Ladies and gentlemen, good day, and welcome to the Stanley Lifestyles Limited Q1 FY 2027 earnings conference call, hosted by Arihant Capital Markets Limited. 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 this conference, please signal an operator by pressing star then zero on your touchtone phone. Please note that this conference is being recorded. I now hand the conference over to Ms. Deepali Kumari from Arihant Capital Markets Limited. Thank you, and over to you, ma'am. Thank you. Hello, and good afternoon to everyone. On behalf of Arihant Capital Markets Limited, I thank you all for joining into the Q1 FY 2027 earnings conference call of Stanley Lifestyles Limited. Today from the management, we have Mr. Sunil Suresh, Chairman and Founder, Ms. Shubha Sunil, Whole-time Director, Mr. Venkataramana Seshagirirao Gorti, Managing Director, and Mr. Sudhir Iyer, Group CFO. Without any further delay, I will hand over the call to management for their opening remarks. Over to you, sir. Good afternoon, everyone, and thank you for joining us for the Stanley Lifestyles Q1 FY 2027 earnings call. As we begin the new financial year, I would like to share some important updates on our business and the developments we have undertaken during and after the quarter. Store expansion and network rationalization. I would like to begin with the developments across our store network. At the retail level, our focus remained on expanding our presence in the right market, while also reviewing the financial prospects of our existing network. During the quarter, we opened three new stores, all in Bangalore. Two stores were opened in Varthur, and one store was opened in Mysore Road. At the same time, we accessed the relevance of each location and relocated resources strategically. The residential development cycles in certain catchments had largely matured, so we closed four stores, three in Bangalore and one in Mumbai. Our approach is not only about adding stores, it is about having the right stores in the right market and ensuring that the network remains productive as the surrounding market evolves. The selective approach also positions us in areas with higher customer acquisition potential. Expansion into new markets. Beyond managing current operations, we are executing a deliberate growth strategy. We entered our first international market in July, opening Stanley Boutique in Colombo, Sri Lanka. This was achieved through a strategic joint venture with Singer Sri Lanka PLC, one of the country's leading retail companies. The partnership provides access to local market knowledge and a platform to deepen our understanding of customer preference as we establish our international presence. We have also expanded our presence in India with the opening of our new Sofas & More by Stanley store in Jaipur. This marks our entry into Rajasthan. Jaipur has developed into an important market for the premium housing and lifestyle products, and the new store brings our furniture portfolio closer to customers in the region. Stanley Superlative Living. Looking beyond our existing formats, we are also preparing to introduce Stanley Superlative Living in the matured market, where there will be one large Stanley store. This will be positioned at the high end of the luxury segment and being developed at par with global luxury retail standards. The format is intended to bring complete home solutions together under one roof, with a focus on design, product presentation, and customer experience. We believe this format can further strengthen Stanley's positioning in the luxury home segment and support our longer-term ambition of building a global footprint. With that, I would now like to hand over the call to our managing director, who will take you through the financial performance and some of the other key initiatives during the quarter. Thank you. Thank you, Sunil. Let me begin with the financial performance and business environment during the quarter. The revenue from the operations was at INR 9,935 lakhs, down from the INR 10,867 lakhs in Q1 FY 2026. Majorly, two factors impacted the dip in the revenue. The first one is our B2B business. It faced challenges with respect to the Middle East war, where it was disrupted because of the freight movement issues. While we have a healthy order book from that, the products have been produced, they are with us, but the logistics is the challenge what we are facing as of now. Second, our retail business operated in a short-term challenging environment. Stanley's customers are primarily new home buyers in the premium and the luxury residential segment, representing 80%-85% of our base. Residential project handovers have been delayed by 12- 18 months in several cases. Supply chain disruptions in West Asia have also constrained the availability of construction materials. As a result, while customer inquiries and store footfall remains encouraging, conversions are slower as customers await possession of their homes. Despite the lower revenue, we have maintained our gross margin during the quarter. This has been supported by the restructuring initiatives undertaken by the company, as well as our continued localization efforts. This disciplined approach resulted in an EBITDA of INR 1,722 lakhs with a margin of 17.3%. PAT was at INR 65 lakhs. I would also like to talk about an important initiative for us, which is the proposed amalgamation of our subsidiaries and step-down subsidiaries into Stanley Lifestyles Limited. The objective of the amalgamation is to create a simpler and more integrated corporate structure. This will reduce the number of legal entities within the group and make management, governance, and reporting more efficient. At the same time, a unified structure will allow us to deploy our cash, manpower, assets, and other resources more efficiently across the businesses. More importantly, we believe this will create a stronger platform for future growth. It will provide greater flexibility for future expansion, fundraising, M&A, and business integration, while also improving accountability and decision-making across the organization. We appreciate the support of our shareholders and remain committed to completing the proposed amalgamation. Furthermore, as we continue to strengthen the organization and build the right leadership team for the next phase of growth, we welcome Mr. Sudhir Iyer as our new group's Chief Financial Officer. Mr. Sudhir is a chartered accountant with over 20 years of experience across corporate finance, M&A, IPOs, and corporate governance. We are confident that his experience and expertise will support Stanley Lifestyles in its growth journey. Looking ahead, our priorities are clear. We will focus on improving customer conversions as residential project handovers progress. We will expand selectively to relevant markets, accelerate localization, and develop our complete home solutions portfolio. We believe the work being undertaken today will strengthen the foundation of the business and position Stanley Lifestyles well for the future growth. This concludes our remarks. We can now open the floor for questions and answers. Thank you. Thank you. We will now begin the question and answer session. Anyone who wishes to ask a question may press star and one on their touch-tone telephone. If you wish to remove yourself from the question, you may press star and two. Participants are requested to please use handsets while asking a question. Ladies and gentlemen, we will now wait for a moment while the question queue assembles. Our first question comes from the line of Saket Kapoor with Kapoor Company. Please go ahead. [Non-English content], team, and thank you firstly for the opportunity. Hope I am audible. Yes, you are. Sir, firstly, if you could also explain to us the depreciation rate and the depreciation amount. I think so that is in the higher tune of, I think so, INR 15 crore on a quarterly basis. So what kind of assets are depreciated? I think so an annual depreciation of above INR 50 crore. Firstly, on this front, secondly, how do you see the year progressing in terms of the volatility that we are seeing in the geopolitical setup? Then going ahead, how are the factors that have attributed to de-growth for Q1 that mitigates going ahead, sir? The first question will be answered by our CFO about the depreciation. Yeah, Saket, good afternoon. Good afternoon and welcome, sir, to the team, sir. So basically, the depreciation is because of the Ind AS impact. I think I should give a clear bifurcation because of the Ind AS impact, because depreciation is there. Okay. Yeah. That is a very significant amount. I only wanted to understand the nature of our assets that leads to a INR 15 crore quarterly depreciation. That was my question. Exactly. See, if you look at the IGAAP, the depreciation will be lower because of Ind AS. What we will do, we will leverage entire spends to bifurcate the entire number of years. So the more load has been loaded to that quarter. It is front-loaded, actually. Front-loaded. Yes. It is front-loaded, yeah. Purely, I can tell you in a nutshell, it is because of Ind AS impact, not on the IGAAP. Correct. And sir, on the growth prospects going ahead, and also firstly, sir, if you could just also throw some light on the utilization levels as we are also looking to restructure the operations and the synergies that will happen post the merging of the subsidiaries, which you have just mentioned. So what kind of EBITDA margin trajectory can we anticipate, and how are currently our utilization currently shaping up? And going ahead, how will they trend? So yeah. So let me commence by saying that the main task that we set out as promoters for the last one year in terms of making the most important senior leadership change, that is already in place, and we are very, I would say, satisfied with the way that has taken shape. That was the most important task for us. Secondly, as far as business is concerned, we are very clear that our B2C business, the architecture is being redone. We are going through a complete change where we had three brands. Now that's going to be folded in. Going forward, there will only be one Sofas & More and one Stanley brand. That is a brand architectural change we are doing after 8 to 9 years, because that is the way that we see is going to be more conducive. Stanley is going to become a complete home solution provider. We're moving from a furniture to a complete home solution provider. Whereas Sofas & More will play the role of what Stanley played in the past. It will be a furniture retail concept. So that architecture is also going on. We hope that it should be completed in about three to four quarters from now. It's a gradual process, and we also did some certain changes. Actually, we relocated. Technically, we did not close some stores, but we relocated. As the markets mature and the catchment fills up, unlike other grocery stores, furniture is a more need-based business. So we need to now relocate some stores and go to new catchments where new residential buildings are coming up. So that is what has happened. Thirdly, from our B2B business, in fact, we have the highest ever visibility of opportunity from our B2B business. But unfortunately, due to the Middle East, we were unable to build. In fact, we have produced the products, and we are not able to invoice in quarter one because of the shipment issues and logistic problems. But we hope that it's going to get cleared. We are hoping that once we get the logistics moving, we should definitely have much better quarters ahead. So can you give us some color how our EBITDA margin will shape up, and how are the utilization levels? What are currently our utilization levels, the control level? Utilization of, you are talking about the manufacturing capacity or? Yes, the manufacturing capacity, definitely. And the amount of inventory that we are currently holding. See, sir, two things. One is that our manufacturing capacity is currently at about 68%-70%. Secondly, in terms of our inventory, because August usually Europe closes, so we have to forward load, so we have a little higher inventory just now. Because for us, the season starts in September and August usually Europe closes. So normally the first quarter, our inventory increases a little bit. That is a normal thing for us when we go back historically. Okay. Lastly, sir, since we are a home solution company and we are looking forward to providing, the service part also plays, the maintenance part also plays a big role because of the value of the sofas and the furniture. Do we have any other forward integration in terms of the service part also, wherein we provide our customer with a post the guarantee of the warranty expired, how do things shape up and what steps do we have for the service part of the issue because of the wear and tear of the surfaces with the passage of time? This is a very valuable question that you have asked me. It's a very valuable question because we cater to the premium end of the market or the luxury market, whereby word of mouth is extremely important for us. Up till now, we have been extremely careful. We have never tried to, just to show growth, done anything wrong, and we have been very careful in handling our customers. We almost have a 98% of customer satisfaction report, and that is an ongoing thing. Now we are in fact enhancing our products as well as our services by introducing new training into our retail chains. These are the changes that we are making. It's a very important question, and you're absolutely right. As the country progresses and the premiumization has started, people want premium products. They want luxury products. At the same time, we should be able to not only give them the customization product, but also the services. It is an ongoing process. We are definitely now, I would say, taking the playbooks a little more seriously than what we were in the past, and we are articulating that in our retail stores. Right, sir. Lastly, sir, the other income component is merely on the treasury, the cash we have on books that is attributable to the other income component? Yeah, Saket, you are right. This is the internal treasury what we have. Okay. Right, sir. Thank you, and all the best to the team and joining the team, sir. Thank you very much. Thank you, Saket. Thank you. Thank you. To ask a question, ladies and gentlemen, you may press Star and One. Our next question comes from the line of Ashish with AK Investments. Please go ahead. Yeah. Am I audible? Yes, you are. Okay. Thank you for taking my question. First of all, I think most of retail businesses, they are reporting pre-Ind AS margins, right? But I think we are not reporting. As a feedback, can we start reporting that? Because from an analyst point of view, it is important to analyze pre-Ind AS margin, right? No, let me correct you. We should report Ind AS numbers only, but we can add the clear clarity to you what IGAAP looks like offline. But for financials and for publication, I wanted to go for the Ind AS matter only. Yes, separately, we can mention pre-Ind AS EBITDA margin as well. Yes. Okay. Thank you. Also, I want to understand what our pre-Ind AS store level operating margin in each format, if you can give me that. For each store you wanted, I think- No each store. Each format. Each store format. Just a minute. We'll give you. Pre-Ind AS. Yeah. Yep. If I wanted to average it out, our pre-Ind AS gross margin will be hovering around 56%-60%. You are giving me gross margin or EBITDA margin? I am talking the gross margin. If you wanted the EBITDA margin, it is hovering around 11%-13%. Gross margin is 56%-60%. EBITDA margin is between 11%-13% currently. Okay. It is like consolidated all three formats put together, right? Yes, all three formats put together. How much is our corporate cost? Corporate cost. It is roughly around INR 90 lakhs per month. Okay. On the revenue, sir. It is 10% [inaudible] 10% of the revenue. 2.5% of the revenue. 420 divided by INR 90 lakhs, INR 11 crores. About 2.25% of our total revenues annually, but right now it is at about INR 90 lakhs per month. Okay. Is there any opportunity to reduce corporate cost? I think as we scale up and as we add more stores, is there any opportunity to reduce the corporate cost? In fact, I think we are now going to go through a bit more of additional corporate expenses because the store formats are actually changing and there are early stores. So we need the right set of people, and that is exactly what we have done in the last one and a half years, identifying and taking better qualified people at all levels. So the corporate expenses probably will hover around the same as we grow. Okay. Point taken. Yeah, thank you. My other question is, can you give me average revenue for mature store in each format? Mature store average revenue per square feet is what you are asking. No, per store. Sir, per store is difficult to say because, see, our Sofas & More are averaging at around INR 4.5 crores per store. Okay. Our Stanley Boutique, which are now going to be merged into Sofas & More, are averaging again about INR 5 crores, INR 6 crores per year for 40- 50 lakhs per month, about INR 5 crores- INR 6 crores a year. Stanley Level Next- Okay. Is hovering around INR 12 crores- INR 14 crores a year. Okay. They are all of different size formats. It is a bit tricky for me to give you, but average, we are looking at our stores, Sofas & More, around INR 5 crores per annum is a kind of a number, INR 5 crores-INR 6 crores. Stanley Boutique, similar number, around INR 4 crores-INR 5 crores is the number. Stanley Level Next is about INR 10 crores and above. Some stores are even giving up to INR 20 crores. Okay. Understood. How do you classify a mature store, 24 months or more? No, it is between. See, it is again, depending on the location and the catchment area. We have had the maturity kickstart at about 18- 20, 22 months. In some cases, it goes to almost 38- 40 months. So average, you can say 36 months is a very good period for us to, what we call as, become ROI, that is return of investment or maturity. Okay. So how many, I think in your initial remarks, you mentioned we close certain mature store. At what stage do we decide to close down or move? Actually, Bangalore, we have closed down four stores, out of which two have already relocated. We have also relocated and opened the other stores. We have gone further down on the same streets or same highway because the catchment area has moved. One of the stores we had to close because in Commercial Street, when we took the store, they had given us a lot of parking in the front, and finally, the local body had to change the entire rule, and they made it a one way, and there was completely parking take off from there. Our footfall drastically dropped, so we had to change that. This is a bit of a, I call it as a industry problem or a retail hazard, because many times when we go to certain areas, suddenly there will be like a metro that will come up, which we will not have a visibility before we take the building. We are trying to put a lot of checks and measures now. We try to go to the BBMP or the BDA and understand whether these roads are not going to have any problems. We are also learning to expand in a more careful manner going forward. Okay. When we relocate our stores, are they as good as new store? I mean, if it- Just now we have opened Mysore Road, is about six months old. No, three to four months. No, in terms of- In this case, I can just give you an example. We have relocated, and the business is almost 2.5 times more than the previous store. Okay. Understood. Makes sense. If you can give me rent expense for this quarter. Rent, is it? Yeah, rent. Rent expense for this quarter. For the whole quarter. Consolidate this? Consolidate? Yeah, consol. 10% 10%, sir. [crosstalk] 10% of revenue. Yeah, 10% revenue. Right. Yeah. Okay. Lastly, can you give me per store CapEx? How much it takes to open a new store in each format? Yeah. So basically, like I said, we are going through our brand architectural changes. In fact, last couple of quarters, when we made earnings call, some investors also suggested that there is a bit of confusion in the market with Stanley having two, three different positioning. So that architecture is just started. In certain mega cities where we have actually bought over our franchisees, we are opening one large format Stanley stores and going to have only smaller format Sofas & More. So the CapEx as of now for Sofas & More is roughly about INR 2 crores per store. The average size is 5,000-6,000 sq ft is what we are looking for. But for the larger one city, one store, the CapEx can go up to INR 20 crores. So that is the kind of CapEx we will involve in the bigger stores. That will just be one city, one store. We have already started work on the one in Hyderabad. Hopefully, we should open in the next few weeks or so. Then we are also doing the same thing in Bombay. We are consolidating and opening one large format store. Then Bangalore and Delhi. So four cities where we are present for more than 15, 20 years, we have decided that we are going to go with one city, one mega store for Stanley and smaller Sofas & More in the same city, which are going to be standalone value premium kind of an offering. Stanley will be in the luxury offering. Okay. Understood. Thank you for answering my question. Wish you good luck. Thank you. Thank you very much. Thank you. Thank you. Participants, to ask a question, you may please press star, then one. Our next question comes from the line of Nishant Sahu with Green Portfolio. Please go ahead. Good evening, sir. Thank you for this opportunity. Good evening. Am I audible, sir? Okay. Yes. Sir, I read your annual reports and other offerings. Sir, exports aren't disclosed separately anywhere. What was the export revenue in FY 2026 and Q1 FY 2027? Is this a business you intend to scale, sir? Sorry. We do not have a big percentage of exports as yet. It is domestic market work mainly. Only domestic market you work at, sir? Yeah. Are you exploring, sir? We have just started with our first opportunity in Sri Lanka, so exports is something that we are going to focus on in the road ahead. As of now, we are mostly manual retailers. Okay. And sir, what is the growth and margin driver from here, given mature store growth? From here, what growth you will expecting, like growing revenue and margin from here at current level, Q1? Our focus is constantly to ensure that we are not just growing the company from a quarter-to-quarter perspective. We are building this brand and company for the next decade. So very focused in terms of having the It needed the plumbing changes. Those plumbing changes are completely now on its way. They are very happy the way it is taking shape. So we aspire to be an Indian luxury brand, and we are going to make sure that our profits also are going to be in the premium range of the market. So that is exactly where we are at this point in time. Okay, sir. And one more question, sir. You uploaded the filing misappropriation of funds by CS. Could you please put on the light on this statement, sir? On the [inaudible]? No, sir. The CS. You resigned was CS, and. [inaudible] CS was resigned and this one, sir. I will just brief you out on this. We found that while doing the Q1 audit on the internal controls, we found some fraudulent activity has been done by the company secretary, and the investigation is going on, and we will let you know to the public in short while once we complete the investigation. Okay. There is a misappropriation of funds in your findings? You are right. Okay. Thank you, sir. Thank you. Thank you, Nishant. Thank you. The next question comes from the line of Arvind Arora with A Square Capital. Please go ahead. Hello. Hi, thank you for the opportunity. Sir, first of all, welcome to Jaipur. Sir, I am more interested in the segment that you have just announced, the Stanley Superlative Living. Could you give some details on this, like what we are planning? Are we planning to open new store for this or we are going to sell through Stanley Level Next? What will be the price point? What is our go-to-market strategy? Any directional things like directional target in this segment, if you can throw some lights on there. Yes. In certain key markets, I want you to understand that post our IPO, we have diligently acquired our franchises in multiple cities. That includes Hyderabad, Mumbai, Pune, Delhi, Chennai. These six cities today where we have our COCO presence contributes almost 80% of India's luxury housing. That was the first thing we did. Post IPO, we strategically acquired this market. Now in these markets, we are very aware because we have actually been present in these markets for more than 10, 15, 20 years in some of the markets. We understand what is the kind of housing boom that is happening, what is the number of units that are going to come for furnishing. Based on data, we decided that we want to have a new brand architecture. Stanley Superlative is nothing but it is a larger format of store where we will shut down some of the smaller Stanley stores, and in a right location where we have already a street that is catering to furniture. For example, what we have done in Hyderabad is Jubilee Hills, Road number 45. It has almost 30, 40 furniture stores. One of India's largest furniture store is also there opposite to us. We have opened a fantastic new store. This store is going to be positioned in the premium to luxury housing, where actually we will be giving design solutions to complete home solution maker. It is not just a retail outlet, but we will take the entire house project, so our average ticket size can go up almost tenfolds from where we are. That is the target. That is the store we are going to open. Hopefully, we are around two to three weeks away from opening that store. Sir, this superlative living would be an ultra-luxury thing. Is my understanding correct? You can call it from premium to luxury. It will not be ultra, it will be premium to luxury. I mean, that way, luxury can be going into multiple ultra and uber and so on and so forth. But it is very clearly a store meant for anyone with a budget of INR 3 crores- INR 5 crores and above, not for homes below INR 2 crores. That is the kind of budgeting. Okay, understood. But our development, like the delivery of the product would be in-house, correct? It's not like an only service arrangement in this category. Sorry, come back again. You said like we will design. I just missed out. You are saying we will just design or we will also deliver the product? No, we will design, build and deliver. See, that is our We are the only company which is fully integrated today. While multiple players in the market, they outsource and give it to you, but we are able to give a complete solution, design, build and install. Understood, sir. And sir, you mentioned- With the warranty of the product and the warranty on the installation. Understood. Okay, fair enough, sir. And sir, we have more than 1,000 skilled artisans as of now. So what is utilization level of that? Currently, our utilization of our manufacturing facility is at about 68%-70%. We can easily kind of go up to 2x our revenues in the next coming quarters by recalibrating our factory by adding a few machines if required. But I think we are quite comfortable with space what we have for the next two to three years of our growth. Understood. My question is not on factory or on those sides. I was asking, we have artisans more than 1,000. Are they all fully utilized or are there someone on bench or something like that? No. Our artisans I think are fully utilized. We are always upscaling them, upskilling them. The fact is that we are constantly also looking for younger artisans to skill and take it into our fold. We are always looking for good skills as far as artisans are concerned because in the luxury business, you cannot mass manufacture. We have to custom-make bespoke products, so thereby we need these artisans. What is your order book as on June 30th, 2026? It is INR 68 crores. INR 68 crores, I think it is. Okay. In presentation, we have mentioned INR 62 crores as on March 2026. As of now it is INR 68 crore, correct? INR 68 crores, yeah. Okay, very nice. Thank you, sir. All the best. Thank you. Thank you. Participants, you may press star and one to ask a question. Our next question comes from the line of Siddharth with ICICI. Please go ahead. Hi, sir. My first question is, what would be the same-store sales growth of matured stores? You see, we are exactly doing that, what I call as a product mix change. We have now expanded our manufacturing facility, which is capable of producing furniture for every room of the house. Earlier, if you go back five years ago, we were only an upholstery brand. We were only known for sofas. But today, if you all visit our manufacturing facility, which we always welcome you to, you will realize that we have specialized and set up our manufacturing facility to cater to all different kinds of products that a normal home will require. The same thing, once the facility is ready, now we are changing our stores, so we are introducing kitchens, wardrobes, tables, bunch of other things. We believe that our same-store growth should exponentially grow as we go forward. But right now we are in the transition. A matured store, if we are growing at about 15%-20% year on year, we should be very happy and that is what we are targeting. Hello? Siddharth, does that answer your question? Yeah. My question is, what kind of number would matured stores be doing as in SSG? Same-store, I think matured stores should do about 15%-20% year on year. That is what we are seeing. In Q1. In Q1, we have made multiple changes. I think we are projecting about 15%-20% growth. Q1, we are actually negative, a bit negative, because we are changing the models also. We are changing the models of the store. Okay. Sir, if I understand this correctly, let's say the Stanley Superlative Living is basically a combination of Stanley Boutique and Stanley Level Next into one large format, full home. Yes. You are absolutely right. It's a one large format. It has completely to do with only Stanley. Sofas & More by Stanley is now, By Stanley is going to be removed. Sofas & More becomes a value premium brand. Stanley Superlative Living will cater to both Stanley Boutique homes as well as Stanley Level Next. You're right. Going forward, won't you open Stanley Boutique or Stanley Level Next by those names? In the six major metros, we do not have any plans. Depending on the size of the other markets, we are flexible. But in the six major metros, the idea is to bring everything under one roof so that the brand Stanley has one store per city. These are large format stores and there is no point diluting them anymore. Wherever the markets are matured and the high street for furniture are already formed, we want to just open one large store and do our business from that store. Sofas & More, we may expand depending on the geography of the city or the cluster of the different cities and towns we are looking at. Understood. So in this format, you will also do interior designing for luxury homes? You are right, absolutely. This is not going to be a furniture store format. It is going to be a complete design build format. So we will do interior design, but sticking mostly to what we supply. We are not going to do any construction work as such. It will be basically fixed furniture and loose furniture and some wall coverings and furnishings and soft furnishings. It is mostly interior decoration. Okay. Understood. That is all. Thank you very much. Thank you. Participants who wish to ask questions may please press star and one on their touchtone telephones. Our next question comes from the line of Manjeet Buaria with Samya Advisors LLP. Please go ahead. Thank you. Good afternoon. I had one question. Sir, you just explained in the previous question that going ahead, we will merge Stanley Level Next and Stanley Boutique into one store for each of the six metros. When I look at your presentation, for example, let us say Pune has one Level Next and two Boutiques, and maybe Mumbai has one Level Next and two Boutiques again. Will these three stores become one store and we will be sort of shutting two stores in these metros? No. I am confused. How will that work? Yeah. Very good question, sir. What we are going to do is some of the stores, Stanley Boutiques will be downshifted to become Sofas & More. We will not shut because they are all good already, what you call as a good traction and good business generating stores. We will be converting them into Sofas & More as a pushed-down brand. Like I said, whichever city we get the right location, the right building, we will go into one single format. Otherwise, something that is working, we are not going to fix as of now. It is a gradual process. It is not going to happen overnight. It is going to take at least about two to three years by the time we execute this. But stores which are doing good, we will actually just change the board to Sofas & More instead of confusing the market with two, three Stanleys. That is what we have done in Hyderabad. Hyderabad is our first proof of concept we have started. Next, hopefully we will do the same thing in Bangalore next year. Then we will do it in Bombay and Delhi. But the Stanley Boutique stores will be converted into Sofas & More stores. I hope I am able to explain this to you. No, this was helpful, sir. One follow-up there is, if you look at geographies like NCR or Mumbai, which are sort of wide in terms of presence, even Bangalore for that matter, the breadth of those metros. Do we envisage just one Stanley store for each of these metros, like even sort of in medium term over the next four to five years, or then it will sort of start expanding again to sort of give presence across these cities? It all depends on the location, sir. If we get the right location and the right building, and there is already a matured market which has got a right furniture, high street, we prefer to have one store because control is much better. Furniture being a once in a 10-year kind of a purchase, people will normally go to a market and select from multiple brands there. Not necessary that we have to be thinking like a fashion brand or thinking like any other daily consumption kind of a brand. This is the strategy we are using, and this will definitely help us to control things much better. If the market is big, we will add two stores. I mean, it is very clear, for example, in my mind, Delhi can easily take two stores, Bombay can take two stores, Bangalore also can take two stores. We are strategizing. Wherever the market is there and there is a prominent premium luxury furniture brands that have come into that, they are all in one particular area, we will go there and open a large format store. But in some cities, it depends on the city to city. We are open to it, but the Stanley Boutiques which will be there will be consolidated once you open a large superlative, and that Stanley Boutique will become a Sofas & More. Got it. Sir, one last question was, I think a couple of calls back you had explained to me to one of my questions that sometimes a location sort of loses relevance because it becomes a mature market and the store no longer gives the same throughput because development in that area is over. That is just sort of contradictory to what you explained, it being a once in a 10-year purchase, people should be willing to come wherever our brand is. If you could just conceptually help me understand why won't that be applicable now in our newer case as well, where we open in one location and then we expect everyone to come there, sort of irrespective of what the development of that location is. Let me explain this to you in a way where you will understand. Sofas & More, by and large, almost 95% of the customers who walk into our stores and buy the furniture are direct customers. They don't need to have designers or specifiers. They come and buy the furniture what they want and take it to their apartments or homes. That is not a designer driven or an architect driven kind of a purchase. Whereas Stanley is more a premium luxury offering, where many a times we have specifiers and high-end customers coming and asking us, can you give us the design solution? This is the difference between Stanley and Sofas & More. Sofas & More can still continue to be available in the right catchment area where the fill-up is happening. Once the fill-up happens, probably we need to sometimes shift it to the next nearest fill-up happening or the next nearest cluster that is developing. Whereas Stanley, see what happens, sir, if you might want to understand a bit better, in matured market like New York or any other larger like Milan or New York or Frankfurt, there is something known as design district. These design districts house all the top luxury furniture brands. That is slowly happening in India. For example, when I said Road number 45, Jubilee Hills, Hyderabad is already becoming like a design district. MG Road, Gurgaon road in Delhi is becoming like a design district. In Bombay, we have Bhiwandi, but Bhiwandi is not a design district, it is a wholesale market. The whole country is sort of moving in a slightly different manner and we being present in these markets for more than 25 years, we understand where to be and what format to be. I would say almost 95% of the time we have had good success rates. Of course, there are certain cases where when we open the store, we have problems with metro coming up or some kind of a road expansion coming up. These are hazards that we are living with, but that is the truth and that is how we want to go forward. Got it. Sir, this is very helpful. I have one more question. Can I ask it or should I come back in the queue? Yeah, I think you can go ahead and ask since you are here. Okay. Sir, on the B2B side I was again curious. I know we have some fantastic manufacturing capabilities, and exporting out of India is an opportunity. I do not understand whether it is an opportunity in our category where we cannot make enough margins, is why we are holding back on it, or is there some other reason? I thought that could have been a big opportunity for us to leverage our infrastructure in India. That was the last one. Thank you. We were also extremely excited about that unless the tariffs were kicked in from America. Otherwise, we were already deep in discussions with quite a few large buyers from the United States. We are hoping that that will cool off, and we still believe that we being exporters to some of the best brands in the world. Actually, we supply to the leaders in the categories capable of doing it. Unfortunately, the tariffs is not helping us right now to the United States. That is the biggest market, and we believe it will turn around sometime because they are also looking at what we call as a China plus one or China plus two kind of a strategy. So we are still keeping our fingers crossed as far as export opportunities are concerned. Nevertheless, we are more excited because BIS is coming into effect actually from today itself. Today is a very special day for us. February 14, BIS came into effect. Six months gazette has put it till August 14. I think from today will be the last date. People cannot import anything from tomorrow where there is no BIS certification. We believe all this is going to help us going forward. Thank you so much, sir. Thank you. To ask a question, ladies and gentlemen, you may press star and one. Our next question comes from the line of Nishant Sahu with Green Portfolio. Please go ahead. Sir, I want to ask one thing. Of your 47 COCO stores, how many are EBITDA positive at store level? Like after cash rent. EBITDA positive? EBITDA positive. Yes, sir. Of COCO? At store level. Of COCO stores. You have 47 COCO stores, right? Yeah, 47. I think if you remove Commercial Street, I think most of them are Most of them are EBITDA positive at store level. One minute. Correct. Am I right? One minute. I will let you know. 35 stores. 35 stores are EBITDA positive. Some of them are brand new. One or two which we are setting are not EBITDA positive, but out of the 42, 35 are EBITDA positive. What about FOFO, sir? FOFO stores? FOFO? Yes. FOFO we do not have to worry about because we are a cash and carry model. We sell everything to them and they manage their business. At their end. Yeah, at their end. You just sell them the goods. Yeah. We are a cash and carry company. We do not give any credit or anything to our franchisees. You don't charge anything? Yeah. Okay. And sir, how much time it would take to become store EBITDA positive, like five months, six months, 12 months, 1.5 years, after opening the stores? EBITDA positive should happen between six months and 12 months, and our ROI should happen between 24- 36 months. When I say ROI, we call it as return of investment after calculating the interest. It's 24? ROI is 24%-30%. 24%- It means in three years, 30%. It means your capital would be paid back in three years. Correct. Capital with interest. Capital will be credit. Okay. Thank you, sir. Thank you. Thank you. Participants who wish to ask questions may please press star and one at this time. Ladies and gentlemen, we will take that question as our last one for today. I would now like to hand the conference over to the management for closing comments. Over to you, gentlemen. To summarize, as we mentioned, we still see that there is a good market pool with respect to the demand. There are, of course, challenges with respect to the West Asia crisis, but our focus is to see how we actually work to improve our customer conversions, work on our cost management efficiencies. We believe that we are getting ready when the West Asia crisis comes down to really work on the growth path, what we are working on. That's the confidence we have in what we are doing as of today. That's all from our side. Thank you. Thank you. On behalf of Arihant Capital Markets Limited, that concludes this conference. Thank you all for joining us. You may now disconnect your lines.