Ladies and gentlemen, good day, and welcome to Tata Consumer Products Limited Q1 FY 2023 earnings conference call hosted by ICICI Securities 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 the conference call, 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 Mr. Manoj Menon, Head of Research, ICICI Securities. Thank you, and over to you, Mr. Menon. Okay, hi, everyone. It's a wonderful good morning, good afternoon, you know, to you from India, on the auspicious day of a celebration day today. Thanks for taking time out and joining this call. Now I just hand over the platform to- Your touch-tone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Manoj Menon, Head of Research, ICICI Securities. Thank you, and over to you, Mr. Menon. Okay, hi, everyone. It's a wonderful good morning, good afternoon, you know, to you from India, on the auspicious day of a celebration day today. Thanks for taking time out and joining this call. Now I just hand over the platform to Ms. Nidhi Verma from Tata Consumer for the introduction of the management and for further proceedings. Nidhi, over to you. Thanks. Thanks, Manoj. Hi, everyone, and welcome to our call. Thanks for taking the time to join us today. We announced our results yesterday and published all the materials, so hopefully you've had some time to go through them. For today's call, I'm joined by Mr. Sunil D'Souza, Managing Director and CEO, Mr. L. Krishna Kumar, Executive Director and Group CFO, and Mr. Ajit Krishnak umar, COO. In terms of the format, we will spend about 15 minutes or so walking you through the key highlights during the quarter, and then we will open up the floor for Q&A. For further proceedings, I'll hand it over to Sunil. Sunil, over to you. Thanks, Nidhi. If I can go straight to slide 6, in the deck, which is the executive summary. During the quarter, we grew by 11%, on consolidated revenue, 10% in constant currency terms, despite huge volatility and inflation. We will spend about 15 minutes or so walking you through the key highlights during the quarter, and then we will open up the floor for Q&A. For further proceedings, I'll hand it over to Sunil. Sunil, over to you. Thanks. Thanks, Nidhi. So if I can go straight to slide 6, in the deck, which is the executive summary. During the quarter, we grew by 11%, on consolidated revenue, 10% in constant currency terms, despite huge volatility and inflationary headwinds. On a three-year basis, this is 12% revenue growth. Expanded our margins. EBITDA grew 14%, 13% in constant currency, up by 40 basis points. EBITDA margin is now 13.8%. India business grew 9%.1% volume in India beverages and revenue up 3%. India foods, volume growth was a bit soft as we took strong pricing in respect of inflation which we are seeing in that business, but revenue up 19%. International business was up by 9%. Margins more or less maintained in the international business. Gross in constant currency up by 40 basis points. EBITDA margin is now 13.8%. India business grew 9%.1% volume in India beverages and revenue up 3%. India foods, volume growth was a bit soft as we took strong pricing in respect of inflation which we are seeing in that business, but revenue up 19%. International business was up by 9%. Margins more or less maintained in the international business, gross margins. Segment margins India expanded 20 basis points despite cost inflation in salt and significantly higher A&P. We continue to invest in our brands while overall as a company we upped our A&P by 34%. India business was up 4%, and that shows in market share gains in both tea and salt. Innovation momentum was accelerated, and we had several new product launches across all our platforms. Group net profit increased by 38%, led by higher EBITDA, and most importantly, improved performance of JV and associates. We've also announced a new sustainability strategy in both tea and salt. Innovation momentum was accelerated, and we had several new product launches across all our platforms. Group net profit increased by 38%, led by higher EBITDA, and most importantly, improved performance of JV and associates. We've also announced a new sustainability strategy with holistic goals and targets. I'll straight move to slide 9, which is a summary of our key businesses. India beverages, I talked about volume up 1%, revenue up 3%. India foods, volume - 3%, revenue up 19%. U.S. coffee, again, strong pricing actions in line with commodity trends out there. Volume down 3%, revenue up 20%, and as you'll see, market share beginning to trend up there. International tea, volume growth -2%, revenue up 3%, up 2% because all the pricing actions that we've taken have not translated into the market, given the fact that we deal with several large customers. We solved that puzzle end of last quarter, and we should see better traction going forward. Tata Coffee volume growth up 8% and revenue up 25%, driven by coffee prices, all in INR 3,327 crores of revenue, up by 11%. Next slide. In terms of metrics, I think you saw flow-through completely. 11% revenue, 14% EBITDA, 14% PBT, and group net profit up 38%. Most importantly, EPS is up by 38%, and we're sitting on INR 1,900 crores of cash. If I move to slide 12. Up 8% and revenue up 25%, driven by coffee prices, all in INR 3,327 crores of revenue, up by 11%. Next slide. In terms of metrics, I think you saw flow-through completely. 11% revenue, 14% EBITDA, 14% PBT, and group net profit up 38%. Most importantly, EPS is up by 38%, and we're sitting on INR 1,900 crores of cash. If I move to slide 12, just to give you highlights of where we are on our strategic priorities. We were on 1.3 million. We are, we have committed 1.3 million outlets direct reach in March, which we've completed, and we had said we are targeting for 1.5 million. Going by trends, we might be slightly ahead, but as of now, we'll stay with the 1.5 million. Most importantly, we said we have to now get the wholesale multiplier as we pump in innovation and A&P through our distribution system. Wholesale coverage is up by 2x from 19,000 to 38,000 outlets. Most importantly, also all our alternate channels are firing full speed. Modern trade is up 35%. E-commerce, which we had ended at about 7.5% of sales last year, is now up to 8.2%. The two-year CAGR is 73%, very healthy trend. Next slide. We are continuing to power our packaged beverages. Overall India business A&P is up by 48%. Coffee is now growing very, very healthy for us, up by 73% for the quarter. But we have about a 3%-5% share, depending on which geography you take into account, and we continue to inch ahead on our market share in base tea. Next slide. On salt, we continue to power A&P, but most importantly, we now will start ramping up our investments behind Sampann. We have always said the opportunity in salt is both on top of base Tata Salt as well as below. Rock salt and premium salts overall, I mean, grown significantly. We had launched this new variant of fortified salt as a pilot in Delhi, doing very well. With a few tweaks in the marketing mix, we will now be rolling it out across the country. Most importantly, our salt share is in the ballpark of 38%, and continues to show 400 basis points improvement over last year. We are fueling innovation. The first slide I think is a critical piece where we are rejigging our blends, the whole marketing mix across the country. Most importantly, 40% of the spice market is in the southern markets, where we had not played seriously so far. We are now customizing both product and communication to match the southern markets. Just started our rollout in Andhra and Telangana, and we will be shortly entering Karnataka, but w ay to go. All I would say is watch this space. Moving from coffee into cold coffee. We probably were a slight bit late to this season, but going forward, we feel very good about this product. Expansion of portfolio in NourishCo was another big thing, and we have launched Tata ORS on a pilot basis in specific markets. Internationally also, we continue to expand with the sweet tea cold brew in the U.S. now. When we had acquired Soulfull, we had said we acquired Soulfull not only for what it is, but what it could be. We had said that is going to be the base brand for our platform in breakfast cereals, mini meals, and snacking. Now that we've got the base business more or less tightened up, now we are expanding. This is our ORS on a pilot basis in specific markets. Internationally also, we continue to expand with the sweet tea cold brew in the U.S. now. When we had acquired Soulfull, we had said we acquired Soulfull not only for what it is, but what it could be. We had said that is going to be the base brand for our platform in breakfast cereals, mini meals, and snacking. Now that we've got the base business more or less tightened up, now we are expanding. This is our first of many more innovative launches, expanding categories in the platform. A blind taste, it is a winner versus the market leader. We are already about 5%-8% share in about the last 60 days since launched in markets and outlets where we are present. We are already about 5%-8% share in about the last 60 days since launch in markets and outlets where we are present. Next slide. Himalayan, we figured that the share of equity and mind space in consumers is far ahead of our share of wallet, and we have the opportunity to expand this into many more segments. We are transforming Himalayan into a provenance brand. You will see many more opportunities coming up for Himalayan, but now we started with jams, preserves, and honey, all sourced authentically from Himalayan, from the Himalayas. Next slide. The other thing, we have always said that we have a 4 + 1 platform play, not elaborated too much on the plus one platform. I think by now everyone on the call will be familiar with the fact that we have entered the protein platform. I would highlight saying that we've entered the protein form and not only a product. In the next slide, the first category that we are entering is alternate meat. We've launched Tata Simply Better off to a good reach albeit it is just two-and-a-half weeks old and we see a lot of potential. Unlike many of the competitors in the space, we've got a winning proposition, both in terms of the protein content in specific products, the taste and texture feedback from consumers, and most importantly, an ambient play, which then allows us to expand our distribution width far more than competition. Next slide. We've always maintained that while we will strengthen and accelerate our core businesses, we will be funding our field of play. Our new engine self-growth last year delivered 52% growth. This year also continuing that trend. Q1 we are up by 53%. Next slide. We won a lot of awards in sustainability, but most importantly, Slide 23. We've announced our new sustainability strategy. We've already put it out in public. Better sourcing, better nutrition, better planet, and better communities. Detailed items under this detailed targets. These are stretch, I would think, achievable targets which we aim to deliver, whether it is supplier assessments or sustainable products in one. These are stretch, I would think, achievable targets which we aim to deliver, whether it is supplier assessments or sustainable products in one form or the other in the product form, or, in the climate phase, net zero, water neutral, zero waste to landfill and packaging, or committing to diversity in the workforce. We have now very specific targets with, very specific timelines which we aim to deliver over a period of time. In terms of the macros, on the right-hand side, commodity trends, a little bit of softening, but albeit overall versus last year, still higher Kenyan Teas, which translate into a bit of inflation in our international geographies because of which we're taking pricing. We have now very specific targets with very specific timelines which we aim to deliver over a period of time. In terms of the macros, on the right-hand side, commodity trends, a little bit of softening, but albeit overall versus last year, still higher Kenyan teas, which translate into a bit of inflation in our international geographies because of which we're taking pricing. In India, tea was broadly operating in a range. A small bit of a blip, I would say, with the floods in Assam mid-June to about early July. Given the broad-based trend of supply greater than demand in India, we do expect to start seeing the secular trend coming back. Operating in a range. A small bit of a blip, I would say, with the floods in Assam mid-June to about early July. Given the broad-based trend of supply greater than demand in India, we do expect to start seeing the secular trend coming back. Coffee prices having hit a high of about 260 per pound some time back and now operating more or less range bound. Given what we're seeing in Colombia, etc., which is where coffee prices are dictated, we expect them to be staying in this piece. Good news is we've taken pricing primarily in our coffee business in the U.S. to account for this. I'll move to slide 28. Yeah. Just some of the businesses. India's packaged beverages, 1% volume growth. Revenue down because we have re-indexed pricing in line with softening tea prices, and 40 basis points share gain. Next slide. India Foods, volume was -3%, but just to point out that vacuum-evaporated Tata base Salt was flat despite the pricing that we've taken. That has, I mean, our overall pricing actions have translated into 19% revenue growth. Most importantly, with the new price hike that we've just gone in with, moving our prices from INR 25 to INR 28, we do think vacuum-evaporated Tata base Salt was flat despite the pricing that we've taken, and that has, I mean, our overall pricing actions have translated into 19% revenue growth. Most importantly, with the new price hike that we've just gone in with, moving our prices from INR 25 to INR 28, we do think margins will be back on track. As you see on the slide, we're continuing to hold on to market share gains. We are 400 bps up versus last year. Next slide. NourishCo, very, very strong trajectory, 110% revenue growth, INR 180 crores for the quarter. NourishCo, this is the first summer that they've seen since we've taken over. Like all beverage majors, as the extended heatwave hit Northern India, we were also hand-to-mouth on capacity. We therefore, as we expand geography and portfolio, we see bright future for this, business. Next slide. Tata extractions and plantations, coffee plantations drove revenue growth to 25%. Next slide. Starbucks, again, you've got to remember we are cycling a quarter of full lockdown last year, but now we are at 275, 99% of stores have reopened. We are in 30 cities. Strong wicket, EBIT positive quarter for Starbucks, which shows the power of the operating of Starbucks, and therefore the ability to generate value in the longer term. Given it's a 25% increase in same-store sales versus pre-COVID, we do feel good about the business. International, slide 34, and we're in 30 cities. Strong wicket, EBIT positive quarter for Starbucks, which shows the power of the operating of Starbucks, and therefore the ability to generate value in the longer term. Given it's a 25% increase in same-store sales versus pre-COVID, we do feel good about the business. International, slide 34, we're more or less maintaining share in Everyday Black in the U.K., but most importantly, we have put money behind A&P for Teapigs, which is our super premium brand, and we've seen a 16% revenue growth there, and overall, the business delivered a +3% revenue growth. Slide 35, coffee bags. We are now climbing back on share. Tea was a bit soft, but I think it will get corrected over the cycles. Overall coffee revenue growth of 15%, primarily again driven by pricing. Canada, our star in the international market, continue to maintain share, growing specialty tea and overall delivering 14% revenue growth. I now hand over to LK for a quick snapshot of financials. Thanks, Sunil. I'll just talk you through the summary financials. Starting with the consolidated profile, see that revenue at INR 3,300 crores grow by 10% in constant currency. Within that, the India business grew by 9%. In the India business, the salt portfolio grew by 20%, and the growth initiatives, which are basically water, Sampann, Soulfull, and the like, grew by over 50%. International business saw revenue growth of, and non-branded also had a stellar quarter because of coffee prices and higher volumes. It grew at 25%. In EBITDA terms, the growth was 14% higher than with an improvement in EBITDA margin, driven by the India business, largely by tea, but also overall cost cut on commodity. International business grew by, EBITDA grew by 9%, and non-branded business had higher EBITDA. Moving on to the next. On the standalone. On the performance, we saw a revenue growth of 6% and EBITDA growth of 12%. Let me just clarify that the EBITDA, which is shown here, is sort of derived from the se statistics where we've taken out the other income dividend portion and kept only the operating income to give you a reflection of true performance. An underlying performance from EBITDA growth. Moving on to the next slide. Again, talking first about the consolidated results, revenue from operations 11%, EBIT, higher EBITDA margin improvement. I want to point out the PAT number, INR 277 versus INR 241. If you move to group net profit for this current quarter is the same as the PAT. That means the share of profit loss from JV and associates is zero at breakeven, compared to a loss of over INR 40 crore last year. This basically reflects improved performance of Tata Starbucks as well as Amalgamated Plantations and EBIT, higher EBITDA margin improvement. I want to point out the PAT number, INR 277 crore versus INR 241 crore. This basically reflects improved performance of Tata Starbucks as well as Amalgamated Plantations, which is the North India plantation that we have. Both performed extremely well in this year. To the left on standalone, again, we are seeing that operating EBITDA grow by 12%. If you look at the reported PBT, it is sort of lower compared to the same period last year, largely because of dividend and investment income, and within that mainly because of dividend. We had a significant dividend flow from the overseas entities in the last year. We expect to have some of the dividend flow in the later part of the year. It's also to do with the restructuring plans that we have, we are hoping to complete with necessary approval. Moving on to the next slide, which is segment-wise performance. Both revenue and EBIT of the India business is 72% of the overall branded business. Within the individual components, we are now reporting India business on a consolidated basis because that's how we manage different product portfolios within that India business. Overall profitability higher than revenue growth of 9%. International business profitability in line with revenue growth. Sunil sort of talk through individual parts. I think overall we have been able to take price up in all of the overall branded business. Within the individual components, we are now reporting India business on a consolidated basis because that's how we manage different product portfolios within that India business. Overall profitability higher than revenue growth of 9%. International business profitability in line with revenue growth. Sunil, sort of talk through individual parts. I think overall we have been able to take price up in a competitive environment and maintain volumes. We have seen strong volume growth in the growth business part of our portfolio, which is water, Sampann, and also Soulfull. Sampann performance was slightly muted because of certain reasons which Sunil mentioned, but we expect growth to come back strongly in the quarters ahead. That's it from my side. We are happy to answer any questions. Thank you very much. Sorry, just a quick summary of what we're seeing going forward. Inflation volatility, I think, is a reality- Also, Soulfull. Sampann performance was slightly muted because of certain reasons which Sunil mentioned, but we expect growth to come back strongly in the quarters ahead. That's it from my side. We are happy to answer any questions. Thank you very much. Sorry, just a quick summary of what we're seeing going forward. Inflation volatility I think is a reality. We will have to keep moving plus and minus depending on where it goes. We will focus on driving and balancing both growth and margins. I don't think it is an either/or situation. We've got to manage both. Just to put it in perspective that if you look at the last three years, we've delivered a very healthy CAGR of 14% in beverages and 19% in foods. Salt costs, where we thought the cost inflation was behind us, and we had moved from 24 to 25 end of last quarter. Forex moving against the Indian rupee and the cost of coal going by roughly 2.5x-3x of what it was last year. We now moved the pricing from INR 25 to INR 28. That said, I mean, like, for me, the most big indicators in a volatile environment are maintaining margin and market share so that you continue to balance between all these three, including top line. Our growth business last quarter. Forex moving against the Indian rupee and the cost of coal going by roughly 2.5x-3x of what it was last year. We now moved the pricing from INR 25-INR 28. That said, I mean, like, for me, the biggest indicators in a volatile environment are maintaining margin and market share so that you continue to balance between all these three, including top line. Our growth businesses are on a strong trajectory. You've seen the 50%+. Given the lockdowns hopefully behind us, our out-of-home businesses, NourishCo and Starbucks, should continue to deliver momentum. Tata Soulfull, strong momentum, triple-digit growth, which we'll continue to drive as we expand portfolio and enter newer categories for the platform. International business, we have taken strong price actions. In the U.K., probably it is just about landing because it took some time to translate into the large outlets. But that also should be on a good wicket. The most important thing I would want to highlight is we manage the Indi, w e manage the overall business as a portfolio, and we will have puts and takes in certain businesses depending on what we are seeing as opportunities or headwinds. With that, back to you, Nidhi. Thanks. Thanks, Thanks, Sunil. Moderator, you can now go to the Q&A queue, and we can start taking 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 their touch-tone telephone. If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use handsets. Headwinds. With that, back to you, Nidhi. Thanks. Thanks, Thanks, Sunil. Moderator, you can now move to the Q&A queue, and we can start taking 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 their touchtone telephone. If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. Participants, you may press star and one to ask a question. While asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. Participants, you may press star and one to ask a question. The first question is from the line of Abneesh Roy from Edelweiss. Please go ahead. Yeah, thanks. My first question is on Sampann and two, three subparts to that. First is in your presentation, you have mentioned short-term impact of trade term margin rationalization and realignment. So if you could elaborate. Second is, at the company level, your gross margin is 43% and EBITDA margin 13%-14%. Sampann, I do understand currently will be, at least, EBITDA margin will be much lower. My question is on Sampann, say four years down the line, when things stabilize, where do you see versus the 43% GM and 13% EM at company level? Last part is the 5% GST which has been put on packaged cereals, pulses, et cetera. Do you see a big benefit because of shift from the smaller players? Yeah. Thanks, Abneesh. Let me take your question. Number one, on Sampann, very specifically in the quarter, we corrected some channel and trade margins. For spices, about 25% of our mix comes from online. For pulses and spices, about 40% comes from online. We did take certain margin corrections to make sure margins are on the right track. In a business like Sampann, which is a high growth, and probably I would say not low, mid-margining, you've got to make sure that the ballpark margin is right as you're accelerating. One is the trade margin correction. The second piece is like I pointed out for spices, we are going in for a full relaunch of our blends, and we are entering the southern markets with a completely different mix. We did pull back our spices business to an extent to make sure that we hit the ground running when we come back new. These are the two factors. Just to give you comfort on the Sampann business, it is a huge growth opportunity for us. Doesn't change. The total addressable market is huge p ulses, INR 155,000 crore. Spices is INR 60,000 crore. Spices is bigger than my tea business addressable market. We're fully cognizant of that, but we've got to play in with the right margin. That is why we probably took a pause. Last three years CAGR, if you look at it, Sampann is still on a 30% CAGR. By the way, July has still trended directionally in the same numbers. That's the reason why LK says he's very confident of coming back to that category. That's your answer on the Sampann question. Number two, in terms of your where could Sampann go? See Sampann, you have to remember, very, very high ROCE for Sampann from a TCPL perspective. It does unlock a strategic question for us as we go forward. July has still trended directionally in the same numbers. That's the reason why LK says he's very confident of coming back to that category. That's your answer on the Sampann question. Number two, in terms of your where could Sampann go? See Sampann, you have to remember, very, very high ROCE for Sampann from a TCPL perspective. It does unlock a strategic question for us as we go forward. It will be, I would say high single digits, low double-digit margin is a very, very long-term aspiration. We have various levers to pull to get there. Number one is as we build scale, we've got to flex our procurement muscle, get better at that, including forward contracting, forecasting, all those pieces. Number two, we've got to get into distributed manufacturing because freight is a huge component in these pieces. We've just finished a piece of work in which we are relaying our entire network. We've got to execute that, which takes a bit of time. Number three, of course, we've got to bring our technology chops to bear, because our R&D team now needs to figure out how to value add into these categories. All I would leave you on that front is I think we've built a fabulous R&D team, having invested in significant resources behind that. In the next, I would hazard between three to six months, you will see some really differentiated products coming in the Sampann base business itself. And the 5% on the package? Oh, yeah. Sorry. Abneesh, you're absolutely right. The 5% on the package, pulses, et cetera, is it will play to our advantage. One is the compliance on the ground, but especially in organized channels like e-commerce, modern trade, et cetera, where the people I would say a lot of competitors were playing on the borderline, with a brand but not registered, so to speak. I think if the compliance is tightened up there, the premium that Sampann was charging vis-a-vis, how do I say? Unbranded, local, loose, or brands which were not playing in the GST space, I think that would reduce. Therefore, we would see more consumers moving into our products. Abneesh, if there is one thing I've picked up across the country, different retailers, especially Kirana stores, right? Their point is, if a consumer has picked up Sampann and taken it home, then guaranteed you've got a consumer for life. The catch is getting the consumers to pick it. Apart from the GST piece, you would also see us starting to up the A&P on Sampann so that we start to get trials and therefore continued consumers. Sure. My last question is on the Masala Oats. Already, entrenched players are there. Saffola is very dominant, and we have Quaker Oats also. My question is, when you say 5%-8% share in the current distribution, what will be the plan in terms of scale-up or distribution and advertising versus a Saffola over a three-year timeframe? Second is, we have seen in foods, if you are too niche, too healthy, there is a limited opportunity. Case in point is, for example, atta noodles. It has remained a smaller. My question is, when you say 5%-8% share in the current distribution, what will be the plan in terms of scale-up or distribution and advertising versus a Saffola over a three-year timeframe? Second is, we have seen in foods, if you are too niche, too healthy, there is a limited opportunity. Case in point is, for example, atta noodles. It has remained a smaller part. Just adding millets and when you are so late, why should this product succeed? Abneesh, first of all, let me clarify, we are looking at Soulfull as a brand, and Soulfull will play in many categories. Some will be large, some will be small. We will only enter categories where we've got a right to win. Soulfull, healthy brand, millet differentiator, better product profile, and the value proposition should work. Thereby, this is one of the very many extensions for Soulfull that you will see. On a blind taste profile versus the leading competitor, we are a win because we are crunchier, because we've got ragi there, and of course, the health quotient dials it up. Now, you're absolutely right. We've got to now up our game, both on distribution and consumer communication to make sure we get traction. I was just trying to give a perspective that within about 60-90 days of launch, we are already at a 5% share in markets where we are present. Now, like I said, Soulfull is our brand for breakfast, mini meals and snacking. This is our first foray into snacking. I would say watch this space as we enter many more categories. The whole idea is Soulfull overall, we are seeking to build a very large brand. Thanks. That's all from my side. Thank you. Thank you. The next question is from the line of Manoj Menon from ICICI Securities. Please go ahead. Hi, team. A few quick clarifications, if I may. One, Sunil, on the salt business, how do I look at the salt volume performance of the last couple of quarters? Is it just the high base of last year specifically, or is there any other big picture, you know, drivers here? Manoj, let me just say the reason why salt pricing we have taken up is because of two factors, input costs. Number one is brine. But number two, of late, the more important one is, coal prices, right? Brine more or less has been stable, but coal is what we did not see coming, if I may. That is why we've taken up these prices. Now, that said, both energy costs as well as brine hits every single competitor in the market. If you look at, say, the reason why salt pricing we have taken up is because of two factors, input costs. Number one is brine. But number two, of late, the more important one is, coal prices, right? Brine more or less has been stable, but coal is what we did not see coming, if I may. That is why we've taken up these prices. Now, that said, both energy costs as well as brine hits every single competitor in the market. If you look at the raw salt prices out of the salt pans in Gujarat, it is up substantially versus last year, and therefore it flows down the chain. Therefore you will see, hopefully you will see industry pricing overall moving up. That said, if you dissect the salt pricing. The strength of the Tata Salt, vacuum evaporated iodized salt is so strong that despite the fact that between last July, where we were at INR 21, look at the raw salt prices out of the salt pans in Gujarat, it is up substantially versus last year, and therefore it flows down the chain. Therefore you will see, hopefully, industry overall moving up. That said, if you dissect the salt pricing, the strength of the Tata Salt, vacuum evaporated iodized salt is so strong that despite the fact that between last July, where we were at INR 21, and as we exited the quarter, we are at INR 25, the volume is flat. We've been able to take up pricing and maintain market share, right? The negative volumes are mostly on account of traded salt, which there was a little bit of a hiccup up and down. Going forward, we should be able to correct that as well. Salt, I think, Manoj, I think the focus is given the fact that we have a very strong 38% share, given the fact that we've got probably the best distribution in town on salt, and the fact that we were slightly late to the party in anticipating that coal prices will move further up, we took another price correction from INR 25-INR 28 at the end of the quarter. Like I said, where we take price corrections in salt, there is a down stocking in channels, because they do expect to go shopping around and find some cheaper Tata Salt from some other trader, wholesaler, et cetera. I think we've seen a bit of that. I would say this quarter, you would see stability coming back into the business. Again, like you rightly pointed out, it's -3% overall total salt in volume terms versus last quarter same quarter last year of 17%. The other thing I would want to highlight is, you know, foods business, FY 2021 Q1, 20% growth. FY 2022 Q1, 20% growth. FY 2023, again, 20% growth. If anything, I think we've been consistent. Fair sir. Just two quick follow-ups, only on the salt part of it. You know, how do I think about the medium-term opportunity, let's say, to maximize or optimize profit pools for you, let's say using price as a lever, in salt? That's one sub-question. The second one is, let's say in a scenario of, let's say, significant deflation in your input, let's say prices, it could be coal, it could be brine, it could be any of those. Do you think that there is an opportunity to retain some of the, let's say, input deflation benefits and expand, let's say, the gross margins in perpetuity? Without obviously affecting your sales, et cetera. Manoj, number one is the reason why we have taken pricing up. If you look at the three big commodities that we have on India beverages, right? We have expanded our margins by 1,000 basis points to put it where it should be. We will drive for volume from here on. Second is India salt margins, gross margins declined by 500 basis points, and that's why we took up the prices. International more or less is stable margins after all the price increases, right? Salt, once we put the margins back on track, we will go for volume because we do think there is a share opportunity out there. On your question as deflation comes in, the question is as and when deflation comes in, we will have to play very, very close to the year. I would like to keep some of the margins, albeit I do not want to lose market share. I would want to continue market share. It will be a tiered pricing approach. If you look at the last one year, what we have done is now we've got brands across different price segments. We've got a rock salt and a set of salt playing at the higher end. We've got now Tata Salt, the base vacuum evaporated salt. We've launched a fortified. We've got an I-Shakti salt at the bottom, and we've just launched Shuddh, which we are learning in the pilots, and we will again tweak the marketing mix to expand it across various geographies. We will make sure that we do a portfolio play, give value to the consumers, while, if possible, increasing margins consistently. The whole idea is continue to gain market share. You're right, salt is one of the big pillar bases which we will continue to have fuel to expand into other categories as we go forward. Sure, sir. Thank you so much for the detailed response. I shall come back in the queue. Thank you. Thank you. The next question is from the line of Trilok from Dymon Asia. Please go ahead. Yeah. Hi, good afternoon, sir. Thanks for the opportunity. You know, just wanted to understand on food business, how are we? I mean, obviously we are entering into new categories in the branded, and you also highlighted about the protein sort of platform. What are, you know, you know, sort of internal targets are we thinking from a growth perspective? You already alluded to one of the participants about the margin. But what's the growth that, you know, you should be happy with? Are you happy with the 20% growth that you guys are talking about the last two, three years? Let me put it this way. I think foods is going to be the big growth engine for us. Till now, even right- I mean, obviously we are entering into new categories in the branded, and you also highlighted about the protein sort of platform. What are, you know, sort of internal targets are we thinking from a growth perspective? You already alluded to one of the participants about the margin, but what's the growth that, you know, you should be happy with? Are you happy with the 20% growth that you guys are talking the last two, three years? Let me put it this way. I think foods is going to be the big growth engine for us. Till now, even right now is overwhelmingly a salt driven business and now Sampann expansion. We have added different levers to the whole business across including Tata SmartFoodz, for example, in which there is a full relaunch in process to start driving into that category. We have very early identified the platforms, and within those platforms, the categories where we will play, where we've got a right to win. It is a big growth, so big growth opportunity, both in terms of size as well as momentum of growth in that category. We've got a right to win and expand. We've just, for example, Sampann, we've identified dry fruits as a category. I would say in the six months, we've hit it out of the park on only online. The run rate that we have on dry fruits is probably rivaling some of the new startups out there, and this is all within the last six months. That's the power of the Tata and the Tata Sampann brand name. We will continue to expand. Foods is the vector, big, big vector for growth for us. Sampann leading the charge, but it is also Soulfull, Tata SmartFoodz, where there is a full marketing mix planning going on. Of course, like I said, the idea is to continue to expand market share in salt. Are we happy with 20? Obviously not, right? We will be shooting for higher numbers as we go forward. Just, you know, follow up on this, you know, between when you enter new category, is the gross margin and profitability are the key, you know, metrics? Because these all, you know, are sort of high unorganized categories with obviously low margin profile as per our understanding. You're absolutely right. When we enter new categories, we do a full-fledged analysis of what is the size of the category, what is the scale that we can get, and what are the margins that we can get. Number one, you remember Sampann is a high ROCE. I mean, I would say significantly high ROCE because there's almost no capital on the ground per se. But we are very, very mindful about two things. Number one is wherever we are entering is incremental in terms of where we are entering. All I would like to leave you with is compared to the base categories, we are incremental, in some of the things like protein, Soulfull, significantly incremental, and some of the categories that we're entering with, Sampann, incremental to our current base. The directional movement of margin will continue to be upwards. Understood. Thank you very much, sir. I'll get back to you. Thank you. Next question is from the line of Jaykumar Doshi from Kotak. Please go ahead. Yeah. Hi. Thanks for the opportunity. My question is on tea. When I look at three-year volume CAGR, it's about 2.6%. It is much lower than 7%, 8% and 9% that you were tracking in the previous two quarters and three-year CAGR basis. Is there a one-off timing kind of channel destocking or anything in this quarter? How should we think about the volume trajectory, you know, either YOY on three-year basis, going forward for rest of the year? You're absolutely right. I think we've seen a lot of YOYs in the last three years, both on the price front as well as the volume front in the tea business. If you take, right, structurally, still 1/3 of tea in India is unbranded. Number two is historically, you've seen a 5%-7% volume growth in the category itself. Volume trajectory, you know, either YOY on three-year basis, going forward for rest of the year. You're absolutely right. I think we've seen a lot of YOYs in the last three years, both on the price front as well as the volume front in the tea business. If you take, right, structurally, still 1/3 of tea in India is unbranded. Number two is historically, you've seen a 5%-7% volume growth in the category itself. The fact that we have not lost our position in the category is shown by the fact that we've gained share in the tea category. Now, overall, this quarter compared to same quarter last year, we're cycling a very heavy revenue growth, but you're right in terms of volume, it's probably not come up to par. I would say one of the reasons or two of the big reasons. Number one is the stress in certain specific geographies. I would say mostly rural across and the Hindi belt per se has been a bit of an issue. It's not come up. Hopefully, a good monsoon should bring it up. Coupled with the fact that we had an extra summer. Proof of the fact lies in if you look at all the soft drink majors and including our NourishCo business. It hit out of the park while the tea struggled. I think people moved to cold rather than hot for some time. That's not an excuse for the business, but we do think as we go forward, volume growth should come back. Now, the other piece that I would leave you with is in our portfolio, our focus has been to grow the mass premium and premium because that is our share opportunity. More than that, the stress in the rural and the Hindi belts has been showing in the lower end of our portfolio. That's the reason why you're seeing a margin expansion of 1,000 basis points in the tea business. Now that the margins are back on track, we will be going for volume growth. In fact, we have just given up some more pricing in the north and coupled with our distribution drive, which is we are moving to top gear on expansion onto total number of outlets, numeric reach and A&P cover, we do think we will get the volume growth back to, I would use the word par for the India business. Understood. Could you give a little bit, outlook on raw material prices, given there are floods, there's flooding in Assam, weather, you know, the second flush, which is where you do bulk of your buying, how has pricing trended and what it means for, tea gross margins going forward? Will it sustain at these levels? Is there scope for further improvement or? I would say essentially, given the fact that we had expected this year to be a normal year, we had seen a downtrend in tea prices, both North India and South India, till the Assam floods, middle of June, were an unexpected event. That said, I think primarily they impacted probably about 30 days of cropping or so. But you have to remember one fundamental, structural, point in the Indian tea business. Supply is greater than demand, and whenever there is supply greater than demand, prices will trend downwards. Therefore, while we have seen a blip, and I would term it a blip, for a short term, and you might see some impact maybe for a quarter or so, but not as significant as the blip that you saw. I would say secular, you will see pricing trending downwards and then playing in a range. While we do see a small blip, I don't think we need to course correct big time. There might be a small dip in margins, but like I said, from Q1 of FY 2022 to Q1 of FY 2023, we expanded margins in the India tea business by 1,000 basis points. We are in the ballpark of where we want to be. We will have some puts and takes, but again, it's a fine balance between top line and margin. We don't expect margins to be as depressed as they were during the COVID lockdowns, et cetera. Small blip, but something we should be taking in our stride and moving ahead. Sure. Final quick one. When we visit some modern trade outlets in this side of the country, I mean, they sell some loose pulses and staples that, you know, essentially are to benefit from the GST. Will that still continue? Recently, you know, what is essentially the definition of label? Can modern trade outlets sell loose sort of pulses and other sort of staple products without customers incurring GST? Now I wouldn't hazard about what they can sell and what they cannot sell. All I can tell you, GST regulation which has come out is very specifically anything that is packed before source or before the selling point has to pay GST. The only thing which is exempt from GST is one that is packed to order. If I can use some chaste Hindi out here, then there is no GST. But that is not what happens in modern trade and online. Therefore, I use the term, if there is compliance, we hope to see advantage. Understood. That's helpful. Thank you so much. Thank you. The next question is from the line of Sheela Rathi from Morgan Stanley. Please go ahead. Sheela, may I request you to unmute your line from your side and go with the question, please. Thank you for taking my question, and hello, Sunil. My first question was, again, with respect to the food business. Just wanted to understand your strategy going ahead, with respect to the distribution, because you just said that, you know, in the dry foods business you're seeing very strong demand on the online side. However, I feel that scaling on the food business will require a lot of offline strategy, which is on the GT and MT side. Just wanted to understand what's the strategy and, where are we with respect to the distribution reach of, Sampann as well as Soulfull? Uh, so, uh- The distribution, because you just said that, you know, in the dry foods business you're seeing very strong demand on the online side. However, I feel that scaling on the food business will require a lot of offline strategy, which is on the GT and MT side. Just wanted to understand what's the strategy and where are we with respect to the distribution reach of Sampann as well as Soulfull? Sheela, absolutely right. If you really want to scale any of these staples, if I may call it, you do need to play the GT game. The reason- Participants, please stay connected. Line for the management dropped. Ladies and gentlemen, please stay connected while we rejoin the management back to the call. Sheela, absolutely right. If you really want to scale any of these staples, if I may call it, you do need to play the GT game. The reason- Participants, please stay connected. Line for the management dropped. Ladies and gentlemen, please stay connected while we rejoin the management back to the call. Ladies and gentlemen, thank you for your patience. We have the line for the management reconnected. Sir, you may go ahead. Yeah. Sheila, to answer your question, the reason why I alluded to dry fruits was, you know, in today's world, the online platforms provide you a fantastic piloting opportunity. That is why we launched it only online because there it is no one between you and the consumer. You're on the platform, you're deciding the whole marketing mix. Consumer sees it online and therefore picks it up. After that, if the proposition is strong, then you've got to get into distribution and put it into the stores where there is something called a retailer standing between you and the consumer. Now that we've proved the proposition, now we've got to tweak the whole mix to make sure we are well distributed. Given the fact that we are going to be touching one. There is no one between you and the consumer. You're on the platform, you're deciding the whole marketing mix. Consumer sees it online and therefore picks it up. After that, if the proposition is strong, then you've got to get into distribution and put it into the stores where there is something called a retailer standing between you and the consumer. Now that we've proved the proposition, now we've got to tweak the whole mix to make sure we are well distributed. Given the fact that we are going to be touching 1.5 million outlets by September 2023, and hopefully, we are already what? At 2.7 million indirect reach if you count total numeric reach, if you count. I think we've got the scale to do it. In the staples category it takes a little bit of time because you're competing against loose even packed by the retailer themselves at certain points. I think we've demonstrated with a CAGR of 30% with Sampann that we are capable of doing it. The idea is now to take the dry fruits proposition into the GT and modern trade for that matter, and that is work in process. You should start seeing it come into some of the modern trade channels very shortly. On where are we with respect to distribution of Sampann and Soulfull, I would say we've made significant progress. For example, Soulfull which we acquired what? About 18 months back, at about 15,000 outlets. We are on a three-monthly billing basis which is how we measure availability. We are close to 400,000 outlets. This is we are only counting direct outlets, so we are in about 25% of our total outlets, and it would be a very similar number for Sampann as well. That said, I think the fastest expansion in our 1.5 million base which we should have by March is you should see the depth of expansion because I don't think you'll find too many more outlets which will stock more teas but Sampann, Soulfull, SmartFoodz that is what we will now seek to exploit. Understood. Thank you. My second and final question is, again on food is, with respect to the, new categories which we are getting into. Do we think that this is the right time to get into more and more categories or first, you know, kind of stabilize the, you know, base business and you know, reach a certain level of margins and then probably get into more and more categories? We just wanted to understand your thoughts on that. No, no, Sheila, absolutely right question and that is why I keep harping to my team that in any category especially established categories it is market share and margin. As long as they are on the right track that is when you start moving into other pieces. I mentioned my beverages margins is back on track with a 1,000 basis point increase. My foods, my salt business was down 500 points. We've taken a 25-28 pricing and stabilized that. We do think we will not have hiccups. I mentioned my beverages margins is back on track with a 1,000 basis points increase. My foods, my salt business was down 500 points. We've taken a 25-28 pricing and stabilized that. We do think we will not have hiccups on the way to maintain market share in both beverages and salt and that is why we are now moving into other categories. For me it's not a or game it's an and game. Sampann as a portfolio has huge, huge, I would say underleveraged, equity if I may. We've not executed to the tea, and that's why we are moving into these categories. As for which you're alluding to protein et cetera, you are right they will not be scale categories today. We do think it is important for us to have first mover advantage, put a stake in the ground that we are one of the leaders out there and build the entire platforms as we go forward. We have the advantage of having, I would say, strong brands, great team, good execution and, stable margins if I may in our base categories which will afford us to do that. Understood. One final follow up here. You know you just said great team. Are we really hiring at the senior level because we are expanding into lot many categories or you know we are just maintaining the same team? Let me put it this way: I think we've got a very strong senior leadership team now. We've sort of expanded over the last two years. That's number one. The big expansions which is happening in foods, we've ramped up the team significantly. Apart from that, we've ramped up the R&D team because we need to up the ante on innovation and how do I say? The scientific basis behind all these new categories. We are investing in behind creating very strong R&D infrastructure and resources for this team. We have expanded significantly in digital, where we do think it will drive both efficiency and effectiveness going forward. Now we're taking digital into the next phase of data analytics, et cetera, including in our procurement scenarios, for example. How do I say? The scientific basis behind all these new categories. We are investing in behind creating very strong R&D infrastructure and resources for this team. We have expanded significantly in digital, where we do think it will drive both efficiency and effectiveness going forward. Now we're taking digital into the next phase, of data analytics, et cetera, including in our procurement scenarios, for example. Answer to your point is, we are adding across the board in spaces where we see either we're deficient or we need to add as we expand, categories. Understood. Thank you. That's it for me. Thanks, everyone. May I please request everyone to restrict their questions to one so that we can address everyone's questions. Given that it's 12:55 P.M. already, if I could just request to extend the call by another 10 minutes. We'll hold the call until 1:10 P.M. Yes, moderator, on to you. Thank you. The next question is from the line of Percy Panthaki from India Infoline. Please go ahead. Hi, sir. Am I audible? Yes, sir. Yeah. Restrict their questions to one so that we can address everyone's questions. Given that it's 12:55 P.M. already, if I could just request to extend the call by another 10 minutes. We'll hold the call until 1:10 P.M. Yes, moderator, on to you. Thank you. The next question is from the line of Percy Panthaki from India Infoline. Please go ahead. Hi, sir. Am I audible? Yes, sir. Yeah, your NourishCo growth, if you just continue to grow this fast, I'm sure in a couple of years you would be clocking close to INR 1,000 crores per annum. At that kind of scale, what kind of EBITDA margins can this business generate? That's one thing I wanted to ask. Second thing is on tea. We had done this acquisition of Lal Ghoda and Kala Ghoda teas in Rajasthan. Can you give us some update on what is the success of that acquisition in terms of what was the market share immediately after the acquisition and what is the market share today? If that has been a good experience, do we plan to do such small acquisitions in sort of individual states? One thing I wanted to ask, and second thing is on tea. We had done this acquisition of Lal Ghoda, Kala Ghoda teas in Rajasthan. Can you give us some update on what is the success of that acquisition in terms of what was the market share immediately after the acquisition and what is the market share today? If that has been a good experience, do we plan to do such small acquisitions in sort of individual states in our tea business? Or that sort of is not something which is of priority right now? Percy, NourishCo, first of all, I should say it's a fantastic business, again, from a ROCE perspective, right? Because we are all on a third-party basis, both in terms of manufacturing as well as distribution. We put our resources into supervising the sales and the marketing, branding, product development, and all those kind of pieces. That's number one. We clocked INR 180 crores last quarter, so you're absolutely right. It's on trajectory to get to a four-digit business very quickly. All I would leave you with is, margins in NourishCo are accretive to quite a lot of my current portfolio. That's number one. We had bought in NourishCo with that whole premise, right? Given the fact that it was a strong business operating in a very small playing field, if I may. Expanding both portfolio and geography would give us disproportionate growth. That was the whole logic. Absolutely right, and we are full press ahead on that piece. That's number one. Number two, on your Lal Ghoda, Kala Ghoda, I would answer your second question out there. Ultimately, it's about creating value for shareholders, right? Do I put my money into growing Sampann or do I go and buy a small tea brand in a part of the country? I think that's the critical piece. In tea, what is that disproportionate growth. That was the whole logic. Absolutely right, and we are full press ahead on that piece. That's number one. Number two, on your Lal Ghoda, Kala Ghoda, I would answer your second question out there. Ultimately, it's about creating value for shareholders, right? Do I put my money into growing Sampann or do I go and buy a small tea brand in a part of the country? I think that's the critical piece. In tea, what is that amount of money that we're putting that we should be able to get better out of an acquisition than what I can't do myself? That is the other question to ask, right? Capital allocation, if I may. From that perspective, I don't think you will see us doing too many small tea acquisitions. I think what is that amount of money that we are putting that we should be able to get better out of an acquisition than what I can't do myself? That is the other question to ask, right? Capital allocation, if I may. From that perspective, I don't think you will see us doing too many small tea acquisitions. I think our ability to do it organically if we really put the money there, that's number one. Number two, when I if I pick up my choices of where to put the money, I think there is significant opportunity in many of the newer categories that we're going with. Lal Ghoda Kala Ghoda, I think has performed more or less to expectations. Is it hitting it out of the park? I don't think so. I mean, it has fulfilled the business case, more or less that we had gone in with. Our ability to do it organically if we really put the money there, that's number one. Number two, if I pick up my choices of where to put the money, I think there is significant opportunity in many of the newer categories that we're going with. Lal Ghoda, Kala Ghoda, I think has performed, more or less to expectations. Is it hitting it out of the park? I don't think so. I mean, it has fulfilled the business case, more or less that we had gone in with. Okay, sir. That's all from me. Thanks and all the best. Thank you. Next question is from the line of Amit Purohit from Elara Capital PLC. Please go ahead. Yeah. Thank you, sir, for the opportunity. Just one question on the salt food business. You indicated price increases. Going forward, how do you see the margins in the food business? We were clocking close to about in the band of around 11%-13%, 14% margins. Should this price hike bring us closer to a double-digit margin, or how do we see this for the year and going forward? Yeah. I did allude to it. Gross margins in salt, if you compare it to the same quarter last year, we're down by 500 basis points, right? The reason why we moved up the pricing from INR 25 to INR 28 is to put the margins back on track. I do think we will come back to a stable state once we put this pricing back. This quarter at least you will see the margins come back on track. There might be a little bit of ups and downs in the beginning of the quarter as the price settles into the market. Like I said, given the fact that the pricing is being taken because of cost increases in energy and brine, which are hitting everyone in the market, I don't think you should see too much movement on market share per se. Okay. Just one small thing on the Gujarat rains which have happened. I mean, is that going to have a better competitive advantage for us? Is the supply side for some of the competition a bit inferior than us? Or it's a every year phenomena and nothing much to read about? Hello? The reason why the brine prices had moved up was because of the extended monsoons last year. Unfortunately, there were some heavier rains- Is the supply side for some of the competition a bit inferior than us? It's a every year phenomenon and nothing much to read about? Hello? The reason why the brine prices had moved up was because of the extended monsoons last year. Unfortunately, there were some heavier rains in Gujarat in the beginning of the monsoon season, and that's why the corrections which we were expecting to see in brine have not happened. That said, there has been almost no movement up or down. Marginally, if I may add this. I would say the picture will become clearer towards the end of September, is when the final monsoons have retreated and you'll know where we stand in terms of the net output from the brine fields. As of now, we are seeing brine prices elevated but stable from where they were. The big movement that we saw was in coal prices because of which we've taken the price increases. Okay. Thanks a lot. Thank you. Thank you. Next question is from the line of Sumant Kumar from Motilal Oswal Financial Services. Please go ahead. Yeah. Hi, my question is regarding NourishCo. Can you talk about the channel expansion for NourishCo and what is our target for next three to five years? NourishCo effectively, I think we are, if I'm not mistaken, about 350,000 outlets nationally. This is what we touch, which is a significant increase from where it was. Kumar from Motilal Oswal Financial Services. Please go ahead. Hi, my question is regarding NourishCo. Can you talk about the channel expansion for NourishCo and what is our target for next three to five years? NourishCo effectively, I think we are, if I'm not mistaken, about 350,000 outlets nationally. This is what we touch, which is a significant increase from where it was. Sumant, I wouldn't want to hazard a guess. I think ball is in our court as to figure out how high is high. From operating in about 25% of the geography of the Indian geography, we're probably at 70%. We've still got a long way to go. You could see continued growth on NourishCo for some time to come as we expand geography. Apart from that, like I said, in NourishCo, it's not only the base Tata Gluco+ business, the Tata Copper+ water is really scaling up. Apart from that, we are in the process of launching. We've launched jelly in cups, but unfortunately, in season we were out of capacity, couldn't really expand that. You'll see the expansion happening now. In Fruski, you'll find a jelly drink coming out. We've launched Tata ORS. We've launched Tata Nature Alive. The NourishCo business has put Himalayan back on track because of which now EBIT is positive. I think this, Tata Copper+ water is really scaling up. Apart from that, we are in the process of launching. We've launched jelly in cups, but unfortunately, in season we were out of capacity, couldn't really expand that. You'll see the expansion happening now. In Fruski, you'll find a jelly drink coming out. We've launched Tata ORS. We've launched Tata Nature Alive. The NourishCo business has put Himalayan back on track because of which now EBIT is positive. I think huge amount of work done, but a long runway yet to go. Okay. Thank you so much. Moderator, perhaps we can go to the webcast to take a few questions. Sunil, there is a question from Tejas at Spark Capital. He's asking: Apart from the inflationary pressures in salt category, there seems to be a sequential contraction in Q4 versus Q1 in gross margins in the past as well. Is there any underlying seasonality playing out here? I would ask LK to comment, but my top line there would be. Sir, sorry, we are unable to hear you. Normally you have slightly higher seasonality in beverages in Q3, Q4 and compared to a Q1. Maybe there's a little bit of that. We don't think there is too much basis out there. The salt cost pressures would have played a significant impact. Sir, sorry, we are unable to hear you. Normally you have slightly higher seasonality in beverages in Q3, Q4 and compared to a Q1. Maybe there's a little bit of that. We don't think there is too much pieces out there. The salt cost pressures would have played a significant impact. The other pieces, I think the freight and logistics inflation, which is coming, I think we are seeing more of an impact of that in Q1 versus Q4. That said, given the fact that we are seeing a declining trend on crude, we should hopefully see that piece starting to stabilize, if not inch downwards. L.K.? No, there's no material underlying seasonality. It's really to do with inflation on coal, brine, overall freight costs as well. No specific seasonality component. Thank you. The second question from him is: The heightened A&P spend that you incurred, was it to support the existing portfolio mainly or to support new launches as well? I think it was a mix of both. Tejas, just as a point of view, if you look at, we had initially itself our hypothesis was that we were relying quite a lot on the Tata brand name. So if you looked at our share of voice versus share of market, which is the standard benchmark used in all FMCG categories, we were slightly behind. Now we have upped the spends. Again, if you look at most of the FMCG majors, your A&SP line, advertising and sales promotion line, A&SP line compared to sales is anywhere between, I would say, 6.5%, 7% to about. I mean, best in class is about 10%-11%. We were quite behind the curve. We have ramped it up. Even for the last quarter, we have upped the number to 6.4% versus 5.3% of last year. I would say we are coming to par right now on overall spend, but the spend is both behind base as well as new launches. Just that, also mindful that we are not scattering it across brands. For example, in tea, we are now distilling it down to four or five umbrella brands, and therefore advertising in one variant has a rub-off on the mother brand. We are leveraging Soulfull for breakfast, mini meals and snacking, so advertising in one particular segment will have a rub-off. Efficiency of the spends is also something that we're looking at closely. The last question is, Sunil: How are we tracking in market share in e-commerce and modern trade versus GT in tea and salt? I think to Sheela's question, I had mentioned that the beauty in e-commerce is that it is only you and the consumer. There is no one else in between, and therefore it is the power of your product and your brand and your value proposition to the consumer. We are still market leaders by far on e-commerce in tea, and we are lagging behind on GT, for example. Modern trade is better than GT and e-commerce is better than modern trade. We are leaders in e-commerce, and that again puts the ball into back into our court on expanding distribution and making sure availability is there in the outlets. We lag competition on numeric distribution by about 10%, and our market share is off by about 7%-10%, again, versus the market leader. The hypothesis being if we cover the reach, we should be able to cover the market share, and that is why the immense focus on distribution. Okay. The final question from Shreyan Ghatani is: Can you talk about restructuring costs and their recurring nature in the past few quarters? When can we expect complete restructuring to take course? Shreyan, I would use a term that I use with a lot of my team. We are a work in process company. We're still not finished where we want to be. It's still not stable state. We've got a long way to go. Aspirations are very large. This quarter, the restructuring. In the past, you would have seen restructuring costs because we had cut down layers in our teams. As we acquired some of the businesses, we rejig the teams to make sure we are deriving synergies. While long-term you will derive synergies, there'll be some short-term restructuring costs to make sure the business is right-sized. Last quarter you would have seen it, or previous quarter you would have seen it with regard to Tata SmartFoodz. Last quarter there were some costs, and I think the picture is yet to be played out in terms of the entire international and India Tata Coffee restructuring that we have announced. We've still not executed fully because we don't have full regulatory approvals. Restructuring, I think at least in the short term, you could see these costs coming out. All I can assure you is that fundamentally this is to right size and make the business much more effective and efficient. Therefore, in the longer term, it will bear phenomenal fruit. That before we put in restructuring costs, we always do a business case analysis, look at the paybacks and then press the triggers. Moderator, given the paucity of time, we'll just take two last questions, please. Thank you. The next question is from the line of Richard from JM Financial. Please go ahead. Hi. Thank you for taking my question. Sunil, two questions here. For a category like salt and, you know, considering all the value added and premiumization initiatives from your end, what could be the growth rate of this category like, you know, let's say five to seven years out, versus your, say, you know, estimated INR 2,400-INR 2,500 crore turnover in this business. Do you see this business at like, you know, let's say INR 4,000 crore-INR 5,000 crore in the next five to six years timeframe given, you know, how it's been growing? What could be the risks in this kind of an assumption? Richard, I wouldn't hazard a guess on INR 4,000 crore-INR 5,000 crore. It will get to that, but the timeframe, I think is a matter of time. That's number one. I would say I would continue to shoot for expanded market share, expanded price realization and continued expansion of the portfolio as we go forward, right? Just to give you a perspective, we were at 30% share exactly two years and four months back when we took over the portfolio. We are at 38% share now, and we continue to expand the market share. Double digit realization and continued expansion of the portfolio as we go forward, right? Just to give you a perspective, we were at 30% share exactly two years and four months back when we took over the portfolio. We are at 38% share now, and we continue to expand the market share. Double-digit revenue growth I think is a given. Okay. Over a sufficiently long period of time, you think double-digit revenue growth? Oh, yeah, yeah. So that I can assure you that, I think we can put enough pressure on all our teams to make sure we are continuing to deliver double digit growth for some time to come. What do you think would be a risk to that double digit assumption? I think basically, Richard, in salt, I think the ball is in our court on execution. I don't think it is as much. We are at 38% share, number one. Number two, we've layered the entire value proposition. I can assure you that I think we can put enough pressure on all our teams to make sure we are continuing to deliver double-digit growth for some time to come. What do you think would be a risk to that double digit assumption? I think basically, Richard, in salt, it's I think the ball is in our court on execution. I don't think it is as much. We are at 38% share, number one. Number two, we've layered the entire value proposition right from entry salt right up to premium salt. So we have the ability to pull levers across various price points. We're offering a full portfolio. It's a question of there might be subtle shifts in consumer preferences. We've got to play to that. I do think we are slightly ahead of the curve on that piece, including the 30% lower sodium salt, for example, or some of the new launches which you will see in the next 30, 60 days. I actually think the risk is in our ability to execute. Got it. Sunil, and while on that, one more on, you know, on Sampann. You talked about trade realignment and change in terms of trade and margin, et cetera. You know, how much would this exercise boost your Sampann business margin by? And against that, how does this impact ROCE for the trade partners? I wouldn't comment on the ROCE for the trade partners, Richard. I think it's a calculation they have to do. All I can say is Sampann is a very, very high ROCE business for me. In Sampann, I think we've got to be mindful about the fact that you've got to maintain a healthy margin while continuing to press the accelerator on top line. In various other staple categories you've seen in the initial phases of category development, you will have a lower margin, which you've got to figure out ways to build it as you go forward. That is where we are. I would think we have put Sampann back onto a margin profile where we would want it to be. Is it the best of places to be? No. I think it's still got way to go. Again, like I said, we need to get back to the 30%-35%+ CAGR on the top line. It will be periodic. I keep using this term with Nidhi. It's a snake in a tube, right? You will have yo-yos, but you build it as you go forward. That is where we are. I would think we have put Sampann back onto a margin profile where we would want it to be. Is it the best of places to be? No. I think it's still got way to go. Again, like I said, we need to get back to the 30%-35%+ CAGR on the top line. It will be periodic. I keep using this term with Nidhi. It's a snake in a tube, right? You will have yo-yos, but directionally it will keep pointing upwards. Sorry, just last one. The trade realignment and the boost in, you know, the Sampann margin, I mean, this was necessary for you to get to that high single digit and low double digit, long-term spices margin that you talked about? I would say spices were in a comfortable position. It was the pulses and besan category which we corrected. I would say a mid- plus single digits, mid- to high-single digits margin is where we have landed up. It was getting a slight bit of erosion. Richard, I am not a fan of going to very low margins, very low EBITs and going for high top lines, because after that, correcting it is a huge problem. I am more a proponent of go full-fledged on top line for some time with decent margins, correct margins and again press the accelerator. Right now, I think we are in a comfortable place to push the accelerator for the next phase. Got that. Did you say that the long-term horizon for the margin for this whole Sampann business is high single digit and low double digit? It is. Yeah, absolutely right. How many years out would that be? I would want it to be as quickly as possible. It's just that I think we'll take time to top line for some time with decent margins, correct margins and again press the accelerator. Right now, I think we are in a comfortable place to push the accelerator for the next phase. Got that. Did you say that the long-term horizon for the margin for this whole Sampann business is high single digit and low double digit? It is. Yeah, absolutely right. How many years out would that be? I would want it to be as quickly as possible. It's just that I think we'll take time to get our procurement engines right with scale. We'll take time to put our entire network in place. We will take time to roll out all the value additions that we have envisaged. Like I said, you will find some path-breaking innovation from Sampann coming out in the next 60, 90 days or so, which will show you directionally where we are headed in terms of ramping up the margin and premium profile. Got it. Thank you very much, Sunil. Wish you all the best. Thank you. The next question is from the line of Devika Jain from Ratnabali Investments. Please go ahead. Hi, thank you for taking my question. I wanted to understand what would be the impact on our tea business given the inflationary trend that's happening in Europe? If you're asking for inflationary trend on the tea business in international because of what's happening in Europe. It's not only Europe. You saw the graph on Kenyan tea, which has moved up versus last year. Added to that, the inflationary both in terms of gasoline prices, which has an impact on packaging, freight, and overall cost of doing business. That is one of the reasons why we've taken some aggressive price increases. U.S. is primarily coffee, which we've already taken up and stabilized the margins per se. By the way, gained share. Our big business of Canada, I think is on right track, having already implemented the price increases. In the U.K., while we had announced the price increases, the price increases are still not landed because there are several large retailers to deal through with on the execution piece. I think the last piece, overall cost of doing business, that is one of the reasons why we've taken some aggressive price increases. U.S. is primarily coffee, which we've already taken up and stabilized the margins per se. By the way, gained share. Our big business of Canada, I think is on the right track, having already implemented the price increases. In the U.K., while we had announced the price increases, the price increases are still not landed because there are several large retailers to deal through with on the execution piece. I think the last pieces of the puzzle have fallen into place end of last quarter, so our margins should be back on track. Will volumes be slightly impacted? I would think so. I think revenues and margins will be on the right trajectory, which is what I would target for in the international space. Okay, got it. A second question. I wanted to understand the reason why we're losing market share in the international market, both for coffee as well as tea. Like every- Pieces of the puzzle have fallen into place, end of last quarter, so our margins should be back on track. Will volumes be slightly impacted? I would think so, but I think revenues and margins will be on the right trajectory, which is what I would target for in the international space. Okay, got it. A second question. I wanted to understand the reason why we're losing market share in the international market, both for coffee as well as tea, like every quarter, value market share. As I mentioned, in the U.S. market, our coffee market share is back on track and started moving up. Branded bags was moving faster than K Cups. K Cups also you should start seeing the share going up. Canada again is starting to move up. Canada, we're anyway in the number one position overall per se. In the U.K., there is work to do versus black tea versus specialty and herbals. That is the reason why we are putting money behind Teapigs, because we do think there is enormous amount of growth to be had there. We did see the overall moving faster than K Cups. K Cups also you should start seeing the share going up. Canada again is starting to move up. Canada, we're anyway in the number one position overall per se. In the U.K., there is work to do versus black tea versus specialty and herbals. That is the reason why we are putting money behind Teapigs, because we do think there is enormous amount of growth to be had there. We did see the overall growth of Teapigs versus the rest of the portfolio. I think the actions have started to move. By the way, Teapigs was the fastest growing specialty brand in the U.S. also in the past quarter. So we've got to play the right profile of where the growth is. Black tea is almost stagnant. The growth is happening in fruit and herbals and specialty. That is where we are putting our money, starting to move the curves. I think it is a matter of time before you'll start seeing the share trajectories gain shape. Okay, got it. Okay, thank you. That's all from my end. Yeah. Thanks. Thank you very much. Yeah, I think with that. Yeah, we'll just conclude because we've run out of time and, I'll just kind of conclude. Thank you, everyone, for joining us on behalf of the management. Sorry for having to extend the call, but if you do have any further questions, you can get in touch with me. Thanks. Thanks, Manoj and team for hosting us. Thank you very much. On behalf of ICICI Securities Limited, that concludes this conference. Thank you for joining us. You may now disconnect your lines. Thank you. End the call, but if you do have any further questions, you can get in touch with me. Thanks. Thanks, Manoj and team, for hosting us. Thank you very much. On behalf of ICICI Securities Limited, that concludes this conference. Thank you for joining us. You may now disconnect your lines. Thank you.