Ladies and gentlemen, good day and welcome to Flair Writing Industries Limited Q3 and 9M FY2025 earnings conference call hosted by Orient Capital. 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 touch-tone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Divyansh Gupta from Orient Capital. Thank you and over to you, Mr. Salda. Good afternoon, everyone. Welcome to Flair Writing Industries Q3 and 9MFY25 earnings conference call. Today on the call, we have Mr. Vimarchan Rathod, the Managing Director, Mr. Mohit Rathod, Whole Time Director, Mr. Sumit Rathod, Whole Time Director, and Mr. Alpesh Porwal, the Chief Financial Officer. Short disclaimer before we start this call: this call may well contain some forward-looking statements which will be based upon our belief, opinion, and expectations of the company as of today. These statements are not a guarantee of future performance and will involve unforeseen risks and uncertainties. With that, I would now like to hand over the conference to Mr. Vimarchan Rathod, Managing Director, for his opening remarks. Thank you and over to you, sir. Good afternoon, everyone. I want to express my gratitude to all the participants who have joined the call. I hope everyone had the opportunity to go through our investor presentation and press release that we have uploaded on the exchanges. The quarter gone by was a pivotal quarter marked by many positives. We continued our growth momentum across existing segments while laying foundations for new avenues for growth. All our divisions delivered healthy growth in both domestic and export markets. Our brand remained the engine for all our propositions, but it was particularly related to note the pickup in OEM sales. Among the key highlights of the quarter was our announcement of strategic partnership with the Maped firm for distribution of products. The second initiative was towards boosting our presence in the pencil segment. We launched a range of mechanical pencils which gave a feeling of writing with a free wooden pencil. Currently, we are manufacturing mechanical pencils, and soon we are going to start manufacturing polymer pencils, wooden pencils, and other new stationery items through one of our new subsidiaries. Pencils form a substantial portion of our overall stationery and writing instrument segment, and thus we have segmented our ability to address this segment via in-house manufacturing of both wooden and mechanical pencils. I am also delighted to announce that we have got award as top exporter by PLEXCONCIL for the year 2021-2022 and 2022-2023, and one of the best brands of 2024 by ET Edge, underscoring the strong brand recall among customers and our efforts to build brand value over the years. The upcoming Q4 is always our strongest quarter in terms of demand driven by upcoming exam season and our push in the export market. With organic tailwind to our biggest segment of the upcoming quarter and continued growth of momentum in creative and steel bottles, we are optimistic of our performance and look to close the year on a high. I now hand over the call to Mr. Alpesh Porwal, our CFO, to discuss financial performance. Thank you, MD Sir, and good afternoon, everybody. Moving to the consolidated performance of the company for Q3 FY2025. Revenue from operations for Q3 FY2025 was at INR 265 crores, an increase of 17.6% year-on-year. Gross profit for the quarter was INR 137 crores, which increased by 17% on year-on-year basis. Gross profit margins came in at 51.9%, largely stable year-on-year. EBITDA for the quarter was INR 45 crores, increasing by 31.1% on year-on-year basis. EBITDA margin was at 17.1%. We saw an impressive margin expansion of 176 basis points year-on-year. Profit after tax for the quarter was at INR 29 crores, increasing by 54% on year-on-year basis, and profit after tax margin for the quarter was at 11.1%. PAT margin expanded by 262 basis points. Moving to the nine-monthly results, consolidated performance of the company for nine months FY2025. Revenue from operations for nine months FY2025 was at INR 782 crores, an increase of 7.3% year-on-year. Gross profit for the nine months was at INR 403 crores, which increased by 9.4% on a year-on-year basis. Gross profit margin came in at 51.5%. Gross profit margins expanded by 100 basis points. EBITDA for the nine months was at INR 138 crores, declining by 2% year-on-year. EBITDA margin was at 17.6%. Profit after tax for the nine months was at INR 88 crores, improving 4.7% year-on-year. Profit after tax margin for the quarter was at 11.3%. On the qualitative front for the quarter, dedicated efforts towards rationalization of resources to enhance efficiencies over the past quarters have started to gradually bear fruit. During the quarter, employee benefit expenses increased by 14.3% on a year-on-year basis, and other expenses increased by 8.4% year-on-year, both coming in lower than gross profit rise of 17% year-on-year as shared above. This controlled rise in expenses enabled EBITDA margin expansion, thus allowing us to enjoy some operating leverage on a yearly basis. Sequentially, both employee costs and other expenses remain in line at a combined outlay of INR 91.9 in Q3 2025 as compared to 92.2 crores in Q2 of 2025. Thus, the marginal decline across key metrics quarter to quarter essentially flowed from higher gross margin in the previous quarter. Our net debt negative status enabled lower interest costs on a yearly and sequential basis, while ongoing CapEx program is leading the natural increase in depreciation. We will continue to invest in our teams and optimizing our sales and distribution structure to unlock higher efficiencies with medium-term outlook. We made additions across functional areas of sales, manufacturing, and administration. So overall, while these outlay toward employee expenses and other expenses may seem on the elevated front from outside looking in, these are necessary investments today to drive growth forward. I would now like to hand over to Mr. Sumit Rathod, our Whole Time Director, for insights into each business segment. Thank you, Alpesh. Good afternoon, everyone. We achieved healthy year-on-year growth across all business segments. Our own brand sales have gone from strength to strength with rise registered across domestic and export markets. Domestic owned brand sales have increased 14% year-on-year to INR 206 crores. Export owned brand sales increased by 33% on a year-to-year basis to clock INR 26 crores. Exports are stronger in the second half of the year for us, and this is further evidenced by 17% sequential rise in exports owned brand sales. Thus, overall owned brand sales grew by 15% year-on-year to INR 232 crores. For nine months, this number stands at INR 689 crores, registering a 10% growth. Coming on to the product segments, first the pens business. The pens segment grew 10% year-on-year to INR 197 crores. The segment also reported a 3% growth on a nine-month basis to INR 606 crores, which was heartening to note given the flat performance during the first two quarters of this year. There has always been a seasonality to the demand during Q3 in terms of school holidays combined with festivities, subduing demand for this category as customer spending gets directed to other products. However, as highlighted by our Managing Director earlier, the upcoming Q4 is our strongest quarter from a business point of view, and we are quite optimistic for the demand uptake for the pens segment to continue. During this quarter, we released 33 new pens, of which 29 are targeted to mid-premium and premium segments, and four new pens launched in the newest price category of INR 10. We continue to execute on our premiumization strategy, with the majority of new releases geared towards the mid-premium and premium segments. The creative segment achieved a 10% year-on-year growth for both Q3 FY2025 as well as nine-month FY2025. The revenue contributions stood at INR 45 crores for the quarter and INR 123 crores for the ninth. We expand our portfolio by introducing 16 fresh offerings under the creative range during the quarter. Notably, amongst them has been the launch of our new 2 mm mechanical pencil range. It is a substantial substitute to the traditional wooden pencils and comes in a range of pastel and Disney branded pencils. This launch further strengthens our positioning in the pencil segment, which remains a material part of the overall writing instrument category. We took another decisive step in the overall development of our creative brand by partnering up with Maped. Maped is a French brand that has been in existence for close to eight decades. They manufacture quality and premium stationery products, and with this partnership, we will leverage our extensive network of distributors and retail touchpoints to distribute Maped's products in India. While this not only gives us an opportunity to generate incremental growth for the company as a whole, it increases our basket of offering under the creative segment to the distributors. Maped's product will primarily be catering to the premium segment of stationery products and thus also enable us to offer products all price ranges. The collaboration with Disney is progressing well. We now manufacture and distribute 20 Disney branded products across categories. We continue to scale the steel bottle segment as a revenue contribution for the quarter more than tripled to INR 12 crores. On a nine-month basis, the segment has generated INR 32 crores in revenue, providing us with substantial growth delta. We added three new bottles during the quarter to our portfolio and look towards two key levers for growth in the business, providing quality and attractive bottles and increasing distribution reach. We remain steadfast to our core strategies for sustainable growth. These include innovation and feedback-driven portfolio expansion, addressing market requirement across price points, deepening distribution throughput from our existing network, exploring partnership and new avenues for growth, focusing on quality operations with a great share on in-house manufacturing, and concentrated efforts for successful execution of premiumization policy. Thank you, and I request the moderator to open the floor for the Q&A session. Thank you. We will now begin the question and answer session. Anyone who wishes to ask a question may press star and one on the 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'll wait for a moment while the question queue assembles. The first question comes from the line of Aradhana Jain with BNK Securities. Please go ahead. Hello. Hello. Hello. Yeah, go ahead. Yeah. Taking my question, and congratulations on the good set of numbers. My first question is, on the top-line growth, if I see for nine months that stands at 7% versus the full-year guidance that was given to us was around 11%-12%, that implies that something will have to grow at 20% plus in Q4. While in the opening remarks, you did mention that Q4 is your best quarter, are we still on track to see such sort of growth, and what would be the growth for the quarter? That's my first question. Yeah. Hi, so looking at the numbers in Q4, of course, it is one of our strongest quarters considering the market sentiments, and at the same time, we are very confident on achieving a double-digit growth in the current year. What would be the drivers for that? Mostly, would it be from pens or creative or a combination? It's a combination of all three segments. Pen, of course, as we have seen in Q3, we grew by 10%. Going forward in Q4 also, we are targeting the same numbers. Going forward to creative, of course, the growth will be better and higher because as we are giving the guidance of maintaining the guidance of 18%-20% growth in creative. Steel bottles also, the traction is good, as we said earlier also, and going forward also, we are maintaining the same momentum in Q4 as well. Okay. While the steel bottles did grow on a year-on-year basis, the growth in steel bottles, but if I see on a sequential basis, it was flat. So any thoughts on that, why was it flat in QOQ basis? In this category, Q3 is a slow period because most of the buying happens before the festival season. Normally, there is a lull of almost 30-40 days, and after that, again, the demands pick up. It's a normal tendency in Q3. The numbers are a little low. But as you can see, we have maintained the top line compared to Q2 and Q3 as we have maintained the numbers. All right. Separately, on the margins, while the EBITDA margin has improved on a year-on-year basis, it is sequentially lower and overall below the guidance of 19-20% for FY2025. So what are the margin improvement levers, and by when do we expect it to start reflecting on the numbers? On the margins, let me take a moment out here. When you said the margins are lower than historical levels, that's your question, right? Sequentially, it's lower. Sequentially lower. Let me just give you a brief on the margins out here. See, if you look at the financials, over the nine-month FY2025, gross margins overall have actually been better for the company by a full one percentage point over nine months due to the rising share of premium products in the mix. During the first half, we had faced elevated freight costs, which we had discussed earlier in our call also. We faced elevated freight costs in the export markets, which also contributed to the rise in the other expenses. Internally, our higher headcount and job work outsourcing raised employee costs and other expenses. And additionally, if you see, Aradhana, actions were also undertaken to optimize distribution network. Thus, overall, below our GP margin, both employee expense and other expenses have remained elevated year-on-year. That's what we see from the financials. Below the EBITDA, higher other income on high cash balance and lower interest costs on net debt zero balance sheet. That ensures that we substantially reduce the margin differential at the EBITDA level and achieve somewhat a parity of PAT margins for the previous nine-month basis. All these initiatives are not just for a single quarter we see, but are critical to ensure an organic build-up capability to scale our overall business. If you see the margins, the explanation for the lower margin sequentially is also because we are also using a good operating leverage over here in terms of all these last three quarters that you see. Okay. But the current levels of 17.5, 17.6, we see that improving to 19%-20% by when? Do we have any guidance on that? Right. So in the next two, three quarters, we see the numbers going back to 19%-19.5%. See, where we today, the reason is very simple. As we continue to invest in our teams and optimize our sales and distribution structure, basically to unlock higher efficiencies, we are making additions across functional areas of sales and manufacturing. And these are necessary investments today to drive growth forward. And as we grow, we will see our margins also improving because these investments will start paying off in the coming quarters. Understood. Understood. Just one thing on CapEx. I have a very basic question. In FY2024, we did around INR 110 crores of CapEx. In FY2025, again, INR 100 crores of CAPEX is what we are aiming at, I guess, from the PPT. So will it be possible for you to provide us segment-wise how much have you incurred towards pens, towards creative, towards steel bottles? How much CapEx has been incurred for each segment? The numbers I won't be able to give you right away. We will share it with you later, but then let me just share with you that today we are in the process of doing a backward integration where we bring about an OEM, operating economies out here. We are adding CapEx in all these segments. Steel we have already done, and going forward as the numbers improve, we are planning that the numbers will go up beyond the capacity which we have built up today. We'll have to end up having a separate outlay plan for steel bottles also, so going forward, yes, at least all three segments is what we are looking at adding CapEx. Sure. So maybe I'll get in touch with you on those segments. Yeah. We'll be in touch. Yeah. Yeah. All right. Thank you so much and all the best. Sure. Thank you. Thank you. Next question comes from the line of Sneha Talreja with Nuvama. Please go ahead. Hi. Good afternoon, team. And thanks for the opportunity. Just a couple of questions while you've answered most of them in the previous participants. A couple of them, even in the pen side, we've seen in the own branded business, we've seen a significant drop in terms of quarter-on-quarter revenue. What would be the reason for the steel bottles? You said it was festivities because of the Chinese New Year backlogging. What about the pen side of it? We've seen revenues going down there due to fewer activities. So if you would have noticed, Sneha, if you compare historic numbers also, the pen business always in Q3 because of the holiday season and festivities is relatively lower compared to Q2. So that's the reason why if you see sequentially, the pen business looks down, but overall, if you see the numbers are better in terms of compared to Q3 last year and Q3 this year. Understood. So you expect the Q4 again a strong rebound similar to previous year's numbers? Right. Exactly. And Sneha, that's right. The thing has become more evident now where we see in all the categories where we see all these consumer categories. We see the Q2 has been on the lower side. Just for numbers, the previous year also our Q2 to Q3, we saw a lower top line of 12%. And this year, the difference is about 2.1% is what we look at. So probably the silver lining or what we say the hope is that we have maintained. We have been able to maintain these numbers well in this year. So we didn't see that much of a. We are actually narrowing the gap between the Q2 to Q3. I mean, just on the positive side, I would say. Understood. I just wanted to get some sense on Maped Partnership that we have done. What are the things that they are planning to look at? What segment do they operate in? What's the visibility out there or some colors there? So, maybe I'd add to what was mentioned. It has a legacy of eight decades, and they are primarily into premium stationery products, which is currently missing in our current portfolio of creative products. So, it's going to help us get into that segment. And, going forward also, overall, the creative growth is going to be very, very positive with the help of Maped joining the creative division. Understood. And lastly, on the margin trend, although you said that it will be back to about 19-19.5% sort of a margin from next quarter itself, even if I consider that to be 19.1%, this year margin guidance will go down from 19-20% to about 17-18%. Is my assumption correct? I would actually not comment on the exact numbers, but this is where we're going to be heading to. So when I say 19%-19.5% in the next two, three quarters, we see the marginal improvement in margins starting from this quarter onwards. That's the last quarter. In a way, you're right. We see the improvement here. Understood. Thanks. Thanks a lot, and I'll get back in the Q4. Thank you, Sneha. Thank you. Next question comes from the line of Shraddha Kapadia with Share India. Please go ahead. Thank you so much for the opportunity and congratulations on the good set of numbers. So I had a few bookkeeping questions. So if you could give us the breakup of the pen-wise contribution in terms of your Flair, PC, and Hauser for Q3 and nine months, last year and this year both? So overall, if you look at the numbers, we do not provide the brand-wide sales. But of course, if you look at our own brand sales, the growth nine months has been in double digits, which is 10% plus of our own branded sales. So basically, for the Flair, Pierre Cardin, and Hauser, if you could give the breakup in the pen segment. Yeah. So what we will do is we will ask our IR agency to get in touch with you and with all the breakups. Okay. Okay. Sure. Not an issue. Also, if you could give the average selling price for this quarter. The average selling price? Yeah. Yeah. It's about INR 5.7. And so now I'll come to your subsidiaries and all. So if you could help us understand how the Monte Rosa stationery and the Flomax stationery have contributed to the consolidated financials? And what do we expect from them in future? Both the subsidiaries are our initiative to accelerate the growth of creative products. One is going to help us in Maped, which will again help us in creative. The other is more to do with the pencil manufacturing and polymer pencil manufacturing. Both are our initiative to accelerate the growth of creative, which going forward in next three years, we are targeting almost around 26%. Understood. Okay. So I just wanted to understand whether they have already started to contribute from this quarter to our top line or how is it expected to contribute from future? Sneha, what has happened is in Monte Rosa, we have started the distribution of Maped products. Whereas in Flomax, we are setting up the unit there. Once the units are set up, we'll have the manufacturing facility there. Monte Rosa is more of a distribution channel which we have developed. These are two different things which have just recently started. One has started. One has been set up. We'll see the contribution coming from there. To answer your first question, earlier question, the contribution to the top line today is just a nominal. Just started. Just started, so we'll see the numbers. Okay. Thank you so much. I'll come up on the Q for the future. Thanks. Thank you. A reminder to all the participants that you may press star and one to ask a question. Next question comes from the line of Resha Mehta with GreenEdge Wealth. Please go ahead. Yeah. Thank you and congrats for some growth revival quarter on quarter. So the first question is on the creative side. So if we see the quarter on quarter growth in this segment is low at 10%. So I would imagine that if we are on such a low base in terms of absolute revenues, quarter on quarter 10% growth, would you say that that is subdued or is this something that we had planned for? I don't know. Why are we basically not able to ramp up quickly? Because as I recall in one of your last calls, you had mentioned there was some problem with our outsourcing vendor. So is that still an issue or is there some other reason for low growth? So we had fixed that problem by the end of November. So now we are back on track and you will see the growth in the current quarter, a significant growth which will make up for the entire year. Okay. And now what would be the share of insourcing in creatives? It's still at 50%. Plans to take this up to what% by when? 75% by the end of 2026. Okay. So it will be 75% by FY2026, right? Yeah. Got it. And would there be any margins that we enjoy here? Is it at a break-even level, the creative segment? How diluted would that be to our overall margin? So we don't have a separate category-wise margin breakup. But if you look at the overall, it's at the similar level as pen. So what happens out here is that we always try to kind of reinvest in products and segments where we see the margins are at the rate between 18%-20% on an average. While we started investing in creative segment now, and as we at least build the entire segment here, the margins can be a little on the lower side from that particular segment. But as it grows and we reach the optimum level, we'll reach at the same margin levels of 18.5%-19.5%. So the investment initially, obviously, you understand that whenever we make investment in something new, the margins we start up on lower margins. It takes a little time to kind of ramp up. We're doing manufacturing. Yeah. And here in creative, we are also doing a backward integration. So the manufacturing facility out here, we are increasing plus the new subsidiaries which we see out there, the manufacturing facility there also will increase, which will go up to increase our margin, in-house manufacturing basically. Nice. So just alluding to the previous participant's question on the margin front, right? So 19%-19.5%, while you did mention we plan to get there in the next two to three quarters, right? But just wanted to understand so basically this increase will happen because the investments that we've made, they'll start bearing fruit and the high freight costs in the exports market will come down. And also your new segments of creatives and bottles will also kind of reach the pen-level margins. Is that understanding correct that these are going to be the key levers which kind of help you move the margin? Largely, yes. You are right. So it's going to be a mix of everything. So the backward integration and the new manufacturing facility in terms of partnerships which we have got into or subsidiaries which we have created, both put together will give us the higher margin out here. It will lead to that. Nice. Nice. On the export side, so do we export any creative segment products currently? And also for the bottles, have we started exporting to our OEM customers? Currently, we do export to the international market. But it's a very small segment. We are still building up the manufacturing base. And once the in-house manufacturing increases, that's where the actual price point for the international market will come in. And for the steel bottle, we have, like we mentioned earlier, we have started a little bit in our own brand for the steel bottles. And going forward, we are planning to expand that business as well in the export market. Sorry, so you said that for the steel bottle, you have started exporting in your own brand. Is that right? So our trial export has started in our own brand. And going forward, we are planning to increase that category. Okay. And on the steel bottles, have you seen any lowering of guidance here? Because I think I recall FY2027, we had guided for INR 125 crore revenue while now we are stating INR 100 crore. So is it a lowering of guidance here or? No. We have always maintained that we'll reach the full capacity of INR 120 crores, not even 100 in the third year of operations. So by 2027, we look at INR 120 crores. That's the guidance we have been maintaining. We are reaching there. In terms of distribution expansion for the steel bottles, so while we are there in most of the modern trade and exports also, like you said, we have started a little bit, right? So do we plan to enter GT or no, we essentially wanted to be a modern trade and an export initially and then perhaps we look at entering GT? No. So we have already started the modern trade. And currently, we have about 50 distributors city-wise. And the GT traction is also very encouraging looking at the numbers. The range of products is very good. Understood, and just last two questions, right, so one is on the export side. On the export side, suddenly, what is it that it is leading to such a heavy growth that we have seen? Because like you said, creatives and bottles, if any, is a very, very small negligible segment currently, and the initial reason that we had been citing for low export growth for the pens was that the freight costs were pretty high, and as I understand, the freight costs are still high. They have not yet come off a lot, right, so what really is driving this pen export growth? Have we added new OEM customers or what is it? Because we see that export growth in both own brand as well as OEM. So both the categories are growing. OEM is also growing and our own brand sales is also growing. So what we have done in the overall, the freight prices remain to be higher, but now that's the new normal and people have accepted it. But now, again, it's easing off. So that's an advantage for us. So going forward, even the current quarter, it's a back-to-school stock taking for them as well because for June, July, they will need the stock in this quarter for their back-to-school season. So Q4 is always good. And Q3, Q4 is always good for exports. Okay. So you are saying that export, the freight rates are no longer an issue because that's been accepted as the new norm. But we have not seen any addition of new clients or new export clients, new OEMs or anything of that sort, right? I mean, that has not been a big contributor. Is this? No. That's all. But only our existing distributors and our OEM clients have increased. Too good of the existing distributions. Understood. Understood. And on the domestic side, right? So our domestic OEM revenues have been flat at INR 12-13 crores since the last several quarters, right? And of course, you have highlighted that it's the OEM-specific issue and really nothing to do with us, right? But can we say that? Is there any growth possible from this INR 12-13 crore revenue run rate with that OEM? Is the worst behind for them? Going forward, we are concentrating on our own brands and in domestic market. We have not even taken into future projections, have discounted the domestic OEM business. Okay. So we expect this to remain a negligible part, right? And it will essentially be sidelined. No. Okay. Got it. And lastly, on the domestic owned brand, right? So if we were to just look at this particular quarter, while you highlighted that Q2 versus Q3 is a seasonally slow quarter, but even if I were to look at your nine-month domestic owned brand growth, right, and here, a big part of the growth would also be the creative segment. So can you highlight just for domestic owned brand pen segment, what is your nine-month revenue growth? Nine-month revenue growth is at 4%. This is for domestic owned brand pens, right? Yeah. Understood. This is the value growth you're talking about, right? Not the volume growth. Yeah. Value growth. All right. Perfect. Thanks so much and all the best. Thank you. I appreciate you. Thank you. Next question comes from the line of Mahek with NV Alpha Fund. Please go ahead. Yeah. Hi, Sir. Thanks for giving me the opportunity. So my first question is, if you could give us some sense on what sort of arrangement we have with Maped in terms of any investments that we have to make and in terms of the margins or commissions we will be making on the distribution that we do for them. So Maped's arrangement is more of a distribution network. So we are expecting it to penetrate and like mentioned earlier, this is into the premium category in the creative segment. So that will create and enlarge our complete portfolio of creative for the domestic segment. Currently, which for the premium and certain products of which premium where current our brands are not available for our products in our own brand. This is where the Maped category will cover up from the overall market perspective. Right. And Sir, the margins, I assume, would be much lower since it is just a distribution business? So, margin we try to maintain historically also on the similar levels. Of course, as a combination in the beginning, it might be a little subdued. But overall, as you know, these products are more in the mid-premium and the premium as a category. So along with time, these margins will average out in the overall strategy. Right. Got it. And my next question is on the creative segment. Now, we aspire to do 15%-20% of minimum growth in this segment. But for last three to four quarters, we have been sort of in the INR 40- 45 crores sort of range. So I mean, what levers do we have for increasing this growth to 20%? As you know, there are multiple leverages which are going to contribute for this particular growth. As we mentioned, the in-house manufacturing, which is going to increase in various categories, including our investment, like mentioned in the Flomax, which is going to contribute more towards the in-house manufacturing of all different categories of pencils. Also, Maped will also be a contributor for the overall segment. Of course, in creative, as we are going along and as we mentioned earlier, we have already started investing in the in-house manufacturing. There are certain key products like the newly launched 2 mm mechanical pencil, certain products in the creative range. These are the categories which will drive the future growth. Sir, in terms of distribution, if I were to compare the pen segment with the creative segment, so what percentage of pen segment distribution is already penetrated by us in the creative segment? When we talk about the penetration of pen versus creative, creative is present at 68,000 outlets. Currently, we are penetrating at 68,000 outlets. Pen is 330,000 outlets. In creative, we are focusing more to increase the throughput through these 68,000 outlets in initial phase. Right. Right. Got it, Sir. And in terms of your steel bottle segment, Sir, I wanted to ask the INR 12 crores of revenue that we did for the quarter, how much of this would be from B2B or private label or entire INR 12 crores in our own brand? So I think it's mostly 90% of it is in our own brand. Okay. Got it. And Sir, lastly, in terms of exports, what sort of guidance do we have where we can grow exports in double digits here on houseware, which is for the full year, not for the next quarter, but on the yearly sort of number? Can we grow it in double digits? Can we grow exports in double digits? So yes. From next year on, of course, we are targeting to grow it in double digits. But looking at the current year and subdued first and Q2, Q3 was very, very positive. And Q4 also looks promising. So coming off as a yearly top line, we would be at a similar level in exports in the current year. All right. Got it, Sir. Thanks. That's all for my side. Thank you. Thank you. A reminder to all the participants that you may press star and one to ask a question. Next question comes from the line of Ananya Annichani with Thinqwise Wealth Management LLP. Please go ahead. Yeah. Thanks for the opportunity. I have a question on the houseware segment. So I've seen on your website that you have quite a comprehensive product portfolio under this category, like casseroles and steel, different boxes and all also. So can you just shed some light on that if it's completely you're manufacturing it in-house or how is the nature of the business? Thank you. So the household plastic category that you're talking about, almost 90-plus% is all in-house manufacturing. And this is just to this category is overall to support the industry from the steel segment penetration in the domestic market. And as Mohit mentioned earlier, we are concentrating more towards penetrating the GT sales in the domestic market. And this particular portfolio helps penetrate that market. Okay. So are you doing any manufacturing efforts for this? Because I mean, we're barely hearing about it. So what is the? We are manufacturing in-house, these products. No. So are you making any marketing efforts for that? Because we're not seeing any kind of. We are doing marketing, but the concentration overall from the marketing angle is more towards the steel bottles. But yes, we have been doing marketing comparatively subdued as compared to the steel bottles. Okay. And for creatives, in your Q4 presentation, you had guided 28%-30% type of staggered. So are you still online for that for this year or are you revising it downward? Can you just repeat the question, please? So in your Q4 presentation, investor presentation, you had guided 28%-30% growth rate for the creative segment. But this year, so far, we're not seeing that kind of growth come in. So for FY2025, do you still expect that kind of trajectory to continue or would you be revising the guidance downward? So maybe you're right. The numbers don't say that we are going to kind of achieve those numbers of 28% and 30% this year. But currently, we will be at 20% growth by the year end. There's a new product offering on the pencils. 20% growth for FY2025. The pencils and all that we have now introduced. This will actually go to increasing growth rate. Okay. Thank you. I just had one last question on employee costs. I understand that it's going to be increasing from now on, but can you just give some light on when it would peak and what other standardized levels may take? So on the employee cost, we did invest. You see our higher employee cost quarter on quarter on whatever periods we are comparing. This is basically to build the entire strength of the company for sales and distribution and administration and even in manufacturing. So the numbers, the teams are set up, and that's where you see a higher employee cost. Obviously, Q1, you would have seen the first and the second quarter on the wages front also. What contributes to our higher employee cost is a rise in the minimum wages. So that has also contributed. But as we go forward, we have to start consolidating. And in fact, the ROI, if I would put it in that term, the ROI on the investment in employees has started paying off. So that will go also to add on or help us in the operating leverage going forward. Okay. Okay. Thank you so much. Thank you. Next question comes from the line of Shraddha Kapadia, with Share India. Please go ahead. Ms. Kapadia, please go ahead with the question. Ms. Kapadia, if your line is muted, please unmute yourself and go ahead with the question. Hello? Hello? Hello? Am I audible? Yeah. Yeah. Yeah. So actually, I'm just taking the previous participant's question further. So if you could provide us the bit of detail on the launch of mechanical pencil, how it fits into the company's broader product strategy, also what edge Flair is holding in this category. And since the launch, what has been the response for launching this new mechanical pencil? And what is our edge over the competitors which we have for this product? So basically, as expected, the response is very, very positive. And we haven't launched in all India. We have launched only in a few states because we are also ramping up the production capacity, which will take about another two months. But whatever we are manufacturing on a monthly basis, we are liquidating that, and the response has been very, very positive. Okay. Thank you so much. That was the question from my end. Thank you. Next question comes from the line of Aradhana Jain with B&K Securities. Please go ahead. Hi. Thank you again. Just on the previous participant's question on mechanical pencils, I understand that we've launched a INR 10 category mechanical pencils, right? So just wanted to understand that are there no other companies which are manufacturing or selling at that price point? And secondly, you do have other mechanical pencils as well, right, in maybe a higher range. If you could just throw some light on how has the performance overall on your mechanical pencils been of the other price points that you have, and what sort of traction are you expecting from this going forward? And what sort of differentiation? I couldn't understand on the differentiation part. I do understand that you are at the INR 10 price point, but is that the only differentiation, or is there something else as well? Secondly, on the pen segment, in the last quarter, we said that we've again refocused our attention on the INR 5 pen segment. And we had launched a few pens in a segment which was to roll out across India eventually. So where are we on that, and what sort of traction are we seeing in that segment? Yeah. So, talking about mechanical pencils, currently we are the largest mechanical pencil manufacturer in India. And the capacity we are increasing on a year-on-year basis. And there is a difference between the regular mechanical pencil and the mechanical pencil we just launched, which is a 2 mm mechanical pencil, which is, you can say, a kind of substitute to a wooden pencil, which looks and feels like a wooden pencil, but it is a 2 mm mechanical pencil. So, in the earlier question, we were talking about that only, that the response has been very, very positive. And that has helped us even penetrate our regular 0.5 and 0.7 mechanical pencils. So, overall, the overall category is in a growing stage for us. That is one. The second question was about theRs. 5 pen. So, we have launched in a few states in India. Again, we would be doing that by the end of this quarter. We would be launching in Pan India. The response has been very, very positive. Going forward, this will help us penetrate further in INR 5 as well. All right. That was helpful. Thank you. Thank you. Next question comes from the line of Resha Mehta with GreenEdge Wealth. Please go ahead. Yeah. Thanks for the follow-up. Just one question. Working capital, so I think we've always been talking about making some small improvements. So have there been any improvements that have happened? And if yes, what are those, and how much more can we reduce? As far as working capital is concerned, you're right. So we have been working on this. We are aware of the high rates which we have been having on working capital cycle. That is basically the stock and the debtors which we see normally. See, there are two reasons out here for a higher working capital. One, we saw due to the Chinese New Year closure, which has come in January, we had to keep extra stock in December. In the previous year, the Chinese New Year was in February, and hence we had stocked up in January in the previous year. The second reason is we have also added 55 new products, and few of them are the first in the category. So there are two things which we have to look at. It's just a matter of time when they stabilize in the market, and that will have a direct impact on two things. One is the stock that we have to maintain, and also the credit period we are giving to penetrate the market. So given these two contributors to a higher working capital, like you pointed out, we are aware of this, but the new policies which we are kind of bringing in and new measures which will go to reduce the working capital. So you will see the impact in this quarter. When you look at the 31 March quarter, we will see a very positive impact here. Right. Okay. So on the inventory days, I think we will probably be at around 84, 85 odd days that we've been at. I understand maybe not much improvement possible there. But on the debtor side, you said we've put in some credit policies, etc. So where could that number I mean, what could that number reduce to? By how many days would we be able to reduce? No. Actually, Ms. Resha, what we see out here is as we add products as a category, within the category, we can add so many products out here. But the first of its kind, I'll give you a small example of the 2 mm mechanical pencil. There is where it's the first in the category. It's a market to explore for us. When we push our product, the first of its kind, we push the product in the market. Once we get the traction in that product, that's when the credit period also starts going down. I'm just an example of how this works in the industry. And the stocking of the working stocking of the goods is where we have multiple SKUs. When we come into multiple SKUs and new products being launched, there's always an anticipation of sales and having the product ready for supply. We have to kind of keep those products in stock. So these two reasons are the main where we see the higher working capital. Rationalization continues. Yeah. It's continuous. The rationalization continues. All right. Got it. Got it. All right. Thank you so much. All the best. Thanks, Resha. Thank you. Next question comes from the line of Sahil Vora with MS Associates. Please go ahead. Hi. Good afternoon. Thank you for the opportunity. I had a couple of questions on the distribution front. Could you provide an update on the current distribution needs for steel bottles? Last quarter, you had mentioned you had hired 25 odd new distributors. What does that count as of now today? Also, have you targeted any new modern retailers? Hello. Yes, we have done a little more penetration in the GT market. Compared to earlier, now we are currently standing at 50 distributors. When you talk about the modern retail and e-com, of course, it's a continuous process, and we are adding more and more partners in this channel. Going forward, we are working on a couple of more very significant players in the industry. Okay. And on the creative front, just a second. What is the current count on the creative front? And if I can recall, the earlier count was somewhere around 65,000-70,000 distributors, roughly translating to 20% of your existing network. What's the updated count if you could provide that as well? Creative retail touchpoint is more or less in the similar lines. What we are concentrating now as a policy is increasing the throughput and the shelf space in these particular retail outlets. This is where concentration of the current strategy implies to. Okay. Understood. And my next question is regarding the pen business. Your pen business has decreased over Q3, while on the other hand, the second half is always better for us historically. As I was of the opinion that back-to-school segment picks up demand from students and education institutes. However, our creative stationery and steel bottle business have exhibited growth. Did the festive shopping help this segment while reducing demands for pens? And can you walk me through how the consumer demand was shaping up during this quarter? So if you talk about Q3, like you mentioned, this is more of a season thing. So because of the festivities during this quarter, that's the reason the concentration of individual buyers shifts a little bit from the pen segment more towards the household, and that's where you see the category jump. Also, of course, because in the Q4, going forward, as you know, it's always been one of the strongest. And you will see a significant increase in the Q4 in terms of all three categories. Okay, so do we feel there is no headroom for growth in terms of revenue for pen segment? Is the competitive intensity from new players putting pressure on our overall market share? No. No. We don't see that thing happening out here, and as you would understand that the competition was always there earlier also. What we are trying to explain to you is that the third quarter for us has always been on the lower side, and we see the uptake again in the fourth quarter, and historically, we have seen these numbers out here. Tailoring to school exams. Yeah. Okay. All right. Thanks a lot. That's it from my side, and all the very best. Thank you. Thank you. Thank you. A reminder to all the participants that you may press star and one to ask a question. Ladies and gentlemen, as there are no further questions, we have reached the end of the question and answer session. I would now like to hand the conference over to the management for closing comments. Thank you, everyone, for taking some time out to participate in this call. In case of any queries, reach out to our investor relation or advisor, Orient Capital. We wish you all the best and hope to interact with you soon. Thank you so much. Thank you. On behalf of Orient Capital, that concludes this conference. Thank you for joining us. You may now disconnect your line.