Ladies and gentlemen, good day and welcome to the Vaibhav Global Limited 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 Mr. Mit Shah of CDR India. Thank you, and over to you, Mr. Shah. Thank you. Good evening, everyone, and thank you for joining us on Vaibhav Global's Q1 FY 2023 earnings conference call. Today we have with us Mr. Sunil Agrawal, Managing Director, Mr. Vineet Ganeriwala, Group CFO, and Mr. Prashant Saraswat, Head, Investor Relations. We will begin the call with a brief opening remarks by Mr. Sunil Agrawal on the business operations, key initiatives, and a broad outlook, followed by a discussion on the financial performance by Mr. Vineet Ganeriwala. After which the management will open the floor for a Q&A session. Before we get started, I would like to point out that certain statements made or discussed on today's call may be forward-looking in nature and must be viewed in conjunction with the risks and uncertainties revealed. The revealed statement and explanation of these risks is included in the earnings presentation, which has been shared with you all earlier. The company does not undertake to update these forward-looking statements publicly. I would like to invite Mr. Sunil Agrawal to make his opening remarks. Thank you, and over to you, sir. Thank you, Meet. I welcome you all to Vaibhav Global's Q1 FY 2023 earnings call. I hope all of you would have reviewed the results. Our presentation provides further details both on the business and on the environment we are operating in. The quarter gone by reflects effects of two macro environments. First, the opening up of economies after two years of travel restrictions led people to go out for revenge outings, impacting all digital retailers like VGL. Secondly, the high inflation in Western economies constrained consumers to spend on discretionary items. Recent quarterly performance was softer over an otherwise elevated base of two years, with revenue reaching INR 628 crores. This was 8% down YOY. However, this performance is encouraging versus our pre-COVID period of Q1 FY 2020, with a growth of 47%. Amidst all broader challenges, we see a visible improvement during last three months, with revenue trend improving month-over-month. We believe that this transitory phase will be behind us soon, and we will get back to our revenue and profitability growth path again. It is worthy to note that despite this transient phase, the gross margin improved sequentially and was 62% owing to our vertically integrated supply chain and better product mix. EBITDA margin for the quarter was 7%. Excluding Germany, it is 9.1% year-over-year, 9.1%. Year-over-year comparison shows decline in EBITDA margin largely due to operating deleverage. Continuing with our strategy of enhancing our digital capabilities, we continued investments on new OTA homes, digital marketing spend on OTT, social media, and third-party marketplaces. Digital is the future with high growth potential. Hence, we will continue to concentrate on this segment and build our strength there for some time to come. This quarter, we have achieved the milestone of completing 25 years of public listing. We take this opportunity to thank our shareholders who shared this great journey with us. All these years, our deep discount and value positioning worked well in various kinds of economic cycles and delivered consistent results to our shareholders. During the quarter, VGL's German subsidiary, Shop LC GmbH, expanded its presence by launching its proprietary TV channel on national OTA platform, freenet TV. With this arrangement, Shop LC GmbH also marked its foray into OTA, that is over-the-air platforms, and increased its coverage by approximately 2.5 million households, thus providing further scope of scalability. At Shop TJC UK, the Freeview channel upgrade has started yielding positive outcomes in terms of new TV customer acquisition. In February 2022, new TV customer acquisition rate was -17%, which today is +24%. We expect that the current trend will continue to benefit TJC with market-leading growth in the long run. Our vertically integrated supply chain network spanning 30 countries is the backbone of our business and a key differentiator. It is helping us with increased product availability while many other retailers battle with supply chain constraints. The low-cost manufacturing with value sourcing enables to serve value-conscious customers in our addressable markets in U.S., U.K., and Germany, thus achieving industry-leading gross margins. Further, our Four Rs framework, widening reach, new customer registration, customer retention, and repeat purchases remains to be our key levers for growth. The reach of our TV networks by end of Q1 FY 2023 was approximately 127 million TV homes, which is 24% higher year-over-year. We reach TV homes through cable, satellite, telco networks, and over-the-air antenna, also called OTA platforms. Our products are also available on digital channels, including proprietary websites, smartphone apps, OTT platforms, and marketplaces. Our sustained investments on OTAs and digital channels is yielding desired results in terms of increase in customer acquisition and sustained retention rates. Our unique customer base is at 0.5 million. New registrations on TTM basis are at INR 3.2 lakhs. Similarly, new customer acquisition on TTM basis stands at INR 2.6 lakhs, which is higher by 12% year-over-year and significantly higher by 27% over Q1 FY 2021. On a sustainability aspect, we are pleased to announce the publication of our first integrated annual report and annual ESG report for Vaibhav Global for the financial year 2021-2022. We hold value creation and sustainability as complementary goals. These reports reflect our continuous efforts towards value creation along with greater transparency, strong governance, and ethical business practices. Further, we are glad to announce that two of our office buildings in U.S. has received LEED Gold Certification. This certification reaffirms our focus on efficient operations and recognizes our efforts towards sustainability. Another important aspect of sustainability effort is our midday meal program, Your Purchase Feeds. Recently, we crossed a milestone of 67 million meals with a run rate of 59,000 meals donated every single school day. Towards the conclusion, the broader economic environment is a bit uncertain. Our outlook for the year and midterm remains intact. We expect to deliver mid-single digit growth in this fiscal year and mid-teens revenue growth next year and thereafter. We closely monitor our liquidity position and deploy funds accordingly while maintaining overall profitability. The board of directors of your company have declared an interim dividend of INR 1.5 per share for the quarter, implying a firm belief in our business model and a strong performance going forward. With this, I now hand over the call to Vineet to discuss financial performance. Over to you, Vineet. Thank you, Sunil Agrawal, and good evening, everyone. A warm welcome to Vaibhav Global's earnings conference call. While Sunil Agrawal gave you some details on overall performance and business status, I will now take you through our financial performance for the quarter ended 30 June 2022 in detail. Last few months have seen some level of uncertainty around inflation and resulting subdued consumer behavior. Quarterly revenue of INR 628 crores is against the backdrop of the macroeconomic challenges. It is also pertinent to note that Q1 of the last two fiscal years grew exceptionally higher owing to COVID-supported tailwind. While the current quarter Q1 growth looks subdued because of higher base, our 3-year compound annual growth rate stands at 13% with a robust growth of 43% over Q1 of FY 2020. The e-com industry in U.S. and U.K., after a tailwind during COVID, have been witnessing some headwinds, with economy fully opening up and lower demand due to inflation-related worries. The sales mix of e-com market in U.S. and U.K. have fallen by 4.1% and 0.3% respectively versus December 2021 levels, as suggested by the macro data. Consequently, in local currency, Shop LC and Shop TJC had a softer revenue performance. We are rapidly adjusting our offerings to changing consumer demand, and the same is reflected in improving revenue numbers month-on-month. We are pleased to report that the preview channel upgradation in Shop TJC to slot number 22 from 50 has started yielding positive outcomes. Today, the rate of new TV customer stands at 24%, which is a delta of 41% over February 2022. We perceive that this investment will further enhance the viewership of TJC, as we mentioned earlier, and thereby offering a huge future growth potential. Our TV revenue stands at INR 386 crore and digital revenue at INR 220 crore. The numbers are down by 9.6% and 9.2% year-on-year respectively. However, when compared against pre-COVID period of quarter one of FY 2020, the growth is encouraging at 40.7% and 59.8% respectively in both the segments. Our focused approach on expanding OTA households continued during the quarter. Sales mix between TV and digital is 64% and 36% respectively. Additionally, our investments on expanding omni-channel distribution have resulted in 58% of new customer acquisition happening on digital platforms during the quarter. This omni-channel distribution model promotes and encourages customers to transact on both TV and digital platforms, which gives them a unique shopping experience and a cross-selling potential for us. Omni-channel customer tends to be sticky and have a significantly higher lifetime value than customers who buy only on TV or only on digital. We also provide hassle-free shopping experience with our Budget Pay service, allowing customers to make purchases on EMI basis. Since its launch in FY 2016, the service has been gaining good traction and presently it is contributing around 39% of the total retail sales. Over the last many years, share of non-jewelry has increased multi-fold, indicating our ability to take higher wallet share out of the same household. Jewelry accounts for 72% of the total retail sales, while the rest 28% is comprised by lifestyle products, which includes apparels, home décor items, beauty and accessories. Our EBITDA margins dropped from 14.4% to 7% during the quarter Q1 FY 2023. A large part of this is attributable to our investment into new Germany unit and our conscious investment on digital and broadcasting network, all of which are strong future revenue growth pillars. We believe current EBITDA margins because of these investments are not true reflection of our business model and we are confident of reverting back to our earlier level of mid-teens range in the medium term, led by continued customer growth, improved productivity and cost optimizations. Profit after tax for the quarter is INR 20 crore as against INR 66 crore of last year, adjusted for exceptional items. Operating cash flows and free cash flows were at INR 32 crore and INR 18 crore respectively, reflecting impact of lower profitability. However, the cash generation has improved sequentially due to efficient capital allocation and focus on costs. On a TTM basis, ROE and ROCE were at 14% and 22% respectively. These return ratios, while continuing to be strong, suggest effect of conscious investments on affiliates, digital marketing and German operations. The Board of Directors of your company have declared an interim dividend of INR 1.50 per share for the quarter. Towards the end, we would like to reiterate that we have immense opportunity ahead and we continue to invest to create long-term value while navigating through a volatile, short-term market environment. For fiscal 2023, we reiterate our previously provided guidance of mid-single-digit revenue growth while maintaining mid-teens revenue growth in the long run and our guidance of operating leverage in the current year. Thank you. Thank you very much. We will now begin the question and answer session. Anyone who wishes to ask a question may press star and one on the touchtone telephone. If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question is from the line of Abhilash Sharan, an individual investor. Please go ahead. Hello? Hello.? Please go ahead. Yes, sir. Sir, can you explain the investments that we are making in the OTA platform? You had alluded in the past that these OTA investments are much higher than the OTT platform. What is the reason for that and how are we looking at those investments? Thank you for the question. OTA is over-the-air antenna platforms. While cable, there's a cord-cutting mechanism. OTA is increasing year-over-year by 6%-7%, so that is expanding in U.S.. In U.K., it is already quite large in ratio terms, but in U.S. it is expanding. That is where we are accelerating our investments for future growth potential because that is growing year-over-year. Wherever we are getting opportunity, we are investing in that. Per household revenue from those OTAs are higher than cable because there are limited number of channels people see via antenna compared to cable. Cable have about 1,000 channels, whereas antenna has anywhere between 25 channels -100 channels only, and it is broadcasted free of cost to consumer. Sunil Agrawal, what will be the exact difference between the full power OTA and the low power OTA, right? You said that full power OTA are kind of much more expensive than the low power. Yeah, that is correct. Good observation. Low power OTA, we are already in about 16 million homes in U.S. out of about 22 million. Full power, we are just about 4 million homes out of 22 million. Full power is usually has much higher signal and reaches broader area of the antenna power. Whereas low power reaches to a limited number of homes. The full power is usually also affiliated with national broadcasters like ABC, NBC, CNN. Whereas there is a large audience tied into those ABC, CBS and CNN. When we go to their digital channel, it is called sub-digital, 0.2- 0.9. The audience, which is on the main channel for ABC, CBS, those flow over to. channels as well. Full power has more value. It's more expensive also, and the higher revenue per household as well. Okay. Sir, is it correct to then say that the full power OTA household average household income will be higher than the low power OTA household? That is correct. Yes. Good assumption you have. Could you give some broad numbers, like what would be the average household income for full power OTA and the low power versus the normal cable, s ome big, broad numbers? I don't have it offhand with me. The multiple between low power and high power is anywhere from 4x to 8x. Okay. 4x to 8x on the household income front. No, no. The revenue from full power OTA is about 4x-8 x of low power OTA per home basis. Okay. Sir, and there are also- Mr. Abhilash, may I request you to please rejoin the queue? We have participants waiting for their turn. Sure, sure. Thank you. The next question comes from the line of Sachin Kasera from Svan Investment. Please go ahead. Yeah. Good evening, sir. My question was on the margin side. You have given a break-up of the impact on margins under various heads. If you can just tell us the margin- Sachin, you're not clear. Is it better now? Yeah, I can. We can try again. Yes. I'm saying this margin impact because of two or three various aspects you have given in the presentation. If you could just tell us this gross margin, 10 basis point impact, can tell us a little bit more in details? When do you see this impact of gross margin going away? The gross margins, we have always guided for, like, 60%+ gross margins. In this quarter, while year-on-year the gross margins are lower from 65% of last year to 62%, but it remains well above our guidance of 60% and have also sequentially improved. While it's a challenging macroeconomic environment, but we are happy that we are able to maintain our guidance of 60%+ gross margins even in this challenging quarter. Coming to EBITDA margins, I don't know whether your question was specifically directed towards gross or EBITDA. I have two, three points on the EBITDA margin. One was on the gross margin. Second was on this investments in OTA and in Germany that you have mentioned. When do you now guide for Germany to break even and the drag on Germany to go away? The second was on the increase in investment in OTA and digital marketing initiatives. Is it, like, gonna be a now continuous affair or is it also a one-time initiative and over the next few quarters the impact of that on the margins will go away? Sure. Germany, we have already guided breakeven in H2 of FY 2024, which is next year H2. We are in line with that. We reiterate that guidance of breaking even in H2 of next year. Till that time, the losses will be there in Germany unit. As of now, it is impacting 2.2% on the EBITDA margin. Sequentially, it is lower from the March quarter. Yes, it will break even in H2, and we are, like, absolutely in line with that guidance. On your point of accelerated investment in digital and broadcasting, we'll not shy away from investing in further OTA opportunities if we get that for future. What one needs to understand is that it takes time to build up revenue from a new household. While the cost may hit from day one, the customer and the revenue build-up happens after a lag. It gives subsequent, like, a very high revenue as well as leverage opportunity for future. Getting such opportunity in OTA households is not very easy and it comes from time to time. As of now, the visibility which we have in overall rupee terms, it may not increase by more than, say, it will be very close to lower double-digit increase in the content and broadcasting expenditure for the year versus last year. If we get more opportunities in OTA, we will not shy away as it is a very strong growth pillar for our future business. In spite of all these initiatives, sir, how confident are we to go back to the mid-teens EBITDA margin over the medium term that we had before these various factors of investment and some impact of inflation impacted our margins? Yeah, thank you. We reiterated our guidance of reverting back to mid-teens level in the medium term. This year there are a lot of macro challenges and our investments into these Germany unit as well as broadcasting coming up. Next year when it starts to unlock, the money unlocking in H2 of next year and all these investments into broadcasting giving commensurate revenue in the next year, we guess, we will recoup a large part of this lost EBITDA margin within next year itself. We have reiterated our confidence on reaching to mid-teens level in the medium term going forward. Okay. Thank you. Thank you. Participants who wish to ask a question may press star and one. The next question is from the line of Nilesh Shah from Envision Capital. Please go ahead. Vineet, just a bit more clarity on the margin side. You said this year we've guided for a single-digit, mid-single-digit kind of revenue growth. Sorry to interrupt, Mr. Shah. May I request you to speak little louder? Yeah, sure. Vineet, we've kind of reiterated our guidance of this year's revenue growth in mid-single digit and the EBITDA margin to also- Mr. Nilesh Shah. Nilesh, we can't hear you. Are you there? Can you hear me now? It is very low, sir. Is it still low? Now you can go ahead. Please go ahead. Yeah. Thank you. Sorry for that. Vineet, just a clarification in terms of the margin for this year. We're guiding for a single digit revenue growth and the EBITDA margin to be a function of the operating leverage. Does that mean that if our revenues grow at, say, 5% this year, we expect our EBITDA absolute number to also grow at 5%? Is that what we should really understand? Thanks, Nilesh, for that question. We have not given a number to our EBITDA margin guidance for the year, but what we have mentioned is with a mid-single digit revenue growth, we will have operating leverage coming in. Profit will grow at 5% or greater than 5%. That is for the current year. For the next year, what we have mentioned is reverting back to our mid-teens kind of a revenue growth in the medium and the long term. Similarly for mid-teens EBITDA margins in the medium and long term. Yeah. Surely. If I just do the math, Vineet, it means that for the rest of the three quarters of this year, our EBITDA margin will have to be 11.2%, which is higher than what we have achieved even in FY 2022. I just thought, is that what we should understand because that's what the math suggests. Yeah. I don't have the exact number of the last 3 quarters of FY 2022, Nilesh. Yes, in the current quarter this year, what we have also mentioned is sequentially we will see improvement in EBITDA margin going forward. The first quarter has a revenue degrowth over the last year for all the reasons explained above. Cost optimization initiatives which we have started since last 3 months have started kicking in and giving benefits as I explained in my commentary as well. These two things, now the revenue coming back to positive growth in the coming quarters and the cost initiatives giving full benefits, the EBITDA margins in the next 3 quarters will match the revenue growth for the full year. Okay, thanks. Thanks very much. Nilesh, not to mention. Yeah. Q3 is our peak season time wherein we see a good amount of operating leverage flowing in and we get a good benefit in the Q3 as well. It will not be like a flat 11% in all the three quarters going forward, but it will see sequential improvement from here. Okay. Just a follow-on question. Our realizations on the web side have increased quite significantly. I'm not too sure. One of our realizations have increased quite significantly. What explains that spike in the realizations? You are talking about the average selling price, Nilesh? Is that the question? That's right. Okay. Average selling price, Nilesh, is a function of what the customers are pulling at that point of time. Like in the last year, there were a lot of essentials which were being sold and hence the prices were low, volumes were significantly up. This year what we're seeing is the impact of all these economic uncertainties. People are resorting to gold as a, like, medium of investment as well. We are seeing a huge spike in gold chains, like unprecedented, like what we would have sold every year. Which is why the volumes may be low, but the prices are higher. What I mean to say is the price and the volume are the function of what the customers are pulling at a particular point of time. We being vertically integrated supply chain are rightly poised to take advantage of any rapidly changing consumer scenario which comes our way. I would urge not to look at price and volume quarter by quarter, rather look at it in the long term, because short term it may vary with respect to changing consumer needs. Fine. Okay. Thanks. That's helpful. Best wishes. Thank you, Nilesh. Thank you. The next question is from the line of Latika Jetha from Concept Investwell. Please go ahead. Hello. I have a question. You have mentioned that we are gaining market share. I just wanted to check how do we calculate this, whether we are gaining market share or losing market share? Any particular source or mechanism to know this? Yeah, I can take that, Sunil. The way we calculate market share for us is we look at similar players. For example, say, there is Qurate in, QVC in U.S. and Evine in U.S. and similar there are multiple such operators in U.K. We look at similar home shopping networks who sell through TV and online as a medium of sales just like us. We take only those companies in comparison whose numbers are publicly available for everyone to see. When we compare our sales from QVC, say for example, QVC, Qurate and Evine in U.S., we find that while our revenue growth might be little muted in the last few quarters, but that is significantly above the competitors like we mentioned it, and we continue to grow market share quarter by quarter, year after year since last many years now. Just to give a broad number, Qurate, while we would have grown by very low single digit in Q4, their Q1 numbers are yet to come. Qurate have de-grown by double digit in the last quarter, Q4. Okay. The market share gain which you have mentioned is not related to the Q1 quarter. It is for the past six months, right? We continue to gain market share quarter by quarter and year by year. The Q1 numbers are yet to come out. They will be coming out later this week and early next week. Looking at the trends of last many quarters now, what we mean to say is that we have been continuously gaining market share. Okay. Consistently. Okay, thank you so much. Thank you. Ladies and gentlemen, to ask a question, you may press star and one. The next question is from the line of Sameer Dalal for Natverlal & Sons Stockbrokers. Please go ahead. Yeah, hi. I just want to refer to page, your presentation page 20 where you are showing the recent trends, improving month-over-month. This 9.9% decline, 8.5% and 5.2%, that is a sequentially slowing down growth or this is over the last year the same month? I've not understood the chart visuals, so if you could just explain that. Yeah, it is over the same month of last year. Even though we are seeing a slowdown in — I mean, just even though you say that online sales every day they are lower. If I were to look at it actually month-on-month, say, can you kind of quantify what is the peak in the movement of sales over this period, month-to-month? This is a sales movement month-over-month, same year. For example, April is 9.9% lower than April of last year. No, no, I'm saying April to May to June, how has the sales been? Not month-on-month, n ot over the previous year, over the current year. This is same month of previous year. April 2022 over April 2021, May 2022 over May 2021, and June 2022 over June 2021. Understood that. What I'm saying is can you give us some indication on how the sales have been, April 2022 to May 2023, you know, month-on-month, June 2022, how they are moving sequentially? Oh, I see. Yeah. Let me see the data. You know, in our case there's a lot of seasonality, month-over-month or the clearance mechanism that we run. That may not give you the best picture because the same maybe the last year or year before as well. I would encourage you. We can give you the data, but I encourage you to look at year-over-year for the same period rather than month-over-month sequentially. Okay. I mean, my time. Now my second question has to do with the fact that, you know, we have seen You're breaking up. Yeah. Not understanding clearly? Sunil, you're breaking up. How about now? Can Can you hear me? Can you repeat the question? Hello? You're coming in and out. If you can probably be just little closer to the mouthpiece and let me encourage, you know. Sure. Yes. Is it clear now? Mr. Sameer, this is the operator. There is a lot of disturbance in your line. May I request to please rejoin the queue, sir? Oh, can I just try once again to ask this question. Because it's, I mean. Okay. Please go ahead. Go ahead, Sameer. What we have seen is a big jump in the TV sales, average selling price. What you rightly said is last year there were a lot of your essential goods because of which the average selling price was lower. What we are also seeing over last year is the gross margins have come down. Would it be fair to assume that those, the gross margins for the essentials was higher than that of what we are selling normally? Yes. Last year, essential also gave higher margin and the customer pull was there, so we could get overall higher margin on our product. The customers were at home, relatively home, last two years actually, and we could gain that leverage to get margin. This year, the costs are slightly elevated due to shipping costs and all that. Customer or eyeballs are lesser on TV as well as on the properties. The leverage that you have to gain extra margin is also less. That there are two reasons for that. No, my question is, if we remove the essentials, now that essentials may not sell to the same quantity what they did in the past, can we assume that the gross margins would be more around the range of 62% for the entire year going forward? Or do you think you can scale back up towards the 65%? That's the question I'm trying to address. Yeah. We don't give those specific margin guidance, Sameer. We give the guidance that we'll keep it at minimum 60%. Above that, we look at the opportunities and then take benefit of that. From quarter to quarter we don't give either. Year to year, we don't give gross margin specific guidance. What I can say is that we'll be above 60% and we have leverage of profitability over last year. This financial year will have leverage over last year. Okay. Now one last question. If you know, if you look at your depreciation, that has seen quite a big jump actually. This has to do with some amount of the amortization also of the TV channels, I mean, the upgrade of the TV channels or that is still not coming to the full. Uh- Over the 10-year period that you're gonna. Yeah. amortize the cost. Yeah. It's already part of that. It's already. This would be the probably stable rate going forward right now? That is correct. We moderated our CapEx for the time being. Only CapEx that will come from Q4 is our new headquarters construction that will start on Q4 this year. That will come in, but that'll last for about two years, so it won't start to kick in. Amortization will start to kick in after it becomes operational in FY 2024. FY 2025 actually. Okay. Okay, great. Thank you. I'll get back in queue for more. Sure. Thanks, Sameer. Thank you. Ladies and gentlemen, to ask a question, please press star and one. The next question is from the line of Sachin Kasera from Svan Investment. Please go ahead. Yeah. Sir, in the presentation you have mentioned three initiatives on the cost cutting and cost savings which should yield between $5 million-$7 million yearly savings. One, any benefit we have seen in the current quarter? Secondly, will we see the full benefit in financial 2023 or partial benefit of this in 2023 and partly in 2024? Yeah, I can take that, Sunil. Some benefit have started coming in Q1, definitely. The amount which we have given out there is for this financial year. FY 2023, the full benefit is in the range of $6 million -$7 million which we have guided out there. All the three initiatives, the call center, arbitrage, shipping and warehousing and the contract renewables have started kicking in from Q1 itself, but they will keep picking speed in the coming quarters and full year benefit of about $6 million -$7 million as stated there. That itself should add another around 150 basis points for profitable EBITDA margin previous to the next fiscal year. Yes. Like we mentioned, the mid-single-digit revenue growth, along with this cost initiatives will more than offset the investments which we would need to continue to do in Germany and in the broadcasting network. We would see positive leverage this year as well. This mid-single-digit revenue growth and the cost exercise is what the guidance is based out of. Sure. Sir, Sir, there's one more question from a medium- to long-term, say a 3 -year to 5-year perspective. We, you know, have periods of very strong growth and then we need to have some investments for digital as well as getting into new geographies. How should we model from a 5-year perspective? Is it that a mid-teen and a mid-teen growth and mid-teen margin sustainable? Or is it that to sustain a mid-teens growth, while we may periodically see mid-teen margin, but the average for, say a 3 -year to 5-year period may be little lower, maybe like low single digits, low double digits, something like that. If you could comment on that. Are we looking at any more geographies to enter once Germany stabilizes after, say, another 6 quarters- 8 quarters from now? Yeah. For your 5-year plan, I think, as we have demonstrated over our 25-year listed, we have over the period shown about 18% growth. For going forward, we are giving a guidance of mid-teens growth, with leverage. Leverage will continue to decline as a percentage, but we are hoping to see the leverage as well. If we go into the next country, they'll have a larger base of three countries becoming profitable. Absorbing of the initial losses of three years into a new country will be spread over a lower number. Our digital investment that we are making, OTT investments, OTT, so they'll also start to kick in. We feel fairly confident of mid-teens revenue growth with leverage coming in from next year onwards for foreseeable future. Okay. Yeah, I think between my questions, if I see your numbers for the last at least 10 years -12 years, which I have right now access to, from the period 2010 to 2018, 2019, our margins, EBITDA margins range used to be between 5%-6% on the lower side to 10%-11%. This time, despite the investment that we are doing, at least in the last 3 years -4 years, the range is more to be like between 10%-11% on the low side and 14%-15% on the higher side. Is that structurally the way the company has now evolved? We will every 5 years keep moving to a little higher band in terms of. Within Within 5%, we will see volatility in terms of margins, but the band will keep moving higher every five years because of the way the business is evolving. That was my first question. Yeah, I can't commit to those 5% for every five years. We expect because of business model, as we leverage our sales up on the same asset base, or get more wallet share of the customer, we will get the leverage. Now, if some volatility comes like we are seeing now, we saw in 2008-2009, so that is kind of unforeseen. We believe in the long-term growth of the business to design the model in such a way that it'll continue to see leverage for quite some time. At what time, at what point of time it will plateau out at the growth, top growth level, I cannot foresee at this time. For the foreseeable future, we expect the leverage to continue to kick in. Are you looking at any maybe geographies from Germany standpoint to enter in the next 3 years -5 years? Yeah. Next. We have researched, and our plan is to go into Japan, but not till the time Germany is fully stable and very profitable. We won't go in when this business is still developing. Okay. Thank you. Sure, Sachin. Thank you. Before we take the next question, reminder to the participants, anyone who wishes to ask a question may press star and one. The next question is from the line of Abhilash Saran, an individual investor. Please go ahead. Hello. Yes, Abhilash, please go ahead. Yes. Sir, can you provide the cost for acquiring households for low OTA, OTT, low OTA, high power OTA and normal cable? Yeah. We don't publish those numbers because we have a confidentiality agreement with those providers. We can, as I mentioned earlier, the low power versus full power has 5x-8x multiple on the revenue side. From cost side, it is somewhere between 5x-10x, sometimes 12x of those low power as well. We can't give specific numbers because of the NDAs that we have signed. Okay. Since can you explain the tenures of these agreements that you signed? Like, how long are these agreements, and what are the cost escalations so broadly for the OTA and OTT agreement? OTT is different. Let me go with that. That's a good question. For OTA, since the households are increasing in that space, the last five-year growth rate has been almost 7%. The cost escalation there is some of the agreements that we have done for three years have about 4% cost escalation built in. Some agreements are just for one year, and there's no cost escalation because they're not long-term. Some agreements are one year, but with an exit clause with three months notice period. There is no such cost escalation with them. There's a leverage for us. If their households continue to increase by 6%-7% and the cost increase is 4%, then there's continued leverage for us in OTT. Okay. I think is there any clause which represents that if we achieve certain revenues from these existing households, then we have to also share any some kind of a revenue share or a royalty with these OTA providers? Or is it only specific to just a fixed cost kind of per household cost? Yeah. It's a fixed cost in OTA. I forgot to add to your earlier question of OTT. OTT, there are multiple different kinds of OTT. One is the smart televisions. There is linear like AT&T Now, Roku TV or YouTube TV. Those are linear TV where you broadcast through the online. The third is the apps. For example, we have apps on Fire TV or on Apple TV or on Roku and Samsung or Hisense. Those apps we advertise and people download the apps. There's no fixed cost with those apps. There's no fixed cost on the smart TV. There is a fixed cost on streaming linear streaming on OTT. There is no escalation built in with those folks yet. Okay, sir. Can you share the percentage of multi-channel customers in our FY 2022 and quarter one of FY 2022? It's about 10%-12% of our total customer base is omni-channel. Like, they have kind of bought from us during this quarter as well, right? Like, these 10 customers -12 customers have contributed to the revenue, right? All our trailing 12 months basis. The customers who bought in trailing twelve months also bought in previous trailing 12 months. You have mentioned in the past that the LTV of a multi-channel customer is kind of very higher than our normal customer. What are the reasons for that, sir? What are the what? Sir, you had mentioned that the LTV of a multi-channel customer is higher than the normal customer. Mm-hmm. What are the reasons for the LTV to be higher for a multi-channel? Is it related to their disposable incomes being higher? No, no. The reason is that the TV is push medium. The customer sits back and we suggest the product that they should own, or they will look good and they will enjoy it for a long time to come. The web is pull medium. What we've discovered is if the customer buys from both medium, pull and push, their engagement is substantially higher than just the push or the pull. Just to give an example, just a TV customer, a customer who just buys from TV in U.S., their lifetime value is about $340. The customer who only buys from one sliver of our web property called FPC, that is just a catalog, that's only $57. The customer who buys from FPC as well as TV, their lifetime value is about $2,700. This is trailing twelve month on just U.S. alone. Now, customer who buys on web TV, within web as well as FPC, so there's a live TV on web and the catalog, their lifetime value is about $1,000. Customer who buys from only web TV is $70. Web TV and FPC is the $70 and $57, and if you can get that customer to buy from both, they jump to $1,000 because it is push and pull. We do not fully know why this behavior jumps so much, but we think the customer becomes more sticky and more engaged with us as they engage with us in push and pull. What measures do we take to ensure that, you know, we convert this either a TV standalone or a web standalone customer to a multi-channel customer? What are the measures that Vaibhav Global puts in place so that the customer becomes a multi-channel? We incentivize them. We promote on television, we promote our web properties. On web, we promote television. Also, we are recently starting to promote or incentivize customers to buy on both. There is just still a plan in place that will kick in next a few weeks, two or three weeks. That plan would encourage customers to buy on both properties on same day. Then we'll incentivize them with certain discounts. That has not fully kicked in. Seeing the lifetime value, such a robust lifetime value, we are doing lot of different initiatives to migrate them in different ways. Okay, one last question. Also, how much time does it take for a new customer, the first customer who buys on the platform, to reach the repeat purchases of whatever 257 levels -27 levels that we have? What is the time period through which he travels to become a repeat customer at that level? You know, some customer buy the first day multiple pieces. Some customer takes six months. There is no formula for that. Okay, sir. Thank you, and all the best. Thanks, Abhilash. Thank you. Ladies and gentlemen, to ask a question, you may press star and one. As there are no further questions, I now hand the conference over to the management for closing comments. I want to thank all the participants for your time and great questions. May I also thank you for your support to VGL in past years. If you have any further question, feel free to reach Prashant Saraswat at VGL or Mit Shah at CDR India, and we'll be happy to answer your questions. Thank you once again. Thank you. On behalf of Vaibhav Global Limited, that concludes this conference call. Thank you for joining us, and you may now disconnect your line.