, Gaurav. Piyush this side. I mean, great question. Given quite a few set of folks are really interested in that, we are going to give more discounts to drive volumes. See, the clear answer is, our portfolio is very, very sharply priced as per the demand spectrum that we are currently witnessing in the market. So people are not actually looking for discounts. People are looking for the best value proposition, price value proposition, which we believe that within Campus we are offering. We have never taken unnecessarily price hike, so there is no question for us to drop prices in order to drive volumes. Volumes are still the volumes are still very much in place for us, compared to to rest of the industry or some of the other peers that you may be tracking. The sole reason is people believe that they are paying the right price for the product that they are getting within this brand. And that's the sole reason why they keep coming back to Campus as their repeat purchase. So it's a very well-positioned, well-priced portfolio. We take care of our consumers at the very onset while pricing the portfolio itself, and there is no such need of playing a high-low game, wherein you first price the portfolio higher and then give a deeper discount. Let's not take consumer for a... Let's not try and assume that consumer is dumb in that sense. Indian consumer is very sharp. They understand the real worth of the product, and hence, they are not really seeking discount. They are seeking the right value for the money that they are paying. Uh, sure. We believe the brand is really delivering. Okay, sure. Sure. My question was more, you know, with regards to the competitive pressure, you know, while your products are, you know, very effectively priced, I would agree to that. Just that, you know, because of the early onset of ESS, consumer tends to seek more discount, and hence that was the question coming from. So certainly, I mean, we have seen behaviors across our online and offline formats, while our online discounts have increased by a couple of percentage points. But then again, I would refer to some of the conversations without naming, taking names with some of our platform partners, where they say that the sensitivity is so strong in Campus, that even a 1% drop in price or 1% increase in discount drive volumes, which other brands even by discounting as high as 10% incrementally are unable to drive. So that is the kind of price value proposition we drive by maintaining a very tightly priced portfolio and not discounting it unnecessarily. See, yeah, see, volume pressures are always there. ESS pressure is always there. Driving numbers is always, and that's why as a management, we maintain this stream that... See, you should always judge a brand or judge a platform by the strength of its portfolio or by the strength of its decision-making capabilities during testing times. See, we can—there is a lot of temptation that we can drive a lot of volumes by discounting, but that really rubs against the grain or the ethos of our brand. So we know what we have to deliver. We understand that fully, but at the same time, we don't want to dilute the brand unnecessarily just for short-term gains, and that's the principle that we all stand by. Sure. Thanks for the detailed explanation. And my next question is just more related to the BIS implementation. You know, we hear that a lot of BIS imports are, you know, in the range of INR 1,000-INR 3,000. If you can, you know, explain a bit in detail how you could this can benefit to the entire industry and Campus especially. Right. So, like I mentioned, you know, BIS is aimed at curbing the imports from China and Vietnam and Indonesia. And this is... These are the three nations from where the majority of imports of footwear is coming into the country. So naturally, you know, once this entire volume, which is a very significant number, we believe that that volume will sort of erode away. This will obviously open up, you know, doors to not just Campus, but pretty much like the entire footwear industry. And this should benefit, you know, the Make in India campaign that our honorable Prime Minister is encouraging all us to do. So that is the primary objective of this BIS scheme. On top of that, you know, there were some clarifications also that have come in, in terms of, you know, that earlier there was some confusion regarding the non-BIS goods. You know, how much time will the government give to various companies and the channel partners to sell through all the non-BIS goods? So that clarification also come in that by 31st December this year, every company and every channel partner will need to update their stock statement on an online portal of their non-BIS goods, and the government will give them adequate time to basically sell it, sell it off. So there is no, you know, the government is absolutely looking out for the domestic players. They are making sure that nobody goes under, and this entire move is primarily aimed at just curbing the imports. That is basically the gist of it. Sir, so just one question here, you know, would this restriction also be on the soles or, you know, those that are imported from China, the raw materials, or is just on the finished goods? No, it's only on the finished goods. But naturally, you know, finished goods is sum of parts of your sole and upper and all the raw materials. So, if the finished goods need to comply with certain requirement of BIS standard, then naturally, you know, all the raw materials and the sole and all will also have to fall into place. So it just percolates down to the raw material as well in that sense. So while, I mean, there are testing parameters expected for upper material and sole material separately, like abrasion, abrasion resistance and flexibility and things like that. So individual components cannot escape BIS regulations per se. In one line, if we have to summarize, BIS always went for a quality domestic brand, because ultimately the standards would be, the quality standards would be uniform for all the, all the domestically manufactured products, be it a INR 500 shoe or be it a INR 1,500 shoe. That means there will be an enhanced pressure on local manufacturers who are cutting corners as of now, who are producing substandard quality just in the name of fashion. So the government wants to do away with that as well, along with cheap Chinese imports or cheap international imports. Idea is to ensure that Indian consumers should get the best quality footwear, and at the same time, India should gear up in the coming times to create world-class quality footwear, which is ready for exports as well. That's the overall objective of the government, which really, really works well in favor of an established domestic brand, which is truly focused on quality. Sir, so just one clarification on this. So because of this implementation, you know, getting affected from the January 1, so in the interim period, do you expect any supply chain disruptions, you know, just before the implementation of this, and because of which, any stocking that you would have done? Not for us, because anyways, 90% of our sourcing is indigenized in nature, and we only work with high-quality vendors to provide quality stuff. So, nothing really changes in our lives. In any case, I'd just like to also clarify that for a brand like Campus, we've always anyway adhered to the highest standards of quality. So even though the BIS standards are decently stringent, we pretty much fall into, I would say, from the previous legacy days also, we've been falling into the standards just by the, you know, sheer quality standards that we maintain. So we've been complying with BIS anyways, so it's not really a... I mean, as an update, our testing labs are already been approved by the government. They are already in place. We are just waiting for the testing standards to be released by the government. The moment they get released, we believe that we'll be able to turn out BIS-certified footwear in no time. Sure, sir. Thank you. Thank you for answering my question. That's it. Thank you. A reminder to all the participants to limit your question to two per participant. We'll take the next question from the line of Bharat Gianani from Moneyc ontrol. Please go ahead, sir. Yes, sir, thank you for providing the opportunity. Two questions from my side. One is, in the presentation, we have seen that you mentioned that in the trailing twelve-month period, our growth has been, you know, kind of a flat if I see the overall revenue growth. So, what would you attribute this factor to? The overall industry slowdown, or have you seen a market share loss in the trailing twelve months? So that will be my first question. Bharat, we have directionally gained market share. If, I mean, given you, you cover the entire industry, you are very well aware of the fact that the industry last year, all the segments put together, and specifically sports footwear, has only... Other segments have, while de-grown, sports footwear has grown in single digits. While on a trailing twelve-month basis, we have maintained a growth rate of 24%-25%, which is way above the industry standard. So this clearly implies that directionally we have gained market share across new and emerging markets, where we have grown over the last three to five years. And at the same time, we have kind of held the fort, maintained share in territories which have seen some bit of degrowth, over the period in discussion. Clearly, we have gained share, not, not otherwise. Okay. So next question is that, while we have, you know, mentioned a lot about, you know, how the margin trajectory, you know, with over a five-year horizon, you know, kind of will improve by the level to the margins. But I guess the street is more concerned about the growth trajectory. So, you know, in the last trailing twelve months, as we have seen, you know, revenues getting impacted. Obviously, that is to do with the, as you pointed out, that would be due to the market slowdown. But, when do you, you know, feel that the Campus will get back to its, you know, growth trajectory that we have seen, you know, pre-IPO or, or if I put it in the other words, for the next four to five years horizon, what's your, you know, revenue growth rate that you got it? See, when we, when we entered the market with an IPO, our three-year CAGR, five-year CAGR was somewhere in the range of 24%-27%. We believe that, last year also, FY23, if you look at or trailing twelve months, if you are, if you're referring to, we have maintained that kind of growth trajectory. See, there has been, some shift in the, in the margin profile, but at the same time, we, we have maintained this, that in, in a, in, in a slowdown kind of a scenario, if we have to pick between the two, we'll still go after growth, at any cost for, for right now, with a respectable margin profile. Because margins are easy to recoup, in a stable macro, but at the same time, it's our endeavor to gain more and more market share, gain more and more shelf space, because that is something which is sticky in nature. Margins, margins are easy to recover, but growth becomes elusive in competitive markets. So these are some pockets of opportunity. So we believe that slowdown is a blessing in disguise. These are pockets of opportunity wherein you get a short at gaining more market share when others are actually not that much focused on the same activity. Hope that answers your question. See, we will very, very soon we'll get back to our standard margin profile. That's... There's nothing to worry about. Oh, okay, sir. Thanks and all the best. Thank you so much, sir. Thank you, sir. A reminder to all the participants to restrict your question to two. We'll take the next question from the line of Mr. Deepak from IGE India Invest. Please go ahead, sir. Yeah, thanks for the opportunity. We'd like to understand what gives us confidence to gain the market share further in future? What differentiates the things we are doing compared to the other players? And, what's the market outlook here on... Are we behind the low growth situation from now onwards, the consumer demand picking up or like to have your views? Thank you. Yeah. Hi, Deepak. So certainly we've experienced sort of a lull in the market in the last, you know, 12-14 months. This is an overall macro slowdown, which every single footwear manufacturer has experienced. But going forward, you know, we believe due to many reasons, like, you know, it's been a good monsoon this year, the festive season as well, and the elections also coming up very soon. We believe that H2 of this year, should result in definitely better demand along with, you know, margins, complementary margins. And even, you know, going back to the company basics, Campus, the biggest USP, you know, we have four pillars on which we take pride. Really, one is the largest R&D in the country, the most developed, you know, number of designs that we churn out, the latest trends. The second is the largest vertically, you know, integrated ecosystem, manufacturing ecosystem that we have. So nobody is even close to the kind of capacity that we can produce, which is about 35 million pairs of capacity every year. And third is our entire omni-channel platform, where we have the largest integrated sales ecosystem between online and offline. And lastly, being the most innovative brand marketing, you know, techniques that we've used, and the strategies that we followed and which have resulted in, you know, significant appreciation of the brand in the last few years. Given these basic, you know, concepts that the brand sort of hinges on, we have seen very, very, very decent growth over the last 10-15 years, and there is no reason that that should not happen going forward as well. We just need to stick to the basics, and we're keeping it simple. Any new category of product apart from sports shoes, which we are planning to enter like the other competitive player? And A very exciting sneaker range along with our sports shoe ranges, and we'll keep on beefing up. We will keep on beefing up the casual footwear category, because we see a lot of potential in that category, along with the sports shoe category that we currently champion. See, you'll see something really refreshing, really exciting in our current offering in the autumn-winter season. Currently, our trade shows are going on. Signs are very encouraging. You'll see a lot of refreshing ranges, both in the sports shoe category and the sneaker category, coming your way in the next couple of months. Okay. Thank you. Wish you all the best. Thank you so much. Thank you. We'll take the next question from the line of Manish Agarwal from Fluida Capital. Please go ahead. Thank you very much for this opportunity. I'm new to the company, and so I have some basic questions. So, one is that, you know, does the promoter family have any other businesses other than footwear business? ...No, we don't. The promoter family is completely vested into only this business. That's wonderful to hear. That's wonderful to hear. And secondly, has the promoter group, you know, reduced their stake in the recent past? No, we've not. No, they haven't sold even a single share since IPO. No change since the IPO, not even a single share. Okay, wonderful. Wonderful. The last thing is that, see, I've observed that, you know, like the premiumization and everything is like, I think it's very good to hear. But then why is it not reflecting in the ASP? See, ultimately, you know, if I, if I'm selling a premium product, then I'll be able to secure a better price, which will reflect in my ASP. So that actually is not reflecting. So if you could just help me understand that bit. Yeah, so, see, there is the same improvement in our ASP. If you look at our 10-year figure, the ASP has improved by 7%. So what you see at the store is a maximum selling price, maximum retail price, MRP. Company gets only a part of it, the rest of it goes as taxes and channel margins. So if there is, say, 10% increase in our MRP year after year, you'll see only, say, 4%-5% of it reflecting in our ASP, because that's what the ratio of MRP to ex-factory is for a brand like us. So we have to predominantly a distribution-oriented company, wherein our channel margin is close to... So wherein our company margin is close to 50%, roughly 35%-40% goes to channel, and the remaining goes as taxes. So if 10% price increase is there or premiumization is there, half of it will reflect in the ASP, and that's kind of the simple alignment between our numbers and the products that you see out there in the market. Thank you, sir. A reminder to all the participants to limit their question to one per participant, as we have several participants waiting for their turn. We take the next question from the line of Ashish Gupta from Goldfish Capital Advisors. Please go ahead, sir. Hi, just one request from my side. Could the management please include, you know, the subcontracting charges separately in our panel, in our investor deck, so that we get a clearer picture of the gross profit margin per quarter? That will be very helpful to understand. Since it's close to 5%-6% of the remaining, the subcontracting charges, which is in other expenses. I mean, I hear you. I mean, some of these are the company-level IPs, because it will eventually give away the kind of arrangements, exclusive arrangements that we have with our network partners. I hear you, but this is some-- this is one information that we won't be able to- Anyway, so giving a page on our annual report, that's the reason why, and this comes in the annual report, so it will be a problem coming out in your quarterly results as well. It's just a number. We hear you. I'm sure we'll take this into consideration. Thanks for highlighting that, it's anyways part of the annual report. Yes. Bye. Thank you. Ladies and gentlemen, that was the last question for the day. I would now like to hand the conference over to the management for closing comments. Thank you so much, everyone, for reinforcing your faith in Campus. We are extremely delighted to share these set of numbers with you for Q1. Going forward as well, we assure you that, you know, Campus is in the best well-placed position, along with a lot of these external factors that are also giving tailwinds to the brand, like the BIS coming into play and the onset of festive season. So we're looking forward to a decent and a very good second half of the year going forward. Thank you everyone for joining the call. Thank you. On behalf of Campus Activewear Limited, that concludes this conference. Thank you for joining us, and in case of any further queries, please reach out to Campus Activewear's Investor Relations team at ird@campusshoes.com. You may now disconnect your lines. Thank you.