Ladies and gentlemen, good day, welcome to CCL Products (India) Limited Q4 FY 2026 earnings conference call hosted by Ashika Institutional Equities. 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 0 on your touchtone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Dipak Saha from Ashika Institutional Equities. Thank you, over to you, Mr. Saha. Thank you, Michelle. Good morning, everyone. On behalf of Ashika Institutional Equities, it's indeed a great pleasure to host the 4 Q FY 2026 and full year 2026 earnings call of CCL Products Limited. Joining us today to discuss the earnings for the fourth quarter and full year ended 31st March 2026 are Mr. Srishant Challa, Managing Director, Mr. Praveen Jaipuriar, Chief Executive Officer, Mr. B. Mohan Krishna, Executive Director, Mr. Chaithanya Agasthyaraju, Chief Financial Officer, and Ms. Sridevi Dasari, Company Secretary and Compliance Officer. We thank the management for giving us the opportunity to hold this call. I would now like to hand over the call to Praveen sir for his opening remarks, post which we'll open the floor for Q&A. Thank you. Over to you, Praveen sir. Thank you, Dipak, and thank you, Team Ashika Institutional Equities for hosting this call. Good morning, everyone. I welcome you all to the fourth conference call of FY 2025/2026. Now let me give a brief overview of the company's performance for the fourth quarter and the year gone by. The group has achieved a turnover of INR 1,226.39 crores for the fourth quarter and which is as compared to INR 839.65 crores for the corresponding quarter of the previous year, achieving a growth of 46%. The EBITDA stands at INR 193.76 crores as against INR 167.1 crores, which is a growth of 16%, while the profit before tax is INR 123.1 crores, growing at 16%, the net profit stands at INR 114.53 crores with a growth of 12%. As far as the full year is concerned, the group has achieved a turnover of INR 4,465.80 crores as compared to INR 3,114.2 crores for the corresponding previous year, achieving a growth of 43%. The EBITDA stands at INR 741.38 crores as against INR 563.54 crores, which is a growth of 32%, while the profit before tax is INR 460.74 crores, growing at 31%, and the net profit stands at INR 388.11 crores with a growth of 25%. The domestic business has achieved a gross turnover of INR 650 crores approximately, out of which the brand sales were around abouts of INR 440 crores. Now Continental as a brand is well-established as the number three player in the country. In some regions and platforms, we are also the number two player, and we will look to further strengthen this position in the coming months and years. As far as green coffee prices are concerned, they remain to be stable as of now, which is a good sign. The Brazilian crop is around the corner, and with the positive news of good supplies, we have a belief that the prices will further soften in the coming months. The Middle East crisis does pose a challenge with a bit of supply disruptions and energy price increase, but we have managed the situation well and do not see much of disruption going forward. I will just ask Chaithanya, our CFO, to give a little bit of a color on the balance sheet performance, post which we will open the floor for questions. Thank you. Good morning, everyone. Adding to what is highlighted by CEO, we are closing the financial year on a very strong note with revenue and profit both growing for the growing significantly for the quarter and for the full financial year. A key area of focus for us this year has been strengthening of the balance sheet. We've always been delivering very good operational results with a CAGR of close to 20%. What we have done this year is to ensure that the operational results get translated into a real balance sheet strength. The balance sheet right now is much leaner, cleaner, and a lot healthier, with healthy cash flows and debt coming down significantly. The net debt as of 31st March is around INR 1,073 crores, a reduction of more than INR 750 crores from last year. Debt to equity is at 0.5 compared to 0.92 a year ago. Our net debt to EBITDA is at 1.45x right now compared to 3.1x a year ago. With that, I hand over to Dipak for questions. Thank you very much, sir. Ladies and gentlemen, we will now begin with the question and answer session. Anyone who wishes to ask questions may please press star one on their touchtone phone. If you wish to withdraw yourself from the question queue, you may press star two. Participants are requested to use only handset 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 Abhishek Mathur from Systematix. Please go ahead. Yes, hi, sir. Thank you for the opportunity. Just wanted to check what would be our volume growth for the quarter. Also, has the EBITDA per kilogram, which is a key metric we track, has it come down to a level of about INR 130 crore, which is a bit down sequentially from maybe the INR 140 crore that we saw in the previous quarter? What is driving the strong realizations on the top line for us to have clocked this kind of a growth? Thanks. Yeah. Hi, Abhishek. Just to clarify. Sorry, the first thing that you asked was on this thing. On volume growth, sir. On the volume growth, for the quarter. Yeah. Yeah. Our volume growth, you know, has been, and I'm speaking on a little larger four-quarter perspective, has been in the range of 18%-20% this year. The quarter was also very similar. Volume growth stands at that level. You know, EBITDA per kilo, again, probably this quarter was a little bit of a down considering the, you know, the proportion of coffee that you sell, because if you, if you would have seen last quarter were much higher high margin coffees were sold. On an annual basis, in fact, the EBITDA per kilos has improved from previous year. That's an improvement. You know, as we have been guiding most of the time, some of these key metrics on a quarter level may not give the right picture. While one sees a sequential drop a bit, but I don't think so that's there's much to read into that. On an annual basis, in fact, the per kilo EBITDA has improved. Oh, great, sir. Just a follow-up second question, sir? We have earlier given the guidance for 10%-20% volume growth and maybe a 15%-20% EBITDA growth. Anything changing for FY 2027? How is our guidance looking now? The guidance is very similar. Probably we are giving a guidance of both, volume at around 15% and even EBITDA at around 15%. That's, that will be the thing. While things have stabilized, quite a few things have stabilized, since the last year. You know, keeping the other volatility in mind, we are sticking to the volume growth guidance of 15%, and the resultant EBITDA growth will also be in the same region. Great, sir. Finally, the guidance on the India business and also any CapEx thoughts that we have, capacity expansion thoughts that you have right now. That's it from me. While there have been discussions, we are looking at things related to capacity. As far as next two years are concerned, we are generally, you know, good for our growth aspirations. Our capacities are good. There could be certain areas where we would like to kind of see if the growths are more. For example, we have seen better utilization for freeze-dried. If that is happening at a much faster rate, the utilization, we could look at, you know, not necessarily a capacity expansion, but maybe a strategic tie-up or things like that. These are things we will be able to comment on when we come closer to a decision on it. Obviously, there are discussions that keep happening on a regular basis. On a largely, on a, you know, on a long-term basis for the next two years, we are good as far as capacity is concerned. As far as domestic business is concerned, as I told in the narrative that, out of the INR 650 crores that we did in the India business, INR 440 crores or odd were, you know, the retail business, the branded business. We'll continue to drive, you know, similar growths in the coming years also. We are seeing very good traction in a lot of areas, and it is important at this stage that we keep driving those growth traction. That will automatically, you know, come through. We will keep up the momentum on the branded business as well. Great, sir. Thanks. All the best. Thank you. The next question is from the line of Abhay from Carnelian Capital. Please go ahead. Hello. Can you hear me? Yeah, we can hear you. Hi. I just wanted your outlook on the D2C business segment, firstly. Secondly, is the margin contraction, can that entirely be attributed to the coffee prices? In general also, what's your outlook on coffee prices in the coming quarters? I'll answer your second question first and then come to the first one. The second question, there actually is no margin contraction. You know, the margin contraction that you see is basically because we are seeing EBITDA as a percentage to top line, and therefore it is only optical in nature. As we have always maintained that our business works on, you know, per kilo EBITDA, where there is no contraction. Because the prices, coffee prices increase and we who are modeling as a cost-plus model, therefore, what it seems that the top line kind of, you know, in times of rising coffee prices, looks, the growth looks more inflated. Let's say if we take the 46% growth top line, it is a combination of 18%- 20% volume growth and another 20%- 25% of coffee prices increases that gets built into the top line. Therefore, EBITDA as a percentage top line looks, you know, contracted, but it is not. What will happen, the opposite will happen, you know, probably going forward, when in the base you have higher green coffee prices, and going forward the green coffee prices could soften. Therefore, you may see instead, in spite of 15% volume growth, you may see lower value growth. What we always say that how the basic metrics is to be looked upon is the volume growth, the EBITDA growth, and are they growing in line with each other or not. That's the guidance also we are giving for the future, that in line with the volume growth of 15%, round about that number, we also look to drive EBITDA also in the same region. That's, that's the answer to your second question. Therefore, what it means is that the volatility in coffee prices does not affect our margins. The moment we do contract, we, you know, do back-to-back buying of green coffee, which means that we are guarded against any fluctuations, if at all it happens in the coffee prices. That's the answer to the second question. The first question, as far as D2C is concerned, we are doing extremely well on D2C. In most of the platforms we are very strong, with double-digit market share. In a few of the platforms we are also the number two player in the category. We are doing extremely good. Approximately, you know, 25%, 20%-25% of our sales come from the online channel, which is a very good, very good marker for the business that we are doing. Got it, sir. Another question was just the CapEx fund, but I think that's been answered already. Thank you. Yeah. Thank you. Thank you. The next question is from the line of Raj from Pheten AMC. Please go ahead. Hi. Thank you for the opportunity. A couple of questions. Firstly, on inventory days. Now I was just looking, I mean, because of the softening of coffee prices, the inventory days are almost for us are at historical lows. Do you see any further improvement in inventory days over the next two years, assuming that the coffee prices stay at these levels or even move down further from here? Secondly, I think, because we don't have any major CapEx for the next two years, our operating cash flow is actually going to be very strong. What is the management thinking about maybe going forward for utilizing these funds, whether it will be increasing dividend payouts or any acquisitions or any other thing? Okay. Two things. First was about the inventory cycle. Of course, yes, you are right. Lowering of coffee prices and better visibility has helped us tighten the inventory cycles. It's just not the inventory cycles. There are hosts of other efficiencies that we have been able to bring in most of our operations. That's an ongoing process. Do we think that as a guidance we would like to lower it from the place that it is? I don't think so we're giving any guidance to of lowering of inventory cycles from here on. We would love to kind of maintain it, better it, of course, we'll try do our best. As a guidance, I would not like to kind of give a guidance of lowering it further from here, because we'll take it as things come along. That's on this thing. Of course, yes, you have pointed it right. We will have, you know, cash flows coming in. Now as far as how do we utilize it, there is no commitment as of now. The things that you spoke about, most of the things we are thinking about and we are thinking, yes, if there's an opportunity in the areas of any good acquisition that comes our way, we'll definitely love to evaluate those. We'll make sure that we are using these, you know, flows to maximize the returns for the stakeholders in whatever way we can. Understood. I mean, just, whether it will also be used for reduction in debt from here on, I mean? It is yes. Of course, [audio distortion] you know it won't come to zero, but definitely, there is a certain reduction that has already happened, and a significant reduction. In fact, we were not, if last year if you would have heard us, our guidance was at around INR 1,400 crores- INR 1,500 crores. We have reduced it to INR 1,080 crore, I think, possibly, around about that number. Maybe there could be a certain more reduction. Again, all will depend on because even our growth numbers are there. We are at 15% volume growth is what we are thinking. Which means that you require 15% more working capital to fund this growth. You know how much of this gets offsetted by lower coffee prices and all that. We will take things as it comes along. Definitely the idea would be to you know the long-term debts will anyways get paid, so there will be reduction in the long-term debt. Working capital, we'll take it up as things come along. Definitely all the efficiency measures are being put in place to improve the ratios and the parameters as much as possible. And so- Maybe, yeah, the CFO is saying that probably with a 15% growth, probably INR 1,100 crore- INR 1,200 crore is the level that we probably could be seeing in the next year. Understood. Thank you. Just lastly on, just, on CapEx again. I mean, currently, what is our capacity utilization on a consolidated basis globally? Yeah. I mean, you said that we'll be good for next two years, but, for a new plant, would it be greenfield or brownfield? I mean, what time will it take for a new CapEx to come on board once we start executing it? First and foremost, our annual utilization would be around 65% or so, 2 percentage here or there. Last quarter was a little better at maybe 70%. That's why I said we are good for another two years. It does take, you know, 1.5- 2 years to materialize the CapEx. You know, the thing is that, whether it will be greenfield, brownfield, we go into a strategic tie-up, it will all depend on how things shape up. There could be a scenario that we don't put our own CapEx, but we end up doing some sort of a, you know, capacity strategic tie-up, or we end up buying capacity, underwriting capacity of somebody else. We may ourselves think that we want to put a brownfield. That also is on the cards. All of this, it is a little too premature to talk to. We'll definitely keep you posted if there is any development on this front because a lot could change as we go along. Depends on, you know, what kind of product the utilization is better. At an aggregate level, we are good for two years. It could happen that maybe on an atypical type of product, we could be seeing, you know, better utilization than two years. It'll all depend how things go from here. On a broad basis, yes, we are good for two years. What do we put next? We are all evaluating and watching the situation very closely, how growths are panning on which areas, which geographies, and accordingly we'll take a decision going forward. Understood. Understood. I was, I mean, only asking from that point of view because we are hearing that Indian players are, I mean, gaining significant market share globally, plus our peers are also talking about strong volume growth. I was, you know, just trying to understand that way. Absolutely. Whether as for volume growth, what we're guiding, if we achieve materially higher than that, we should not be caught in the wrong foot in terms of. Absolutely. Absolutely. Not having enough capacity there. Yeah. That is an assurance we are giving that we will not let capacity come in way of growth. We will make sure that we do kind of, you know, get the capacity required to fulfill our ambitions. Understood. Thank you so much. Thank you. We'll take the next question from the line of Kashyap Javeri from Emkay Investment Managers. Please go ahead. Thank you so much, and congratulations, team, for great numbers. Just one question. I missed out on the number of CapEx for FY 2027, if that was discussed. If you can repeat that number. Kashyap, there's no CapEx for 2027. We didn't say there would be any CapEx. As we have been maintaining next two years there'll be some maintenance CapEx of maybe INR 25 crores-INR 30 crores, INR 35 crores, but these are very small CapEx. There's no planned big CapEx planned as of now for the next two years. Yeah. Just trying to reconcile, you know, sort of reconcile this number. I think what Chaithanya mentioned was that our debt next year closing could be roughly about INR 1,100 crores. If let's say our sales grow by about 15%, that's about INR 700 crores of sales. At about 120 days, that would need just about INR 200 crores worth of cash. You add about INR 20 crore, which will come from the maintenance CapEx. That should still leave a significant number, in terms of, you know, free cash, to repay the debt. Does that mean that we would retain cash on the book? Is that assumption correct? Not really. You know, Chaithanya is a little bit conservative considering the volatility that has been there in the market. You know, we would like to kind of err on the right side than on the wrong side. Definitely, as per your calculation, there will be cash in the books. As I said- Okay. You know, there are multiple ways to figure out things. Right now, while we are doing a lot of, you know, evaluation, not wanting to commit on any one aspect or the other. Right. Given a chance, obviously we would like to retire debt rather than keep it on the, on the books for long periods of time. That goes without saying. Yeah. Understood. But, we don't know. Yeah. Understood. If coffee prices remain where they are, this ceteris paribus, the calculation is in the right direction. In the right direction, absolutely. Like you said, you know, there could be, you know, if there is any plus/minus in either of these assumptions, then obviously what- There could be. Yes. Chaithanya is saying could be. Yes. Yes. Yes. Yes. Yes. Understood. Thank you so much. Yes. Congratulations again for a great set of numbers. Yes. Thank you. Thank you, Kashyap. Yes. Thank you. The next question is from the line of Prithish Garg from Nuvama Wealth. Please go ahead. Hi. I would like to bring attention to you a little bit about the business side of things. As we have seen the coffee market in India shift from spray-dried coffee to freeze-dried coffee and even to roasted blends. What do you believe would be your plan to shift that demand in the company as well? Since we're also talking about DTC demand that has grown to 20% this year. What is your plan on brand visibility as we again mention that freeze-dried coffee and roasted blends are usually focused, the buying is focused on brand visibility, like Blue Tok ai and everything. Does Brand House usually acquire that share by creating the taste of coffee and focus towards premiumization? Yeah. Okay. There was a little bit of a disturbance in your voice, what I heard you, I'll try and answer that. Probably a couple of answers lie in your question as well. The first thing. I'm sorry. Is there a shift? Sorry, there's a lot of- Mr. Garg, please mute your line, sir. Yeah. Mr. Garg. Please mute your line. Sir, you may proceed. Yeah. What I was telling you that, you know, it happens in any category that there will be premiumization. There is not a shift from a spray-dried to freeze-dried. There is a large chunk of consumers who are still drinking a spray-dried and will continue to drink spray-dried. Yes, as it happens in any category, there is always a premiumization that happens. People are always, you know, upgrading to better coffee, and that leads to some of these shifts that where consumers are adopting freeze-dried coffee. That's the reason we are pretty well equipped to cater to that demand, and that's the reason. This, in fact, we had predicted a couple of years ago, and that's how we, you know, initiated capacity enhancement in freeze-dried as well. That is, that is always there. As far as, you know, the shift towards beans is concerned, if you see largely the consumption of beans is for out-of-home consumption. In growing market the out-of-home consumption is growing, therefore, you know, the usage of beans is growing at a much faster pace. We largely are not into, you know, beans because that is something that we're very localized. There is not much of value addition. We don't see that market as a very big market for us. Yes, in the Indian context, we do supply to a lot of cafes and a lot of cafe chains, the beans, the roasted beans as well. That is also something that we are seeing as growth drivers, at least in the local Indian market. As far as concerns your brand building activities, question is concerned, yes, we are building the brand. We have developed certain strengths in certain categories and in some areas, we are taking things forward. It's not necessary that all the categories we will be driving the growth. What we think that will give us the maximum impact are the categories that we are building. Like we started in South of India, we are strengthening our brand presence a lot there. Now we have started building traction in rest of South also, so we're getting good you know, returns from markets like North and West, where our next growth momentum will come from. All of that is part of our, you know, strategic initiatives going forward. Yeah, there will be certain categories where we will not, you know, knowingly participate because we want to deploy the resources at the places where we think we'll get the maximum impact. I don't know whether I have answered all your questions because there was some disturbance from your side, but, this is our thought process. Thank you, sir, for answering those questions. Sir, the participant has left the queue. We will move on to the next question. Sure. From the line of Vivek Ganguly from TCG AMC. Please go ahead. Thank you, sir. I had one quick question. Your debt in the balance sheet has come off very significantly by out of INR 700 odd crores. We do not see a corresponding reduction in the finance cost. Can you shed some light on that? Sure. Vivek, last year we had a lot of interest capitalized because our Vietnam facility was not yet running last year, right? The interest was getting capitalized. If you take that interest, there is a significant reduction in the interest as well. Okay. What would that number have been? Secondly, what was your cost of borrowing as we speak today? I may not be in a position to give you exact number that has got capitalized. That should be somewhere around INR 25 crores-INR 30 crores could be probably last year what got capitalized. The cost of borrowing right now hovers between 7.2%-7.5%, depending on where the borrowing happens. Okay. Got it. Great. That's all from my side. Thank you. Thank you. Thank you. The next question is from the line of Bhavya Sonawala from Samaasa Capital. Please go ahead. Yeah, thank you for the opportunity. Am I audible? Yeah, yeah, Bhavya, you are audible. Yeah, yeah. First of all, congratulations on a good set of numbers. I think last few years have been very good. Just a couple of questions. First question is, I think you guided 15% EBITDA growth and volume growth for the next two years. Is this with respect to contracts still being short-term or because it's such a special item, are the customer giving you long-term guidance? Can you throw some light on that? Yeah. You know, a lot is changing now. Sorry, there's some noise that I can hear. I don't know where it's coming from. Yeah. Things are changing. As the coffee prices are stable, we are seeing a lot of long-term contracts. In fact, some of our freeze-dried capacity is quite long-term now. That has given a very long-term picture. There is a movement towards long-term contract, and therefore we can be fairly assured of the guidance that we are giving. Okay. Understood. Just with respect to the guidance, again, I think this year, we ended up at 30% growth in EBITDA, and the next year we are guiding 16%. Is that considering some conservatism and, you know, keeping in mind coffee prices and other, probably issues that might happen? Or anyway, is there some change because, you know, we were guiding 20% and then we obviously revised it upwards to 25% in this year. Right. Right. Just wanna understand. There are, you know, a couple of things that, you know, went our way this year and probably, you know, once it gets into their base, there may not be further improvement there. For example, you know, this year our proportion of freeze-dried was much higher, right. That proportion may not get even higher next year. Therefore, that benefit we may not get. There are certain efficiencies that we had spoken about that may get built over a period of time. Some of them, you know, got preponed a little bit because we were able to fasten some of these efficiencies. That got built into the base as well. Some of the small packs where we were able to, you know, fasten the proportions there. You know, some of these things are already there in the base and therefore may not come as an additional thing going forward. Therefore, we have always guided that our EBITDA growth will be in line of volume growth. Since we have guided a volume growth of 15%, and we already have built the efficiencies into the bases and proportions into the bases, I don't see this, you know, adding onto anything that we have already built. Therefore, we are giving a guidance that EBITDA also will grow in line with the volume growth, which is around sort of 15%. Okay. Got it, sir. Just a last question, if I may, Praveen. On the branded business, what kind of growth do you think we'll be able to garner in the next two years or at least the next year? You know, again, branded business also this year we got very, very handsome growth, which was on the back of volume as well as value. Volume was around 25%-30%, and then we added another 15%-20% of value growth. This year, probably because, you know, post GST and post coffee prices softening, I don't see that advantage of value coming in. We are still committed to driving 25%, you know, kind of a volume growth, which means that the value growth also will be in the same lines. We are looking to drive that sort of a growth going forward as well. Okay, got it, sir. Thank you so much, Mr. Daphne. Thank you. Thank you. The next question is from the line of Richa from Equitymaster. Please go ahead. Sir, thank you for the opportunity. My question is related to utilization at FDC capacity at Vietnam and, you know, the capacity enhancement that you had done at India. What is the annual utilization? What is the run rate currently? I'll give you a broad picture. You know, we don't kind of get into too much of details on capacity utilizations. It works against us sometimes. You know, at a broad level annually, we have, you know, with everything put together, new, old, everything put together, we are at approximately 65% capacity utilization. You know, I cannot kind of, you know, go into details of Vietnam, India, but freeze-dried was a little higher utilization. As I told earlier also, the proportion of freeze-dried was better. Freeze-dried was higher than the average utilization, but average utilization remained at 65%. Last quarter was a little better at around 70%, so that's where it is. Okay. Sir, this year, you know, normally you guide for that our volumes and EBITDA grow in tandem, but this year our EBITDA growth absolute was more than well above 30%, while volume growth was- Right. ... what it was, 18%-20%. Right. I mean, I understand that there is a mix of FDC and small packs, coming in here. Right. Going forward, is there also a possibility that our EBITDA per kilogram could moderate given the product mix and the fact that when coffee prices soften, a lot of, you know, non-premium customers or traders also come in to get that volume? So I- So would that be a fair assumption? I think you've asked a very precise question. Yes, there could be a possibility where it could soften. As I have always maintained, last time also we were saying that we will try and, you know, kind of, negate the pluses and minuses and keep it at the levels that they are in, right? Yes. Although technically you're bang on when you say that there could be, you know, a situation where my proportion of FDC could increase, and as you rightly said, if the coffee prices are down, a lot of low-margin customers also come into the picture. That could lead. As I have told that we are continuously trying to build efficiencies, small packs, you know, trying to go to end customers. All that will also help us, and we are very confident that we'll be able to, if at all there is any negative impact, negate through some of these actions. Hopefully we will try and maintain the EBITDA per kilo going forward. Okay. Okay, sure. Sir, also, you know, from a 2-3-year perspective, what kind of guidance would you give for your, you know, domestic sales and branded business especially? Where could it be as a proportion of the total business? Will that end up becoming a better growth driver, let's say 3-5 years from now as well? You know, again, there are two aspects to it. One is that, yes, we are growing the business aggressively. What percentage to the total business will it become? I think that's not the right way to look at it because the other part of the business also we are growing it aggressively. That matrix becomes, you know, irrelevant. What is relevant that, are we growing the B2C business much faster than the category? Are we gaining shares from our lead competitors or not? Are we making this business sizable enough for it to kind of, you know, give it back to the business? We are well online to this, and not only in India, we are now looking to expand our B2C business in some of the other geographies as well. Hopefully we will keep building on this vertical as fast as possible. Going forward, let's say the India business has become quite sizable, you know, at INR 400 odd crore. It is no longer a very small business. It is quite sizable. When you look at from a very absolute, on an absolute term basis. We are looking to kind of, you know, every three years, we would love to kind of double this and say that, okay, how, where do we go from there? You know, in the previous calls, we were also saying that we are also trying to see if there are some other categories we can kind of grow our business into. A lot of our growth momentum will be dependent on how some of these things shape up. Yeah, that's the intent that I would like to tell you that we are driving things very aggressively, not only in India, but trying to see if we can scale up outside India as well. In India, can we get into some other categories as well? All of them is being worked upon, and yes, as a proportion, we'll try and keep increasing the proportion as much as possible. Yeah. Also we keep investing back in the business, you know, as we grow at least for the next 3-4 years, right? Absolutely. Uh- Our intent is that, you know, we don't want to milk this business as of now. We'll keep investing back into the business going forward. Okay. Okay. Sir, my last question is if you could just guide us on the tax rate- Ma'am. -for next year. Sorry to interrupt you, ma'am. Okay, fine. Sorry. I would request you to reach out. Sure. Thank you so much. We'll take the next question from Naeem Patel from Bastion Research. Please go ahead. Hi. Thank you for this opportunity, and congratulations on good set of numbers. I would just like to follow up on the last questioner's question that what the tax rate, what are we looking forward for that in next 2-3 years, considering we have capacity set up in Vietnam? That's my first question. Secondly, on the B2C side, you know, we have international brands as well. What sort of initiatives are we taking in on that account as well? Those are the two questions from my side. Regarding the first question, the average tax rate at a consolidated level is a combination of different, multiple things in the sense that we have entities which are at full tax, then we have a resident which operates at 15% tax, then we have a 115BAA entity, then again we have an entity which is completely not taxable. When we take an average tax rate at a consolidated level, you may have a bit of deviation year on year. Having said that, the average tax rate should be somewhere closer to 17%. Okay. The international, you know, you were talking about the international brand. Yes, you know, Percol now this year in U.K. alone is approximately anything between INR 25 crores-INR 30 crores and there is a bit of India business as well. We are looking to expand, not penetrate not only in the U.K. market with Percol, but we are now actively looking to take this brand in some of the other geographies as well. We're talking to a lot of, you know, our partners across countries that how could we take this brand in some of the other countries now seeing this getting established in the U.K. market. Understood. Just one last question on the cost of goods sold side. This quarter was on this spike in this quarter on year-on-year, this was largely due to the cost-plus model nature of the business and there is no inventory loss or anything. Is that correct way to look at it? Yeah, yeah. Actually it's not really about anything else because we work on cost-plus. The cost of goods sold higher could be dependent on the type of contract one is doing. This quarter the proportion of lower margin contracts were higher. The cost of goods proportion is a little higher this quarter. Understood. Understood. That's all from my side. Congratulations again for the numbers and best of luck. Thank you. Thank you. Thank you. Thank you. We'll take the next question from Dipak Saha from Ashika Institutional Equities. Please go ahead. Hi. First of all, congratulations on great set of numbers. My question is on the B2C side. It's very heartening to know that on the quick commerce side, say we are doing INR 100 crore kind of a number for full year. What I wanted to understand, since there will be many markets where we'll be, you know, mature in terms of, compared to other micro markets that we have gone, what broad understanding currently we have that say we are giving 30%-35% discount, and after considering commissions and all, at MRP. Now, are there levers to grow that particular number or improve our take rate on some of the mature markets and which can eventually, you know, impact our overall revenue and profitability? Yeah, yeah, definitely. You know, Dipak, it's actually directly linked to the equity that we are building. Brands with higher equity will command better pricing, lesser discounts, right? Also discount is this thing of how the competition is this thing. What has happened is that because of the aggressive growth that we have been seeing, there is also a very heightened, you know, level of competitive activity. We have to keep maintaining, you know, pace so that we don't lose grounds that we have gained till now. Having said so, on a, you know, thumb rule basis, as the markets mature, as the brands get, you know, stronger in terms of its equity, your margin profiles keep improving because then you are able to command a better pricing, right? Your discounts could be lesser and things like that. That pattern will continue and more and more strength with that we get, the more and more, you know, pricing power also we will get. Got it, sir. What's the feedback on the Malgudi brand that we launched for snacks, in our, you know, vision to create multiple pillars in the- Yes. ... consumer business, what's the response there? Absolutely. The response is quite good there. We have done, as I told you, very small, you know, 100 store, 150 stores kind of a pilot. There is a lot of response on various aspects. People have liked the product. There are certain variants where, you know, we are doing some product tweaking as well because there was certain feedback. Hopefully in a month's or couple of months' time, you should be seeing a more, you know, broader launch at least with some of the product categories. Yes, we are going to scale that up pretty soon. Got it, sir. Sir, last two questions very quickly. We have 60%-65% capacity utilization, say, and probably we are at the 50,000 kind of a number. I know you guided for 15% kind of a volume growth, but let's assume if at all we get an opportunity 20% then, and next year, next two years, 20% kind of an opportunity, that would be still under 72,000 ton, you know, kind of a volume at aggregate. Overall level, even if this kind of opportunity arises, that would not be constrained to our capacity utilization, right? We'll be able to deliver that kind of a growth. Absolutely. Absolutely, Dipak. We'll be able to deliver that kind of growth. We have that capacity. As I have told earlier also, we are always on our tours. We are making sure that any growth opportunity is not lost because of any capacity, even if it means that we have to do some strategic tie-ups, buy capacity from outside. You have seen 4-5 years, four years ago, when we were, you know, we were at a 100% utilization, we did take that step to buy capacity from outside and not let the growth rates come down. That goes without saying we'll not let the growth momentum suffer at all. Got it. Last question, sir. On the interest cost side to CFO, sir, we have seen INR 130 crore interest against, you know, FY 2026. Given our debt is gross level INR 1,280 crore-INR 1,290 crore, right? At least on interest cost side against INR 130 crore, probably INR 110 crore, hundred and, you know, around that number would be easily we can pull up and we can save INR 18 crore-INR 20 crore around for the year. We have a growth rate of probably around INR 1,000 crore-INR 1,200 crore levels next year as well, as indicated by CEO in one of the questions. If you take INR 1,200 crore at an average rate of 7.5%, it translates to close to INR 90 crores-INR 95 crores. Somewhere around INR 100 crores would be an appropriate number is what I feel. Got it. Very heartening to know. Thank you, sir. All the best for FY 2027. Thank you. Thank you. The next question is from the line of Sanjaya Satapathy from Ampersand Capital. Please go ahead. Yeah. Sir, congratulations on executing so well. My question is that there is a huge difference and volatility in your subsidiary performance that you report. This quarter, for instance, the subsidiaries made hardly any profit, which is why the consolidated and standalone there is not much of a difference in profit. This keeps fluctuating a lot. Can you explain that? That is one. The second thing is that it looks like there was a decisive shift in your revenue mix towards freeze-dried coffee. That also you said that has a lower margin contract. Was it some kind of a entry strategy, which is why it is normally better profit should be expected out of this frozen freeze-dried, but it didn't materialize and it will reverse going forward? You know, first and foremost, I think looking at subsidiaries and trying to add up at the consolidated level is not the right way. You know, the business is sort of centralized wherein, you know, the production planning will have this thing to say that where the, what gets produced, which customer gets serviced from which this thing. The business development teams at subsidiary levels could be, you know, doing a higher margin business in some quarter, lower margin business in some other quarter. All of these play a role and therefore, you know, the consolidated level is a better picture to see. I won't read much into, you know, subsidiary performance and therefore you see sometimes the volatility in subsidiary performance. The second part is the freeze-dried thing that you have asked. Yes, there was a higher proportion of freeze-dried. This also depends on how the markets are shaping up. You know, there are times when the demand for freeze-dried goes up. You know, I actually 2- 3 years ago, if you look at long-term patterns, when the coffee prices are high, you will see that there is a little bit of a downtrading. When the coffee prices starts to soften, the up trading happens. All these factors play a role in deciding what would be the proportion. We keep tracking some of these trends that are evolving, and accordingly, not only do our business but also build our capacities, you know. That's how we kind of play on this. A lot of this is not driven by us, but it is dependent on the market forces. Understood. And, but typically is it right to assume that the profit of freeze-dried is generally going to be higher? Yeah, yeah. Profit of freeze-dried is always higher than spray-dried. Okay. Okay. It's a more premium product. Yeah. There was some contract issue in this particular quarter. Not contract issue. It's more of a, you know, phasing issue. There are quarters when you will do, you know, because it is all dependent on when which customer at what point of time wants their goods and all that. Quarterly there could be variations in these proportions. Some quarters you will see higher proportions of spray-dried, some quarters lower proportion. Yeah, quarter-wise these variations come and, therefore we always maintain that it is best to see us on a slightly long-term perspective because quarters could give you a little, you know, varied picture. Last question. Mr. Satapathy, I'm sorry to interrupt you, sir. I would request you to kindly rejoin the queue for follow-ups, please. There are others who are waiting. Thank you. We'll take the next question from [Deepak] from Sundaram Mutual Fund. Please go ahead. Yeah. Thank you for the opportunity. Am I audible? Yeah, yeah. Yes. Yeah. Hi, sir. Sir, my first question is, with respect to our exports. Could you please highlight, like, out of our total exports, how much would be FOB based? Most of it. Almost if I take exports, 70% of our sales would be FOB based, right? Okay. In the CIF based contracts, are we facing any backlash from our customer to pass on the increased, let's say, insurance or freight costs since since this Middle East crisis has started, and we do export to U.S. and Europe as well? Any contract negotiation in terms of rate or are we able to fully pass on the logistics cost increase to them? No. You know, if you have done the contract earlier on earlier terms and conditions, you will have to take on that, right? Any increase or any this thing in cost in CIF contracts is not a backlash, it is actually a stress on us. In fact, we go back to them asking for increases. It may not happen all the time, so not all the costs can get passed through, especially in CIF contracts. Yeah. Okay. Sir, any disruption are we seeing, let's say, either in terms of any fuel availability or let's say shipping routes towards this western exports, or how are we managing it? Is it like as of now, there is no such disruption that we have observed? A little bit of a supply disruptions to the client that we were servicing in the Middle East for some time, we haven't seen any route disruption because it was only the Strait of Hormuz which was closed, which is only for mostly for oil, not for goods and all. Yes, there has been certain increases in the logistics cost. There has been certain increases in the energy cost. That is there. Availability-wise, we haven't seen any challenge, but there are challenges in terms of cost pressures on certain accounts. Okay. Helpful, sir. All the best. Thank you. The next question is from the line of Samay Sabnis from Helios Capital. Please go ahead. Yeah. Yeah, hi. Thanks for the opportunity. When you're guiding for the volume growth of 15% next year, what is the blended utilization level that we target to achieve in FY 2027? When you're saying blended, are you saying utilization of the capacity? Yes. You know, we probably from here, 15% on the basis that, you can do a back calculation. We are looking at, 7,000-10,000 additional tons of, you know, sales that could happen. like, you said it's 65%, right, for FY 2026. Yeah. 65% will go to around 72%, 73%. If I were to be very specific. Okay. That becomes to what level in FY 2028, which is when you look for a capacity- Yeah, another 7%- 8%, that will become to around 80%, 82%, 85% maybe. Oh, okay. Understood. Yeah, thank you. That was my one question. Thank you. Thank you. The next question is from the line of Yogansh from Mittal Analytics. Please go ahead. Hi. Thanks for the opportunity, congratulations on a good set of numbers. Most of the questions have been answered. Just one follow-up on your branded D2C business. Like, it has been scaling really well. Last quarter you mentioned about an EBITDA positive, it has turned. Going forward, what is your expectation? Can we expect the EBITDA to increase, or would you like to still maintain it and, you know, pull back the money to grow the business further? Yeah. We'll keep maintaining the same percentage levels, which means that a large portion of it will be pulled back. As I was mentioning that we are looking at new regions, new categories. We'll try to kind of develop that also. It will be in an investment mode in the next 3-4 years. Got it. Sir, broadly, can you also quantify what was the proportion of small packs in our overall business? Largely it is around, you know, 20% or so it used to be. I'm talking about broad, this thing because on a very small quarterly basis it becomes difficult to assess. Largely it is in that zone. If you remember, 2- 3 quarters or let's say last year we were talking about a number around 15% or so. It has increased, and that has also helped us improve our profitability. We have last time spoken that we are trying to see if we could, you know, go up the value chain as much as possible for a lot of more of our clients. That endeavor will continue, and we'll try and see if we can improve upon this going forward. Fair enough, sir. Just last one, if I can squeeze in. The new markets that you want to enter for your branded business, by when can we expect that, and what kind of scale should we, you know, think about those businesses? This one is a little tough to answer, but, you know, just to give you a little color that where what are we trying. Of course, there is one market, which is the U.S. market, which we are actively evaluating that, what are the ways and means to enter that market. Vietnam is one more market which we are evaluating that because we have our setup there, so it makes a lot of sense to see if we can build something there. Now, what is the scale that we want to build? That's a little tough to answer. You know, if I were to say U.K. Percol, let's say if it's already an INR 30 crore or INR 25 crore-INR 30 crore kind of revenue, we probably are looking to kind of get to an INR 100 crore within maybe two years or three years or so. That's the kind of scaling up we will try and do there. As far as the other markets like U.S. and Vietnam, it's a little premature to comment on the kind of scaling because let us see them first and see how what is the kind of traction we are getting. I'm sure there are certain markets where we'll go wrong as well, so it's not that everywhere or everything that we do will be bang on. A lot will evolve and closer to our evolution and our understanding that what is going right, what is not going right, we probably will be able to give you a sense of scale. Whatever I can, I've given you a scale that how we are looking to build up some of these markets. Fair enough, sir. That's really helpful. Thank you and all the very best to you and your team, sir. Thank you. Thank you. We'll take the next question from the line of Kenneth Mendonca from TCG AMC. Please go ahead. Hi, sir. I just wanted some color about for our B2C business, about how the non-South growth has been. Secondly, while you have mentioned briefly about reinvesting profits, generally, what is the medium-term profitability trend for the business? For the B2C business? Yes. Okay. Yeah. Of course, the non-South business is growing at a faster pace now. Yes, the bases are still very, very small. But, we are, you know, putting a lot more effort into these markets to make sure that we build a sizable base here as well. As we speak, our market shares have also seen positive movements in some of the key cities like Delhi, Bombay. Probably our efforts are also bearing fruits in these markets. We are actively, you know, seeking to grow at a much higher clip in these markets than the South markets. That is there. As far as the profitability, I had already mentioned that we probably are at around 4%-5% EBITDA levels. We'll keep the EBITDA levels there so that all the additional profits are plowed back into, you know, building the brand and growing the business. That will be my, our model. Next 2-3 years, I don't think so, we will look to milk it. We'll keep the EBITDA levels at the same percentage levels. Sure, sir. Thank you. My last question is just given that you mentioned that we are seeing heightened costs due to freight, insurance, and given that largely we are an export business, do we expect any sort of impact on margins despite the guidance you've given? Of course, last quarter there was a bit of an impact, a little impact that we saw. What I see as we speak, I'm seeing much more stability, and hopefully we'll keep our fingers crossed that things only improve from here. We don't see much of because, you know, since a 100% of our business is on cost-plus and 70% is on FOB, a lot of our, you know, these kind of fluctuations are, we are insulated against. Therefore, there won't be much of an impact, but I'm hoping, and we all are, that the situation improves from here. We don't see much of an impact on the guidance that we have given. Thank you, sir. Ladies and gentlemen, we'll take that as the last question for today. I would now like to hand the conference over to Mr. Praveen Jaipuriar for closing comments. Thank you, and over to you, sir. Thank you everyone for joining the call. I appreciate Ashika Institutional Equities for holding this call, and we'll all meet in the next quarter. Thank you, everyone. Thank you, members of the management. On behalf of Ashika Institutional Equities, that concludes this conference. We thank you for joining us, and you may now disconnect your lines. Thank you.