Good evening today and welcome to the Shoppers Stop Limited Investors Conference Call. As a reminder, all participant lines will be in listen-only mode. There will be an opportunity to ask questions once the presentation concludes. Should you need assistance during the conference, please signal an operator by pressing star and then zero on your touch-tone phone. Please note that this conference is being recorded. On the call, we have with us the management of Shoppers Stop, represented by Mr. B.S. Nagesh, Customer Care Associate, Chairman, and non-executive director, Mr. Venu Nair, Customer Care Associate, Managing Director, and CEO, Mr. Kavindra Mishra, Customer Care Associate, Executive Director, and CEO delegate, Mr. Karunakaran Mohanasundaram, Customer Care Associate and CFO. We now hand the conference over to management. Over to you, sir. Good afternoon, friends. Thanks for joining us today. Hold this meeting because the recent management changes approved by the board yesterday. Along with me, like Gavin said, I have Venu, I have Kavi, and I have Karuna with me. You would have read the information that we sent to the stock exchange last evening. Well, it definitely makes me sad to share that after nearly three eventful years of being at the helm and driving growth to Shoppers Stop, Venu has decided to move on for personal reasons, to spend more time with his family, and to pursue other opportunities. But I will let Venu speak on that. Venu's leadership came at a time when we had just come out of COVID, and he was instrumental in strengthening the business post-COVID era. Of course, all the strategic pillars that we had decided upon, I think he worked very diligently on that. That has left Shoppers Stop fairly strong compared to where it was three years back. I'm also very happy to inform you that we have appointed, promoted Kavi, who was our Chief Commercial Officer and CEO of HomeStop, as the Executive Director and CEO with us from first of September. He comes with a lot of background, and in the last five and a half months, I mean, he has settled in very well, and he's also brought in a lot of changes in HomeStop, which is one of the verticals that he wanted to drive, and we are seeing some very positive growth there. Before I introduce Kavi, I also want to, on behalf of the board, assure you that transition would be absolutely smooth and seamless. In the last 3-4 years, we've built a very strong management team and have enough management bandwidth. A strong executive team at the senior level, at the middle level to drive the company. So he has been with us, like I said, for the last 5 months, and all of you will know that Shoppers Stop is a board-managed company. Promoters own more than 60% of the shares, but the business is run by professionals, and therefore, every transition is managed to come out of challenges and has pushed ahead. And we believe that with Kavi being there, Venu supporting us during this transition period, and I coming into the picture to handle the company, we're very confident that all the strategic pillars that we have taken on, we'll be able to build on it as we change month after month, quarter after quarter. Let me now talk briefly about Kavi. Kavi comes with a background of more than 24 years of experience, and IIM Bangalore graduate. Has worked in Madura Garments, which is ABFRL now, was a co-founder of Zovi, which is a dot-com business, which was started, funded by Sequoia at that point of time. Has worked in United Colors of Benetton, was the Managing Director and CEO of Country Impact, the start of the transition when they moved from Indian operations to international operations, the shareholding shifted. He was the Managing Director and CEO of Anita Dongre, where he was heading the business, and was responsible for the AND Girl, which was launched, which is probably one of the most successful children brand launch that we have seen in the last two years time. I'm very confident that with whatever Venu has left us with, okay, we only will be building on that. The foundation that he has built for the company, Kavi will be making it stronger, and I'm there to hold on during this transition. I will now stop and ask Venu to comment, and probably ask Kavi to come in before we open the house for question and answer. Venu, over to you. Thank you, Nagesh, and good afternoon, everyone. Thanks for joining in for the call. As Nagesh mentioned, I have, as you know, I have chosen to move on from Shoppers Stop, and that's which I arrived at after quite a bit of thought. I had joined in on a three-year contract, which November 2020, sorry, November 2023. The board has kindly extended it April of 2023. However, over the last few weeks, I have been evaluating what I do and on the personal front, what I would like to do. I've come to the conclusion that I would like to explore some new avenues at this stage and also spend some quality time with my family, and hence take the decision to give focus to the company. And again, the important thing here is that I am going to be around for the next six months to guide- ... We ensure that the transition is smooth. There is a lot of emotional commitment that I have put into Shoppers Stop, and I'm absolutely committed to make sure that we continue on that journey, ensure a seamless transition, and continue to grow as the journey that we have embarked on. Thank you once again. I will now hand over to Kavi. Thank you, Venu. Good afternoon, everyone. Thanks for being on the call with us. I'm really grateful to the, to the board to give me this opportunity. I've been five and a half months with Shoppers, and I'm really excited to take on this new responsibility and work with a very, very strong leadership team, as well as the admin team, which we have, to drive growth and the four pillars of business, which we have all spoken about and worked upon for so many years. So looking forward to a great journey with Shoppers. Thank you. Thank you, Kavi, and thank you, Venu. Gavin, we can open up if there are any questions. I will take all the questions around the subject of the leadership change, and will not be able to answer anything on financials, because this is not the part of agenda for today. Thank you very much, sir. We will now begin the question and answer session. Anyone who wishes to ask a question, press star and one on their touchtone telephone. If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question is from the line of Dhanraj Agrawal from Kotak Mutual Fund. Please go ahead. Yeah. Thank you for organizing this call. I appreciate it. As long-term shareholders, we are first shocked and surprised on surprise of this news. I think the commitment of Venu was clearly there, and this sudden news came as a big surprise to us. What I would like to understand is that in the last 12, 13 years, there have been 4 leadership changes. Govind was there, Salil was there, Rajiv was there, now Venu is there, and now Kavindra is there. What is leading to such frequent changes that the company has not been able to retain the senior leadership beyond 2.5, 3 years? That's my first point. Mr. Nagesh, you have been there as a mentor to all the 4 CEOs during this transition phase. So something is, maybe it's just a coincidence, something is worrying us that the leadership stability is not there, which one would expect it to be. The second is that, you know, Rajiv had his own style, Venu brought his own style and capital allocation and, and thought process on growth and other four pillars, which we spoke about. What we would like to understand is there a strategic shift, which probably the new leadership will bring along with it? These are my two questions. All the best, and wish Venu all the best in the future endeavors. Thank you. Thank you very much. Wonderful questions, and let me answer the second question first. When Venu joined, even before joining, my decision with Venu was, Venu, we already have decided to have four strategic pillars, and Venu will work along with this team in order to execute the strategic pillar. So if you had to ask Venu in private, okay, the strategy has not changed in the last three years. We have just been implementing it, and we have been implementing it in the realms of the capital that we have and the capital allocation we have done. I just want to assure everybody that there is no shift in the strategy. In fact, Kavi coming in and with me also being involved, he would actually drive the strategy further. We rest assured, the two strategic pillars of growth, which is adding up stores, running at full next speed, okay? We will continue to talk about how we are adding up as a test. There is no shift in the growth strategy, which has been add a little more growth based on what we see in the next 2 quarters. Venu had already mentioned to you all that this year we will be opening 15 stores. Inshallah, maybe we'll end up opening more than that. On the change, I mean, you have a very, very right question. When you look at the span of 10 years, you would definitely say there has been a leadership change. I think as an organization, everything that is required to be done to hold on to the senior leadership, we do. Whether it is ESOPs, whether it is compensation survey, whether it is culture mapping. Let's not forget that under Venu's leadership and even before, we are among the best place to work, best place to work for women. I think we also have to respect individuals in today's world when they want to be on course in order to grow and, and achieve their own personal objectives. I mean, very few people like me are there who work 32 years in the same company, so I think we need to appreciate that part. The challenge will be if the organization is weak, and it cannot carry forward. I believe the organization is strong enough. The shareholders are extremely committed. The promoter shareholders who are only increasing their shareholding at 65% plus, and the board is very committed to the decision and what we are taking. I think with that, I hope I have been able to answer your question to the extent I think I can answer you. ... We appreciate that, but our only worry is that, you know, the strategic pillars may be the same, but a lot of people had come along with Venu. Do you foresee any attrition happening at the senior level or the second level out there, which can disrupt the execution? Because let's appreciate that in the second phase, you guys have also started Intune, which is itself a very significant, you know, development on the value retailing, which we have never done. So is there a slight bit of worry on the attrition picking up post-Venu, or you feel that it will be business as usual? So if you look at, if you look at attrition, I think there's two ways of looking at attrition, one by name, one by past data and one by percentage. Currently, we are talking of attrition by name, which is Venu, and I, I do empathize with what you are saying, because, yes, Venu's loss is going to be our loss. If you look at attrition level at the top level has been in the region of 10%-13%. Attrition on the front end, like any other retailer, is in the region of 25%-35%. I think the attrition will be contained within the same level. I don't see anything more than that. And everywhere in the last three years, thanks to Venu, we have actually built up a very strong N minus two team. Till now it was the N minus one, which was exposed to all of you or we were talked about. But N minus two in the last six months also has been strengthened. When Kavi came in, he came in as a Chief Commercial Officer and CEO of HomeStop, who has the background to handle the company and lead the company. And that's why we found that we had to do an internal promotion on Venu's exit and not have a gap and hunt for a person outside. Fair enough. We hope that everything settles down quickly and the company works on the growth path, and there's no change in the strategy per se. Thank you. Thank you very much. Thank you. The next question is from the line of Nihal Mahesh Jham from Nuvama. Please go ahead. Nihal, the line for you has been unmuted. You may proceed with your question. Yes, thank you. Am I audible? Yes. Yes, Nihal, go ahead. Nagesh here. Yes, yes, Mr. Nagesh. Just one question actually, was that, you did highlight the four pillars, but there have been two aspects, which have increasingly come through in the last 12-18 months. One is obviously beauty distribution, the second is on the Intune part of it. How did the expansion plans for that change, given the transition of management happened? Because the core Shoppers Stop business, as you highlighted, the four pillars, along with the N minus two team, is very much in place. The new initiatives, I think, were something that, Mr. Venu were very much driving. So if there is any pause or maybe just a relook at, these two initiatives. So thank you very much for this question, because, we wanted to keep it around, the leadership change. I didn't want to comment, but since you asked the question, let me tell you. On Intune, we opened 4 stores. The stores have performed so well that instead of opening another 10 stores, we have decided to open another 20 stores. Okay, so capital, people, resources, organization, team is all in place, and it is run very, very independently by a very young gentleman, who runs the business. I don't see any, any, slowing of growth there. Absolutely no. As far as beauty is concerned, I mean, there are three parts of our beauty business. One is the beauty within the department store. Second is the beauty which we run as standalone, which is the N plus stores that we have, Estée Lauder, M.A.C., Clarins, Clinique. So that's the second line. And the third is the distribution line, which is an independent vertical as a 100% subsidiary of the company. In fact, in the distribution line, we have been only adding more names, and we hope that we will be able to continue to add and actually perform on that. As of now, the distribution business is online to perform to what it has projected for itself. That was very helpful. That was it from my side. Thank you so much, Mr. Venu, and best wishes to the company ahead. Thank you. The next question is from the line of Samir Gupta from ICICI Securities. Please go ahead. Hi, sir, and thanks, first of all, for organizing this call, and secondly, for taking my question. My question is to Venu. So in the opening remarks, Mr. Nagesh mentioned that how instrumental you have been in strengthening the business. Just wanted if you could just elaborate on some of these aspects as how you have brought value in the last three years, and if you could also elaborate if these are more process-driven or process-oriented or people-oriented approaches. Just this question, thank you. Sure, Samir. I think over the last three years, if I look at it, the areas that I have focused on, and I will put it as three P's and three C's. The three P's being, product, sources, and people. So I think in that order is where my focus has been and the organization's focus has been. And if I were to elaborate on that from a product point of view, it is around ensuring that we have the latest trends, we have the latest fashion, but equally importantly, making sure that we are offering a curated range rather than just offering a lot of everything. It is that curation which we have been focusing on, and that is something which is an absolute strength for Kavi, and he will take that forward. ... even more strongly. In fact, one of the reasons I chose Kavi to join us five months back was with the strength, with that strength that he brings in. The second was on process. And again, taking on from what I talked about process, not just process on product, but also process in terms of who we buy, what we buy, process in terms of the selection of property, process in terms of projects, and the process in terms of the whole capitalization that we do. And the third one was on people, and I'm very proud of the fact that we have built a very strong team. Nagesh touched upon that. The senior executive team that we now have are individuals who are absolute leaders in each of their individual functional areas, whether it be on fashion, whether it be on digital, whether it is on e-commerce, Kavi, of course, on the product side. So we've got a very, very strong team. Under succession planning has been something which I have spent a lot of time on. Under the leadership team, the N-minus-two, as we call it, we bring succession at that level also. The fact that my replacement is an internal succession is an illustration of that strong planning on people that we have done. So that's the three Ps that I had worked on, and the three Cs that I worked on was, customer centricity, and I think that is something which, we have been, absolutely focused on in terms of... That's at the heart of everything that we do. During the investor calls, I have elaborated on the customer centricity and what we do. Second is on cost, and, from the time when COVID happened, we had, managed to relook at our whole business and take a lot of cost out of the business, keeping that control and ensuring that the discipline is carried forward to the skill area. The third is on capital allocation, which again, I think was touched upon earlier. That's what I have done over the last three years, and I think, the numbers speak for itself in terms of what has been delivered because of that. Thanks, sir. Very, very elaborate. Just one more question, and, pardon me for my ignorance, but, I'm just wondering, with Kavi joining 5.5 months back, was it sort of a planned thing or, you know, it just happened and just a coincidence? No, it's just a coincidence. And if you look at it, whenever we are bringing in people at every level, always, like Venu mentioned, the succession plan is always kept in mind, and therefore, he comes from that kind of a background. Let me honestly assure you, absolutely no doubt in mind, that there was no plan as such. Got it, sir. Thanks. That's all from me. Thank you. The next question is from the line of, Kalia from Phillip Capital. Please go ahead. Sir, only one question from my side. Historically, the MD and CEO have been same in the organization. This time around, Kavi has only been made the CEO. So, are you looking at an external MD for the organization? So if you look at it historically, we always kept this role and always looked at this role as a succession plan. Okay? So Kavi has been promoted to the CEO's level. We have not declared him or declared the position of MD. That remains vacant. I would play the role, although I'm a non-executive chairman, handle the company over the next 6-9 months, and the board will take accordingly a call. The reason for doing MD and CEO was also to say that at any point in time, you can cushion the organization with one role between the two roles. So currently, Kavi has been appointed as an executive director and CEO. Sure, that's helpful. Thank you, sir. Thank you. The next question is from the line of Kaustubh Pawaskar from Sharekhan by BNP Paribas. Please go ahead. Yeah. Good afternoon. Thanks for giving this opportunity. My first question is to Venu, sir. You are here for the next six months to guide Kavi, you know, for the smooth transition. So in these six months, what would be your key, you know, focus areas or aspects where you want to focus so that this transition would be smooth and there won't be any way you call flaws, flaws in whatever the growth, you know, aspirations you have? Thanks for that question. Over the next six months, our focus continues to be on delivering the strategy that we have put in place. We have got the budget and the plan for this year, and our focus, Kavi's, mine, and the rest of the teams, is to deliver on that plan. And as we speak, we don't see any change in that plan. And the way between Kavi and me, the way we would operate is, Kavi would take the lead, and I would step in as and where needed, based on mutual comfort, in terms of to ensure that it is completely seamless between us. And then, second question is to Kavi, sir. Sir, you have worked with, you know, specific brands, for example, Peninsula or, you know, for that matter, so when you work with a brand like Shoppers Stop, which has the all the, you know, you have apparels, you have beauty products, you have, you know, other services. So in that context, how you think, you know, taking this business over, you know, to the next phase of growth? Okay, see, I think, I think the strength which I have is to understand the brands and the way brands can be connected with the consumer. Shoppers gives me an opportunity to see different kind of brands work out as, as we, as we talk about customization and curation of the line, it allows us to go and offer a differentiated offering to the consumers. I think that is where I see each of the brands playing a specific role for the consumer. So that is something with my experience, I would be able to drive further. And, and we believe that whether it's non-apparel or beauty, they all add up to the whole consumer experience, and, and that's how I look at the entire thing. Got your point, sir. All the best to you, and all the best to Venu. Thank you. for your future endeavors. Thank you. Thank you. The next question is from the line of Aliasgar Shakir from Motilal Oswal. Please go ahead. Yeah, thanks for the opportunity, question to, you know, Mr. Kavindra. So a couple of things, I think a lot of the, you know, strategy that has played very favorably and, you know, positively for Shoppers Stop in the last, couple of years. One is, you know, when it was, strategy to open smaller size store, you know, which has helped, the company add about 10 stores in the last one year. And you see, you know, in last year, in the last 5 years, it would have added barely about, you know, maybe 5, 6 stores. Not because probably there would have been store addition, but probably because, you know, the stores were larger size, and therefore, there were probably many, you know, shutdowns, you know, or changes, in the format and so on. So wanted to understand your, you know, how you are looking at this, strategy of opening smaller size store. Do you think, you know, there is any change in that strategy? And in terms of, you know, the growth in number of stores, being a smaller size, you know, how do you look at the economics of this? I just want your, you know, perspective over there. I'll stop here. I'll let you answer the first question and then go to the second one. So I think, over a period of time, we have been able to optimize and understand what store size works well for us. And, given the fact that a certain kind of store size works well for us, that's something we'll continue to drive. As JSN has spoken about, we are looking at opening around 16-17 stores this year, which will be across various sizes, obviously. But we understand as a business what is optimum size, and we keep on driving around that. Got it. You know, the quick follow-up here is that, when we're opening larger size store, probably, you know, the attachment, area requirement for that is way larger, and that probably, you know, kind of restricts our number of cities or, you know, I mean, locations that we can go to. So in that context, you know, when you, open a smaller size store, probably that helps you go much more deeper. So, you know, it certainly expands your, you know, penetration, your approach quite significantly. So, you know, this kind of, has been a very key factor that allows you to expand quite rapidly. So, you know, therefore, that's where I was trying to understand if the strategy changes, and will that be an concern in terms of new cities that we can go to for our expansion plans? Oh, so, so I don't see a change in the strategy. For example, we have just opened Guntur. We are talking about opening the store in Warangal. So I think, we have just opened a store in Cochin as well. So, so the store size, different markets can have... And different markets, different cities can have different sizes of store, and we are aware of that and work accordingly. So I don't see any change in that strategy going forward. Understood. Second question is on the private label strategy, which has been a key, you know, strategic pillar for us for quite some time. But in terms of the contribution, it has still been, you know, quite low versus, you know, a lot of other brands where, you know, private label share is way higher. We understand we are in a departmental format where, you know, we are—our value proposition is to offer third-party products. But, you know, across the industry spectrum, if you see, most retailers today are, you know, trying to sell their own labels, which has led to a very significant value proposition, you know, a price point, benefits to the customer and. drives a lot of sticky customer base. Do you think this private label share that we have, you would like to drive far more significantly from what we are presently, from the high tens or to, you know, probably for 40%-50%? I'm asking this also in the context that when I see your smaller format stores, I see the shelf space provided to private label is already significantly higher, but we've not seen the contribution of private label really growing very significantly in the overall portfolio. Private brands continues to be a strategic pillar for us. In my experiences in brand building, I would be able to work closely with the private brand teams and drive that business. So that is an important part of our, of our strategy going ahead. But obviously, this is something I think should come naturally. The desire is to grow this further and ensure that this business is a strong business for us. Got it. Do you think this can grow meaningfully to, you know, probably 40, 50% plus, or you think this will kind of grow, but maybe probably around, you know, way lower percentage points, and you'll still focus on the third-party brands? Yeah, third-party brands. I, Nagesh, I think at the beginning of the meeting said that we can't share any financial data. I'm sure you're aware of the regulatory constraints we have. So, please, please call some other day. Sure. Sure. Thank you so much. ... The next question from the line of Varun Singh from ICICI Securities. Please go ahead. Yeah, thank you, sir. The question is to Kavindra on how, what's your vision for Shoppers Stop in the multi-brand, in the retail ecosystem, given that there has been you know so much intensifying competition from the multi-national brand companies et cetera into the space. And also given that you know the last three, four, five years, under Venu's leadership, all rightful strategic intervention, which has already taken effect. But still, I mean, we see relatively slower pick up in the format itself, I mean, the multi-brand retail format, and thankfully, we have entered into the value value segment, which is, of course, growing, growing fast, et cetera. But still, given this context, and also I think I would like to highlight the degree of transparency and disclosure which Venu has started imbibing. As an analyst community, we almost all of us loved it very much. I hope that that level of transparency and disclosure continues under your leadership as well. Given this context, pick up your thought with regards to how do you see the Shoppers Stop main multi-brand retail format? So, given all this competition, et cetera, I understand the growth pillars remains in this call. Varun, thanks for the question. I believe that, Shoppers as a business, as a standalone box, will continue to grow. As we have been talking about the four pillars, those remain existing, and each one of them has got a role to play in the strategy going forward. As you mentioned about Intune, and Nagesh also spoke about that, we have got a great future and we will keep on investing in that. I think, as you rightly said, Venu has done some amazing things, and the desire is to keep each one of them and build them up even further. I just want to add one thing. Rest assured on the transparency, Venu has taken it to 9 or 10. The team here will take it to 11 and 12 and not 9.9 also. Okay? That's an assurance I want to give to all investors, all investors on this call. I mean, this is a standard that we have set for us for many years. Venu has kept it and taken it forward. We continue to do that. However, I would like to thank each one of you who participated in the call, and thank you for coming in such a short notice. We actually wanted to talk to you, since this announcement was done yesterday night after the board meeting. Thank you once again. Thank you very much. See you in the next quarter call. Thank you. On behalf of Shoppers Stop Limited, that concludes this conference. Thank you all for joining us. You may now disconnect your line.