Ladies and gentlemen, good day and welcome to the Tata Consumer Q3 FY 2021 earnings conference call hosted by ICICI Securities Limited. I now hand the conference over to Mr. Manoj Menon, Head of Research and Consumer Analyst at ICICI Securities. Thank you, and over to you, sir. Hi. Good evening, good morning, good afternoon, depending on which part of the world you are joining from. Welcome to the Tata Consumer call. It's our absolute pleasure to host the management for a discussion on the Q3 FY 2021 results. We have with us today, Mr. Sunil D'Souza, the Managing Director and the CEO from the company, Mr. L. Krishnakumar, Executive Director and Group CFO, Mr. Ajit Krishnakumar, COO, and Mr. Rakesh Sony, Global Head, Strategy and M&A. Over to the management for the opening remarks and for further proceedings, please. Hi, Manoj. Thank you so much. Good evening, everybody, and welcome to the quarter three results of Tata Consumer Products. I have with me my colleagues here in Bombay and Nidhi, who is our Head of Investor Relations. I'll hand over to Nidhi now. Over to you, Nidhi. Thanks, Rakesh. If you could move the slide, please, Rakesh. Hi, good evening, everybody. This is pretty self-explanatory, the agenda. Rakesh, can you go back? The agenda of today's call would be a quick presentation by the senior management, and then we will open up the floor for Q&A. Next slide, please, Rakesh. For those of you who are joining us for the very first time, we are Tata Consumer Products, and we were formed by merging the consumer products business of Tata Chemicals with erstwhile Tata Global Beverages in February of 2020. We are less than a year old in our current avatar. We, of course, are home to some of the most iconic brands like Tata Salt, Tata Tea, Tetley, Eight O'Clock Coffee, and some of the more younger and emerging brands like Tata Sampann and Himalayan. That's us in a nutshell. I would like to now hand it over to Sunil. Sunil, over to you, please. Thanks, Nidhi. Thank you everyone for joining us today. If I take you through the executive summary of our performance for the quarter ended December 2020. During the quarter, our consolidated revenue was up 23% year-on-year with group net profit up 29%. The India business top line accelerated sequentially, while international markets also delivered a strong performance. Overall, all in, the India business grew by 33%, led by packaged beverages, which was up 43% with 10% volume growth. India foods business also was at 12% volume growth and grew 19% on revenue. We had sequential improvement in NourishCo's performance with a 9% revenue growth. Branded international, if I exclude food service, which is the Empirical food service business in the U.S., grew 13% with underlying constant currency growth of 7%. Consolidated EBITDA for the quarter was up 12%, while volume was very strong, revenue was strong, EBITDA was up 12%, with strong margin delivery in international and India foods business. The India tea business had to walk the fine lines between margin, volume, and market share, and therefore, faced margin pressure during the quarter. While the overall year-to-date margins have been largely stable despite a period of hyperinflation in raw tea prices. We have made significant progress and moved forward with our transformation journey while maintaining our focus on volume growth and competitive market share performance, the details of which we will share in a short while. We continue to invest behind our brands to drive long-term growth. More importantly, we continue to focus on the building blocks for the future: sales and distribution infrastructure, digital advertising and promotion, and innovation. In line with our strategic intent of entering new adjacent categories in the food space, we have now entered into an agreement to acquire 100% equity stake in Kottaram Agro Foods Private Limited. The brand name there is Soulfull. Additionally, we also exited the MAP Coffee business in Australia in line with our portfolio revamp. If I go over the details of the performance. India business revenue of INR 1,275 crores, growth of 46% on the back of growth 60%. India food, INR 631 crores, volume up 12%, revenue growth 19. U.S. coffee, volume 7%, constant growth of 6%, revenue growth 11% at INR 321 crores. International tea, again, a volume growth of 6%, constant currency revenue growth of 7%, total revenue growth 14% at INR 549 crores. Food service, and this is the business that I was alluding to, was down 20% in volume, down 31% in currency, down 28% on overall revenue at INR 56 crores. Tata Coffee, which has already declared its results, volume growth - 4%, revenue up 1% at INR 212 crores. Total consolidated constant currency up 21%, including Forex 23% at INR 3,070 crores. For the nine months of this fiscal year, India business, still a strong volume growth of 8% on India beverages. Revenue growth of 30%, that's primarily because of the rise in tea prices and therefore our pricing in the market. Revenue, INR 1,396 crores. India Foods volume up 9%, revenue up INR 1,700 crores-INR 1,800 crores of revenue. U.S. Coffee, double-digit volume growth at 10%, revenue growth at 19%, and almost INR 1,000 crores of revenue. International Tea, 4% volume, 13% revenue, almost INR 1,500 crores of revenue. Food Service, albeit improving, but still -35% in volume, -36% in revenue, INR 146 crores all in. Tata Coffee, volume up 6%, revenue up 10%, INR 684 crores of revenue. All in, INR 8,565 crores, up 18%. In summary, for the quarter INR 3,070 crores, up 23% on revenue. EBITDA at INR 365 crores, up 12%. Profit before tax up INR 298 crores, up 13%. Group net profit at INR 237 crores, up 29%. Margins at almost 12% on EBITDA, down 120 basis points versus the same quarter year-on-year. Profit before tax, 9.7% margin, down 90 basis points, group net profit up by 30 basis points at 7.7%. Our EPS was 2.37, up 29%, we've got now net cash of INR 1,550 crores sitting on our balance sheet. For nine months, INR 8,565 crores, up 18% revenue, INR 1,253 crores EBITDA, up 26%. PBT INR 1,080 crores, up 29%. Group net profit INR 856, up 47%. We have grown margins on a nine-month basis across EBITDA, PBT, and net profit, and EPS up by 50% at INR 8.71. Now we have outlined six strategic priorities and we've talked about it in the past, starting with strengthen and accelerating core business, driving digital and innovation, unlocking synergies, creating a future-ready organization, exploring organic and inorganic new opportunities, and embedding sustainability. To give you a glimpse of how we progress against those priorities, starting with strengthening and accelerating our core business and powering our brands. We have started our IPL drive, especially into the South. This is what you see our partnership with the IPL team in Tamil Nadu. We strengthen our position on Tata Gold in the East. We ran a digital campaign for, and we continue to run digital campaigns behind Tata Sampann Spices, leveraging our celebrity Chef, Sanjeev Kapoor. We advertise value-added salts after a long time leveraging Kaun Banega Crorepati. I will talk to you about the results in a bit. Continued to power A&P behind base salt on the idea and differentiation. Just as a perspective for IPL in this quarter in India, our total IPL spend was up by 40% versus last year. If I move to innovation, which is our next big priority, beverages was off to a fast start. We've relaunched Tulsi Green. We've launched Tetley Immune, green tea. We've launched Tata Tea Gold Care in select markets. Poha, which is growing 5x, albeit on a small base versus last year. We've added to it by launching Thin Poha, and we've seen very strong traction. Apart from that, pre-boiled tea, Tata Quick Chai, giving the convenience of boiled tea in a sachet, launched in select markets and again off to a good start. We continued our innovation drive even on the international front, so herbal infusions in the U.K., Australia, and specialty teas in Canada. Apart from that, we had launched Good Earth in Sainsbury's, which is off to a good start. We've extended the Good Earth range by launching Kombucha. Incidentally, Kombucha has won the best NPD award from the Kantar Group. Apart from that, we've also taken this opportunity to leverage our infrastructure in the U.S. to expand our India portfolio to appeal to the Indian diaspora. We've launched Quick Chai and Tata Coffee brand in the U.S. With that, I'll hand over to Ajit to walk you quickly on the integration status and how we are unlocking synergies. Thanks, Sunil. As you all recall, we have been updating on the status of the integration that started shortly after the merger was closed in February last year. It has been almost exactly a year since we started this process. Two points I wanted to highlight at the high level. One is that this formal process that we've been running essentially concludes by quarter four in this current quarter, A. B, the objectives that we had set out in earlier conversations with you, we believe we have mostly achieved. I'll highlight a couple of points from the latest quarter. I think we mentioned last time that the synergy identification had been done and that synergies had actually started flowing through. Those have been flowing through, and some of that has been visible inside our results. They are consistent with or slightly better than what we announced when our original transaction was announced in May 2019. In terms of F&B, which is a significant focus here, and we will come to that more in a minute, the substantial infrastructure of the India F&B is complete. That would include, for example, a consolidated distribution channel partner. We have essentially a distributor across most of India for our food and our beverages business. The digitization of that when it comes to urban is complete. Rural is essentially very far along in terms of its rollout. In terms of the backend, for example, the CFA consolidation, that has been completed for the north and east of India. We expect that to be completed by Q4 of this year. In terms of digital also, we have made substantial progress. We expect to go live in India with SAP S/4HANA in this quarter. We've also gone live with our business planning software for peak demand planning in Q3, and the supply planning piece of that will go live now. We are substantially along the way, and we will conclude, as I said, by this quarter. The critical piece to me here is that these are essentially enablers for the performance that we hope to generate. Some of that is already visible, and I'll hand it over to Sunil to walk through what this is meant for example, our sales distribution network. Thanks, Ajit. On this slide, you will see the integration update in terms of sales and distribution. We have substantially completed our entire combination of distributors, and all our distributors are now 100% food and beverage. We've trimmed down the number of distributors by about 63% and got scale and focus distributors. With that said, while the number of distributors has come down by 63%, dedicated sales reps and feet on street has gone up by 30%. This is in line with our target to doubling direct distribution in 12 months from start of the integration. Unique outlet build for three months are up by 65%, and the best part is 80% of these outlets are now built monthly, which shows a frequency of coverage that we needed to put in place. Rural feet on street, we've got about 700 TSOs out on the streets, which is 3x of the number that we had. We've got exclusive distributors and now direct servicing for a large chunk of modern trade and e-commerce. 100% of our distribution and channel partners are integrated in terms of automation, therefore, we have real-time access to data. While we've done that, we made sure we've held a tight line on accounts receivable, and our accounts receivable days have literally halved from where they were in the month of March, which just proves that we are moving from a largely wholesale model to more of a retail servicing model. Apart from that, exploring new opportunities. We started off on our journey on exploring new opportunities. Sampann, our total business is up by 40% year to date. I talked about value-added salt and powering A&P behind this. The value-added salt is up 110% year to date. Coffee is the other one which we have embarked on, and we have seen sequential improvement on this portfolio. Quarter one, quarter two, quarter three growths of + 30, + 21, and + 32, respectively. The NourishCo portfolio, which started -68% in April, is now up 9% as we exit quarter three and going from strength to strength. I talked about the acquisition of Kottaram Agro Foods, which are exploring new opportunities inorganically. In line with our expansion priorities, we have now acquired 100% of the brand Soulfull. This second acquisition, and you'll see many more of them as we go along, will enable us to have a better play in the better portfolio products category. This portfolio straddles multiple consumer occasions, breakfast, snacking, mini meals, convenience, healthy, clean label, no maida offerings targeted for millennial families. It's a strong brand built in select urban markets, and the key out here is select urban markets, because their total reach is 15,000 outlets. Just remember, our total numeric reach today is about 2.4 million. We started off in March with 2 million. Expanding our F&B, we are now at 2.4 million outlets. Soulfull starts with 15,000, therefore giving us a huge opportunity to expand this brand across the country. It's got a young, passionate, purpose-led management team, which we retain as we go forward. It's got in-house manufacturing and R&D capabilities, allowing us for portfolio expansion very quickly. They've got a strong NPD pipeline in the works, which allows us to expand the business. In terms of a transaction overview, we acquired 100% of the shares for a consideration of INR 156 crores. The company is to become 100% subsidiary of Tata Consumer Products. The transaction is expected to close by end of this quarter, and it will be integrated into Tata Consumer Products, starting with the sales and distribution system and gradually the entire business. The founders and key management, as I mentioned, will continue to be with the company. It's a strong strategic fit for our health and wellness portfolio. They have built a platform with differentiated offerings in the health and wellness space with an estimated market size of about INR 20,000 crores, which is projected in the next five to six years to grow to INR 40,000 crores. It's adjacent to our core category of for-better food products, access to a fast-growing brand with a new addressable target group. Most importantly, the opportunity to expand both categories. Now, just to recap, as mentioned, was our In the Kitchen brand, primarily catering to pantry of the kitchen, and this one would play on the table. Both the brands would complement each other perfectly. It also gives us an opportunity to new consumer occasions in breakfast packing. The categories that it plays in, cereals, mini-meals, health snacks, and protein drinks, are currently growing at 15%, which we will take advantage of. It's margin accretive to the total business, and we will expand the portfolio in line with current consumption trends. I did talk about the synergies of 15,000 outlets versus 2.4 million, which is our total numeric reach, and therefore scope to unlock significant synergies in sales and distribution. Apart from that, the back end in terms of procurement, manufacturing, logistics is the other piece, I think, which we can unlock. We're looking at adding the Tata brand. Consumer research shows us that adding the Tata only strengthens its credentials and takes it completely to a new platform. We have the innovation center at Pune, which already has very strong knowledge on millets and the like, and therefore we can leverage our R&D capabilities to build a platform for the future. The strong and passionate team that we acquired with Soulfull, supplemented with TCPL expertise, will create magic. Definitive agreements have been signed. We expect to close by quarter four 2021, and we will then commence operational integration. In line with our strategic priority on embedding sustainability, we continue to focus on ESG. For the second year in a row, we've featured on the CDP A- list. In 2020, we continue our water programs of Project Jalodari in Assam, benefiting about 25,000 people. We've decreased our carbon footprint by 26% over the last 10 years, and 12% of our energy is from solar. Waste management, both the U.K. and India, we are very much part of our waste management processes. Sustainable sourcing. We won the Trustea program, won CII Food Future Foundation National Award, which recognizes our work done. This program verified 680 million kgs of Indian tea, positively impacting over 6 million workers and 57,000 small tea growers. We initiated the UNICEF Malawi project this year. Apart from that, the UNICEF Improving Lives program in Assam, 250 beneficiaries, and we continue our work on healthcare for people in Munnar, Assam, and we are a proud supporter of the Canadian Cancer Society. In terms of macros, no big news. On the left-hand side, all our three major markets are coming back very strongly. U.S., while it jumps into positive territory on GDP growth, U.K. and India still are slightly below the 0% mark. The interesting piece is the piece in the middle, which is tea prices. After having a record 70%-80% growth over last year in the months of August and September, which was quarter two for us, now we are seeing prices come down. That said, they still remain about 15%-30% above last year, because while they did come down quite significantly in December, we have seen them inch up and sort of stabilize at a level early January. Coffee prices, while Arabica coffee prices saw a slight uptick, Robusta was largely stable. In terms of the categories that we play in the U.S., we saw a decline in regular black tea after strong growth of Q1 and a decent growth in Q2. Coffee continues to be high- single-digit, albeit off the highs of growth that we saw in the last two quarters. In the U.K., after growth in Q2, black tea has started to get into declining territory, we continue to see strong growth in fruit and herbals. Canada, we saw growth both in black tea and in specialty tea, high double-digits. This is because Canada was one market where the second round of COVID and the lockdowns, combined with sales promotion run, has spurred on the category. India, we saw 14% growth for branded tea, a volume growth of four. Revenue growth has accelerated from 6%- 14%. That said, I think the entire impact of tea cost, and therefore pricing taken in the market, are still not reflected. You could expect this number to keep climbing as we go into Q4. A quick snapshot of our different businesses. Starting with India, 10% volume growth, 43% revenue. We continued with market share gains. 50 basis points versus last quarter and 94 basis points versus same quarter last year. Margins for the quarter were definitely impacted by tea inflation and competitive pricing. As I said, we've maintained a fine line between margin, volume, and share, and we think we delivered a good result. Year-to-date, the segment margin is still at 14%, despite unprecedented inflation in tea prices. We have gone aggressive with Tata Coffee brand. We've reformulated product as well as pricing in low unit packs. Restage of Kanan Devan and Gemini, both of which play in the South, happened during this quarter. India foods, 12% volume growth translating into 19% revenue growth. Third successive quarter of double-digit revenue growth across the salt and Sampann portfolio. Salt revenue was up 19% in Q3 with double-digit volume growth. Market share, again, we've continued with market share gains with the highest-ever sales volume in December. Tata Sampann portfolio grew high- double digits despite in-home consumption normalizing, and EBIT margin expanded despite doubling of advertising spend year-on-year, driven by mix and a tight control on cost. Our value-added salt portfolio, I talked about it, was 2.7x versus the same period last year. NourishCo, I talked about it, starting from a negative base in quarter one. April was actually -6%-8%. It is now growing up 9%, INR 33 crores in revenue. Back in growth trajectory with very strong growth momentum in December. December was up 40%. Tata Gluco+ and Tata Water+ are key drivers. Himalayan is still a bit soft with on-premise still running behind the curve, if I may. Tata Water+ achieved highest ever volume growth in December and goes from strength to strength. We continue on our plans and expansion, both for geography as well as capacity, and making sure our innovation pipeline is ready to deliver. Tata Coffee, we had 6% growth in plantations, and overall growth of 1%. Extractions was down 3%. Top line overall 1% growth was led by Vietnam extractions and tea plantations, which helped offset the decline in the India extractions business. The India extractions business, the decline was led by a softening of the European market, which is the primary consumer for the India business. Apart from that, severe shortage of containers across the world and shipping jams did not help. The Vietnam plant is now operating at 93% capacity and new product development is gaining traction. Tata Starbucks, we've seen strong sequential recovery with December now at 90% versus last year. We're now present in 15 cities, 209 stores, and 92% of stores are open. The stores which are not open are primarily in office and mall complexes. They returned to being EBITDA positive in December 2020, despite the pressure on the top line. The non-metro cities are recovering faster. High Street is recovering faster. We opened 13 stores during the quarter. We continue to focus on making sure we are maintaining our momentum on new store expansion. It should be broadly in line where we ended last year. Dine-in capacity is still at 50%, and this is the one which is holding the top line down. That said, dine-in as a percentage has come back very strongly. We continued our effort to build the brand with the Stay Safe with Starbucks campaign, a new film on social media, launching various programs including the Starbucks 190, celebrating eight years in India, the Tata Starbucks Empowering Girls and Young Women program, where every store supports girls' education, and leveraging Indian festivals by launching the Diwali blend pan-India, a first of its kind initiative right now for India. The international pieces, starting with U.K., we had a 1% revenue growth, in constant currency terms with volume growth of 5%. It was led by discounted channels, while out-of-home and wholesale continued to be under pressure. Good Earth tea and kombucha, which we've launched now in the U.K., continues to see good traction, especially in e-commerce. Tetley continues to grow share in the rapidly growing segments of decaf, fruit and herbal, and green. We've seen strong profitability on account of good overheads management and lower trade promotions. Tetley, our super premium brand, grew by 32%, and we more or less maintained our market share in Everyday Black. In the U.S., coffee was a revenue growth of 6%, with volume growth of 7%. A strong uptick from previous quarters when volume declined. We are seeing the retail coffee category slowly returning to its long-term average growth rates. E-commerce channel continues to grow at an accelerated pace, and we are more or less maintaining our market share around the 5% mark in the U.S. market. Tea, excluding Empirical, which is our out-of-home business, which has got impacted. We've seen robust growth of 18% against a volume growth of 22. Especially strong growth seen in the Good Earth new launches of Sensorial blends, and the tea category continues to be driven by the specialty tea. I did talk about the foodservice business that continues to remain under pressure with the second wave of COVID not helping us, but we continue our innovation focus overall on coffee. Café Arriba launched in select Hispanic Florida markets, and continuing to run promos behind Eight O'Clock, including raising masks to those who have served in the American military and offering free bags of Eight O'Clock on Veterans Day. Canada, which is a strong market, exceptional revenue growth of 24% on the back of 19% volume. Canada was one market where we saw an upsurge again with the second round of lockdowns. We have not seen a similar upsurge in the U.K. or the U.S. We have seen a 41% revenue growth in specialty tea outpacing the market, and Tetley continues to be the number one brand in the market, both in regular and specialty now. We launched a range of Tetley Super 3.0 range in Canada, strong profitability in Canada, driven by higher sales as well as a strong control on overheads. In other updates, we have maintained close to 30% market share and continue to run extensive ATL campaigns in Canada. In terms of awards and recognition for the company overall, for our annual report, we received an award from the League of American Communications Professionals. I talked about Tata Consumer Products receiving an A- and being recognized in CDP's Leadership Band for the second year in a row. Sustainable sourcing with Trustea TCP Partnership, receiving an award from the CII Food Future Foundation, six of our packing centers received food safety awards from CII for outstanding performance. Apart from that, we were voted the number one brand in the tea sachet category for the eighth consecutive year in Portugal. With that, I hand over to Mr. L. Krishnakumar for highlights on our financial performance. Welcome. Thanks, Sunil, and good morning, evening, good afternoon, everyone. I'll walk you through highlights of the financial performance. As Sunil said, overall, it's been a strong quarter with a 23% growth in top line and 29% in bottom line. Though the India business was impacted by the inflation in the tea cost, and we chose to focus on volume and share. Talking through the slide for the quarter in standalone. In standalone is the foods business, the tea business that also has some amount of non-branded business included in the standalone results. Turnover of INR 1,463 crores increased by INR 500 crores or 34% to INR 1,963 crores. EBITDA dropped from INR 208 to INR 197, largely a function of tea cost inflation. Overall, the foods business did well with improved margins, but profitability was impacted in the tea business. Moving on to the consolidated revenues. 2,493 crores in the previous year, increasing by INR 577 crores or 23% to INR 3,070 crores. Of this increase, roughly about 7% or a little more is attributable to volume growth, and we saw volume growth across all markets and categories. In terms of operating profit, up by INR 39 crores, 12%, lower than the growth in turnover because of inflation in tea cost. Moving on to the next slide, our consolidated financials. Just walk you through some of the key line items. For the quarter, revenue at INR 3,070 crores, up by 23%, of which 2% is FX, roughly 7% is volume, and the balance is price increases to cover tea inflation and some amount of price increases or reduced promotion intensity in different markets. The increase in EBITDA, apart from tea cost inflation, includes also higher spend on brands and overall tight control over discretionary costs and various elements in the cost line. EBITDA INR 300 crores is high by 13% compared to the same period last year. Moving on to tax, you will find the tax at INR 55 crores is lower compared to INR 75 crores in the previous year. There are three reasons for that. One is the change in mix, it's been a strong quarter for the international business with a lower rate of tax. There's also been an element of restructuring. Thirdly, there have been some completion settlement of assessments. There have been some credits consequent to that. Talking about performance for the nine months, revenue INR 8,565 crores, an increase of 18%. EBITDA margin 14.6%, an increase over the same period last year. On a YTD basis, operating margins higher than the previous year. For the quarter, we have been impacted by tea cost inflation. PAT INR 860 crores compared to INR 585 crores, a 47% increase. Overall strong YTD performance, a little bit of impact on margins in India, and that's consistent with the overall trend for the industry, and we are focusing on volumes and gaining market share. Moving to the standalone financials. Revenue up by 24%. Operating margins for the quarter standalone, lower than the previous year, again impacted by tea cost. PAT is also lower because of the reasons that we have explained. For the nine months, revenue from operations higher by 22% and PAT higher by 19%. Operating margin stable for nine months in India compared to the same period last year. Moving on to segment performance. India beverages, an increase of 46%, and we saw earlier in Sunil's summary slide that the revenue growth was about 10%. India foods, an increase of 19% in revenue, of which 12% was volume. International beverage, an increase of 9%, and the underlying volume growth is different in different markets, but roughly a 6% growth in coffee and a 6% or thereabouts growth in tea, excluding out-of-home. Overall, it's been a quarter of robust volume growth coupled with price increase. Moving on to the segment results. In India segment profit lower by 38%, INR 79 crore versus INR 128 crore, largely a function of tea cost inflation in India. India foods, strong profit growth, 41% improvement, good growth in salt volumes. In addition to growth in salt volumes, it's also an element of premiumization as some of the new salt variants and new Sampann variants have done exceedingly well, improving the level of premiumization in the product mix. International beverages, INR 123 crores versus INR 79 crores, an increase of 56%. The volume growth is a major contributor, but in addition, it is also mixed because we had strong performance in Canada, outstanding performance by Teapigs, which is our premium brand, and also an element of cost control, which helped to achieve a fairly record operating profit from the international business. If you move on to the pie chart on the right, India beverages 45% of the total revenues. India foods 22%. Together, India business accounts for almost two-thirds of the total revenue. Moving on to the segment results. India beverages, 27% lower in relation to turnover this quarter. On a YTD basis, the trend is different. International beverages profitability contribution to the total is higher at 41% compared to the earlier quarter. That's it on the financials. We're happy to answer any questions. I'll just walk you quickly through the outlook for the business. All of you are aware that the COVID-19 vaccination programs have started in various countries. This should help with economic growth beginning next year. The Indian economy especially seems to be on a recovery path with key macro indicators moving up. All in-home consumption categories normalizing. The second wave of COVID-19 in the U.S. and U.K. does present us some level of uncertainty because, A, we are not seeing the pantry loading that we saw last time around, and second, we are seeing lower footfalls in retail stores, and that could put a bit of pressure. Tea inflation, we talked about it, in India remains a challenge in the near- term. Given all the building blocks that we are putting in place, we remain very confident of the medium to longer- term. We need to navigate margin pressure while staying focused on volume and share growth in the near coming quarters. The distribution expansion in progress and growth momentum in India foods, beverages, and ready-to-drink business, we expect to see continued momentum in these businesses. The addition of Soulfull will now give us an opportunity to expand our product portfolio and participate across multiple consumption occasions and multiple categories. The international business is expected to normalize once the vaccination program is complete, which hopefully should be either late Q4 or somewhere in Q1, we should start seeing trends coming back to normal. Meanwhile, we will continue our transformation journey that will help us deliver on our strategic priorities. With that, we come to the end of this presentation, and we would open the floor to questions. 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 handsets while asking questions. Ladies and gentlemen, we will wait for a moment while the question queue assembles. To ask questions, please press star and one. The first question is from the line of Arnab Mitra from Credit Suisse. Please go ahead. Yeah, hi. Good evening. Thanks for taking my question. My first question was on the salt business, where you've seen this very high growth in the last couple of quarters in the value-added premium salt business. My question was that in terms of after the growth that you've seen, approximately what part of your salt portfolio would be beyond more value added? Do you get a sense that there has been actual offset growth in these products to the level of your growth or there is a bit of distribution pipelining as you have expanded distribution? Where I'm getting at is, do you see this one time very large jump here or do we see this actually being a very fast-growing segment within your salt mix for a three to five-year view also? Let me leave you with two or three points and I'll ask L.K. to jump in. Number one is we have seen share gain in salt. It is obviously not only volume and distribution expansion that has led in part to volume growth as well as share growth. That's number one. Number two, we've always maintained that we have a good opportunity in salt to expand the business both on the mass end where we have local brands and unorganized players as well as on the premium end. With that, we are now focused on the higher end and we are seeing traction there, but we are also seeing growth on the lower end. I would say it's a combination of distribution expansion, it's A&P as well as expansion of portfolio because of which we are seeing growth. I do not think distribution and channel loading, if that is what you're referring to, has played any significant part in the salt growth. Okay. Thanks for that. My second question was on Soulfull. Congratulations on the acquisition. Soulfull, of course, plays in a lot of value-driven opportunities, but it has a very niche, extremely health-oriented positioning. Would you in the medium term use this to broad base into existing products also in this segment or do you think the brand has got its strength in its niche and you will probably want to keep it that way? One of the biggest reasons why we've acquired Soulfull is its current positioning of better for you and it's resonating with consumers in places where it's placed. They've got a very strong product pipeline and we see an opportunity to grow just by distribution expansion in the first place and then focusing on product expansion. That said, right now I do not think there is an intention to dilute the positioning of the product because if anything it plays up to what we bull's eye of what exactly we were looking for. Okay. If I may just ask one last question on international margins, we've seen an expansion this year. Some of it may not be sustainable because we would have had COVID benefits or better mix and things like that. Versus FY 2020, are there some components of the margin expansion or cost saving which would be permanent in nature? If you could highlight what will be those areas. That was the last question from my side. I think there are two or three things here. I think the COVID impact really, there is a one-time impact and there is a continuing impact of COVID. COVID from a demand side and some cost benefits, right? Overall what COVID has done is it has increased consumption in-home and tea is a winner when it comes to consumption in-home. Even among coffee because people are drinking coffee at home, brands which cater to in-home consumption have a higher growth rate. That, apart from pantry loading and all that which you saw in quarter four or quarter one, there's a slight uptick in category. That's the message I want to leave. How much of that will continue? We believe some of it will continue. The second part is premiumization and mix. I think a fair bit of that is sustainable because clearly that's come because a lot of people are now buying online and they're willing to experiment and buy newer brand. The product portfolio and the margin as more and more part of the portfolio gets sold through online, is also improving. I mentioned about Teapigs which is our premium offering having record growth. In Canada we have seen very good growth in some of our specialty tea herbal offerings. People are discovering that and some of that is going to stay. I think some element of mix is there to stay. A question mark is how much of slight uptick in category volume growth will stay, right? Some of the habits will remain. On the cost front, yes, there has been a lot of work on the cost. I think there is further work which can be done in terms of cost and that's where we need to do more in terms of making it sustainable. We also have an element of looking into the future of sterling sort of stabilizing from the Brexit lows and that also will have a continuing somewhat favorable impact. I think many factors are working in favor in addition to COVID. We have to work hard to make it sustainable and the demand, how much of this will continue, we need to watch. Thank you so much and all the best. Thank you. The next question is from the line of Percy Panthaki from IIFL. Please go ahead. Hi, good evening team and congrats on a set of good numbers. I have two questions. Let me put both of them upfront. First is pretty straightforward. If you can give some idea on Soulfull in terms of the total turnover and the gross margins of the company, that would be really helpful. Secondly, on the price increases, see you have done 43% value growth and 10% volume growth. That's approximately 30% price increase you've taken. I have two sub-questions to this. First is the 30% price increase, and correct me if my inference here is wrong, is higher than what the other large player in the market has taken. If not now, over a longer period of time, this price differential, will it sustain and at what cost? That is sub-question one. Sub-question two is that the key cost has already come down, and it's just a matter of time when your inventory runs out or whatever, couple of months here and there, it doesn't matter. In context of that, how do you see your margins going ahead in terms of, I know that there will be a significant pass-through back to the consumer, either in terms of MRP reductions or higher promotions, et cetera. Since the decline in tea prices will be so sharp, given that they are at such a high base, is there any chance that there will be some retention of this going forward? Firstly, let me take a punt at answering your questions, and then I'll ask Mr. Krishnakumar to jump in. Number one is on Soulfull. It's about INR 39 crores of turnover in the last fiscal year. Margins are accretive to our business. That's number one. Number two, on tea pricing itself, here's the point. I did mention that it's a fine line to walk between margins, volume, and market share. That said, just as a perspective, I think the critical point to note is market share. I did mention that we have gained share quarter on quarter, and we are up by about 90 basis points versus same quarter last year. You would see that we are not ceding ground significantly to competition. In fact, we are inching ahead. That's number one. Number two, while you mentioned that tea prices are coming down, tea costs are coming down, you're right, but I did say that they were still about December, they did come down. In January, they started inching up by about INR 10 a kilo again at the auction. I would say they're operating between about a 20%-30% premium, about 25%-30% premium on the same period last year. How fast they will go down and where they will go down, your guess is as good as mine. Our calculation is, hopefully once the new crop comes in, which is end of April, sometime May, is when you will start seeing prices to start softening. After that, yes, there might be an unwinding, but we will play it by the year, make sure that we are being competitive. At the same time, we're making sure we're protecting volume and share. I'll ask L.K. to add if I missed anything. I just, two additional comments. One is the 30%, there is this element of mix also, that there's some element of premiumization in that. The mix may not be like when you compare it with somebody else. Secondly, you are basing your view based on a period, right? The timing of pricing phase may be different for us versus competition. I think some price moves have also happened subsequent to this quarter, so I would not be fixated about an accounting quarter. Right? We are conscious of the pricing of competition, and we, Sunil said, are conscious of the level of share gain that we want to have. Just the other thing I would like to add is, remember, one of the critical pillars for us to increase our market share, and therefore volume, is also our execution out in the market, whether it is in sales and distribution, whether it is in ATL spending or in innovation. We did show you an acceleration in innovation. On sales and distribution, numeric reach as measured by Nielsen, we started off at 2 million outlets end of March, and right now we've exited December with close to 2.4 million outlets. I did talk about higher level of spending on ATL to build our brand with very targeted spends by geography. We remain quite confident of continuing our momentum on market share. That's very helpful. Thanks a lot. Thank you. The next question is from the line of Tejas Shah from Spark Capital. Please go ahead. Hi, team. Thanks for the opportunity. On last call, we had called out that synergy benefits of 2%-3% that we had identified at the beginning of the year. It will start surfacing a bit from 3Q itself. Where are we on that? Is there further room to see that advantage in fourth quarter as well of this year? We have put in, as Ajit had presented, we have put in most of the blocks in play for realizing the synergies from the integration. I would say we are much ahead, if not ahead of plan in terms of execution to realize those synergies, whether it is delayering of distribution, restructuring our go-to-market for rural markets, whether it is moving from wholesale orientation to a retail orientation. All those blocks fell into place more or less, I would say, by December, though there is still some work to be done till end of this quarter. The synergy numbers should now start flowing in. In terms of the back end, also we started the integration. Again, Ajit presented that almost half the country, the back end has got synergized in terms of logistics and warehousing. Rest of the half of the country, again, should be done by end of this quarter. We had given a guidance of 2%-3% of synergies, and we remain very confident of delivering it on or before time or ahead of estimates. Second question is, it has been a completely online or MS Team kind of management of businesses across. I believe now as market has opened up, perhaps you would have stepped out and met the team and perhaps done some ground checks also, assuming that you have acquired a company also in this period. Is the priority list in terms of to-do list, which you started with at the beginning of the year and after doing some of these checks or on the ground checks, has it changed or the priority list remains the same? I think the list is a very long list, excepting the priority list doesn't change. I don't think anything has changed in terms of the priorities. If we just execute the priorities that we've listed down, I think we will be in a good place. Sure. Last one, keeping our JV numbers have been very volatile on last three quarters. We had INR 43 crore loss and then INR 38 crore profit, and then again, it has dropped down to INR 3 crore for this quarter. What exactly, if you can explain what is going on there and in terms of volatility part. Okay. The share of profits from JV and associates, right? Yeah. In terms of JV, I talk about the material ones, right? We have Starbucks. As far as Starbucks is concerned, it has been a challenging year because of COVID, and progressively quarter on quarter they are improving. That is one end, we have some businesses in markets like South Africa which are doing exceedingly well. The third element is the plantation company, in North and South India. Because of the tea pricing increases, they have also done well relative to the previous year. Right? There is elements of volatility quarter on quarter. Right? The general story is the challenges on businesses like Starbucks are mitigated by the plantation company and markets like South Africa, which have done better. I'm not talking about quarter to quarter, I'm talking about overall for the business. Quarter-on-quarter, what you need to remember, the volatility apart from, Starbucks is in improving trend, so we should check that. As far as the plantation company, especially North India is concerned, there is volatility because a lot of the crop comes in the second quarter. Second quarter things will be a peak profitability coming down a bit in quarter three and then, not having much growth in quarter four. That volatility of plantation will be there. The underlying story is the plantation company doing well, compensating for accounting losses in Starbucks. Starbucks, as Sunil said, has been doing well progressively, and I think for the month of December, they were positive in cash flow. The sequential drop is largely to do with the plantation business volatility rather than Starbucks. It depends on the period. That's why I'm not commenting it. I'm just saying. The plantations were impacted in quarter one because of the lockdown. Starting thereon, I think the plantation business has picked up. Starbucks was severely impacted and is now picking up. I would say right now all look to be in the positive direction, but like I said, Starbucks is still at 90% of last year levels, EBITDA positive in the last quarter and right now seems back to get back 50. Sure. That's all from my side. Thanks a lot. Thank you. The next question is from the line of Devika Jain from Ratnabali Investment. Please go ahead. Hi. Basically when the new chairman joined Tata Group, he stated the vision to reduce the number of listed entities within this group. Do you see a consolidation of consumer entities within Tata Consumer? Could you throw some light on that? The new chairman's mantra was simplify, synergize, and scale, and we are fully in line with that, and we are working towards those objectives. Okay. One more question is, what is your vision for NourishCo? Sorry, what is NourishCo? Vision for NourishCo. Business of NourishCo. Yeah, vision for NourishCo is obviously we saw great potential in the brands that they have, albeit it was restricted very much in terms of geography. Tata Water+, Tata Gluco+ have been very strong. Like I said, we've exited December with growth. We see geographic expansion, capacity expansion, and portfolio expansion as being the key, and we see this business as growing multifold over the next few years. Okay. Thank you so much. Thank you. The next question is from the line of Sumant Kumar from Motilal Oswal. Please go ahead. Yeah, hi. The Tata Consumer, you said have gained 94 bps in this quarter. With the increase in direct reach, how is the market share increase expected in next three to five years? We've got a very clear objective to continue to grow our market share. Remember this 94 basis points is just as we've started our execution drive, which fell in place in December. The numbers of 94 basis points are December quarter 2020 versus December quarter 2019. We start executing, and expanding our reach, especially direct reach, expanding our portfolio, making sure we power it with innovation and ATL, we do expect continued share momentum. Okay. With the decline of more than 20%-25% tea prices recently, and we have already taken price increase as on a date. Can we expect the gross margin likely to be normalized in this coming quarter? As I mentioned, we've taken price increases, not completely in line with the tea cost. Tea costs are expected to normalize by, I would say, early quarter one of next year. Till then, I did mention that it's a fine line to walk between margin, volume and share. The tea prices have been volatile through this year. They did come down, December probably saw the bottom, again, it has started to inch up in January, I wouldn't hazard a guess on where it is headed and how it is headed. Only when the next season crop comes in, we do expect to see normalization. Thank you so much. Yeah, hi. We can take couple of questions from the webcast now. I think the first question is from Pavars. His question is: what will be the impact on the company post-budget disallowing amortization of goodwill for taxable income? L.K., could you take this? We are still reviewing the fine print. Yes, there could be an impact in cash terms, but not so much in accounting terms. We are trying to quantify, but there could be some cash outflow. It won't impact the results. Yeah. Another question is from Nikhil. He's from Swiss PMS, I guess. He said: We have made an acquisition of Kottaram. We have a brand called Fabsta, which is also ready to eat cook, although not in Tata Consumer. Do we have any plans to integrate such businesses? I will take this actually. Nikhil, Fabsta is actually a private label brand of Star Bazaar, and it is not owned by Tata Consumer Products. It is their private label and it will continue to be theirs, because it's part of their strategy. Soulfull, which we are acquiring, is a brand which is largely into breakfast cereal and healthy snack category, and that is fairly different from what Fabsta says today. Himanshu Nair, his question is: Can you share your plans for Tata Coffee brand in the branded coffee market dominated by Nestlé? Yeah, I do believe that with the Tata Coffee heritage and origins with us, given the Tata brand name, I do think we can make a decent dent into the coffee category. Nestlé and Unilever dominate this category. Today we have an insignificant share. Will we become very, very significant? Probably not, but I do think we can make a meaningful play in the coffee category. Distribution, brand, ATL and disruptive innovation is what will play a part, and you will see these things coming out very quickly. Raymond, we can take one last question. Maybe Viraj from Securities Investment. Sure. The next question is from Viraj from Securities Investment Management. Please go ahead. Yeah, hi. Thanks for the opportunity. Just had three questions. One, on the tea business, if you could just provide how is our market share moved in the Hindi-speaking belt region last couple of months, last nine months. How is the market share move? Second is on the Sampann brand and the India food business. We have been launched quite a couple of products before taking over as well. In last nine months, we also added new products to the portfolio. If you could just provide a more granular detail of how the product scale-up has been and are there any products which are more INR 50 crore or +INR 100 crore kind of a scale? How much of the growth is coming from new launches and the scale-up of the existing which we have? Any color you can provide on that. That's all. Thank you. I'm not sure I got the question on tea shares, but we did talk about growth versus last quarter as well as growth versus last year same quarter. We have seen growth almost across all geographies. That's number one. Number two, on Sampann, I think right now the growth is still happening on the products that we acquired, and we are seeing that through a simple formula of fusion and ATL. We're just embarking on our expansion of the Sampann portfolio and Poha, Thin Poha I showed you is one example. Poha, for example, we've had it for the last one year. Right now we're seeing about 5X growth on that Poha portfolio and adding Thin Poha to it will only expand the business. On Sampann both for spices and pulses, you could expect to see more rapid launches coming up very quickly. On tea, what I meant is, before we took our market share in the Hindi-speaking belt region was low single digit. How has that moved for us? Sorry, I didn't get you. In what region? Our market share in the Hindi-speaking belt region has been low- single digit in the tea business. How has that moved for us in last nine months? I am not sure that actually one of our erstwhile territories is in the Hindi-speaking belt. Punjab, Haryana, U.P., all these places and Delhi remain a very strong market for us. I'm not sure of the data on single digit. In fact, those are some of our stronger markets. Say MP and other markets, or Rajasthan, and those are the areas where market share has been traditionally low. As I mentioned, I won't comment state by state per se, but overall, we're gaining market share and we are happy to see the momentum. Okay. Thank you. I think, we can take one last question. Sure. We take the next question from the line of Nikhil from SIMPL. Please go ahead. Hello? Hello, am I audible? Yes, please go ahead. Sir, thanks for the opportunity and congrats on good set of numbers. Sir, my question was on Starbucks, where you mentioned that we are operating at 77% and still we've turned a bit of positive. Is it some structural changes at the operating level which we have brought in, which has helped us to reach this level? Which means that probably as we come back to that 100% of the revenue of our pre-COVID operation, our margin profile could be much better than what we were doing earlier. Has there been any structural changes which we have brought in at the operating level? 77% is the index of the same store versus last year, the comps. Overall versus last year, because of the addition of stores, we are operating about 90%. A, we've increased scale and therefore leveraged fixed costs and the support center head office costs, if I may. That's number one. Number two, there's been a very strong focus on costs, both at the center as well as in the stores, especially on rentals and other things. I think the team has done a phenomenal work of renegotiating rentals, et cetera. Going forward, now how those costs play out, your guess is as good as mine. I do expect because of our continued thrust on opening new stores, and as I mentioned, we expect to open close to the number of stores that we opened last year, even this year. We do expect that we will come out stronger out of the COVID-19 impact as we exit, and the business should be on very strong momentum. Fine. Thanks a lot. Yeah, I think we are good to go. Over to you, Nidhi. Yes. In the interest of time, we are concluding. If you have any further questions, please feel free to get in touch with us. Thanks for joining again. Thanks ICICI Securities for hosting us again, and we look forward to meet you all next quarter. Have a good evening. Thank you. Thank you. Thank you. Thank you very much. On behalf of ICICI Securities Limited, that concludes this conference. Thank you for joining us, ladies and gentlemen. You may now disconnect your lines.