Thank you. Good evening, everyone, and a very warm welcome to you all.

My name is Purvangi Jain from Valorem Advisors. On behalf of the company, I would like to thank you all for participating in the company's earnings call for the first quarter of the financial year 2027.

Before we begin, a quick cautionary statement. Some of the statements made in today's earnings conference call may be forward-looking in nature.

Such forward-looking statements are subject to risks and uncertainties, which could cause actual results to differ from those anticipated. Such statements are based on management's belief as well as assumptions made by and information currently available to the management.

Audiences are cautioned not to place any undue reliance on these forward-looking statements in making any investment decision. The purpose of today's conference call is purely to educate and bring awareness about the company's fundamental business and financial quarter under review.

Now, I would like to introduce you to the management participating with us in today's earnings call, and hand it over to them for their opening remarks. We have with us Mr.

V.S. Ganesh, Managing Director; Mr.

Deepanjan Bandyopadhyay, Chief Financial Officer; and Mr. Karthik Yathindra, Chief Executive Officer.

Without any delay, I request Mr. V.S.

Ganesh to start with his opening remarks. Thank you, and over to you, sir.

Thank you. Thank you so much, and good afternoon, ladies and gentlemen.

Welcome to the earnings call for the first quarter of FY27. I am joined by our Chief Financial Officer, Mr.

Deepanjan, and our Chief Executive Officer, Mr. Karthik.

I will begin with a brief overview of the business and the quarter, following which Mr. Deepanjan will take you through the financial performance in detail.

We will then be happy to take your questions. Let me begin by saying that we are encouraged by the underlying performance of the business during the quarter, particularly the volume growth.

Consumer demand remained healthy, with good traction across our key channels, including exclusive brand stores, e-commerce, and our wider retail network. Our new product introductions, including JKY Guru, also received encouraging consumer response.

While volume performance was strong, reported revenue was moderated by temporary quarter-end logistics and manpower-related constraints. This affected billing during the period.

The underlying demand and volume momentum therefore remained better than what was reported as revenue growth. The quarter also reflected inflationary pressure across key inputs, particularly cotton and synthetic materials, amid a volatile external environment.

As regards pricing, we remained calibrated and chose to absorb part of the input cost increase, balancing margin protection with consumer value and competitiveness. This approach helped us stay competitive while the subsequent moderation in some input costs supported our position.

At the same time, we continue to focus strongly on productivity and operational efficiency. Our strategic sourcing and supply chain initiatives helped us mitigate some of the cost pressures.

We are also seeing steady progress in the scale-up of our Odisha and K.R. Pet manufacturing facilities, which will progressively enhance our production capabilities and efficiency.

Our digital transformation journey also continues to progress across ERP, distribution management, and HR transformation. We are also working on our consumer data platform.

These investments are aimed at creating a more agile and data-driven organization and in improving the way we serve our consumers and retail partners. Our distribution network remains a significant strength, with 1,15,871 multi-brand outlets, 1,640 exclusive brand stores, and 930 large-format stores.

Our online channel also continued to deliver healthy growth. Financially, revenue grew by 7.9% during the quarter, and profit after tax declined by 4%, reflecting the combined impact of input cost pressure and the temporary constraints on converting underlying volume into billings.

Looking ahead, we remain very confident in the underlying health of the business. We see multiple growth opportunities from volume recovery, new products, premiumization, retail and e-commerce expansion, and through improving our supply chain and manufacturing efficiencies.

In fact, looking at the demand signals, we are working hard in augmenting our in-house capacities and also working on improving our outsourcing garment supplies so as to cater to the demand. Our focus remains unchanged: to strengthen the brand, deliver greater value to consumers, improve availability, and grow the business sustainably and profitably.

I would like to thank all our shareholders for their continued trust and support. With this, may I now request Mr.

Deepanjan to take you through the financial performance in greater detail. Thank you, and over to you, Deepanjan.

Thank you, VSG. Good afternoon, everyone.

I will now provide an overview of the company's financial performance for quarter 1 FY27. In quarter 1, revenue was ₹14,204 million, which is a 7.9% growth year on year.

Sales volume in the quarter was 61.9 million pieces, growing by 5.7% year on year. EBITDA for the period was ₹2,890 million, which has declined by 1.9% year on year.

EBITDA margin was 20.3%. While EBITDA margin was within our planned range of 19% to 21%, a stronger EBITDA margin of 22.4% in Q1 FY25, due to the stable input costs then, resulted in the decline in EBITDA in the current quarter.

Profit after tax for the quarter was ₹1,928 million, declining by around 4% year on year. Inventory days was 66 in the end of quarter 1, as against 73 days in the beginning of the quarter.

Net working capital days was around 54 days, as against 56 days in the beginning of the quarter. With that, we can now take up the queries.

Yeah.

Hi. Thank you, sir, for the opportunity.

I have two questions. First one is on the volume growth trajectory.

I believe in Q4 what the CEO has highlighted that we are focused in to deliver the double-digit kind of a volume growth going ahead, but I don't understand what was the miss there. Second question is on the pricing thing.

As far as I remember, last quarter, the management said that in January, the price hike that was taken, it was mainly to improve the product quality, and they were anticipating that there will be some calibrated price hikes going forward to mitigate the raw material impact. Again, on that front also, what I can understand is that the management seems to have missed that the outlook what they have given.

Two questions. Thank you, sir.

Thanks, Ashutosh, for the question. On the volume side, I think we still remain committed towards the goal of a double-digit growth in terms of volume for the financial year.

This is going to be phased across quarters. With regards to the quarter 1 deliveries, there were two major pieces that has affected the volume delivery.

One is a planned one, which is structural in terms of how we are planning our growth across quarters. With the ARS now fully in place, we're also not front-loading our our performance like it used to be.

Hence, schemes and incentives for the trade has been designed in a way that it is better distributed between quarters. Structurally itself, you will see a difference between performance between quarters.

However, the annual goal remains unchanged, which is to, aim for a double-digit growth in volume. The second bit which has affected the quarter delivery has been essentially our undelivered billing.

Unlike the last year Q1, this year we've had extraordinary volume that has not been delivered in spite of being billed. That's because of the disruption we've experienced in the logistics and manpower towards the quarter end, which is what was, narrated also in the MD's commentary.

These two have impacted volume reported volume growths reported for quarter 1, both of which which we we believe one planned, the other is temporary and hence should be absorbed going forward. With regards to price increase, you're right.

The January price increase was largely to enhance the product itself and was not linked to input cost. We have undertaken a price increase partially to absorb the input cost in quarter 1.

This was done sometime in mid of May. However, the full gains of the price increase has still not been realized, and that's something that we'll be realizing in quarter 2, purely because of the FIFO principles that we operate in our billing.

Large portion of what was invoiced in quarter 1 was in the previous pricing, and the gains from the price increase which was taken in quarter in in the mid of May would be realized in quarter 2.

Okay. Sir, just on your reply on the volume growth, so as per my understanding, you are saying that for the remaining three quarters, we should be seeing 11, 12% kind of a average volume growth?

How confident Yeah, sorry.

Fairly confident, given how the demand atmosphere has been in quarter 1, we should see recoveries for us to make up for lost grounds in quarter 1.

Okay. Fair point, sir.

Thank you. Thank you for the opportunity.

Yes, hi. Thank you.

My first question was on the comment made on the new product lines. Which segments would it be focused towards besides the younger consumer through Groov or licensed merchandise, if you could help on that, please?

We've got product introductions across the category. Some of it has hit the market in quarter 1, some of them will go through in quarter 2 before the festive season is upon us.

Quarter 1, the big ones were Groov 3, which is our street fashion line which was launched in the month of June. This is our third line.

If you'd recall, we had launched this as a proposition starting quarter 1 last year. This year, the collection was taken to close to 500 exclusive brand stores across the country and has been received very, very well, and our sell-through numbers look very good.

This was a large one. Other than that, we've had specific products that have come in across the portfolio.

Another big piece is the collaboration with Disney and Marvel to bring in character merchandise. This, again, while the go-to-market was planned towards the end of June, large portion of revenues from this will be realized in quarter 2.

Okay. Just two follow-ups to this.

One is that in this licensed merchandising piece, it's quite a competitive space with multiple D2C players already present. What is the differentiated opportunity that Jockey as a brand has?

The second would be, fair to assume that new product lines would be dedicated to the athleisure space rather than the innerwear space?

Okay. Specifically on the character merchandise, you're right.

I think they're prevalent across many brands, both D2C brands as well as legacy brands. We are looking to differentiate this with the design aesthetic and the signature handwriting that we have the opportunity to put out in the market.

Of course, this is backed by the trust and the quality that you can expect with a Jockey merchandise. These two pieces, I believe, will help differentiate our product offering when compared to the rest of them in the market.

The start is this with Disney and Marvel. This also opens up a window for us to collaborate with other licenses in the character merchandise space going forward.

As far as the second question is concerned, there will be upgrades as well as newness across the portfolio, but the large pieces which will be backed with marketing investments, new propositions, etc., is going to be in the athleisure space.

Got it. The second question was on the inventory level.

If further reduction of inventory days from 73 to 66 or 67, could that also lead to loss of sales to some extent? What's the thought process here in bringing down inventory levels all the more?

No, right observation. I don't think our intention is to bring down inventory level any further, and we should admit there has been some level of lost sales opportunity in quarter 1 as well because of non-availability.

This was largely attributed to some level of disruptions we've had on the supply side in quarter 1. I think we've reached optimum level of inventory both in the value chain as well as inventory at Page level.

In fact, we are now looking at augmenting capacity, investing above plan in terms of manufacturing to make sure that, both in-house as well as outsourced, to make sure that we're able to do justice to the demand that's coming our way.

Got it. This last bit, if I may, would it be possible to give a ballpark range in the difference between primary and secondary growth in this quarter?

We don't give away secondary numbers, but I can say that secondary growth performance has been much better than primary. That's largely because of the undelivered inventory, and hence, us not reporting it as primary in quarter 1.

Sure. Thanks for that.

I'll get back in the queue for further questions.

Thank you.

Thank you very much. Karthik, my question was actually around the logistics disruptions only.

If you could just double-click in on exactly what these were, and some idea on the quantum of the undelivered volume will really help. Related to that question, does this mean that for the year, you said double-digit volume growth is your target, could it be a little bit higher in 2Q because 2Q will have this undelivered volume and then also whatever the underlying volume is there in Q2?

Could you please double-click exactly what manpower issues and what logistics issues these were? Thanks.

Yeah. This was actually disruption because partly to be attributable to the rumors around escalation in fuel prices, availability of fuel itself, and hence, and all of our logistics are third party, and the third-party labor having a concern given the SAR drive that was undertaken through the month of June.

We had disruptions in the last-mile delivery with our distributors towards the end of June. That's what has impacted deliveries.

I cannot exactly quantify it, but what I can say is, rough and ready, about 3 days of billing went undelivered when compared to normal. Typically, every quarter, we have quarter ending, we have about 3 to 4 days of billing that does not get delivered and gets pushed to the next quarter.

This year, that moved to about 7 days. A delta of about 3 days of invoiced billing was not reported as revenue this quarter 1.

That's what has impacted. On your second observation, largely, yes, majority of this should be reported in quarter 2.

Anyway, the next three quarters, given that our goal is to hit a double-digit volume, should see above-average volume growth to make up for the shortfalls in quarter 1.

Okay. Just one more question.

The difference between value and volume this time is a little bit lower than it was in, let's say, the previous quarter, which is basically the price and mix. Pricing ideally should have been slightly higher than previous quarter because you took something in May.

What changed that the difference should shrink a little bit, if you can just let us know? What's your outlook going forward,

yeah? Yeah.

Two pieces there. One is the product mix, like you rightly pointed out.

We've had some of our lower ASP products, like accessories and socks, Again, this is by design in terms of scheme design seeing above-average performance in quarter 1, which has, in a way, contributed to a lower ASP. The second is the price increase taken in May, like I mentioned earlier, is not much of it we've realized in quarter 1 in terms of benefit.

That's something that will flow in from quarter 2. The outlook going forward will definitely be much bigger difference between volume and value performance than what we've seen in quarter 1, purely attributable to mix as well as the price increase in May, which will start kicking in by quarter 2.

Right. Thank you.

Hi. Thanks for the opportunity.

Couple of questions. Given the rise of e-commerce and digital channels in our mix, how are you leveraging real-time data analytics to harmonize, let's say, channel pricing, maintain margin parity, and also build some sort of KYC on the customer base as well?

Thanks, Tejas, for this question. On pricing parity, see, because there is no real-time data required, because we anyway don't, unlike most other brands, our pricing, we follow a uniform consumer pricing principle, irrespective of the channel of purchase.

There is no quick deals or flash sales or any kind of markdowns at any given point in time to the end consumer, irrespective of where that consumer is shopping. However, on the larger point of about how we're leveraging data, we are probably in the apparel consumer space, we are best positioned to leverage consumer data, given the large set of consumers that we serve.

In terms of D2C, our avenues today is jockey.in as well as EBOs, where we have direct first-party information. We are trying to synthesize this data, first-party consumer data, by building a CDP, a consumer data platform, which is largely in place.

We should be going live by end of August. We are now ensuring that we're being completely compliant with the DPDPA act and ensuring that all forms of consent in usage of this data is being secured.

Once that is done, we would be in a position to leverage it. Now, leveraging this data is on two fronts.

One is a direct impact on revenue in sense of cross-selling and upselling products. The second, and more importantly and a little bit more strategic, is about understanding consumer buying behavior, having cohort-level analysis of what is being bought, and feeding that back into our category management and product design teams to better make informed decisions on what to launch, how much to launch, etc.

That's something that we're building as a foundational capability within the organization.

Super. Just one follow-up direct.

What stage do you expect this digital investments to kind of become a source of efficiency tailwind also to let's say unlock operating leverage in specifically the DMS improve inventory turns and replenishment cycle also across the distribution network?

Yeah. The DMS is underway, but we've not yet completely moved ahead.

It's still a very small portion of distributors who are on DMS today, but the goal is, by end of this year or latest first quarter of next year, all of the distributors in our network should be on DMS, and then give it about a quarter more to stabilize as a tool, and thereafter, you will start seeing efficiencies coming into the system.

Great. Thanks and all the best for coming quarters.

Thank you, Tejas.

Yeah. Hi, Karthik, and hi, team.

Sorry, just two bits I wanted to understand. On this growth outlook, the way you're essentially witnessing, and just clarifying, in the next quarter, there should be a benefit of these lost billing days as well as the underlying secondary sales trends which we saw.

I just wanted to clarify that part, and that should rationally flow in the next quarter only, right? Is that a fair expectation to have?

That's correct. I think that's a fair expectation to have.

All right. Just on the input cost bit, see, if I recollect, there was some low-cost inventory benefit that we had in this quarter.

Despite that, gross margins did come under pressure. Wanted to just appreciate how are we placed now, and should we see sequentially margins kind of more or less now improving, or is there some pressure in the near term that we should kind of build in?

In turn, how do you see the full-year EBITDA margin guidance? Would you retain that at 19% to 21%?

Thank you.

Okay. Go ahead.

Deepanjan, please go ahead.

Mid of last quarter, yes, we did see inflationary conditions in the input cost, in fact, fabrics also went up, and as well as any synthetic products that we are buying, which is petroleum-based, there was a significant escalation. While we did pre-positioning of supplies, we couldn't fully absorb the extreme increases that happened.

Yes, end of June and even now, the situation is to large extent normalized, and going forward, we expect things to be stable. Of course, if there is again an escalation in the Middle East situation, it can happen differently.

As of now, we expect things should be stable, and with that, our annual outlook on EBITDA margin will still be within this 19% to 21%.

Deepanjan, just clarifying, what I'm trying to understand is, the price hike that has been taken passes on the current input cost and hence kind of gets us back to earlier gross margins? I wanted to kind of just confirm.

You're right. We did initiate the price increase, as Karthik said, in mid of May.

It didn't absorb the entire impact of cost input increases. Now, that will completely flow in Q2, and with that, we should start getting the stabilization in the gross margins.

Got it.

I think, Avi, let me just clarify. I think the price increase that we have taken does not completely absorb the input costs.

If the input costs continue to be or resumes to the level of what it was in April and May, then the quantum of price increase will not be enough to absorb the complete input costs. I think that's what MD also mentioned in his commentary, we've taken a very measured approach, keeping in mind not to outprice ourselves, and keeping competitiveness in the market in mind, we have partially absorbed the input costs in the form of MRP increase, believing that both the raw material increase as well as operational costs through logistics, etc., are temporary in nature, and should in a way stabilize going forward.

We've not, in a way, attempted to completely absorb the input cost in the form of MRP increase taken in May.

Got it. Very clear on this, Karthik.

I just had a bookkeeping, and I just landed at Speedo, the drop in MBOs, is there anything that we should be aware of? That's all.

Thank you.

Yes, I think we've gone through a consolidation, especially in the in the swim business in the offline space, given how quickly that business has moved from offline to online. Today, our online contribution to the overall Speedo business is upwards of 35%, and hence, the our network of multi-brand outlets for Speedo has consolidated to about 700 stores in quarter 1.

If I had to consider quarter 4 as well as quarter 1, because typically, multi-brand store stores/traders tend to build up inventory at the beginning of the season, which for Speedo is typically January, February. If I had to combine the two, it's about 950-odd stores.

All right. Thank you very much.

That's all from my side.

Thanks.

Yes, hi, team. Good evening.

Am I audible?

Yes, Nihal.

Yes, sir. Couple of questions.

First one is again on the impact. You did highlight about the second part, which was the undelivered billing.

Just to understand the first part, we have ARS being fully in place, and as we highlighted in Q4 also that the channel inventory across all segments is sort of normalized, let's say, close to between 45 days. With that as a framework, what is the kind of normalization that we are looking at in terms of sales, because generally, Q1 is one of the higher quarters given it's also a back-to-school kind of quarter.

Just wanted to understand the first part better in terms of the two impacts that you highlighted.

It's got to do with how we design our schemes across months in the year. If you see the last 2 years' performance, you will see how contribution of each quarter to the overall annual number has gotten a little more flatter.

Prior to the implementation of ARS, we had quarter 1 being the biggest quarter of the year, which is not the case in the last bygone year as well. We're trying to see how we can normalize between the four quarters in terms of more or less equal contribution.

Obviously, seasonality will play a role, which is beyond what we tend to design, but by design to make sure that there is no inflation of inventory or any kind of push abnormally in one quarter when compared to the other, that's how we're trying to design our schemes to ensure that, between quarters, by design, there is normalization.

Understood, Karthik. The related question to this was, you did highlight the impact of 3 days ballpark, which could have been related to billing.

Now, if you just take a very crude of say 3 days' contribution to the quarter, it is a 3, 3.5%. We were clocking a 14, 15% growth in Q4.

Is it fair to assume, that you're saying that underlying momentum of secondary is similar, that because of this normalization, the 2, 3% impact in the growth moderation is more related to this normalization, and the secondary trends or the tertiary, if you have your EBO data, sort of remain similar to Q4?

Yeah. In fact, EBO data has been better than Q4.

We've seen quarter 1 perform better than quarter 4 when it comes to tertiary-level performance in the EBOs, as well as distribution secondary. Coming back to your observation on impact on the top line, I think you're more or less there in terms of what impact it has had on the top line.

Got that. Final bit on the RM impact side.

Incrementally, we would have covered for what proportion of the RM inflation that we are seeing with this second price hike in May also that we've implemented?

Very difficult to put a number or say what percentage of the impact has been offset with the price increase, because it's been very volatile. March and April operated at very different levels.

We saw further escalation in May, sharp decline in June, then again gone up towards the end of June. It's very difficult to put a number and say this portion of this amount of increase in input cost has been covered with MRP increase.

What I can say is that it's only partially covered. It's also got to do with how we are forecasting the RM prices to be, and that's a bit of a punt, because we don't want to be in a position where we've outpriced ourselves, because we don't want to discount the brand later on.

Hence, we've seen a trend towards prices coming back, not to let's say the pre-war situation, but definitely better than what it was in April and May, and hence, it's a waiting game as we go ahead. We're hopeful that it will not escalate to the extent that we need to come up with another price intervention.

We believe that with this price intervention, we can operate in our targeted EBITDA range of 19% to 21%. As long as we're able to operate in that space, I think the intent would be to hold prices and drive volumes.

Got that. Thank you so much, Karthik.

I'll try coming back in the queue. Thank you.

Thank you.

Hi, sir. Good evening, and thanks for taking my question.

First question is basically on the RM side only. I understand you will not be able to quantify what kind of RM inflation you're facing, but can you quantify the kind of price hikes that have run in the system?

Yes. It's about 2.2% weighted average increase that we have taken in the month of May.

This is on the back of a 2.5% which was taken in the month of Jan. Jan, of course, had nothing to do with input price, but the May one, the 2.2%, is directly as a result of increase in RM cost.

Just a follow-up on this one. Basically in the first quarter, you still would be having a lower-cost inventory given that price escalation only started from March onwards.

Suffice to say that as you basically encompass the new price inventory in 2Q, these price hikes will flow through, and net-net, we are in a similar situation as in 1Q?

No, see, if you see the number of days of finished goods inventory that we started with, we had some level of pre-war inventory and a lot of March inventory as well. In a way, that is a net-net situation when it comes to Q1 opening.

Large portion of our finished goods, and to some portion the raw material that was procured, was through April and May. We also had prepositioning of inventory, specifically in raw material, to offset this RM escalation impact.

Again, the escalation has been much higher than what we had anticipated, so that impact did flow in in quarter 1. The price increase in May should help offset that partially.

Now that raw material prices are better than what it was in April, May, it should have a net-net equal impact and take us back to early Q1 kind of a scenario.

Okay. With the price hike, you'll be back to pre-Q1, assuming that the prices stay where they are today?

Yes, going forward, because the prices have come down when compared to April and May. If it sustains at this level, we should be okay.

Fair. Second question, a very different versus what has been asked.

There has been a minimum wage hike in Karnataka, and while garmenting at this point is still out, but we still have a very large workforce which is based in that state. Large number of our manufacturing units are there.

Fingers crossed, but if we were to assume the worst were to happen here, a similar kind of a 60% minimum wage hike, which if it includes garmenting as well, what kind of margin pressure are we looking at? Any indication you can give will be helpful.

Another way to look at it would be, how much percentage of our employee cost is basically at minimum wage in Karnataka?

See, by the way, the minimum wage increase for garmenting has already been actioned in the month of April, which was applicable for garment industry. That's already flown into the salaries, and it has, in a way, hit our P&L as well.

Now, the announcement that was made towards mid-May, which did not affect garmenting industry, still affects us marginally because of, let's say, third-party employed support staff, like security, like drivers, like our sales specialist at the stores, all within the Karnataka state. It is only to that effect that this second announcement by the government of Karnataka is going to have an impact, which is not a material impact in terms of the overall P&L.

By the way, that also has now been withheld temporarily with the latest announcement made towards the end of July by the government of Karnataka. As of now, the first announcement was challenged and was in the court.

Meanwhile, by the end of July, the government has withheld that announcement temporarily. Even if that were to go through, it's not going to have a massive impact, because it does not affect employees who are directly related to garmenting.

All of our tailors who are today governed by the minimum wage code do not get impacted by this announcement.

You're saying that even if there was a rollback of the minimum wages, it will still exclude garmenting. That's what, or that the employees which are directly employed at your place, that's what you're saying, right?

It always was. The announcement by the government anyway did not cover the garmenting industry.

For garmenting industry, a separate announcement was made in the month of April itself. New minimum wage is announced, and the same has passed on to all eligible employees.

Got it, sir. Subsequent to that in May, I think there is a review committee separately made just to relook at garmenting, and that is why the question that if we were to assume a similar kind of minimum wage hike that comes in through garmenting, what kind of margin impact are we foreseeing?

That is something that we've not done. Maybe something that we can do and come back with a number, because the announcement that was made was clear that it was not to do with garmenting.

It still affects us, like I said, for associates who are not directly involved in garmenting, but that did not have a material impact on the P&L.

Just to clarify, even that initiative also, by the government, seems to be going slow because there has been change of hands of government at the ministry level, and things are going very slow on that front.

Got it, sir. That's very helpful.

Last question, if I may squeeze in. I have seen your annual report, and in that, the ad spend, selling and distribution expenses are down 5% in FY26, and I believe this also includes the commissions that are paid to the third-party e-commerce channels.

Now, in a year where e-commerce has grown at 60%, I was just wondering why overall ad spends are down 5%. Would it imply that we have meaningfully moved to an outright sale model to e-commerce platforms?

If yes, what is the rationale? If you could give the salience of outright sale and marketplace model within e-commerce?

The other implication would be the brand-level sales itself has been meaningfully cut down. Again, just wondering why that should happen.

Okay. Within the e-commerce business itself, if you had to look at it between marketplace model and outright model, yes, the contribution is shifted more towards the outright model.

This is largely because of quick commerce. Quick commerce, we cannot operate on a marketplace model.

With the fast-paced expansion of the quick commerce players, all of them operate on an outright model with Jockey, and that's why you see a swing in business tilting towards outright when compared to marketplace. Even with traditional marketplaces, our endeavor is to actually operate on an outright model when compared to marketplace, because the last-mile delivery and consumer experience happens to be better, because we today operate with two fulfillment centers, one in South and one in North, whereas most e-commerce players that you can think of operate with a lot more DCs, distribution centers and fulfillment centers, and hence, the TAT to deliver to end consumer is a much better and results in better consumer experience.

That's something that has definitely had an impact. In terms of overall brand spends, the difference that you're seeing is because the year before last financial year, we had a large campaign for the World Cup, which was a disproportionate spend, which did not follow through in the last financial year.

That's the delta that you see in terms of lesser spends at a brand level. Otherwise, the intent is to continue operating between a 4% to 5% of the revenue towards marketing.

Got it. Just very clear.

Just a follow-up here. Basically, going towards an outright model, you also will be losing control of pricing on these marketplaces.

Would you be comfortable with that as a strategy?

No, we are looking to have the best of both worlds. We are in a strategic partnership with majority of the marketplaces where we are operating in outright to ensure that price governance is maintained, and we don't in a way dilute pricing principles to the end consumer.

We're fairly confident that that is something that we'll be able to maintain.

Got it, sir. Thanks a lot for all these very detailed answers.

I'll come back in the queue for follow-ups.

Thank you.

Thank you for being with us today. We truly appreciate your continued interest, confidence, and support.

While the operating environment continues to evolve, our focus remains clear: serve our consumers better, to strengthen our brands, execute with discipline, and build a business that creates enduring value. We look forward to engaging with you again the next quarter.

Thank you again. Have a good day.