Hi, and good evening to all those who have joined the call. I would like to start with a narrative on the operating environment during the quarter gone by, after which I'll touch upon our performance and strategic objectives going forward.

We witnessed steady demand trends during the months of July and August before facing transitionary disruption in trade channels due to the implementation of the revised GST rates in the month of September. The recent GST rate rationalization is a positive step towards boosting demand and driving sustainable growth in the branded FMCG sector.

About 30% of our India business have benefited from the GST revision. Consistent with the government's objective, we have passed on the benefits of the reduced GST rates to the consumers across relevant categories, either through price cuts or grammage increase in price-point packs, thereby enhancing product affordability and accessibility.

Further, the ongoing progress of Project Setu continued to strengthen our distribution fundamentals with execution across markets. Coverage expansion remains on track, underpinned by focused initiatives to deepen presence in upgraded towns and expand outlet reach.

Organized trade, specially quick commerce, continued to lead growth for the business. Q-comm has nearly doubled on a year-on-year basis.

Overall, we are optimistic that easing inflation, supportive policy, transformative GST reforms, along with favorable monsoons and a healthy crop outlook, will boost disposable incomes and aid consumption across urban and rural markets. Moving on to the quarterly performance, we have delivered a 7% volume growth in spite of the disruptions in September in India.

After absorbing, as I talked about, the transitionary trade disruptions, our franchises continue to witness healthy offtake growth, with more than 95% of the business gaining or sustaining market share and more than 75% of the business gaining on or sustaining penetration. Revenue growth in India business hit multi-quarter highs, supplemented by prior pricing actions in core portfolios in response to sharp inflation in key commodities.

Revenue growth will remain strong in the second half, even with partial anniversarization of pricing actions in the Parachute and Saffola portfolios. Delving further into the India business, I will now share the performance of our key categories.

Parachute was muted in volume terms in the context of unprecedented hyperinflation in copra prices and 60% pricing growth year-on-year basis. I've never heard of any brand, masterbrand, power brand in the world taking a 60% pricing growth, and I think it's something unheard of in large FMCG economies.

Obviously, in small countries with hyperinflation, this is a possibility. The brand was flattish in volume terms after normalizing for MLH changes.

In addition, we also rationed supplies to certain institutional customers to safeguard brand profitability. The brand consolidated its market share, therefore continuing to exhibit remarkable pricing elasticity.

We expect Parachute to remain steady and revert to growth as pricing and input cost headwinds recede over the far next few quarters. On copra prices, it has come down actually from 15% from the highs seen in July '25.

Current forecasts and our crop estimate outlook suggests that copra is likely to settle down over the course of the next few quarters and start coming down March onwards. Saffola Oils was flattish in volume terms amidst the prevailing elevated pricing environment.

We anticipate growth will gradually pick up over the course of the next few quarters as pricing volatility has subsided. The recently launched Saffola cold-pressed oil range witnessed a positive response on e-com and Q-comm platforms.

Value Added Hair Oils accelerated its growth trajectory. The franchise gained 150 bps in value market share on a MAT basis.

The mid and premium segment of the portfolio continued to record double-digit volume growth in this quarter. As you will recall, we have started investing behind that and growing that part of the portfolio.

We are confident of maintaining this double-digit growth momentum in the franchise in the quarters ahead on the back of strategic pivots over the last 9-12 months. The foods portfolio has crossed 1,100 crore ARR.

Saffola Oats continued to gain market share, while the honey and soya chunks continue to scale up well. The new Muesli range is exhibiting green shoots.

True Elements and the plant-based nutraceutical portfolio, Plix, maintained their growth strong- strong growth momentum. During the quarter, True Elements expanded its ready-to-eat portfolio with the prototyping of protein bars and overnight oats.

We remain on track to meet our aspirations over the medium term. The immense growth opportunity in foods and the potential to expand TAM is undeniable, and we will continue to double down on the same.

Having said that, I would have seen that we have grown 12% this quarter. Let me address upfront the reason for this.

I think it's a combination of three, four reasons, and therefore, we expect foods to go back into higher growth trajectory by Q4. There were four things.

One, as now we are lapping up the last year of earnout of True Elements, and obviously, once we have integrated, we have adjusted in terms of certain strategy and consolidated the process and focus on profitability instead of just growth. There is some Flipkart adjustment in terms of, specially on Plix and, which is Flipkart has adjusted its accounting where the net realization has gone down based on the discounting.

There is also a base of mayo, peanut butter, and munchies, some munchies in the base. Also, for the next two, three quarters, we are now very, very focused on improving Plix profitability and mix.

Having We will do these things over the next two quarters, and we are extremely confident that by quarter four, we will get back into higher growth rate on foods. Premium Personal Care maintained a strong growth trajectory during the quarter in the serums, male grooming, and skin care portfolio.

We aim to invest in sustainable growth vectors across the course of the coming quarters. The digital-first portfolio exited the quarter with an ARR of over 1,000 crores.

We are on track to reach 2.5x of FY '24 ARR in FY '27, in line with our aspiration. We remain sharply focused on profitability and aspire to achieve double-digit EBITDA margins in this portfolio by FY '27.

Moving on, the international business maintained its robust performance. Bangladesh showcased its foundational strength and delivered ahead of expectations.

Vietnam showed signs of recovery, backed by targeted initiatives during the quarter, and will continue to grow in the coming quarters at a higher rate. MENA remained on an accelerated growth path on the back of strong growth across core and new franchises, while South Africa had a sluggish H1, we are certain of a visible recovery in the second half.

To sum up, we delivered an encouraging performance in the first half, with both the India and international business progressing in tandem. We remain focused on executing our strategic priorities for the year and expect to sustain the positive growth momentum across India and overseas business in the quarters ahead.

We will aim to improve India volume growth and maintain robust double-digit constant currency momentum in the overseas business in the second half of the year. Supported by pricing growth, we continue to target around 25% consolidated revenue growth this year.

Over the last few years, we have deliverted- last few quarters, we have delivered reasonable EBITDA growth despite unprecedented input cost inflation and continued A&P investments. As margin margin pressures ease gradually, we aim to deliver double-digit EBITDA growth in the second half.

We remain confident in our trajectory and expect to make meaningful progress towards our ambition of reaching 20,000 crores in revenue by 2030. While headwinds and disruptions in operating environment are inevitable, we have consistently focused on embedding resilience across our systems, culture, and operating model to deliver consistent and predictable outcomes.

Beyond the strong equity of our brands, it is this institutionalized resilience in cost management and back-end capabilities that has enabled us to sustain EBITDA growth through vary- varying input cost cycles without compromising in brand-building investments in each and every quarter since the pandemic. This is something perhaps you are one of the very few companies to achieve this.

We have never given any surprise any quarter on EBITDA growth. Our culture of empowerment encourages teams to experiment, adapt, and innovate, fostering agility and ensuring the continuity of our growth flywheel.

This is backed up with a strong next-gen leadership and capability development plan, which has led to a strong, largely internal succession pipe- planning pipeline. I had also mentioned that addition to this resilience and leadership pipeline, our ability to anticipate and call out risks and opportunities in our business ahead of, time has ensured consistent top-quartile performance in recent times.

This is enabled by a leadership mindset which is self-aware, authentic, which encourages us to embrace reality and focus on internal solutions for issues rather than always externalize a problem. With that, I conclude my remarks.

Thank you, and we can now take questions.

Hi, team. I just had one single question on the GST transition.

Could you give us a sense on what would be your expectation of the impact and how long do you think it'll take for this disruption to reverse?

I think we saw some of this impact flowing into first half of October, but I think it's now more or less stabilized.

The quantum of the impact, in your opinion, how much could it be on sales or volume, whichever way?

You can take around 2% kind of a thing for quarter two.

See, quarter two, there was an impact for about 2%. Now, it was led by destocking, but typically what we have seen is that once the trade destocks, it's very difficult to sort of bring it back to the old stock levels.

If the question is whether we'll see a positive impact of 1% or 2% in quarter three, answer is not really. Having said that, we've given a guidance on the overall volume trajectory, which we definitely expect that could be slightly better than what we delivered in quarter two.

Got it. Perfect.

That's all from my side. I'll come back in the queue.

Thank you.

Thank you.

Thanks. Two questions.

First is on the honey and soya chunks. If you could tell us how much is the salience of kirana in this part of the portfolio, and if you could talk about profitability, how is the positioning?

Are you more of a price warrior or now you are charging almost parity to the market leader in these two segments?

We will be a warrior, but not on pricing. I think we are a challenger.

If you really look at it, two things we have to do, which is as far as honey is concerned, I think we were over-indexed in organized trade. As far as GT is concerned, our weighted distribution was not that great, but there is a significant portion of honey business which is on GT.

We are beginning our initiatives on that and we believe that while in OT, it is a lot of pricing game and a lot of more clutter, as far as GT is concerned, this is the same case with Muesli also, that the number of players in GT are far lower. Usually the leader enjoys a far higher market share, therefore the market share pool available for grabbing is far higher.

I think we should have done it a little earlier, but we are now very, very determined to get our act right on GT in foods. Now coming to profitability, profitability of honey is I think decent.

There is no reason for concern. As I said, that on pricing, we don't operate on price.

As far as soya is concerned, soya is primarily a GT initiative, and we are obviously taking steps to ensure the reason we are not growing significantly aggressively in soya to ensure we grow profitably. As you are aware, in the last two years, we've increased our gross margin in food by 1,000 basis points, and we are determined every year to improve that gross margin.

One follow-up there, Saugata. In terms of soya, why is it primarily GT?

Because modern trade, e-commerce, quick commerce generally is a much easier, low-hanging fruit. I couldn't understand why more of GT in this.

Soya actually, the consumer use is basically specially during the monsoon, when vegetable prices go up, it is used as a protein substitute. It is for the mass end.

Now, we don't participate in the so-called mock meat and frozen, which is growing, but it is not yet that critical mass. Also, if you look at the unit price, it is not a very high this one, and therefore, technically even if I push OT, it will not be a very profitable this one to push in OT because the pricing is pretty muted in terms of the unit price of soya.

Understood. Second and last question.

Generally Plix, the growth is quite strong. Now you are also mentioning profitability also comes into the picture.

The reason for that, it is just the phase evolution? If you could talk about competition, how is the competition shaping up?

I think HUL's Oziva also in many of the segments now they also compete. If you could talk about how the competitive intensity is, is that one of the reasons why profitability is coming as a focus area?

You spoke on accounting on Flipkart. Normally, this kind of a thing we have not come across other FMCG companies.

How does your number change because of the accounting, the logic behind that, if you could explain? Similarly, what is the size of the True Elements' two new products?

One is of course overnight oats market size, is it very nascent? Second, protein bars is very competitive.

What is your positioning here given a lot of D2C companies are also there here?

Okay. I think Pawan will address the Flipkart thing, which is specific to only Plix and this one, only digital brands.

It is not this one for other. Anyway, we'll explain that.

I think as far as Plix is concerned, there are two things. One is we want to significantly improve profitability because it is a critical mass.

It continues to grow, and reason is we have, as I talked about, an aspiration of double-digit EBITDA for the entire digital business FY27. What we are doing is the next two quarters, the food part of the Plix, which is while we will continue to aggressively grow the personal care, which is that mix is changing.

The food part of the Plix, we are ensuring that we invest in the right channels and the right this one to drive and improve profitability. It takes only two quarters to handle that, okay?

Now coming to overnight oats, it's a category we are creating. It's a big category in developed markets like US, because of the Bircher Muesli and that this one.

It is a category we are developing and True Elements is one of the pioneers. As you know that historically Marico has created the category.

It was a plain oats category. Masala Oats is something which Marico has driven and we have significant success and experience in category development in the oats category, okay?

Now coming to protein, I think you have to participate in the category. It's unlike other companies where protein is the only driver of growth, True Elements has a far more wide spectrum and a broader participation.

We believe that True Elements has a right to win and get a share. It is more of a participation and getting some share of the category because at the end of the day, if you are a pro-health consumer who is using various types of this one, I can easily cluster and upsell to that set of consumers.

Now coming to the Flipkart, I think just Pawan will take it up.

This is more in the context of the digital-first brands. When Saugata mentioned in the opening commentary, does not have any material impact on the Marico numbers reported.

Because Plix has a significant chunk of business coming in from foods and therefore it's more of an accounting adjustment where certain part of the expenses is now getting netted off from the revenues. On a like-to-like basis, there is some impact on the reporting of foods.

If I were to just extrapolate this to a overall company level, there is no significant impact.

This would be impacting other brands on Flipkart also? Is it specific to you?

It is for the brands where is the B2C arrangement with Flipkart, and for us, it is largely on account of Plix. Nothing to do with Marico set of brands, and nothing to do with even some of the other digital brands that we have.

Understood. That's all from my side.

Thanks a lot.

Thank you.

Hi, sir. Thank you for taking my question.

Looking beyond FY26, and just taking a context and a leaf from FY25, despite significant gross margin pressure, you materially stepped up your ad spends. How should one think about ad spends going forward in FY27?

Is there a threshold of margin that you want to work with on the gross and EBITDA level that we should keep in mind?

If you really look at it, our objective is to ensure that we continue to maximize growth and volume share while we operating with a threshold level of margins. What I see in FY27 is the following is that I think, in terms of some of the raw material costs coming down, there'll be an opportunity to get back some of the margins.

The other issue is that we will continue to invest and, as that we started investing in the premium part of VAHO. We'll continue to invest behind the diversification and the premiumization.

Therefore, there will be margin improvements, but as I said, our main focus is also to ensure superior and top-quartile volume growth as we continue to get into FY '27. We also expect improvement in Parachute volume growth.

As you know that Parachute, some part of the volume dip has also happened because of two things: one, we couldn't supply to some of the institutional this one because of the choice which we took because of the profitability, and number two is the MLH drops. I believe there will be higher volume growth opportunities in Parachute specially, and we will continue to invest.

There could be slight increase in A&P maybe, but I think the more important part of it is that we are extremely confident of the bottom-line growth as once the input costs start coming down, and as I said, that commodity nobody can predict, but as far as we are concerned, given the outlook, given the crop, given the demand-supply situation, we expect copra to definitely come down by March. Therefore, next year, and one of the things which we had alluded to in the earlier call, in the previous quarter, is that one needs to look at a double-digit profitability growth over a two-year CAGR basis, which we are pretty confident about.

If I may just add, I would just want to mention that gross margins definitely have bottomed out, and as we move ahead, it can only improve from here. As far as A&P spend is concerned, we are very confident that we will continue to spend in double-digits growth in A&P.

We've also seen in past that in any deflationary year followed by any inflationary year followed by deflationary year, we've been able to increase our operating margin by 200-250 basis points. Depending on where we end at this year, we are confident that next year operating margin will definitely see an improvement of at least 200 basis points.

Got it. Very clear, Saugata, Pawan.

Thanks for that. Second question is on Project Setu, again looking beyond FY26.

What is the kind of benefit that this should continue over FY27, and how should one look into any tangible targets that you have that you can share on Project Setu and the benefit of that?

Okay. It's very difficult to allocate a growth, but I will give you what are the things we have done.

The first benefit of Project Setu has come that, as that usually a wholesale dependency means that only they deal with high-velocity power brands. In most of the south and west, they dealt with Parachute, in the north and the this one in east, they dealt with Nihar, and in the north and some parts of the west, they dealt with Shanti Amla.

What it has done is Project Setu is given range selling and that has led to directly this significant improvement in the trajectory of VAHO growth, and we are extremely confident that these VAHO growth which has happened is on the high-margin part of the VAHO group, because Shanti Amla is a slightly low margin, the rest of the places are high margin, which has also given us the luxury of saying that we are not getting into a BTL fight in terms of trade spends and try to protect the price-point fight of Shanti Amla. We now have the luxury of choice thanks to Setu.

The second part of Setu, which is now going to happen, is that in markets where Parachute is dominant, how do we grow other and diversify the business, specially in the south? The third opportunity which we will tap is, as there is a gap between Parachute rural market share and Parachute urban market share to the extent of at least 14%, because I think it's 60 in urban, 60 60, and around 46 47 in rural.

That gap we want to bridge. The fourth part of Setu which you will now see is that the urban part of Setu, which is we are under-indexed in food, we are under-indexed in chemist and cosmetic outlets.

I talked about the fact that in things like honey, Muesli, where the opportunity to grab market share because of the number of players are far lower in GT. Secondly, I think in chemist and cosmetic, and this will also give an opportunity for trying out in limited options of Setu of some of our digital brands into GT, whether it's in chemist, cosmetic, or food outlets.

That will be the last phase of Setu. I think what will Setu ultimately do is it will first reduce that gap between direct indirect coverage, but secondly, it will help in diversification, help in range selling, help in far more automation.

One of the other things that has happened is we are controlling the resource allocation. A lot of below-the-line spend that was wasted we will convert that to above-the-line over the next two, three years, which will also help in driving offtake-based growth.

Got it. Thank you, Saugata, for the detailed answer.

I think the momentum that we are seeing should continue, and that is the confidence I was seeking for. Wishing you all the very best.

Yes, hi team. Good evening.

Just two questions from mine. If you could just explain, with the copra price coming down by about 15%, how does the market competitive activity work?

Is it that you need to make some price revisions, MLH revisions, or given that you had not passed on the full impact, you don't need to make any changes there? The copra price movement at this price, how does it impact the market activity for you in terms of MLH and price?

That's my first question.

At this current levels, I don't see any reason for pricing action. We are very comfortable.

Right. The way to think about it is that this recent fall actually just plays out in terms of a slightly better margin profile going forward.

That's the way to think about it.

That's why we have indicated that we are a little more confident of trying to deliver double-digit EBITDA growth in the second half.

Got it. The second question was on the LUP bit you mentioned that there have been some grammage increases as well.

What percentage mix of the portfolio have you seen these grammage increases? If you could just highlight that.

Okay. Let me just clarify.

In Parachute, because of inflation, we have taken MLH drop. In the case of

I was asking more from a GST perspective, yeah.

GST, yeah. Shanti Amla, yeah, that's some part of the portfolio.

That is very marginal because, as I said, that we only operate in LUP mostly in Shanti Amla.

That was in the context of Value Added Hair Oil, where on the price point we could not have reduced the prices, and therefore we had increased corresponding grammages in those price-point packs. As Saugata mentioned, that's largely in Shanti Amla.

Other part of the VAHO does not have any significant contribution coming in from price-point packs.

Got it. The last thing on VAHO was, this quarter obviously has been amongst the highest growth that we've seen in recent times and you mentioned a lot of initiatives.

We also had a fairly favorable base this time around where we had fairly sharp reductions in the base. I just wanted to get a sense of how much of this is base-led and your confidence on continuing to maintain may not be this level of trajectory, but at least a double-digit growth trajectory.

That's something that you're fairly confident about, right?

Okay. Let me give you some piece of statistics.

The volume two-year CAGR minus Shanti Amla, because as I said that we have defocused the LUP of Shanti Amla, the value is around mid-single high-single digit, sorry, 9%. If you take this year also, the volume will be around for the premium part, which is the non-Shanti Amla portfolio, is in double digits.

We are extremely confident of continuing to delivering teens growth in VAHO.

Fantastic. Those were my questions.

Thank you. Wish you all the best.

I think just to add that the very fact that we are focusing on the premium part of it, which also helps long-term margins.

Yes. Great.

Thank you very much.

Hi. Hi team.

Thanks for the opportunity. A few questions.

Firstly on the digital-first portfolio, you already sort of seem to be clocking much higher than your aspiration. As per my math, you already probably would be in that 1,000 crore ballpark this year itself.

Any chance sort of I think you have already upgraded the ARR guidance to that extent, but any chance there you will surpass? Which parts of the portfolio are firing here mostly?

Can you give some granularity?

I think we are getting significant growth in Beardo and Plix. As Beardo is around in the region of a double-digit EBITDA.

Plix has broken even. Over the next two, three quarters, we'll focus on significantly increasing the EBITDA percentage in Plix so that we are on our way to our 10% target in 2027.

True Elements has undergoing the integration. As we got 100% sometime in September, and therefore our first task is to ensure that we integrate it well.

Also start our journey towards breakeven. As we said in the last call also, our focus on Just Herbs and True Elements is first to get to the breakeven, and I'm okay with a moderate growth.

We are most happy to accelerate the personal care part of Plix. We are working towards improvement in the profitability of the other part of Plix and also driving the this one.

More importantly, I think we have started the process of synergies of the digital brands, cost synergies to drive profitability, including common sourcing, common logistics, common systems, common media buying, digital media buying. That is a huge this one, because we believe that while we are capable of growing at a faster pace, it's equally important to focus on the profitability.

Once we get the profitability, we push the pedal and accelerate rather than just pushing the pedal.

Got it. Perfect.

On the margin side, would it be fair to say you will already maybe by '26 end be in that low to mid-single digit in terms of margins for the digital-first portfolio?

Overall put together, we may not be able to give you an exact number as to where we will be, but as Saugata mentioned, in Beardo, we have moved to double digits. In the next two quarters, we are hoping that Plix will move to mid to high single digits.

We have a job to do in True Elements and Just Herbs. Saugata also mentioned that in True Elements also, our focus has been to sort of improve the profitability because we have taken this from the promoters since the first year.

We continue to stand by with our guidance of a double-digit operating margin for the next year, where we feel that we should be able to reach that mark by end of next year.

Wonderful. One clarification, True Elements would be clubbed in your foods reporting, that's correct, right?

Yeah. That's true, and also the foods part of Plix also gets reported under foods.

The foods part, yes. Got it.

Got it. Second, you did indicate that from inflation to deflation, eventually you see 200 bps kind of an expansion on average, which has been historical band as well, 200-250 bps.

If copra is just in this price as if it is today and let's say it doesn't correct, then would that still hold up?

See, as far as copra is concerned, we believe that it will remain range-bound over the next two to three months. Then when the flush season comes in in the month of March, we will see some meaningful correction.

Definitely we don't expect the copra prices trajectory to continue at this level. Of course, it has already come off from the peaks for about 15%.

After 3 to 4 months, we definitely believe that it will come down.

I think just to answer your question, in the second half, you will get obviously even if it is at 15% reduction from the peak, there will be flow-through to margin anyway.

You guided that double-digit EBITDA growth in second half essentially.

Yes. Yeah.

Got it. Got it.

In foods, it seems you have shifted a bit more in course correction and profitability to that sense. You were looking at sort of 8x FY27 on FY20 base.

Would that still hold up? Because it seems you're a little bit undershooting on the foods revenue target.

No, we are just doing for two quarters, where I said that we are getting some of the things right, because if you notice, it's important to grow, stabilize, get the profit, then grow. That is how we do it, a step jump, step jump.

These two quarters would I call it a little bit of a pause. It's nothing, as I said, I think from Q4, things will be back on track.

Some of it, as Pawan alluded to, is that Flipkart adjustment and all those in the base. I think it's a two-quarter issue, I think there's no need to worry.

Just to clarify, when Saugata says pause, pause means at least double-digit growth.

Yeah. Our standards of pause is slightly different.

Got it. Got it.

Wonderful. Very lastly, if I may, any indication on the margins you can share in foods, either on gross and EBITDA or if it is a differential you want to share?

We've discussed in the earlier call that it is a function of what scale do we reach for each of the sub-portfolio. For example, Masala Oats makes company-level operating margins.

As and when these businesses will reach to a certain scale, we are confident this definitely has the potential to reach up to company operating margin levels. It's a bit of time before we reach there.

What we always ensure is that whenever we get into new foods or we equally get into some of the personal care and weighted average gross margin is better than what we have at a portfolio level. Therefore, that is something which we make it as a complete sacrosanct and that drives our entire new product innovation process as well as any acquisition that we do.

I think one shift we have done in foods after our learning, I think we have tried things, is we are going to follow the policy of fewer, bigger, better, and relevant.

Okay. Okay.

Wonderful. Thanks and best of luck.

Thanks a lot.

Thank you.

Hi. Good evening and thank you for taking my question.

Thank you, Saugata. My question is on VAHO, and VAHO, clearly the trajectory has changed and it is sustaining.

I think good to know that the higher margin part of VAHO is growing. Saugata, what I would like to understand is that can you give us a bit of a deep dive into how this change is happening and is there a channel cut to it and is there a brand cut to it?

Clearly, if you could give us some sort of salience that is it MT, GT, or e-com? What sort of major transition has come and it's sustaining?

Is this now margin-enhancing and is the margin at VAHO level are better than company-level margins or at least reaching there? How do we think about this portfolio growing at this rate and what's the impact on margin for overall company?

Okay. The margin at VAHO level is higher than the company-level margins, okay?

Significantly higher, and specially the things which we are focusing in. Therefore, basically what we are doing is a virtuous cycle of growth.

Now coming to what we exactly did in the past two years before we repivoted our strategy, I think it was a road to nowhere, which I call it, where we went into a trade spending fight in the sector. Because of competitive action where ATL was withdrawn and put into BTL, we perhaps went into the trap, a temporary trap.

I believe that if for a category to grow, you must invest behind premiumization, you must reinvest behind brand building, and you must invest behind driving consumer penetration instead of just putting money behind trade. We just did a repivoting where we said we are okay to lose share at the bottom of pyramid, because that share is sometimes channel filling, which we don't want to do.

Focus on the higher part of the this one and drive premiumization. For example, we are also one part of the premiumization, if you have seen, we have bought some of the international Middle East franchises focusing on modern trade and this one.

Also there are some large brands like Hair & Care, Jasmine, Aloe, Nihar perfumed oil, and focus on them. All of them are very significantly higher margin and invest behind ATL and behind brand building and significantly gain share.

If you look at it, we have gained 150 bps value share. We'll continue to gain value share and this value share.

Therefore, our entire KPIs in VAHO today is value growth, value share, and gross margin.

Got it. No, that's very helpful, Saugata.

Can you give us a little bit of channel cut to it? What is GT, MT, and e-com for this VAHO portfolio?

No, I think it has been a broad-based growth. As I said, Setu has driven VAHO growth and our investment behind premiumization is giving us growth in OT.

Okay. Great.

No, thanks so much for this, Saugata. Could you give us the oats growth this quarter, please?

Food and within food, the oats part of the portfolio, how it has grown?

The organic Saffola foods, ex of some of the discontinued products in the base, has grown by about 8%.

Okay. Perfect.

Thank you, Pawan. Thanks so much for taking my questions.

Hi, Saugata. Can you just give your estimate?

Of course there will be Nielsen figures, but I would value your estimate more. What is the industry growth of the VAHO sort of industry right now?

If I have grown say 16% and gained share, you can derive a number. It should be in double digits, little bit entering double digits definitely in value.

What really has changed here? Because over the last five years, VAHO as a industry has been a very slow-growing industry.

Now it has come to a 10% growth at an industry level. We have not seen any major recovery in macro consumption across many of the FMCG segments.

In the past, we've held that VAHO will grow sort of or slow down, whatever, in line with the personal care industry. It is clearly sort of the growth or slowdown, at least right now, seems to be divorced from the personal care industry.

I think two things I would say. Firstly, at a macro level, I think starting with us and at least one more player is doing fundamentally the right things in terms of investing behind growth.

Secondly, I think, as the category was under-indexed in the OT, and we are doing a lot of category management work in OT to drive the saliency of the category relatively to the other this one, which is leading to premiumization. I think fundamentally category building and premiumization work is happening.

We had perhaps stopped that and we had got defocused for 18 months when we started perhaps getting into too much focus on LUPs, and that is leading this category growth.

Understood. Also, how do we see the foods and the digital brands business over a medium term, let's say 3 to 4-year kind of period?

What kind of CAGR growth target and what kind of margin targets 3 to 4 years down the line would be something that you would consider reasonable?

I think, firstly, on foods, some of the scaled-up businesses should get into a company EBITDA in the next 3 to 4 years. I think as our first milestone for the digital business is to get into the 10% EBITDA and then sequentially move forward.

The growth momentum we have indicated already as far as food is concerned to 8x and in the this one to 2.5 this one for FY27. I think we are able to maintain and at the end of the day also, as far as digital is concerned, we will continue to ensure that we look at some inorganic opportunities also over the next two, three years.

Saugata. That's all from me.

Thanks and all the best.

Thank you.

I audible?

Yes.

Three questions from my side. When you mentioned about the foods part about munchies and peanut butter, is it that these products have been discontinued or just that the growth of this part of the portfolio was muted, which led to the overall slowdown?

We have mostly discontinued it because, see, again, as I said that we talked about fewer, bigger, better. Anything which is not a significant opportunity, I think one of our biggest learning has been that if you want to participate in food, scale and profitability goes hand in hand, okay?

Therefore, anything which you can't really make it big, this is our learning, let us not do these niche things. We have actually Plix and True Elements two brands to actually experiment with niche things and Saffola will actually drive scale.

Got that.

Because if I have to do peanut butter, I can do with True Elements. I need not do it with Saffola.

Understood, Saugata. My second question was I just wanted to clarify, when you mention about double-digit margin, this is for the entire foods and digital business by FY27, right?

It's not specifically for the digital part of the business

Digital business, please, digital brands. We talked about digital brands.

Excluding the oats and the core Saffola part of the portfolio.

No, oats is not a digital brand. No.

There are four digital brands, which is Plix, Beardo, True Elements, Just Herbs.

Understood that. My final question was on the Plix part of it.

Now, obviously as a brand, the proposition of the foods part is very clear with the hero SKUs like apple cider vinegar and the proposition on weight management. It's obviously great to see that even the personal care part of the portfolio is sort of an equal contributor to growth.

Specially wanted to understand which are the hero SKUs or segments specifically for the personal care part of Plix and maybe if there is a proposition there that you may just want to highlight, which may be not something we may be aware of.

The proposition, if you look at trends in Western countries, it's about hair and skin food. Whatever is good for you, how do you transfer that into personal care?

The concept is about plant-based hair and skin food. It's a science-based with nature.

For example, you have watermelon, you have different other what else is that?

Pineapple.

Pineapple, guava, and of course we have rosemary. That is the concept, and then getting into hair and skin categories and mixture with science, because obviously the actives are science.

That is the proposition, it still is plant-based, which is the this one. What we are talking about is that whatever you consume, can that be hair and skin food, which are essentially problem-solving or enhancer.

Each of the products has a strong functionality.

Just one quick follow-up. Do you expect the mix in Plix of personal care and foods to sort of remain similar at the ballpark 50-50?

No,

we are deliberately driving a higher personal care ensuring that that will also ensure profitability. That will also drive traction of growth, because at the end of the day, I think similarly, however, having said that, as far as nutraceuticals is concerned, also over the next couple of years, we will also look at some of the other platforms of nutraceuticals.

As you know that any nutraceutical brand can extend into five or six areas, which is basically weight management, heart health, gut health, bone health, sleep, stress, and diabetes. It's a good thing about Plix is the brand name doesn't stand for any particular problem.

Therefore, we can extend that. That is the second stage.

The TAM of Plix is actually infinite in some way, in terms of both personal care and nutraceuticals. One of the highest TAMs any digital brand can have.

Understood. That's very clear, Saugata.

Wish you all the best. Thank you.

Hi, thanks for the opportunity. Actually, continuing on the earlier question on Plix, could you give us some color in terms of what are your top five hero products, what is the contribution of these products to overall sales of Plix?

Over the past two years, it has done phenomenally well. Are your hero products continuing to grow at the same pace as the overall brand growth, or is it also driven by a long tail of new introductions, product that you may have added?

Any color you can share on repeat offtakes, and what does the channel mix look like today? I think it's predominantly still online.

How do you see some of these things change over the next one or two years as it scales up to maybe 1,000 crores or close to 1,000 crores top line? Whatever you can share on Plix, our understanding is fairly limited of this space as well as Plix, it will help.

That's it. Thank you.

In a lighter vein, I must say you're asking me due diligence questions almost. It's even more than a pitch document.

Let me just give you a broad strategic flavor to this. Plix participates in nutraceuticals where the hero product is ACV.

Having said that, we are also looking at value addition in that space and there are flavors, there's a no sugar variety. One of the biggest things we have done in Plix is staying true to two things: having hero SKUs contributing significantly to it and not growing through just mindless innovation, which I call spray and pray.

Secondly, there is a significantly strong, profitable D2C business and a marketplace. It's a very limited what I call brick-and-mortar play, but a primarily digital play.

Having said that, there are opportunities like, for example, we have specific SKUs like there's a coconut powder, there's a 75 rupee, smaller ACV which is there which we are experimenting with. As far as the personal care is concerned, we have both hair and skin products like hair growth, we have presence in some of the skin products.

Again there, our effort is ensuring for a successful digital business, it's extremely important that the hero SKUs contribute to at least a majority, 50-60% plus, in our case, it's higher. Number two, they also continue to deliver high organic growth, because it is extremely critical that that delivers your sustainable profitable growth for the brand.

I think that's the broad this one. Of late, obviously, we have focused a little bit on personal care growing ahead of this one.

Plix also has a international business. It is available in the Middle East, it's available in some in US, and therefore, that is another area we are trying to grow.

Our initial results, specially in the Middle East in UAE, has been extremely encouraging.

That's helpful. Thank you.

One more separate question. If you were to assume that Parachute was at normalized margins today, what would be your company-level consolidated EBITDA margin in first half?

Or to put it the other way, what's the impact on percentage margins that Parachute has had in the first half of this year?

I think large part of the margin erosion is because of Parachute margin compression. To work out backward numbers, you would not want to get into all of that.

We can only suggest that as we've already mentioned earlier, that second half, we can expect double-digit profit growth. Difficult to give a guidance because a lot of moving parts in terms of how commodity costs will move, what impact will the pricing have.

In second half, we expect double-digit profit growth at EBITDA level. Next year, of course, we would be targeting much higher, because we expect the prices to go down.

Therefore, we've seen in the past as well that in deflationary years, we make up for the lost margins in the previous year.

Right. Essentially I was trying to understand, you've made significant progress in foods and you intend to make progress in Plix on profitability.

If and when Parachute gets back to normalized margins, is there a possibility that your percentage margin band would actually be higher than where you were 2 years, 3 years back given this non-Parachute portfolio margin improvements sort of is also helping, or you will just get back to the earlier band? No,

fairly possible. Again, we've discussed this earlier as well that there are margin improvement levers that are in place.

If you ask me for next 2 to 3 years perspective, of course, it can go beyond our peak that we've delivered in the past.

Perfect. Thank you so much.

I think immediate focus next year is to do the catch-up so that over a two-year CAGR, it's comfortable double digits. Number two is continue to focus on volume growth.

I think that is equally important, the fact that how do you maintain top-quartile volume growth.

Fair point. Thank you very much.

Thanks for listening in on the call. To conclude, our performance has kept us well poised to advance on our key strategic priorities.

Volume growth in India was well ahead of the sector despite elevated pricing and transitory impact of the GST reform. We continue to channel our efforts towards our diversification agenda and remain committed to consistent brand-building investments.

The international business has visibly accelerated its growth momentum and expected to maintain the same. Going ahead, we are fairly confident of delivering top-quartile volume growth in India business, and with early signs of easing cost headwinds, we'll strive to deliver improved profit growth as well.

That's it from our side. If you have any further queries, please feel free to reach out to our IR team and they'll be happy to assist.

Thank you and have a great evening.