Ladies and gentlemen, good day, and welcome to the Q2 FY 2022 earnings conference call of Godrej Consumer Products Limited, hosted by Kotak Securities Limited. As a reminder, all participants' lines will be in the listen-only mode, and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal an operator by pressing star and then zero on your touchtone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Jayk umar Doshi from Kotak Securities. Thank you, and over to you, Mr. Doshi. Thank you. Good evening, everyone. On behalf of Kotak Institutional Equities, I welcome you all to Godrej Consumer Products' Q2 FY 2022 earnings call. I'll now hand over the call to Pratik Dantara, AVP, M&A, and Investor Relations for initial introductions. Over to you, Pratik. Thanks, Jay. Hi, everyone. Good evening. We hope you're staying safe and healthy. We have on the call, Nisaba Godrej, Executive Chairperson, Sudhir Sitapati, Managing Director and Chief Executive Officer, and Sameer Shah, CFO and Head of Investor Relations. We'll start with Nisaba sharing her perspective on the business performance. Thank you, Pratik. Good evening, everyone. I hope you and your families are safe and healthy. Thank you so much for joining us on this call today. I am delighted that Sudhir is here with me today. I have found his initial thoughts on strategy and operations excellent, and we look forward to having him share them more broadly with you next quarter. I will start with our performance. In quarter two, our overall sales grew by 9% with a two-year CAGR of 10%. EBITDA grew by 1% with a two-year CAGR of 9%, and PAT grew by 5% excluding exceptional items. Home care delivered a growth of 5% led by steady performance in household insecticides and a gradual recovery in air fresheners. Our portfolio in home hygiene is scaling up well. Personal care continued a strong growth momentum growing at 10% led by personal wash and hygiene and a robust growth in our hair care portfolio in Africa, the U.S., and Middle East. From a geography perspective, India grew at 10% with a two-year CAGR of 10% led by broad-based growth within the home care and personal care categories. In home care, household insecticides delivered single-digit sales growth. Air fresheners and fabric care witnessed double-digit growth. In personal care, personal wash and hygiene continued its double-digit sales growth momentum with a two-year CAGR also in double digits. Hair colors also witnessed growth in double digits. Our innovation rate was in the early 20s. We continue to strengthen our e-commerce business, which contributes approximately 4% of our branded sales. Overall, we remain cautiously optimistic on demand recovery in the near term. Indonesia delivered a weak performance with a constant currency sales decline of 2%. This is impacted by challenging macroeconomic variables, a gradual recovery in the air freshener category, and high competitive intensity in the wet wipes category. We continue to put building blocks in place to ensure gradual recovery during the course of the year and drive sustainable, profitable sales growth in the medium term. Our Africa, U.S., and Middle East business continued its strong growth momentum and delivered a profitable double-digit sales growth of 16% in constant currency terms. Our two-year CAGR was also in double digits. I'm pleased with the strategic focus and growth mindset of the team as we continue our focus on driving sustainable, profitable sales growth. Our consolidated EBITDA margins at 21.6% decreased by 210 basis points year-over-year, driven by a decline in India and Latin America and SAARC margins. Our overall margins expanded sequentially by 30 basis points. In India, margins decreased by 330 basis points year-on-year on a high base and driven by the lag between an increase in input costs and end consumer price increases. This was partly mitigated through scale leverage and continuous cost saving initiatives. We continue to have a healthy balance sheet. Our return ratios continue to improve sequentially while the net debt to equity ratio continues to come down. We remain confident of leveraging growth opportunities to drive sustainable growth across our portfolio in fiscal year 2022. I'm very proud of this, of the exceptional agility and resilience demonstrated by our teams. We also continue to adopt a safety-first principle across our ecosystem, supporting our team members, their families, and business partners across to get fully vaccinated. In India and Indonesia, 90% of our people are fully vaccinated. In LATAM, we have achieved a 75% vaccination rate. Unfortunately, our vaccination numbers in Africa are much lower due to the paucity of vaccines with 50% of white collar and 35% of blue collar fully vaccinated. As always, our values matter the most at this time. We remain committed to doing our best to truly live the Godrej way in serving our people and communities. Thank you. Thank you. Should we open the call for Q&A session? Yes. Thank you very much. We will now begin the question and answer session. Anyone who wishes to ask a question, may press star and one on the touchtone telephone. If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use handset while asking a question. Anyone who would like to ask a question, please press star and one at this time. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question is from the line of Abneesh Roy from Edelweiss. Please go ahead. Yeah. Thanks for the opportunity. My first question is on India HI. I understand Q2 muted growth. My question is on the outlook. We are seeing very high dengue cases in many parts of the country. I see your HIT advertisement, in fact, mention the dengue word also. Second in this is, Dabur has entered the in-home HI. If you could discuss, do you see a big impact of that longer term? Essentially, if you could discuss the margins, how are the margins in HI in India? Hey, Abneesh, this is Sameer here. I think the overall HI performance so far has been, you know, steady for us. Of course, I mean, we don't disclose specifically HI, but I'm very happy to share that for first half of the year, the overall HI growth has been, you know, around double digits, you know, mark. We continue to, I mean, get the building blocks in place in terms of either driving penetration in the category as well as driving premiumization, taking the category beyond mosquitoes as well as taking this category out of home. I would say the season has been mixed for us. We did see, I mean, dengue breakouts in some of the cities where we had very strong growth. However, we also saw rain deficit in August as well as excessive rains in September, which did impact the growth. Let's see, I mean, how the overall performance in medium term shapes up, but so far, you know, so good. We do feel that we should, I mean, structurally remain in that zone of high single digits through low double digits growth, something which we have called out as our ambition on HI in India over a period of time. Could you discuss the new competitor and margins? Some sense on the margins. Yeah, I'll take the margins question first, Abneesh. I think the margins are largely intact. Thankfully, HI is one of those categories which does not have any major commodity inflation barring metals, which does impact aerosols and a bit of LPG and solvent. The inflationary impact is relatively lower as compared to rest of the portfolio, so the margins are up there. We have been also taking calibrated price increases in HI to mitigate some of the inflationary impact. The new player? I think it's too early to call out. I mean, we have always, you know, kind of mentioned in the past that in a very consolidated category like HI, every player will sort of, you know, expand the overall market, right? We are very, very dominant in terms of our play. We have a very strong brand equity. We are not too overly worried at this point in time. Sure. Thanks. That's useful. Just one follow-up on HI. Jumbo Fast Card, now Pan India full launch has already happened? It is getting nationally rolled out, Abneesh. This was more of a West Maharashtra rollout over the last two to three months, and this is just now getting rolled out, including media, you know, kind of break nationally since the last two, three weeks. Yeah. My last question is on, again, on the India business. You have seen good growth in air freshener, personal wash, hair color on YOY basis, I understand that. But when I compare, say, two years back to pre-COVID, if you could give some sense, where are the volume numbers in air freshener, personal wash and hair color? I would give you directional input to appreciate the quality of growth, Abneesh. I think the overall growth in personal wash YOY as well as on a two-year CAGR basis has been, you know, robust. There is also pricing-led growth over there, so we need to also keep that at the back of our, you know, minds. Hair colors growth also has been, you know, kind of good on a YOY basis as well as on a two-year CAGR. Air freshener and, you know, our two-year CAGR is still, you know, I would say, you know, relatively on the lower end, which means that it's gradually recovering as we come out of COVID environment. Air freshener, hair color are back to two-year level? Is that what you're saying? No, not air fresheners. I would say hair color is largely there. Okay. Okay, that's all from my side. Thank you. Thanks, Abneesh. Thank you. The next question is from the line of Percy Panthaki from IIFL Securities. Please go ahead. Hi. Just wanted to understand on the inflationary scenario in soaps. Your standalone gross margins are down very significantly. Firstly, what is the extent of price increases that you have taken? How much more do you think you require to offset or manage the cost inflation? This is in a context of the fact that there is a cut in the ad spend and also employee costs due to a revised actuarial calculation. That I understand. This ad spend cut would not sustain for long, right? I mean, you would need to advertise. If you were to sort of maintain this kind of EBITDA margin, how much more price increase do you think would be required? Yes, Percy. If you look at India's gross margins, there has been contraction of around more than 800 basis points. If we double-click into that, I think around three-fourths is led by palm, which has impacted soaps, and the rest is driven by basket of chemicals and metals, as well as crude-linked inputs. What we have done is in soaps we have taken price increases. They have been calibrated. Also, what we have done now actually is taken price increases further rounds in soaps as well as non-soap portfolio. The reason being that over last couple of months, we have seen generally inflation moving up even sequentially, and hence to combat that we have taken price increases. They will be effective, I think, till somewhere, you know, late December. This high inflationary challenge, especially on overall operating margins, will remain for next, you know, couple of months. Our sense is come, you know, kind of quarter four, we will see, I mean, you know, overall operating margins, you know, kind of parity. To take your question on employee costs and ad spends, I would say employee cost is, you know, driven by genuine efforts to kind of reduce down, you know, overall employee costs. Part is also driven by, the performance variable remuneration, which is in turn driven by, you know, part, EVA and part, you know, sales and EVA because the profitability is relatively on the lower side. Ad spend sequentially are moving up, Percy. I think from around 5%-5.5% in Q1, we are at 7%-7.5%, though we will see, I mean, ad spends also moving up in rest of the year, and that's also one of the major reason why we are taking some of these price increases. Honestly, I would say they are little bolder ones at this point in time, which will be, I mean, seen effective in the market somewhere, you know, sort of late December. Lastly, in category like soaps, I would say it's a basket of, you know, taking calibrated price increases, consumer offers, trade offers and ad spends, right? We need to fine balance all these four types of investments together. You cannot go ahead with all the four, you know, investments at one go. There'll be some prioritization. The thinking is very clear for non-soap portfolio, especially where we are seeing good solid growth. We will continue to invest ahead of Percy. Right. Secondly, on household insecticides, I believe for this quarter, the two-year CAGR would be somewhere around 6%. That's a pretty lackluster growth considering that household insecticides is at least partially a COVID tailwind kind of a category. Any comments you have there? As I shared earlier to Abneesh, right, this has been a mixed quarter for us in a way, because we did see, you know, dengue outbreak in cities. There is very strong growth, Percy, but we also saw rain deficit and excessive rains, which, you know, is not very good for mosquito breeding. We have called this out also in the past, Percy, that, you know, the best way to appreciate this category's performance is actually over a three to four quarter period, right? If you look at H1, we are there in terms of, you know, close to double digits, you know, growth rate. A quarter can always be very deceptive, whether it's exceptionally high growth or exceptionally, you know, low growth. The building blocks are very much in place in terms of driving a sustainable growth in this category even over a period of time. Okay. Lastly, since Sudhir is there on the call, Sudhir, any thoughts that you would like to share in terms of diversifying the product portfolio in India so that the dependence on HI as a category is reduced, or it's too early for such questions for you? It is a bit early for that specific question, Percy, but I think I can say this from the brief time that I have looked at the business, is that all the categories and countries that GCPL is present in offer terrific opportunities for growth, including HI. While HI is a business that, as Sameer said, varies by quarter because of variety of reasons, penetrations, for example, of the liquid vaporizer or of aerosols are low. I would say that while there will always be opportunities outside, I think there is a lot of opportunity for us to grow in the businesses we are in today. Okay. That's all, Sameer. Thanks and all the best. Thanks, Percy. Thank you. The next question is on the line of Arnab Mitra from Credit Suisse. Please go ahead. Yeah, thanks for taking my question. My question was again on the input cost side. You know, I know we are in pretty unprecedented times of commodity inflation, but we have not seen this kind of a gross margin hit YOY in any other company or even in GCPL in the past. Is the reason you know, that there is a constraint in pricing because the market leader hasn't taken enough pricing, or is it just a timing issue that the commodity ran up too fast and therefore the pace could not be kept? Where I'm coming from is that if we assume that palm oil prices don't correct from here, is there a challenge of managing margin for the rest of the year also? Hey, Arnab, this is Sameer here. No, I think it's more of the latter, to answer your point, because we have been pretty competitive and honestly a little ahead of curve. I mean, as you are aware, we have this micro-marketing strategy, so it's not one size fits all pricing approach which we take on a category like soap. Also when we look at, you know, relative pricing index, we are perhaps little higher than what historically we have been. The gap is huge, I mean, especially in category like soap between increase in input cost and end consumer price. There is also a cap, right? I mean, at the end of the day, how much consumer can, you know, take that inflation. As I was sharing earlier with Percy, we have taken next round of price increases in soap and also in non-soap category, which will help mitigating the inflationary pressures which are largely in soaps at this point in time. Because of our strong market standing as well as brand equity in rest of the portfolio, we feel that it should, you know, kind of sail through without any impact on the consumption and also cushion the overall operating margins in medium term. Sure. Basically what you're saying is that you have been a little ahead of the curve, which means that the overall market pricing growth is still lagging a little bit. There is a bit of reluctance in taking the full pricing by most of the other players also? Gap is too huge. I mean, to give you some data, Arnab, I mean, the overall palm inflation is around 50%-55% on a YOY basis. Now, we cannot pass on as an industry, I mean, the entire increase, I mean, to the end consumers, right? Because consumption may just, you know, fall flat. It has to be calibrated in nature. Yes, I mean, sometimes it could be little more, you know, bolder, which is what we have, you know, kind of gone ahead with on soaps. Then we're leveraging our rest of the portfolio to kind of drive, you know, kind of pricing-led growth in the non-soap portfolio, which will, you know, kind of, mitigate some of the inflationary impact in soap portfolio. No, understood. And my second question was on the demand scenario. You know, second half last year, we had seen your haircare business recover and even H2 after a soft Q2 had actually recovered in Q3, Q4. You actually have a relatively tougher comparator. Overall, how do you see the demand environment? We have heard mixed feedback from companies on potential rural slowdown and other things. A general kind of sense of how you're what kind of outlook you're looking at from a growth point of view. I think as Nisa called out earlier, we remain cautiously optimistic in medium term. I mean, it's mixed, to be very honest with you, and it also differs from, you know, month to month in terms of what's happening, not just with channels, but more importantly with consumers also. We remain, at least at this point in time, reasonably well placed to, you know, be close to the double-digit growth ambition which we had called out in India business. There will be some, you know, play between value and volume, right, UVG and UPG, at least in very short term. From overall demand, you know, perspective, we feel, I mean, largely it's more of the same. There have been no major changes, especially at consumer's end, which gives us, you know, a view to kind of change our own point of view in terms of high demand or low demand. Okay. Thanks, Sameer. That's it from my side. Thanks, Arnab. Thank you. The next question is from the line of Avi Mehta from Macquarie. Please go ahead. Hi, Sameer. Just wanted to continue with what you said last. While you are, you know, you are clearly confident or looking to kind of at least do the double-digit growth ambition in India, would we find it difficult to meet the margin, flattish kind of margin expectations given the sharp inflation and input costs? Would that be a fair understanding? Yeah. It's very difficult to give a guidance on margins, honestly, right? Because there are just too many, you know, moving parts. There could be a scale play, there could be, you know, generally how the demand is shaping up in either of the directions. As I mentioned earlier, in very short term, maybe for next month or two, our sense is, you know, there will be a bit of operating margins, you know, contraction. Again, equally we remain confident that, you know, maybe from January also, with all this price increases, you know, getting into the market, we will see at least, you know, margins maintenance. See, also we need to look at margins on a relatively longer period. While in this quarter the overall margins have contracted, if you look at first half, the margins contraction is only by around, you know, 60 or 70, you know, basis points. Till the time the overall double-digit growth momentum continues, we don't mind, in fact, investing little ahead of A&P, to kind of get sustainable sales growth, even if it comes at the cost of, you know, very short-term margins. Got it. Fairly clear. The second bit on Indonesia, I mean, in the earlier, you know, when we had a call with Indonesia, you know, what we had understood is there is a recovery that is kind of planning out. Could you kind of give us a sense on how is that coming through? Especially because the understanding that we had is even the competitive intensity on the wipes is now getting managed. Any update on that, if you could please share? Yeah. Hi, Avi, this is Sudhir here. Can you hear me? Yeah, yeah. Yes, Sudhir. I'll take that question if Sameer doesn't mind. I think in Indonesia there are a set of two or three issues there in Indonesia. First is that the macroeconomic situation does seem to be very, very tough in Indonesia in the short term. You know, many companies have posted weak results, GDP growth is contracting, etc. Having said that, you know, again, this is a very early read of the situation. I do feel that there are some things that we could have also done better in Indonesia, and I hope we'll do them in the near future, and we will see a recovery in the medium term, both because of the economy and both because of some actions that we take. Okay. Sudhir, just last one for you. I mean, you obviously have settled in now. It would take some time to kind of, you know, get to know the business well. Any, you know, when can we kind of hear a roadmap from you on how do you want to, you know, look at growth rates from medium term point of view? Any timelines would you be willing to share on that shift? I think perhaps in a few months' time. You know, I'm still just getting to understand the big picture. I think in a few months' time, perhaps we can talk in more detail. Thanks a lot, Sudhir. That's all from my side. Thank you. Before we take the next question, we would like to remind our participants, you may press star and one to ask a question. The next question is from the line of Vivek Maheshwari from Jefferies. Please go ahead. Hi. Good evening, everyone. Couple of questions. First, on the gross margins again in India business. Do you think that second quarter marks the trough of, you know, on margins, or is it going to be the third quarter in your view? Assuming that input stays where it is. Hey, Vivek, this is Sameer here. Again, I think it's difficult to call out at this point in time in terms of what could be the quantum of margins contraction. I mean, there are too many moving parts, Vivek, right? I mean, there is going to be incremental pricing-led growth in Q3 compared to Q2. There is going to be also shift in category, you know, kind of mix. We have a big season, especially on liquid dish, which is relatively high in, you know, gross margins. To say the least, there will be, you know, kind of gross margin, you know, kind of pressures. Hopefully, you know, kind of lower than what we have seen in Q2, especially on a YY contraction. With some of this price increases, you know, kind of getting into the market, we should see, I mean, a southward trend in terms of contraction of gross margins in coming months and quarters. Right. That is given, I understand. But I'm saying if you just eliminate the category mix part and just look at soaps, you know, can you just, you know, give your views? Or basically the other way of asking this is, you know, when we look at second quarter numbers, the consumption of input versus, let's say, exit gross margins, is there a big difference between the two? Vivek, to answer your question, my sense is the soap gross margins will, you know, kind of continue to move up from here on. Okay. That's good to know. The other thing, Sameer, on price hike, when you say that, you know, soaps you have effected the price hike the next round, is this. You know, are you following the market leader over here or this, or, you know, for that matter, in the past, I'm guessing you would have. But this one, when you say that, you know, you have been bold, so does that mean that you have taken up prices ahead of, you know, what the market leader has done? I don't know what the answer you got from the market leaders. No, as I mentioned to you, I mean, we continue to take calibrated price increases. The approach which we have adopted, Vivek, over last many years is, you know, what we call as capturing micro markets in terms of taking those calls in specific states, in specific bunch of districts, rather than taking a pan-size, I mean, pan-India, you know, one-size-fits-all pricing, you know. Apparently, that has worked very well for us. We realize that in so many markets and districts, we compete with so many different players, right? Hence there is no question of one-on-one comparison for, you know, a lot of our brands as well as SKUs. It's, you know, kind of not straight to or specific players. Yes, I mean, we have been little bit more bolder, is what I can share in terms of our, you know, kind of soaps, pricing generally, I mean, over last, you know, few weeks because the commodity inflation has been relatively on the higher side. Okay. Got it. One question for Sudhir. Sudhir, can you just, you know, give your initial thoughts on how do you know, how do you contrast, let's say, GCPL with HUL, both, you know, a few points which let's say are up on the positive side and a few points where you think, you know, GCPL can do better, the way in which you know, mentioned about Indonesia, for example? Why don't you wait for Sudhir to give you his full strategy in a couple of months? I don't think this is a comparison between HUL and GCPL. Sorry, Sudhir, but you might want to do it. No, no, I think the interesting thing, Vivek, is not. I think that there's something which are common to the two companies. They're both, I think, great places to work. They've got a great value system. They've been around for a long time, very strong brands. Yeah. I mean, I think there are some things for GCPL does really well, and there are some things for it probably to do better, but maybe I'll answer that question in a few months. All right. Looking forward to that, Sudhir, and all the best to all of you. Thanks. Thanks, Vivek. Thank you, Vivek. Thank you. Ladies and gentlemen, you may press star and one to ask a question. The next question is from the line of Harit Kapoor from Investec. Please go ahead. Yeah. Hi, good evening. So this is regarding India innovation pipeline. You know, you mentioned you know in your outlook as well that there are a lot more exciting you know product innovations, et cetera. I just wanted to understand that you know does the timing of some of these launches that you are planning from a medium-term perspective get pushed out you know given the unprecedented inflation that you are seeing? Or is one of the reasons that you know you're taking these aggressive price increases to keep your launch timeline consistent? Yeah. We are not going to compromise in terms of our launches. I mean, timing also is a factor of readiness and, you know, readiness even from an end consumer perspective. Honestly, in medium term, I mean, there are no big bang, you know, sort of launches also, I mean, you know, planned at this point in time. Strategically and directionally, we'll continue, I mean, you know, to drive innovation-led growth and not compromise in terms of, you know, pausing on innovation for a long time because there is, you know, short-term margin pressure. Just a follow-up on that is, you know, do you also believe that, you know, this is given that you are, you know, cautiously optimistic on the demand environment, this may also be a time to even just keep focusing on what you've already done and, you know, may not, you know, look at something more big bang? You know, does the market kind of warrant, you know, that kind of an outlook right now? I think we already have some big bang innovations in place, and I think like what Sudhir said earlier, even say in HI, there's a whole penetration game, whether you look at electric or even say something like Jumbo Fast Card is a sort of very big innovation for us in India. So, you know, I think we will focus in terms of what we've already launched at least for the next quarter to two quarters. Got it. The second question was on the hygiene portfolio, both on personal and home. You know, now that, you know, these categories seem to have normalized a little bit more in terms of demand and, you know, consumer penetration, et cetera, you know, is there something more than others in terms of what you're willing to, you know, invest in, you know, regarding, say, for example, what you launched in, you know, in the last, 12, 15 months? You know, are there two, three focused subsections that you're gonna look at, you know, slightly, you know, closer or invest more behind on both the home hygiene and the personal hygiene side in terms of new launches? No, I think it won't be. Sudhir here. I think I shouldn't. It'll be giving away too much to say what our strategy in terms of investments are. I think that during COVID, both in India and Indonesia, we got a lot of new launches in the home and hygiene space, and many of them have done well. You know, since we've got this tailwind of the pandemic, we'll continue to build on the gains that we've got during the pandemic. I have a suspicion that many of these products may or may not do as well this year as they will do last year because of. Yeah. The pandemic. I think the equity is strong, and these are long-term plays, both Saniter in Indonesia and Magic in India, both of them know extremely well, and these are long-term bets for the company, I would suspect. Got it. That's it for me. Thank you. Thanks, Harit. Thank you. The next question is from the line of Richard Liu from JM Financial. Please go ahead. Hi, good evening, everyone. Just wanna check if you can hear me clearly. Yeah, we can. Yeah. You know, my question is on Africa. If you can talk a little about, you know, about that region, because that's definitely one of the bright spot here. Would you say that, you know, that we've now reached a higher level steady state, that we wanted after all the actions taken by Dharnesh and team in recent months? Any perspectives on what more actions are in store and what should we look forward to, from the region going forward? Yeah. Thanks, Richard, for your question. I think with Africa, with Dharnesh coming in and now with Sudhir also, we had put a strong turnaround plan to that business. I think what we're seeing is that, you know, it is playing through, and we'd actually put a five-year plan in place. I think both on top line growth and, you know, sort of, EBITDA margin moving sequentially, we've been quite happy with what's happening in that business. As we voiced over before, there's quite a lot of back to basics there in terms of driving distribution and focus on core categories. Also in, you know, in Nigeria, we talked about building out categories like HI. Okay. All right. Thanks. Thanks, Nisaba. I wish you all the best. Thanks, Richard. Thank you. Anyone who would like to ask a question, you may press star and one. The next question is from the line of Shirish Pardeshi from Centrum Capital. Please go ahead. Hi, good evening, Nisaba. Good evening, Sudhir and Sameer. Thanks for the opportunity. I have two questions. The first question is broadly on the rural part. I think there is incremental noise has happened over the last 45 days, and companies have been saying that the Nielsen data points out that there will be a slowdown. In your lens, how do you see this as a challenge? Because what I see is that last four to five quarters of COVID-19 has given you a strong impetus and you would have grown to rural. My question is in two parts: What is our rural contribution today, and, how do you see this, as a challenge or as an opportunity, or you really see that rural slowdown is visible, in the last 45 days? Yeah, Shirish, I'll pass to Sudhir here. I'll pass on the question on rural contribution to Sameer. The honest answer is, when I looked at the data, I'm not able to, in real terms, see a rural slowdown. See, there are a lot of optics in data, both externally and internally because of COVID basis, right? Like for example, during the COVID lockdown or the first COVID lockdowns, urban cities were closed, but business in rural continued. You have different comparators and so on. When I look at this data shown of these quarterly and annual movements, I don't see a specific rural slowdown, even though optically the rural numbers are lower. You know, both in Nielsen and our own numbers, rural is now not growing as fast as urban. I don't see this when I adjust for a two-year period, or I don't see it very obviously in any case, Shirish. I'm not able to read the data clearly. I'm gonna pass on to Sameer on what our rural contribution is for our business. Directionally, Shirish, rural is going to be a big growth sector for us, right? Because couple of our categories are under-penetrated in rural, especially hair colors as well as household insecticides. Contribution is a shade below, you know, 30% for us, which is lower than generally what the contribution would be in the overall FMCG space. It's definitely going to be actually a big growth, you know, kind of space for us in medium to long term. No, I agree with Sudhir. The specific question is that in your erstwhile organization, you were the guy who really pushed systematization of Glaxo portfolio. I think you have done a wonderful job there. In that understanding, I wanted to have your opinion. From the Godrej perspective, do you really see that the product profile which we have customized as per the rural requirement is there is a penetration-led growth which we can expect in next four quarters? 100%. Certainly in household insecticide, which is electrics and in hair color. These two core categories, they are very, very underpenetrated. Soaps is well-penetrated in rural. Perhaps air care is a bridge too far right now for rural. These two large categories, I would say a bulk of the growth have already been coming actually when I look over the numbers of the last few years and will continue to come from rural. Sure. My second and last question, again on Indonesia business. Since I've been tracking businesses for a long time, I think last five, six quarter, this business has always been volatile, either in terms of top line or bottom line or something. I just want to have a candid answer. If there is a real problem in this business, in terms of marketing, in terms of sales, in terms of channel, in terms of mix, or in terms of category, what is the real problem in Indonesia business? I think we've, you know, we voiced over this. Obviously, if you look at the macroeconomic, it is not supporting the business. You know, if we look at under the hood of the business, what Sudhir also mentioned, I think there have been sort of missteps by us also, which we are very sort of conscious of and focused on correcting in over the next few quarters. I think fundamentally, the business is a strong one, which we have, you know, said before. It's a strong relative market share in categories that we're strong in. Good sort of margins. Both from a penetration and distribution, lots of opportunities. I don't think we've been executing as well as we should have. You know, Saniter has been a big success there, but definitely on the core, we need to be doing much better, so that would be. I agree, Nisaba. The last call which we did on the Indonesia business, I was pretty excited. I think, again, we are after seeing the quarter number again, the worry is that whether the business will show some momentum in next four to five quarters. That's the worry. Yeah. I appreciate your worry, but you know, I think we are quite focused on that. We're not happy with the numbers. You know, we are focused on turning the ship there. I think one thing that you probably acknowledge about GCPL is that you know, we're not gonna sort of just put this on just macroeconomic and say that's the only reason. It's definitely there. I mean, if you see the other companies' performance there. It is something that we're focused on, you know, bringing back to good growth as soon as possible. Wonderful. Thank you. All the best to you and the team and, belated Diwali greetings to the team. Happy Diwali to you also. Thank you. Thank you. The next question is from the line of Latika Chopra from JP Morgan. Please go ahead. Yeah, hi. Two questions from my side. First one was on the HI side of, you know, with the markets opening up, you know, how do you see the salience of incense sticks as a format in this category shaping up now? Your own play, you know, here, Jumbo Fast Card is something that you're rolling out across the country. How has been the response so far? Do you anticipate or do you see a need to introduce more, you know, HI formats in the economy end to tap into the whole rural end play? The second question was again on the new launches that you've done on ProClean and Ezee 2-in-1 for regular clothes. What is the update on distribution scale up for both these products? Thank you. Hey, Latika. Latika, the salience of incense stick has remained sort of stable over the last year or so. We don't see it growing. You know, it's not gaining that much salience. That being said, you know, as we've talked about before, it has a big job to be done for the consumer. You know, our rural response to that has been this Goodknight Jumbo Fast Card, which is an excellent product. It is a bit early to comment on this Goodknight Jumbo Fast Card. I think like Sameer said, you know, media has just sort of started in October. The all-India launch has really just happened in September and October. I think we'll be able to say more on that over the next six months. I think the other sort of job to be done also is to drive electric penetration, which is at about 25%. I think that's gonna be a, you know, really big strong focus of Sudhir's and the team sort of going forward. I don't think it's a one-pronged approach. In terms of new launches and innovation, I think while we have things in the pipeline, I think between Gold Flash and this, you know, Goodknight Jumbo Fast Card, we already have quite a lot in the pipeline. I think one of Sudhir's, which he'll probably talk more about in February also, is really focusing, you know, less is more type of strategy because there is these big penetration gains for us to have with what we already have in hand. I think your other question was on ProClean. Yeah, on ProClean and I think the Ezee 2-in-1. I think that's doing decently well. Sure. Thank you. Thank you. Before we take the next question, we would like to remind our participants you may press star and one to ask a question. The next question is from the line of Anand Shah from Axis Capital. Please go ahead. Yeah. Hi. Just had a couple of questions. First on the hygiene part, I mean, you have done a lot of launches over the last, you know, 15, 18 months. Can you give some update on, you know, I mean, what is the salience of these new launches to, overall India revenues? And, particularly which ones, would you know, continue to focus on or may continue to or sort of discontinue, you know, because of COVID has stabilized? Yeah, Anand. I think the overall hero format, I would say, within the hygiene has been, you know, hand wash and within that actually powder to liquid hand wash, which has been, you know, consistent, you know, kind of growth vector for us. Some of the formats like mask and sanitizers have, you know, sort of either normalized or, you know, sort of moved away. That's how the hygiene portfolio is shaping up at this point in time. I think we are the second-largest, you know, market players in terms of volumes when it comes to, you know, hand wash, thanks to the powder to liquid, you know, hand wash, you know, format. That's great news for us. We need to drive, I mean, penetration as well as drive, you know, kind of consumer awareness. The way we are looking at this space is not just, you know, hand wash, but it's actually soaps, right? That's the, you know, way we are looking at, you know, kind of getting, you know, share, you know, within the overall hand wash, you know, space. I think the other big thing that has worked well for us is Saniter in Indonesia, which is a disinfectant aerosol in the hygiene space. Both of them have worked very well. Saniter has been a blockbuster success in Indonesia, which is a big one. These are the two big ones, since you asked the question, what we'll continue with. Got it. Thanks. Just my last question is on hair colors. I mean, if I heard correctly, I mean, we are now back to sort of pre-COVID, right? Largely there. I mean, Anand, in terms of, you know, sales, you know, what it used to be pre-COVID levels, the growth rates as well as two-year CAGRs are very much, you know, on track. The creams and the shampoos, hair colors are, you know, kind of firing on all cylinders. Got it. Yeah. Thanks a lot. Thank you. Thanks, Anand. Thank you. As there are no further questions from the participants, I now hand the conference over to the management for closing comments. Thank you, everyone. Thanks for joining. Stay safe. See you. Thank you. Thanks. Thank you. On behalf of Kotak Securities, that concludes this conference. Thank you for joining us, and you may now disconnect your lines.