Ladies and gentlemen, good day and welcome to United Spirits Limited second quarter and first half of fiscal year 2027 earnings conference call. 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 Ms. Shweta Arora, Head of Investor Relations, United Spirits Limited. Thank you, and over to you, Ms. Arora. Thank you, Anju. Hello, everyone. Good afternoon, and welcome to United Spirits Limited second quarter and first half of fiscal 2027 earnings call. Before proceeding with today's call, I would like to remind the listeners that during the call there may be some forward-looking statements. These statements are based on our views and assumptions at this point of time. However, this is not a guarantee of our future performance and results may materially differ from those expressed in or implied by such forward-looking statements. I request all of you to please refer to our financial and press releases posted yesterday. Both are available on stock exchange and company website under the investor section. Moving on. Today on the call we have with us Mr. Praveen Someshwar, MD and CEO, who is joined by Mr. Pradeep Jain, Executive Director and CFO. Praveen and Pradeep will take you through the business and financial performance for the quarter, followed by the Q&A session. Thank you, and over to you, Praveen. Thank you, Shweta, and very good afternoon to everyone. Thanks for joining us today. As always, it's wonderful to connect with all of you. A very, very happy festive season to all of you and your loved ones. We've had a resilient quarter, lapping a high prior year comparative and dealing with the regulatory headwinds. When I mean regulatory headwinds, FSSAI issues, which impacted the organization's bandwidth and focus. That said, I'm happy to share that we have emerged stronger and stayed on course to serve the consumer with the right choices. Quick snapshot of the macro environment and consumer sentiment as we see it. With the prolonged and continuing West Asia crisis, softer monsoons and inflation, consumer sentiment is not very upbeat and the same is reflective in various consumer confidence measures. Rural may not have fully absorbed the impact of the weaker monsoon yet, but the bottom end of the urban consumer is feeling the inflationary pressure. Therefore, in our parlance, we speak about India I, II and III. India I, the bottom end, the consumer. India I consumer, which is a target audience for the lower half of the IMFL portfolio, is showing signs of fatigue due to the impact of inflation on its wallet. India II and India III are robust and holding up. Overall, I am resiliently optimistic on the India consumer story. This brings me to my last quarter reference for inclusive premiumization. We remain focused on delivering the right value proposition through a well-calibrated price pack architecture across our portfolio that caters to consumers spanning all the three Indias. While keeping in mind that premiumization is a powerful long-term trend in India, yet being cognizant with the reality of the value-conscious consumer in India. In this context, here is our first initiative. We have relaunched our international whiskey trademark, J&B Scotch, as a compelling consumer proposition enabled by the India- U.K. FTA. This offers consumers 100% Scotch product at a very attractive price point and will help drive recruitment of younger LDA, as well as deepen Scotch penetration. We believe it's a winning proposition going into the peak festive season. We are also broadening our portfolio to unlock new avenues of growth. More recently with the launch of Smirnoff Ice ready to drink. RTDs bring together flavor, refreshment, and convenience in a ready to enjoy format. Smirnoff Ice has rolled out in Goa and Mumbai and shortly will roll out in Bengaluru at 4.8% ABV and 8% ABV. RTD is the fastest growing segment globally and has seen recruitment from adjacent categories like beer and wine, and is now looking to pick up pace in India. Our outlook for RTD is buoyant and we will continue to develop our portfolio in this space. Coming to the most awaited McDowell's transformation. It's reached 80%-85% of the salient markets ahead of the season. Initial response at a national level is mixed, as should be expected from a relaunch of this size and scale. Where the liquid, the packaging, including the core packaging of glass and PET, and the brand communication are being renovated. Overall, I can say with confidence consumer KPIs are up on McDowell's. It has received very good response in some of the bigger markets like West Bengal, Rajasthan, and is also ahead of our expectations in markets where we are not leaders. That's U.P. and Haryana. In the more conservative markets where we are leaders, there was some concern on acceptance of the new proposition. We've closed the feedback loop with nimbleness and agility. Some of them are responding to the interventions and others where the glass is just entering the marketplace, we will start seeing improved performance here onwards. The consistent feedback on liquid and packaging is outstanding, which is indeed very reassuring. So as I mentioned always, we need to stay resilient in this and give it time to settle down with the consumer. We will talk more about this in the coming quarters as we see it unfurl. Let's come to Smirnoff. Delighted to share that the Smirnoff trademark has continued its strong momentum in the current quarter, and we remain firmly on track to achieve our INR 1,000+ crore NSV aspiration for the fiscal year 2026-2027. Adding further to the exciting Smirnoff flavor world are two brand new offerings, Kaccha Mango and Coffee Toffee, both going to the market as we speak. Both flavors are fantastic and add diversity to the existing Minty Jamun and Mirchi Mango. I would encourage you to try and discover your own favorite flavor. Coming to our quarterly performance now. We have closed a resilient growth quarter overall, both on top line and bottom line. P&A NSV grew by 6.3% in Q2 FY 2027, lapping a growth of 12.7% in the same quarter prior year, bringing the half 2027 growth to 7.8%. The EBITDA margin in the quarter was at 19.7%, despite a very healthy increase in the A&P investments that have been consciously front-loaded ahead of the peak season. Our reinvestment rate for the quarter was at 11.6% versus 7.6% in the prior year same quarter, reflecting healthy investments behind our brands. P.J. will cover financial performance in detail in his comments. Bright side is the sustained momentum in the top half of the portfolio, with strong growth in luxury and acceleration in the premium segment on the back of primary scotches, which includes the relaunched J&B and Smirnoff, the Indian flavor innovation. The clear must-do task for us remains McDowell's, and having already made agile interventions based on consumer feedback, we look forward to the peak festive season while remaining committed to turning the momentum trajectory. With our innovation renovation calendar and ahead-of-the-season brand investments, we are excited for the festive season and remain confident on our P&A double-digit growth aspirations for the fiscal year. Coming to a brief update on the RCSPL transaction, BCCI due diligence is underway and at an advanced stage. The Competition Commission of India has already approved the transaction. We await BCCI approval and other statutory clearances. Looking ahead, as the consumer and regulatory landscape continues to evolve, we will stay anchored in our consumer-first approach, adapting our portfolio to changing preferences with disciplined and agile execution. With this, I hand over to P.J. for a quick update on the financial performance for the quarter before we come back to answer your questions. Thanks, Praveen, and good. Wishing all of you a wonderful festive season ahead. Thanks for joining us today for the second quarter and first half of fiscal year 2027 earnings call. Always a delight to connect with all of you. Would request all to please refer to the financial and press release posted last evening. Would want to highlight one small reporting change. The P&A segment now includes the brandy portfolio. This change is reflective of the consumer MRPs in key states that are broadly aligned with the lower prestige whiskey segment. Consequently, the current quarter and the first half as well as prior year respective bases have been reported and restated accordingly. As Praveen mentioned, we delivered a steady quarter amidst regulatory challenges and lapping of strong prior year base. The organization stayed resilient and focused on the key business priorities. We are now all geared for the festive quarter with optimism and excitement. The quarter growth has witnessed healthy demand momentum in India II and III, and consequently, our luxury and premium portfolio has delivered a very strong performance, which is reflected in the strong price mix for the quarter at 7.4% for the P&A portfolio. I would also like to highlight that the festive season is relatively delayed this year compared to the prior year, given the timing of Puja in India. Hence, October, November, December will capture the full benefit of festive demand in the current fiscal year. Praveen has already covered the top-line performance in detail, so we will not be repeating anything on that front. I will just briefly touch upon the popular segment. While it continues to be a small part of our business, accounting for less than 10% of the revenues, and in this quarter, approximately 6%, it is important to provide some context for the quarter. The segment has faced two policy-related headwinds, which all of you are well aware of, the continuation of the Maharashtra adverse impact and the full impact of the changes in the Karnataka policy. The downside due to the latter is being captured in the P&A portfolio of the relevant state. On the cost side, this quarter continued to absorb the impact of the West Asia crisis, broadly a range of about INR 50 crore. While this impact is against the pre-March 2026 prices, it does become a little irrelevant and more business as usual when the supposedly temporary disruption carries on for more than a couple of quarters. Impact was across the lines of glass, energy, packaging, and logistics. Neutral alcohol spirit has now started to get inflationary, driven by the El Niño impact on the monsoons, and therefore, the associated crop inflation. The marketing reinvestment rate during the quarter was 11.6% of net sales, which is an expansion of 400 basis points compared to prior year same quarter. While this may appear elevated for the quarter, it should be viewed in the context of our heavy innovation/renovation calendar and is expected to represent the new normal for the current fiscal year. As already mentioned by Praveen earlier, we have also consciously frontended the higher investments ahead of peak season to get maximum mileage from the same. Consequently, driven by the conscious higher A&P investments in this quarter, our EBITDA declined by 4.3% at INR 643 crore, and EBITDA margin was at a healthy 19.7%. The reported profit after tax for the quarter was INR 462 crore, down 2.1% with a net profit margin of 14.2%. All other relevant numbers and information is well contained in our press release. With this, we can now open the floor for the Q&A. Thank you. Thank you. We will now begin the question- and- answer session. Anyone who wishes to ask a question may press star and one on your touchtone telephone. If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question comes from the line of Abneesh Roy with Nuvama. Please go ahead. Yeah. Thank you. My first question is on the popular segment. You had done this evaluation a few years back and sold a large part of the business. Now it is 6% of the revenue this quarter, and my sense is margins would have come off sharply given the operating deleverage, and India continues to premiumize a lot. My specific question is, why continue on this 6% of the business where long-term, I think, viability and presence, does it make a lot of sense? I wanted to understand, can, again, a recalibration evaluation of this end again happen? Yeah. Abneesh, hi. I think we've answered this earlier. The 6% portfolio is largely the McDowell's trademark. The McDowell's Rum part of the business. It's the same trademark. We've been carrying on with the segmentation historically, that's why we report the number, but we look at it pretty much as an overall trademark. That's the reason we don't want to do anything. I guess our insight four years, five years ago, that the future profit pool and the growth pool is the Prestige & Above business, that's playing out in reality. That's what it is, and I guess to your point, it may continue to dwindle further and probably die a natural death. But yeah, as of now, we don't want to make any interventions. Understood. Second question is, Karnataka, a lot of reforms have happened for the P&A. Let's ignore the popular end. Beer industry in Karnataka has seen 50%+ growth now for many months. If you could tell us spirits, which also saw good benefit of reforms. So how has P&A done? What pricing initiatives you have done given 16 slabs became eight slabs, so there is more flexibility? Give some examples you can give, and are you happy with the performance? Has the competitive intensity gone up because of the reforms? Beer industry, a lot of consumption happening. Obviously, India can't consume both beer and spirits equally so strongly. Someone may be growing slower. If you could elaborate on that. Hi, Abneesh. Praveen here. Yes, Karnataka has seen, as I see, a very progressive tax policy. Clearly, P&A has done very strongly. Our business has grown strongly. Volume is up around 30%, 27%, 28%, and value is up 32%, 34%. So it has done reasonably strongly, consistent across months. I do not see that being an issue. I just see overall getting squeezed and premiumization is playing out in wine and spirits. I believe in the beer business, I do not know it well enough. It is a little other way around that we have seen pricing soften a little while volumes have seen healthy growth. Overall, I can see that is a massive opportunity for all the organizations in Karnataka. Now over and above that, we are just going to get in with our RTD which, as I say, consistently plays in the same occasion as wine and beer. Therefore, we have line priced it very competitively versus beer. We feel good about it. Sure. Last question. Tamil Nadu, any update you have? All liquor companies yesterday in the call spoke extremely positively on Tamil Nadu. They said that obviously this is second largest market, I think, in the country after Uttar Pradesh. I wanted to get an update, what is your sense of the current reforms? Some of the companies have said that some level of reforms have started. Some of the private companies, national companies are getting more market share. Initial days. Second is, do you have any infrastructure ready there? The companies have said some manufacturing, some presence is already there. So if you could update us on infrastructure, on manufacturing and distribution, if any. Look, I am not going to speculate first. Obviously, all industry associations are advocating for the right policies, and I hope the right policies come into play. Tamil Nadu is a big market, and it will be exciting how it unravels and opens over a period of time. But I would really speculate by saying very soon or later, but I am optimistic of where we are. Yeah. Abneesh, I think you said this earlier also, which is that in case the opportunity does open, we have demonstrated our agility in the prior instances. I mean, Andhra Pradesh, if you remember, we were up and running in about 45 days from the date the policy was announced. Therefore, we will retain the same nimbleness and agility should the market open up. All right. Thanks a lot. That is all from me, sir. Thank you. Thank you, Abneesh. Thank you. Next question comes from the line of Aditya Soman with CLSA. Please go ahead. Yeah. Hi, good afternoon and thanks for the opportunity. So two questions. Firstly, on this whole DRI investigation and checks space, what is the update here, and does this have any sort of bearing on the benefit we are likely to see from the sort of U.K. FTA? Secondly, we have seen a very sharp reduction in costs, particularly wage costs as well as other expenses. So is this the new sort of steady state, and should we expect this level going forward? Thanks. Yeah. Hi, Aditya. I will take this. So look, on the DRI front, we have already made a stock exchange disclosure. We have been very consistently classifying our Scotch imports in the same HSN code over the last, probably 15, 20 years, ever since the entity has been operating. So there is absolutely no deviation from our side. The government was kind of getting into it. So that is fine, absolutely. We are cooperating, and this will kind of play out. So we are absolutely confident in terms of our own classification. So no change on that front from our side. Your second question was regarding the sharp reduction in wages part, right? I think last quarter we did discuss, Praveen and I spoke about the overall organization simplification drive that we have taken. Therefore, in pursuance of those objectives, we have kind of lightened the organization a little bit. With the desire of being more faster in our decision-making. So it is the benefit of that exercise that is playing out. So yeah, that is broadly the perspective on both. Understand. So the takeaway here, obviously, on the expenses, this is the new steady state that we should expect going forward. On the DRI issue again— Aditya, as always I will maintain, just look at the four quarter run rate, et c. Because there would always be a little bit of differences, et c. Just look at the four quarter run rate. As you start tracking that, you will reach the steady state on your own. Fair point. Thanks for that. On the DRI issue again, just to sort of clarify again. From your perspective, as of now it is business as usual on the FTA and— Yes, absolutely. The benefits should start rolling from this quarter. Absolutely. And yeah. We are cooperating with the authorities. The FTA benefits are rolling in as we speak. July 15th onwards, our consignments are being cleared. Praveen, you want to add something on the advocacy part? Yeah. Very clearly as this is playing out, obviously there is lots of advocacy around to make sure that the benefits continue to reach the end consumer. Perfect. Thanks so much for the clarification. Thank you. Thanks, Aditya. Thank you. Next question comes from the line of Krishnan Sambamoorthy with Ashika Institutional Equities. Please go ahead. Yeah. Hi. A couple of questions. One, Praveen, you highlighted that you are awaiting the BCCI approval for the RCSPL stake sale. Could you give us some revised timelines on when you are likely to expect this and subsequently the combination of that as well as the dividend payment to investors? Would you hazard a timeline here? Go ahead, please. Yeah. So I think, again, we have shared this earlier. The long-stop date was earlier six months, but it was an auto extension of two months. So that takes us to almost till mid-December. We are hopeful because through the engagement levels of BCCI, we know we are at a fairly advanced stage. Therefore, right now our assessment is we should be able to close the transaction by the extended long-stop date, which is mid-December. Perfect. My second question is on ad spends. You indicated that there was some front-ending of ad spend ahead of the festive season. Would you like to state your ad spend guidance for the full year, and would it be higher than what you had been guiding earlier? Yeah. Again, we'll be consistent somehow on that. We had always said that for our core portfolio, we will probably be in the range of about 11%. Right? Whatever new platforms we are launching, like the RTD, the Smirnoff Ice that Praveen mentioned about, that will to some extent come and sit on top of the 11%. Okay. Just see if I can squeeze in one more question. This is on the J&B Scotch relaunch. Just to clarify, will this be under the erstwhile Diageo portfolio and therefore subject to a 10% margin cap, or would it not— Yes. —be a part of that? Yes. No, J&B very much a Diageo global trademark, so it will be within the margin cap. Thanks. Very useful, Pradeep. Thanks. Thank you. Thank you. Next question comes from the line of Rakshit Desai with IIFL Capital. Please go ahead. Yeah. Hi, this is Percy Panthaki here. I just wanted to understand the gross margin movement on a sequential basis that is versus Q1. Q2 gross margins have expanded while the inflationary pressures have sort of intensified, and this is also in light of the other two listed players who have shown a sequential contraction in gross margin. So just wanted to understand the drivers behind the same. Yeah. No. So Percy, look, again, the FTA benefit has started coming in, so that's one driver of how the gross margin is holding. And I think I had mentioned on the last quarter call also, while there is an adverse impact on account of the West Asia crisis, extra neutral alcohol was holding up wonderfully well. In the April-June quarter, extra neutral alcohol was actually deflationary. In July-September, it's by and large par versus last year, and as I've already mentioned in the opening comments, it will get inflationary driven by the poor monsoon and the El Niño effect. But having said that, it should also get offset with the full FTA impact as it gets more absorbed into the P&L. So sequentially, I'll probably say the gross margin should hold for the coming quarter. Understood. While we have discussed this in the past, now that FTA is a reality and you are actually seeing the consumption cost at a new level, can you just let us know what is the FTA benefit in terms of basis points of gross margin? Percy, that I do not want to comment right now because there are multiple things happening. Again, I want to be consistent on that. What I have always maintained, I do not want to quote that number because you guys will pick it up as a standalone number. However, there are multiple things happening, right? The currency is depreciating. There is cost inflation on Scotch at the base level, et c. So I do not want to comment on that number, but everything will be there in the P&L, and we are trying to hold an overall blended P&L and give you guidance for that. Understood. So the gross margin on a sequential basis, the expansion, the driver is the FTA benefit only, or apart from that, is there any driver? I am talking only about Q2 compared to Q1, the gross margins, what has changed in that? The mix is a big driver, Percy. So it is mix and the FTA impact. FTA impact, July 15th onwards, all our consignments are at the concessional rate. So that is almost kind of not the weighted average, but it is fully coming into the P&L in terms of impacting the weighted average price. Understood. Thanks a lot, Pradeep. That's all from me. All the best. Thank you. Thank you. Next question comes from the line of Harit Kapoor with Investec. Please go ahead. Yeah. Hi, good evening, team. Hi, Harit. Hi. Good evening. Just a couple of things from my end. The first half, as you have mentioned, has been in the high singles with growth close to 8% on P&A growth. Your aspiration continues to be double-digit number, which obviously requires mathematically, I think 12-ish% growth in the H2 growth. In the context of your realizations, probably normalizing because of, number one, because of Maharashtra now in the base. Some of the heavy lifting will have to be done with volume growth. Just wanted to get your thought process on what drives this kind of volume growth number and maybe if you could give a sense of ex-Maharashtra, are you already growing at that pace? You gave a number in Q1, but just to give a sense of some more confidence on how you see this trajectory play out to get to your double-digit aspiration for the year would be helpful. Look, a great question, and yes, we are around 8%, and if we are talking about double digits, you are talking in the range of 12%. The whole idea and yes, it has to be volume value both. Mix certainly continues to play an important role, but volume will play an absolutely important role. We are seeing consistently ex-Maharashtra healthy growth, and we have got impacted this quarter a little because of all the regulatory headwinds, as I said. It did impact us. As we see it, we have seen September, we are now starting to see October. We are starting to see how it is coming back, and therefore building up. Our focus on investing on the brands ahead of their season was to drive availability, it was to drive mind space, was to drive consumption, and I think that is why we feel absolutely good about getting back into healthy double-digit growth. Yeah. As we go forward, in all this, do remember, the premium portfolio is chugging along, and that consistently adds to the base. Yeah. Maybe I will just add, Harit, to your pointed question, which is that if you remember, all of you will remember that the first set of MML brands came into the market sometime around October, right? So the lap will be complete from the ensuing quarter now, right? Therefore, that itself, the mathematics will give us, hopefully, anything between two to three additional points of growth, right? That is exactly. If I also remember in the May investor call, the annual investor call, Praveen and I had very clearly said that first half will be a little lower, and the second half have to be naturally a little higher, right? So the script is playing out in line with our expectations. I will not be too worried on that front. Yeah. Got it. Just a follow-up on that. Do you expect second half to also show the full benefit of some of these innovation renovations that you are doing? I think number one should fully start to play out in H2, the launch of Ice, the launch of Flavors, J&B, and probably some more from your stable. So, the innovation renovation percentage, however you calculate it, could that also be an additional kicker on growth? Yeah. Well, see, if you look at it, Smirnoff flavor, right? The run rate has got established from the January-March quarter, right? So we already have taken three quarters of Smirnoff flavors. Right? Now the new flavors. Intent is that the new flavors are. Now, if one of them fires like Minty Jamun, who knows, Harit, right? All that is well incorporated right now, and Smirnoff Ice is too small right now to impact the numbers, but the intent is yes, probably two, three years down the line, that will start giving us serious numbers on the— Harit, overall, innovation is chugging. Yes. It will continue to build. J&B is going to add— J&B, yeah. —serious revenue to that. You are absolutely right. Each of these will help us deliver what we thought a strong second half. Got it. That is all, Praveen. Wish you all the best. Thank you. Thanks, Harit. Thank you. Next question comes from the line of Arnab Mitra, Goldman Sachs. Please go ahead. Yeah. Hi. Thanks for the opportunity. My first question was on the two challenges in the quarter that you mentioned. One was the FSSAI issues, and second, your comment on the McDowell's No.1 Feedback on acceptance in some of the large states. Just wanted to understand, did these two really impact sales in this quarter, in terms of either pipelining or actual consumer offtake? Are both of them behind in terms of, are you now seeing both these issues completely behind? The first issue is completely behind us. We still are in the process of doing the changes and getting it into market, but it's pretty much complete and well planned out. The first issue is absolutely behind us. The second is a massive opportunity. Number one, as I said, as we have, in an agile and nimble manner, done some changes around packaging, and as the packaging is reaching the market, we are seeing improvements market after market. It will take roughly till end November, so this is an ongoing process. But we believe sequentially you're going to see significant improvement as you go. Got it. Any of these two issues, did it really impact consumer offtakes, or it was more like your primary sales which got impacted, but availability was there in the market in this period of time? That is interesting. Wrong piece. Yeah. Praveen, I will just start and you can build on. Look, Arnab, it is very difficult to quantify that. Our reality, when you have FSSAI officials visiting your plants, right? And spending extended duration, the organizational bandwidth gets diverted, right? So the supply momentum gets impacted, right? Therefore, you end up having probably for a temporary period, wrong things at the wrong point of dispatch, et c. So that is the bit that we had gone through during the quarter. As Praveen mentioned, that is well behind us, everything, and we are pretty much firing on our supply processes now. Got it. My second question was on the FTA in terms of the other part of the FTA, which is as consumer prices come down on the imported products, you were expecting a certain price elasticity of demand. Could you help us appreciate it? Are you seeing that elasticity in the market? What kind of uplift you could be getting on volumes on those categories? Yeah. Arnab, look, the BIO part, right? I think the prices, just as we speak, are beginning to reach the consumer, right? Like I said, the machinery, the excise cost card were all submitted. Some of the states have approved, some of the states have still not approved. So literally between now and probably the next 30 days, the consumer will start seeing the lower prices. Hopefully, we will get a sense of it over the next three to four months in terms of how the response to BIO is. BII, we already fired the salvo, which is J&B. We had been working on it for nine months in anticipation. We are so glad and delighted that that has gone absolutely on plan and on schedule, right? J&B is pretty much Praveen, am I right? Is it pretty much available across the country as we speak? Yeah. Roughly 60% area. Roughly 60%. But in that 60% salience, we're excited how consumers have embraced it. Yeah, absolutely. So yeah. So those were the two things that we had always been working on. Got it. Thanks. That is it from my side. All the best. Thanks a lot. Thanks, Arnab. Thank you. Next question comes from the line of Avi Mehta with 360 ONE Capital. Please go ahead. Yeah. Hi, team. Thanks for the opportunity. I only had one question, and I just wanted to check if this was answered or not. If I were to remove Maharashtra, what are we trending right now? I do understand the timing, but first half growth rates, just to appreciate the tailwinds as we go forward into the second half beyond the benefits of price cuts in the BIO portfolio. Yeah. Avi, like I just responded to one of the earlier questions, where the Maharashtra lap is almost complete. For the first half, ex-Maharashtra, we have grown at about 10.5%. That is broadly the number. It has got impacted a little bit in the quarter as Praveen mentioned, but for the first half, ex-Maharashtra, we are at about 10.3%- 10.5%. Perfect. Just to clarify, this would have the additional tailwind from Karnataka impact now coming— Yes. —into both, right,— Yes. No doubt. —as well as cuts that should come in as we go through from the BIO portfolio. Yeah, absolutely. It would include the Karnataka tailwind. Absolutely. Okay. That's it. Just the other bit I wanted to clarify on the gross margin side. We did see the expansion, and you've clarified towards the mix. Is this mix a state mix that you're talking about, or is this more product level, between white and brown spirits? If you could help clarify that part. Yeah. No, it's category mix. It's a premiumization mix, right? It's absolutely the premiumization mix. Smirnoff growing so well that itself adds so significantly to the mix. Even the rest of the top half of the portfolio growing well. Perfect. That's all from my side. Thanks a lot for the details. Thank you, Avi. Thank you. Next question comes from the line of Jay Doshi with Kotak Securities. Please go ahead. Hi, thanks for the opportunity. Maharashtra as a geography and lower Prestige as a portfolio segment have dragged your growth for the past few quarters. With the relaunch of McDowell's No.1 and Maharashtra also getting anniversarized, the way you see things today, do you think that starting March quarter, both these buckets will also start growing at least 8%, 9%, 10% kind of growth rate? Or are there any other headwinds that we are not aware about? When I am referring to lower Prestige, it is largely competitive landscape. So if you get your relaunch right, and once your full India rollout is complete, do you think that portfolio can potentially grow at 8%-10% in value terms? So, Jay, great question. If only I could speculate and talk about the future consumer, I agree with you. Maharashtra, look, having said that, Maharashtra very clearly, I genuinely believe it is in good play. Now, is it 7%, 8%, 10%? I would not get there, but Maharashtra will get back to growth. There is no doubt about it. On lower Prestige, I do not know. The consumer does not understand the language of lower Prestige, okay? India I consumer works in a certain band. That band will see growth. What type of growth? As I said, the India I consumer has felt the pressure of overall inflation hitting in, and we have certainly seen some slowness there, and so sluggishness there. So I do not know what is the right number in terms of growth, but should it come back to growth? I genuinely believe that is our opportunity, and therefore, it will. Yeah. Jay, again, I am just taking you back to a question both of us answered maybe four questions ago, which is that Maharashtra lapping will probably give us 2 points, 3 points, which takes us to whatever, the 9.5%, from the current quarter. If we are saying literally that we are committed to double-digit P&A for the full year, which means that we have to grow about 12%, right? So the balance points of 2.5 points, 3 points is on account of the McDowell's and the innovation that we are doing. So absolutely. That is very much. Now to Praveen's point, whether McDowell's will reach the 7%, 8%, that is a difficult one to call out. Too early to call out. Historically, the premiumization, the category has not grown at that level in that segment. Understood. This is helpful. Thank you so much, and wish you the very best. Thank you. The next call comes from the line of Nitin with HDFC Securities. Please go ahead. Yeah. Hi. Thanks for answering my question. My first question pertains to vodka segment. If you can highlight how material is the vodka revenue for us in first half? Also, if you can share what is the salience of flavors and any thoughts around getting into the deluxe price segment. Getting into the? Sorry. Deluxe. We are already in the deluxe, but I will let Praveen answer the vodka question. Look, the whites are on fire. Be it tequila, be it vodka, very clearly as a category, it is on fire. It is on fire across the ladder. The middle end, at the top end. We are at the top end. Smirnoff is right up there. It is premium to most players. How have we done? As I said in my opening comments, we feel good about where we have come. Over the last nine months, consistently quarter- on- quarter, we have seen very healthy growth, and we believe we will top the INR 1,000 crore NSV for the year. That keeps us in good stead. That is on overall vodka category addresses within that Smirnoff. Now, if you segment it, do we have opportunity to play up and down on Smirnoff? We constantly say we are looking at the consumer segments carefully and constantly evaluating and looking at opportunities, exactly what we do in our Scotch and whiskey space. As vodka gets bigger and bigger, it is something we will certainly look at and unlock the opportunity and play to potential. Sure, this is helpful. My second question pertains to BIO brands, we are going ahead with the price cuts. As we are selectively with the price cut, I just want to check state governments may look to protect their excise revenue in the next budget after this V2 reduction. Are we also factoring those things or that can be a spoilsport ahead? Just wanted to be clear on that. Yes. We are not doing that kind of scenario. Whatever our early experience has been, the states where I mentioned have already approved the excise cost cuts, et c. They have not done anything of that sort. The price benefit is going to be passed on to the consumer. The intention is to grow revenue. Seemingly so far, even the states are wanting to grow revenue. I think the states overall benefit from the growth. As we have seen, they have completely come into the same scenario and starting to build on this. Sure. This is really helpful. Thanks a lot and all the best. Thanks. Thanks. Thank you. Next question comes from the line of Ashutosh Jain, Barclays. Please go ahead. Hello. Thank you for taking my questions. I have three questions, please. The first one is, I just want a little bit more clarity around the DRI situations. When you say all consignments have been approved, I am sure this includes both HSN codes, which covers bulk and the BIO portfolio. As we all know, of this bulk, part goes into your raw material mix and part is your BIO portfolio. Hypothetically assuming if the final outcome is against us on bulk portfolio, am I right in thinking there will be a material impact on numbers given you mentioned some gross profit, the gross margin benefit also, and also the pricing benefit on the BIO portfolio. Where there is pricing benefit on the BIO portfolio, there also you have a margin cap. Could you just throw some more color on that? That is my first question. My second question would be on Smirnoff Ice. Could you just give some examples of price points and the distribution strategy? How should we think? Because in my assumption, because of malt nature, it is more of a beer RTD category versus, say, a spirits market. How do you see that category evolving and how do you see the synergies between the new launch and your current portfolio? My third question would be, just a quick update on your McDowell's X Series. There has been limited information on that, how that brand is doing, and where do you see that brand going ahead? Thank you. Praveen, you want to take the Smirnoff Ice question first? Maybe the two brand questions, and then I'll come back on that. Okay. Look, overall, Smirnoff Ice, as I said, will unlock new avenues of growth for us. It brings together very simply flavor, refreshment, and convenience and plays to the ready-to-enjoy format. Very much plays to the beer and wine occasions, early evening, mid evening, late evening. So we've launched 4.8% and 8% ABVs. Yes, our present go-to-market works on that. We go to the same stores. We sell pretty much the same manner. Just here, additionally, we need to make sure that it is chilled, and that is the additional work which is being done. That's why we've picked up three markets. We're going to perfect our playbook and replicate it across the country. So very clearly, that's the first thing. What are the synergies? The synergies, it's the same go-to-market, goes without saying. More importantly, it is the same trademark, which is Smirnoff. It drives a whole set of new consumers coming into the category. We've seen there is a 3x multiplier that an RTD drinker will graduate to become a core spirits drinker. That's a big multiplier. So there are huge synergies of driving new consumers in through the RTD back into the spirits space. So overall, it's an exciting space. We're going to build on it slowly and therefore scale it. That's the first one. What is the second brand question? X Series. X series. Document. I think we spoke about it a couple of calls back. Yes, we had experimented and created. We are looking at renovating that range and re-looking at that overall portfolio. You will very shortly start seeing how it comes to market. I would just wait for that as we talk about it and margins. No DRI issue. Yes. Ashutosh, I do not think I will have anything more to say on the DRI. We have already shared what we had to share. We have been very consistent in our classifications. We are cooperating with the DRI and the authorities. In case some additional developments happen on this, which has a material impact, obviously, we will be regulatory bound to kind of come and disclose it to all of you. As of now, we do not want to say anything more than that. But yes, the impact will be material in case there is classic with that going forward. That is only a hypothesis. So therefore, we do not need to think about that, right? No, absolutely. Thank you so much for the color. Even, I just do not want to get there, but just wanted to have some clarity. Also, one quick follow-up, if I may have, is on the BIO portfolio, given you have a margin cap and this FTA benefits is passed on to the margin, not your, the product which you get as a raw material which gets built from the global parent. So does that have an impact on your margin profile or somewhere in your cost lines, or does it does not have an impact over there? No, for your view, you pretty much kind of got it right. USL will remain margin-capped, right? Based on whatever the P&L is, right? So therefore— Got it. —we will not get impacted. Got it. Thank you. Thank you. Thank you. Next question comes from the line of Karan Kamdar with Choice Institutional Equities. Please go ahead. Good evening. Great set of numbers on the, especially the margin front. What I wanted to understand is that, how far do we see this gross margin sort of continuing? Or do we see some compression due to West Asia impact or glass pricing? Or do you see this high sort of margin continuing over the next two, three quarters? Yeah, Karan. Look, like I've already said, there are tailwinds, right? Which is the FTA tailwind, right? Which has held us in good stead for the current quarter that we have reported. Immediately next quarter, what I see in the short term is ENA going up on account of the El Niño and the monsoon effect, right? But hopefully that will be neutralized by the full effect of the FTA benefit, right? And post that, very difficult to call out, right? Ideally, we would want to maintain the gross margins at the current levels. Yeah. But again, we will form that view as we kind of go along, right? Right now, we don't want to think beyond that. Got it. Second question is more on the competition side. Generally, we are seeing the competition is heating up, especially Spirits and Beer now, and before just spirits as well is heating up, and there are too many new players coming up, new brands coming up. How do you see this landscape, and how do you plan to sort of defend the number two spot that we have currently? Do you see any slippages because of heightened competition, or do you see it as an opportunity for acquisition, maybe? Karan Kamdar, look, competition is very healthy. When there are more competitors, you will see the category showing growth. That is a great place to be in. What it is telling us is, obviously, there are other organizations mining data and seeing the opportunity and want to play in this category space. We are excited about it, because with competition comes category growth. We need to be disciplined on how we speak to our consumers, how we ladder our products to our consumers, and how we play each of these categories. It could be international whiskey, it could be Indian whiskey, it could be vodka, it could be tequila. How do we play it in a disciplined manner? That is how we will look at it, and we are excited to embrace competition and play to our potential. Maybe you can outline what part of the portfolio excites you most in terms of growth, apart from the innovation side and the J&B and the new brands. Out of the existing portfolio, where do you see most growth coming in? Look, if you see overall, if you look at the category, whites as a category, as I said, is seeing explosive growth. That is the way the category is behaving. Repertoire is growing, and with repertoires coming, consumers are expanding their consumption, and whites is benefiting from that. That is why you see Smirnoff's performance. You are seeing it in terms of growth. Therefore, these trends will keep coming. We have to play disciplined in each of these categories so that we can play to our potential. Got it. Thank you, and all the best. Thank you, Karan. Thank you. Ladies and gentlemen, that was the last question for today. We have reached the end of question- and- answer session. I now hand the conference over to Ms. Shweta Arora for closing comments. Thank you. I am cognizant that many of you have back-to-back calls today, so we are just finishing on time today. On behalf of United Spirits Limited, I wish you and your loved ones a very happy and safe Diwali. If there are any questions, please feel free to reach out to me. Thank you for joining. Have a good evening. Thank you to all, and happy Diwali to all. Happy festive season. Thank you. Thank you. On behalf of United Spirits Limited, that concludes this conference. Thank you for joining us. You may now disconnect your lines.