Thank you, Shruti. Good evening, everyone.

I would like to welcome the management and thank them for this opportunity. We have with us today Mr.

Sunil Suresh, Chairman and Founder; Mr. Venkatraman Golthi, Managing Director; Mr.

J.K. Sharath, Group Chief Financial Officer; and Mr.

Abhijit Sonar, Chief Executive Officer, Retail Business. I shall now hand over the conference to the management for the opening remarks.

Over to you, gentlemen.

Good evening and thank you for joining us. This year marks three decades of Stanley, of leather mastery, manufacturing excellence, and brand building.

As we complete this milestone year, we have taken a deliberate pause not to slow down, but to strengthen the foundation of the next phase of growth. Our revenue trajectory remains stable, however profitability for the quarter reflects conscious investments and structural transactions we undertook over the past three quarters.

Let me explain this clearly. After almost three decades of founder-led growth, we have initiated a structured transition towards institutional leadership.

We inducted a Joint Managing Director and a new Retail CEO, both among the strongest leadership talents for Stanley. These leaders represent the new generation for Stanley.

For approximately three months, there was an overlap in senior management roles to ensure continuity and seamless transfer of responsibility. This overlap has increased short-term cost, but was critical for long-term governance strength.

We believe institutionalisation leadership is not optional, it is essential for sustainable growth. Store expansion and investment phase.

Over the past three quarters, we opened nine new stores, including FOFO stores. Six additional stores expected to open in the next couple of months.

We acquired franchisee operations in Hyderabad and Pune, converting them into company-owned formats. We have now expanded our COCO presence across the top six metros in India.

However, stores under 36 months of operation yield significantly lower margins than mature stores. With a large number of recently opened stores in the system, this has temporarily diluted profitability.

While our COCO stores have grown steadily this year, the franchisee channel experienced moderation, partly due to broader demand softness and project delays. Importantly, these investments have been deliberate.

We have invested over ₹62 crores in expansion in the first three quarters, yet our cash reserves remain at the same level as last year, reflecting prudent financial management. Strategic sourcing, BCC best cost country model.

We are working diligently to be more and more competitive through our strategic sourcing initiatives through our BCC model. This has started yielding good results for us and will continue to do so in the future, too.

Brand architecture and network rationalisation. As part of our three decades reset, we undertake a comprehensive brand architecture review, reviewing existing stores, evaluating underperforming catchments, paused certain expansion, rationalisation formats where required.

Some stores had outlived their catchment potential. It was prudent to address this now, rather than defer this difficult decision.

Market environment and demand outlook. Order execution during the year was impacted by residential project handover delays, global macro uncertainties, subdued discretionary demand in certain months.

However, traction has improved meaningfully from January onwards. Data across the six metros where we are present now shows that the premium housing sales over the past three, four years have been at historic highs.

Delays in handover have created a pipeline of premium housing awaiting interior fit-outs. We expect deliveries to accelerate starting 2026, unblocking significant demand for premium furniture.

Stanley is now fully present in these markets and well positioned to benefit. Regulatory advantages, BIS certification.

We obtained our BIS certification this month on products covered under QCO, among the early movers in the furniture segment. With the Quality Control Order coming into effect this financial year, non-certified importers and unorganised players will face restrictions in the Indian market.

We believe this structural shift will favour organised, compliant, integrated players like Stanley. Technology and full home pivot.

As we pivot from leather specialist sofa manufacturing company to full home luxury provider, we have paused selectively to integrate the right technology platforms, upgrade backend systems, recalibrate our kitchen and cabinetry vertical with the experience we have obtained. Order books remain robust, and we are confident this integration will strengthen execution capability as we move towards FY27.

Closing outlook. Premium housing and branded luxury furniture India remain in early stage of organised growth.

To summarise again, the reset after three decades: organizational restructuring of leadership transition, brand architecture and network rationalisation, cost optimisation through strategic sourcing, efficiency and productivity improvements, business enablers through technology enhancement, BIS certifications, full home solutions. The investments made this year have temporarily compressed profitability, but they have structurally strengthened the business.

We remain confident of delivering quality growth, improved margins, and stronger return ratios in FY26 and beyond. I now invite Mr.

J.K. Sharath to walk you through the financial performance.

Thank you, Sunil. Good evening, everyone.

Every investment we make today in stores, people, and processes is aimed at reinforcing our position as India's most admired luxury furniture company. For the nine months ended FY26, the company reported revenue from operation of ₹3,179 million, reflecting a modest year-on-year growth of 1.4%.

This relatively muted growth is largely attributable to evolving consumer preferences, with a visible shift towards more value-oriented products during this period. Encouragingly, gross profits grew by 6.2% compared to the corresponding previous last year, supported by an improved product mix and continued operational efficiencies.

EBITDA margins remained largely stable at 18.8% in nine months FY26 as against 18.9% in nine months FY25, demonstrating resilience at the operation level. However, reported PAT stood at ₹136 million, making a decline of 26.1% from ₹184 million in nine months FY25.

The reduction in profitability was mainly due to higher depreciation and finance costs arising from ongoing store expansion and strategic investments in growth infrastructure, which we believe will support long-term value creation. During the nine months, we opened seven COCO stores and are progressing on five additional COCO stores.

This resulted in higher depreciation and finance cost of ₹101 million due to lease-related accounting impact. These are forward-looking investments, preparing us for the next phase of growth.

For the third quarter December 31st, 2025, revenue from operations stood at ₹1,038 million, reflecting a decline of 5.4% year-on-year, primarily impacted by near-term demand softness. After considering the impact of new labour laws, EBITDA margins moderated at 11.9% in Q3 FY26 compared to 18.7% in Q3 FY2025, representing a contraction of 680 basis points, largely due to operational deleverage and costs associated with recent expansion.

During the quarter, the company reported a marginal loss of ₹2 million at PAT level, as against a profit of ₹89 million in the corresponding period last year. The decline in profitability was mainly attributable to higher depreciation and finance cost, along with expenses relating to new store additions that are yet to reach optimal utilisation and deliver commensurate returns.

Higher amortisation and finance costs from new store additions had a short-term impact. However, these strategic investments will strengthen our retail footprint and support future profitability.

We will now open the floor for questions.

Yes, good evening and thank you for the opportunity. The first is on the growth part, right?

If we look at your commentary, basically project handovers will accelerate only by the end of FY27 and also the consumer is shifting or down-trading or to more value-oriented products. With that, then how do we look at growth internally for us as a company?

If you really look at how we have kind of moved from our typical home markets and now have a clear presence in the top six metros, there is definitely a solid pipeline that is expected in terms of the premium homes and luxury homes that have been sold over the last three to four years, which normally take between four years to four and a half years to come for delivery. We are very excited in terms of the number of projects that have already been sold, probably a bit delayed, and they're all going to come to handover starting from FY26.

While there has been a small little what you can call as a sentiment in terms of how things were in the last six months or so with global headwinds, and also the project coming into delivery will definitely accelerate our offering to the market.

No, sorry, my question was then, what growth are we targeting, let's say, for FY27 considering the macro consumer sentiment is not supportive and handover of projects only happen by the end of FY27? While we've been articulating as our aspiration of 20% plus kind of a revenue CAGR, but right now, we are nowhere close to that.

Just from a realistic standpoint, what would be your revenue guidance for the next one financial year considering the macro situation?

For you to understand that actually our pivot towards full home solutions have turned out very positive, and if I look at how our KCD order book looks compared to December of last year, basically when I say the kitchen business comes in first followed by loose furniture later, last year December we had an order book of roughly about 12% of our total order book coming from kitchen and cabinetry. This year on December 31st, it has gone up by 20%, almost 30%.

The pipeline for us to do complete homes are increasing, thereby the average ticket size of each customer will jump almost six to seven folds. That is how we are pivoting from our loose furniture brand towards the complete home solution brand.

This will definitely kind of cascade into a much higher sales as we go forward.

Would you want to quantify your guidance for revenue growth overall at a company level for FY27?

Basically, as part of our approach, we are looking at a very healthy and profitable growth. At this point in time, we will not be able to give you a numbers as to what we are projecting, because we are in the process of budgeting and we will probably give it to you by Q1.

On the store additions, I think for the full financial year, we would be at plus nine stores, right? We would have added nine stores.

And...

No, I think by the end of probably April, maybe not March, but by April, I think we should be having all together 15 stores, out of which we have 12 COCO and three FOFO stores coming in, including yeah, 12 12 COCO, am I right? 12 COCO?

No, sir, we currently have...

No, no, and so he's talking about how many stores this year, total.

Correct. Nine we have opened till December, already opened.

We have another six in the pipeline. In that, five is COCO and one is FOFO.

Total COCO how many?

Total COCO is 12.

Total COCO is 7

plus 5. 7 plus 5 makes it 13.

12.

12,

yeah. 12, yeah.

Total COCO stores will be 12 and three FOFO stores. We have already opened nine out and the six are pending.

We are confident of doing in between now and Q1, within the early Q1 we will do it.

Lastly, the employee expenses and the other operating expenses are growing at a much higher pace versus the revenue growth. Any comments there?

Where do we see the quarterly run rate settling, especially for the employee cost?

Sure. I think I was quite clear about that in my commentary.

Actually, as I told, there has been a senior management change and there has been a transition period. Probably for almost three months, we had an overlap and that will start settling down by the end of this quarter.

Plus also because of the new labour code, we had to take a one-time hit in terms of employee benefits for gratuity and leave. One-time hit was there, and plus also a recurring hit because of the change in the regulation has come and all these has hit our employee costs.

Quite a large number, actually. Close to ₹9 million.

Sure, thank you.

Thank you.

Sir, I'm trying to understand that since we are in the luxury furniture space, what impact with Quality Control Order have, because I understand mostly the unorganised sector would be at the entry-level cheap furniture stage. Are you really expecting some significant tailwind from the QCO order?

Yes, as most of our competition is imported furniture and the compulsory of making it BIS and QCO coming in, I think we will definitely be benefited because we already applied for and already got certain BIS certifications done. We are quite positive about the impact on our company with the QCO being implemented.

While I think the unorganised sector will find it fairly difficult, companies such as ourselves who are basically compliant and are already certified will probably have a couple of years lead ahead. We remain very positive about that.

Now sir, another question, basic question is on the top line, which doesn't seem to be growing from FY23 levels. We are stuck at around 400-450 levels, even though the net worth has significantly expanded thanks to the IPO proceeds.

All that capital, even though net worth has over doubled, still when will it start showing in the top line?

If you have heard my commentary, I think we're quite clear. We have completed three decades in business now, and this has been a small pause for us to kind of restructure, do the entire brand architecture, which I think we are almost completing by the end of this financial year.

We are very positive that you will start seeing a lot of growth. In terms of also our store aging, if you really look at it, we have close to about...

50%.

50% of our stores are under three years, which are basically still at very young age in terms of the maturity. We expect that due course of the next financial year, many of them will start coming to a higher profitability and maturity.

That's how we are positioned right now.

Now sir, we have over around ₹190 crores, which is like 20% of our market cap, and we remain debt-free. Any plans to do a share buyback so that the future growth can get divided on a smaller base and EPS can increase?

No, at this moment, like I said, we are fairly busy and been very involved in doing the reset for the company. We are going to go ahead and do some good performance in the due course of next quarters, and we'll think about it later.

Sir, what about the rupee depreciation? Since we are also importing quite a bit, how are our margins getting hit, or have we taken some kind of price hike in recent times?

Not really, but then I think our entire kind of pivot towards moving away from expensive European imports towards BCC or what we call as best country suitable or localisation, those things have started to play out and I think we're well positioned to kind of de-risk ourselves from forex volatility.

Sir, and are we looking at exports to US and EU after the recent deals?

At the moment, I think we are very clearly focused. While our B2B business has been showing a lot of good enquiries and order book expansion, our focus will remain on B2C.

Since we are investing in acquiring multiple franchisees in cities, we are going to be very focused as a B2C brand.

Sir, and in page number six of your presentation, it says 61% stores are COCO, 9% are FOFO, and 30% is others. Others meaning what?

Others is basically B2B. We have a mix of B2B and B2C.

70% of our revenue is B2B...

B2C.

...B2C, which is a mix of COCO and FOFO, and 30% is B2B.

Sir, what are our capex plans going ahead?

We have completed our capex projection for this year and as I mentioned to you, despite investing ₹63 crores, our cash reserves are exactly the same where we were last year. At the moment, we are budgeting.

I think we will basically be able to give you better clarity by the end of Q1.

Sir, all the funds that we have, ₹190 crore or thereabouts, it's for working capital usage going forward?

No, it will be a mix because as per the fund utilisation we have raised in the IPO, we have partially utilised the proceeds which we have realised. The whole working capital requirement which was raised has already been utilised and consumed by us.

The remaining will be for our new stores opening, which we plan for the next couple of years as per the prospectus. We have close to ₹78 crores which we still have as part of our IPO proceeds, which are yet to be deployed, and as per our IPO plan, we will be deploying it in the next couple of years.

Out of the 190.

Out of the 190, yes.

Yeah.

Sir, lastly, I just wanted to understand that do we enjoy any, let's say, advantage in the production side? Is our cost of production lower than the competition, let's say Godrej Interio or whosoever is our competitor?

Where do we have the edge? Is our cost of production cheaper or we are fully integrated?

What would you say is our USP?

Please understand that our segment where we are catering to is much higher than what other Indian organised players are actually playing. For us, the competition is primarily European imports and other Chinese imports and so on and so forth.

We don't look at segment-wise competition, direct competition with the companies that you mentioned. I think we are mostly bespoke manufacturing and customisation is our most important USP, and we will continue to do it.

We are not in the mass production. We're in what you call as handcrafted bespoke production, and our customer base is normally homes with more than ₹2 to 3 crores investment in their residential project.

We don't cater to homemakers below ₹3 crores of residential budget.

Sir, since our competitors are foreign companies like Gautier of France, etc., with the recent EU FTA deal, I hope they will not be flooded with European furniture imports and...

No, no, no. Basically that is exactly the touch point that you have to understand.

The BIS certification and QCO is doing exactly what it did to footwear and toys five, six years ago. If you realise that same QCO was applied on footwear and toys and now it's being applied on furniture.

It will definitely block certain imports. As we look at it, as we expand our base and are able to kind of give the similar quality, we believe that when we have a higher-end competition, we normally win because our speed to market, we are able to deliver our loose furniture in four to six weeks, whereas they take almost four to six months.

That's the kind of advantages we have. As the market is getting more and more premiumised, our business is going to thrive.

That is how we are positioning ourselves.

Sir, lastly, in Bangalore, sir, what percent of our revenue is coming? Sir, with this, if the IT sector gets disrupted, then we might get hit because after all, they are the highly paid white-collar segment, which is our customer base.

Any thoughts on that?

Again, I think I understand your concern in terms of IT getting disrupted, but actually, even in our value premium segment, it is typically the CXO level of IT that actually start with it. We are not in the market segment where the typical IT employees are our customers.

When we look at our customer profile, it normally starts with CXOs, but we cater to a lot of HNIs, our mix is very, very large. We have SME owners.

We have a very huge mix in terms of bankers and that corporate honchos, actually. Normally I could say in a way that for you to understand, 90% of our customers are employers and not employees.

Got it, sir. Thank you very much.

Thank you.

Thanks.

Thank you for taking my questions. Sir, I just wanted to again touch upon once on our revenue growth on a slightly longer timeframe.

When I look at March 2023 end, the store count then and the store count now, our store count has gone up by about 43%, whereas our B2C business has grown by about 10% in this roughly three years now. Right?

Why is revenue growth lagging the store count growth with such a wide margin? I'm not able to understand that.

If you look at our store aging, normally as we have always mentioned that we require about between 24 to 36 months for our stores to come to maturity. Currently, when we looked at FY23, probably we had stores that were fairly matured, but today more than 50% of our stores are under 24 months.

We are still in the process of maturity. This, you will see the what you call as results unfold due course of the few quarters going forward.

Sir, then is my understanding correct that the 35 stores which you have shown as more than three years old, which are our mature stores, have these stores been degrowing or do they have negative SSG?

Some of them probably have, because like I've mentioned that there were some very legacy stores which have outlived their catchment area, we are doing what we call as either we are changing the brand from our premium to our value premium brands or we're relocating the stores. Also the pivot is happening in the company as far as we're moving from loose furniture to a complete home solution provider.

That's the changing process at this point in time.

Sir, on this point of moving from loose furniture to a full home solution, I think you gave some statistics, I think I missed that, in terms of what percent of our order book has now become a full home sort of a more composite order than just a loose furniture order. Did you mention any mix over there?

Yeah. Essentially like I mentioned to your other question earlier, if you look at December '24, our order book position, our what you call as full home orders or our cabinetry orders was only 12% and our loose furniture order was 88%.

This year FY25, it has grown by 20%. We have our KCD and full home order book is at 37% versus 12%, and we have grown by 20%.

Thereby we are very clear that once we get into the house with kitchen and cabinetry, the loose furniture also will start following. That is the shift that we aimed for and we're getting there.

Okay. Sir, on employee expenses, as I understand, there has been sort of investment right now to strengthen the corporate team, the ₹19 crore quarterly number we see in Q3, is this the new implied run rate or that ₹19 crore will settle lower going ahead?

Sorry, we missed your voice. It was not clear.

Can you repeat it again? It was not clear.

No,

I was just asking the ₹19 crores of employee expenses we see in Q3 quarter, as you mentioned that there has been some over-investment right now for the transition, wanted to check, how will this ₹19 crore settle going ahead?

Primarily what happens, this increase constitutes of two, three items. One key item which is increased is more of the labour code impact which has come.

Overall, we have an impact of about ₹9 million in the quarter which we have taken because of the new labour code which has come and the past service liability which we have taken. The second key impact item is because of the new stores which we have opened, there is a increase in the employee expenses which has come, because we will have employees also being coming in each of these nine new stores which has come.

The other key piece is the transition which Sunil spoke about, because we had onboarded new leadership team. We had in the quarter both two both old CEO, new CEO working, new MD, old MD were there, because of which this salary is sort of higher in this quarter, which over a period of time will sort of even out.

Okay. My last question was, has the Bangalore cohort overall shown equivalent performance to other city stores, or has Bangalore been more subdued than the non-Bangalore stores?

That was my last question. Thank you.

Actually, when you look at it, just about 24 months ago, almost I would say 66% to 67% of our entire business was dependent on Bangalore. After acquiring our partners in Hyderabad, and also now expanding in Chennai and Hyderabad and Pune, we acquired our partners.

Pune has grown by almost 250 odd percent compared to last year. Hyderabad has grown by almost 30, 35%.

Chennai has grown by about 35 40 No, Hyderabad has grown more.

Chennai

has grown by 35%. We see that in the due course of the next three to four quarters, I think our business will be fairly evenly spread among five of the six metros, because in Bombay we still struggle due to non-availability of real estate.

Other than that, I think we have expanded in all the other metros, it will even out and we are hoping to have a more even play across the six metros in the due course of next three to four quarters.

Thank you, sir, for taking my questions.

Thank you.

Sir, two things. I think some time back you had said that in three years you will be reaching a figure of ₹1,000 crore.

Is that intact? Number two, the number two question is the Furniture Control Order, do you see the import of furniture coming down with that?

Let me articulate that once again. We had always mentioned that it would be 1,000 working days, so that's technically what it was anyway.

Nevertheless, I think we are definitely keyed into getting towards that number. There is no change.

Up to us, like I said, there has been a small little pause in the last couple of quarters to realign our entire brand strategy. Looking at how the winds are favouring us, we are very positive that with the QCO and everything, the imports coming down, I think we're probably one of the few companies in India who are well positioned to cater to the premium and luxury demand that is emerging.

The Quality Control Order, you see import coming down?

Absolutely, absolutely. I think basically like I said, the BIS certification process has already started.

We are one of the first early guys to have already got certain BIS certifications done. I think that is really going to favour organised players in India.

Now the 1,000 crore in 1,000 days, right now, has the period been prolonged by say another 200, 300 days, or where is it?

Like I mentioned to you, we have done this structural change. Our intentions are very clear.

We have to get to that milestone and we are definitely working towards that. We have seen that in the last six, seven, eight months, there has been major global headwinds that kind of played out with tariffs being implemented, and Indian sentiments in our customer profile was a bit slow.

They have, I think postponed high-ticket purchases. I think those winds are once again changing.

I think January we have seen a more potential walk-ins in our stores, and we remain very positive about that.

My last question, what is your prognosis of gross profit margin and operating profit margin in say another two years, say FY29?

I think with all the developments in terms of our purchasing and scale coming into the business, of course, I think we have to look at how the aging of the stores play out because we still have a lot of younger stores as we call. Eventually, our vision is very clear that with a premium and luxury positioning, we need to have a premium margin.

My last question, gross profit margin around 55% to 60% and operating profit margin around say 20%?

No, sir, the gross profit margin currently whatever we have is we have also mentioned earlier, is something which is sustainable. That's where you'll see that because of our lot of efforts in localisation, product mix, and changes in the operational efficiencies which we have bought in as a strategic effort over a period of time, you see a very consistent and more recurring kind of a benefit coming in.

That's where these numbers which we have are more sustainable numbers. We are

confident that

we continue to have it or maybe slightly better it as we go, depends on the various other parameters. Operating profit, like Sunil said, it's more a factor of how our new stores perform and what is the mix of our new store versus old store.

Like currently, we have 50% of our stores which are less than three years and 50% more than three years. We are currently looking at all the stores which are underperforming, and plus we are also opening a lot of new stores in the current year.

This mix will influence a lot of margins which will be there in short term, because we are making a lot of investments and you would see the investments are initially getting recognised. Over a period of time, once this amortisation, interest cost, etc., which is an accounting matter under our lease accounting is sorted, then you will have a much better financial position which will get reflected.

You are not committing anything on the operating profit margin?

No, we don't give any guidance on future numbers at this point.

Thank you, okay.

Hi, sir. My first question is what kind of margins do you earn on COCO retail versus FOFO versus the B2B business?

See,

our margins more or less remain same. I'll first take the FOFO business.

FOFO business is a franchisee-owned, franchisee-operated. It is a cash-and-carry business.

We sell to them and immediately that comes to our revenue and it increases our overall profitability. In a COCO model, we have our own stores where we incur the rentals, where we incur the store people, and it is more monitored by us.

Net-net, our focus has been on our COCO model and our COCO margins are higher, provided we have an operating leverage which we achieve over a period of time, which is what we are trying to work on and get to that level. Yes, we are also working towards getting a better mix of COCO and FOFO, because some of the cities, we have seen that FOFO model is what works better than a COCO model.

In the six metros, we have

COCO. Our focus on the six major metros to continue to remain as a COCO, and we continue to invest in the COCO format.

We see a lot of benefits coming out of this, because also we work on the tailwind of the RERA and the housing this one. The luxury means the more than ₹1.5 crores housing which are launched plus also which are expected to come for deliveries in the next couple of years, you'll see in this six major cities, there is a big spike which is expected in the next two years for

deliveries

in these cities. That way, we look forward to a lot of growth in these COCO stores.

Understood. Correct me if I'm wrong, does the FOFO stores require lesser working capital for you guys?

Absolutely right. The way it works is while we manage the branding, store positioning, etc., etc., and provide all the support to the FOFO stores, we don't make any investment in the store cost, employees, etc., etc.

It's also cash and carry.

It's a more cash-and-carry business where we sell it to them and they, based on the orders, stock it, and then they sell it to the end customer. You can in a sense say that I have less working capital and a capex spend in FOFO model, yeah.

sir, hi. Sir, you've been talking about this QCO thing for a while, and thankfully it has come to fruition now.

Just couple of things here. One, you indicated that a part of BIS certification has been achieved for your operations, right?

What exactly that mean and for full certification as in by when are you expecting factory premises to be fully BIS certified?

We have a lot of different SKUs and quite a lot of SKUs have already been certified. We are in the process and we are very confident that in the due course of next one or two months, we should be able to get almost 90% of our SKUs certified under BIS.

Probably we are one of the first guys to also kind of get our BIS certifications.

Okay. By Q4, the full BIS certification should be achieved, right?

Or maybe say by Q1, Q1 FY27?

The BIS also is, I would say, completely chocker block with hundreds of people approaching them, and the government is very clear that first they want to clear the Indian manufacturing before even looking anything at foreign manufacturer. I think it's going to be a long-drawn process.

We are expecting definitely to complete almost 90% by hopefully end of Q4 itself, and I don't see any impact on that coming into play for us.

Okay. Okay.

Last bit from my end. Typically, whenever there are such implementations, the channel sort of sees huge flooding of inventory, right, just to save themselves from an expected BIS implementation by the government.

Are you noticing such a trend? Because we have seen such things happening in the footwear space, where typically the channel was flooded with excess inventory and it took a good amount of time first to sort of liquidate that channel inventory and then the benefits of BIS sort of started to come to fruition.

Do you also anticipate such things to happen in your industry as well?

You are right, actually. Probably this QCO thing has been in the market for the last I would say at least two to three quarters, and we have seen some amount of inventory build-up with importers because they were concerned and now the gazette is passed, everything is awaited.

There has been an impact, I think, which is behind us. I don't see that ahead of us.

Since we have passed through this, I think we are going to see better quarters coming forward. We're also told that already the customs have started blocking the imports.

There are challenges for importers going forward.

Sure, that's fair. Whatever has been imported, they will have some stock existing in the channel, right?

Will that take some time to get liquidated?

It could be. I wouldn't want to really comment on that.

Because I said this has always been there for the last three, four quarters, and I think there was a lot of inventory build-up. I'm not too sure.

Also the market being a bit subdued, I think what we realise is the most of the importers are still stuck with some unsold inventories and are finding it a bit difficult. I wouldn't really be in a position to give you that.

It won't be unlike in footwear and other things, these are very bulky products, they also need a lot of storage spaces. I don't think they're going to be impacted like how the footwear industry importers were impacted.

Fair enough, sir. Thanks for taking my question.

Thank you.

Hello, am I audible?

Yeah. Sir, what's your change in your strategy that you are focusing that whatever milestone that we are setting, like ₹1,000 crore, we will be able to achieve?

Sunil sir, specifically for you, what will be your role going forward since there is a change in the management that we can see?

I don't know whether you heard me speak in my commentary. We are in that little pause phase where we are actually structuring all this much better.

As I mentioned, this was very crucial after three decades of our presence. We realised that this was an essential investment to do in terms of getting the top management and in terms of doing a bunch of, I would say, brand architectural changes, which is all going on as we speak.

While our intentions are very clear and our targets remain the same, we had to go through this little phase.

No, I understood, sir. Setting up a target is a one thing and then taking steps, I understood that and I heard you clearly that there is a change in the management.

If you can throw some light, because these things we are listening from last one, two years, correct? If we see the revenue numbers and everything, the movements are not visible.

If you can throw some lights a little bit in detail so that we investors can understand what's going on, so that would be easy for us.

Basically like I mentioned, I think we are focusing on this six major change implementation. One is basically organizational restructuring, leadership transition after our three decades of play, brand architecture, network rationalisation, cost optimisation, strategic sourcing, efficiency and productivity improvements, because we realised that with scale, our profitability will improve, we are doing that in terms of getting our productivity and efficiency improved, business enablers through technology, that was something that was missing, we realised that it would be dangerous to scale without getting the tech implementation done, that's also being done.

Of course, BIS certification, and we're pivoting mostly towards full home solutions, actually, and we have started to see the trend, because if I look at what we were having as an order book on December 2024 versus 2025, our order book has improved 20% in terms of full home solutions, and that will actually lead to more sales as we go forward. That is the pivot that is being on.

Understood. Sir, I remember 15 months back, there was an order that you announced that we are supplying to an airport, for some seatings or some materials.

I haven't heard anything in last one year. Is there any change in the strategy, or how we are not focusing on that part, or how it is?

If you can throw some light on that part as well.

These are things we keep doing. We have already supplied to our Bangalore airport long time ago.

We recently also supplied to the business and first class lounge in Delhi. Wherever there is a brand connect for us and we have a HNI clientele movement, we take up such orders.

We are not a B2B brand, we don't go behind corporate orders and hospitality orders. We are a very B2C residential furniture, full home suppliers.

However, when we get such opportunities, we definitely take it up and we execute them. In the Delhi T2, in the business and first class lounge, we have already supplied our furnitures.

Understood. Sir, is it we are losing our market share in Bangalore?

Because you mentioned our revenue is increasing in Hyderabad, Pune, and other cities, but if I see at a total level, the revenue is flat, correct? Is it we are losing at Bangalore location?

Bangalore I think has been slightly flattish for us primarily because, like I said, we are doing multiple changes. Bangalore has been our oldest market in terms of cluster expansion.

We started in 2017, the cluster expansion worked for about five to six years. We are making certain changes now, and that's how I think Bangalore has been slightly flattish.

I think we have expanded our business and reached out to the other metros, which was very important as a pan-India player.

Sir. Last one, sir.

In the last quarter, we discussed there was a new product that you were launching. What's traction on that, if...

Oh, yeah, Hilker. I think you're talking about the licence of a German company, what we have taken.

That I think we are just about starting and we will have our pilot store going live probably by end of this quarter, and we will have certain budgeting done for that for next year, which we have not yet budgeted. The first pilot store is going to go live by end of this quarter.

How much revenue we can expect from that? We've been

working on the collection for almost one year. There were German designers who have come and made the collection.

The collection is fully ready. We sent out one small container as a sample container to Germany, we are awaiting results of that.

Plus also, like I said, the pilot store is being made and end of this quarter, we'll have the first pilot store ready.

Nothing as such as in other than the sample or pilot project, nothing has been materialised as a discussion how much revenue potential that project would have?

Not yet. This we will budget by probably end of this quarter and have something for next year coming up.

It's a process. It has taken more than one year to get where we are, and we are now just about ready to get market ready.

Understood. Sir, all the best.

I know this time will still pass and we will definitely cross this 1,000 milestone. All the best, sir.

Thank you.

Yes, sir. Thank you very much.

Hi, sir. I just have one more question.

You've been talking about the brand restructuring, and with the new leadership team, how are you actually going to build this brand in the future? What is the strategy?

It's a good question. Basically, if you really look at how we were evolving in the last few years, we did not have the quantum of premium and luxury houses coming into the market between 2015 and 2020, or for that matter even between 2020 and 2025.

When I look at what the actual RERA report says and the quantum of luxury and premium houses that are sold in the last four years, which are historical high numbers, these are the homes that are going to come to the market mostly in the six major metros of India. Almost, you can say, 85% or 90% of India's premium and luxury housing is going to come into play in this six metros of India.

We have actually very steadily, but slowly, moved from our home market of Bangalore, acquired partners in other cities such as Bombay, Chennai, now recently, after IPO, we acquired our Hyderabad and our Pune partners. We have actually started putting up our COCO stores and that is already starting to show growth there.

The new management team which is coming on board is more institutionally oriented. For three decades, we were promoters, we were driving this business, and we had a legacy team who probably were not capable of taking the company to the next level.

We had to go through those change implementation. Tech implementation is also happening.

Various things are in the pipeline and that is how we believe that we will be able to grow substantially going forward. I hope I've answered you correctly.

Thank you, sir. That's it.

Thank you for giving me a follow-up. Sunil, one question was, as Abhijit has taken over as CEO, on a day-to-day basis, have you taken a backseat, or are you operationally involved daily even now?

I can't hear you. I think you're too close to the mic.

I think this is coming a little ruffled, yeah.

Sorry, is this better, Sunil? Hello, am I audible?

In fact what I'm really going to do is basically, in fact, take a further front seat. I don't think I'm going to take a backseat.

That's not correct. Like I said, we had to get certain professionals to kind of address certain areas which are very important.

Of course, there will be a slow process of succession that is going to happen, but in terms of our involvement as the promoters, we are very much involved in this business and it continues to be our Yeah, strategic changes that we're implementing.

Okay. Sunil, the RERA reports which you mentioned for the six metros, over the next three years, what is the volume or the number of houses which will be delivered as per these reports in these six metros that are your key target market?

Do you have any number there, the premium houses which are your target audience?

Yes, we have and it is very, very interesting for you to note that the spurt is actually going to start coming from now, and in 2027 and 2028 it's going to peak. From our collection of data, we will have close to 1 lakh 9,000 homes coming into play above the value of ₹1.5 crores in 2026.

That's going to almost 1.5 lakhs in 2027 and 1 lakh 60 63,000 in 2028. That's what's the kind of number.

Home delivery.

Home deliveries, yeah. Home deliveries coming for fit-out.

This is something which we have calibrated. This is where it is, for example in 2025, it was less than 60,000.

Technically the home deliveries that are going to come to the market is almost doubling and it's going to start in 2026 and peak up to 2028. That's the data we have collected.

Very helpful. Last question, Sunil, was, when we define premium, let's say a house which is more than ₹1.5 crores, I'm guessing the household income of that family would be probably annually about ₹30 lakhs or maybe 40 lakh, 30 lakhs maybe.

Is that really our customer segment? My understanding was we would be catering to a sort of a higher segment than the ₹1.5 crore sort of house value.

You can say that our Sofas & More starts catering to that. Actually, when you further break down, ₹1.5 to 5 crores is in the residential business, they call that as a premium, value premium.

₹5 to 10 crores is where they call it as premium, and above ₹10 crores is what is considered luxury. The split currently is almost even.

What is really selling is more of premium. Of course, Bombay is a different consideration.

Bombay is really 2x. Don't consider Bombay.

When you look at the six metros, the way the premium and luxury demand is continuing to grow, in fact that's the fastest growing segment. If you look into what is happening on either a JLL report or Anarock report or even RERA report.

Very clear. Sunil, can I just ask one more question?

Sorry.

Yes, please.

Okay. Sunil, you mentioned to one of the questions in response that Bangalore cohort of stores which started in 2017 are going through a certain sort of reshift in a way.

Now, my thought is typically retail outlets which once established go on for about 15, 20 years in the same location. This is a seven-year journey for the stores you mentioned.

Why is that happening so fast? Because typically what I see is retail, especially large retail formats typically stay in the same area for anywhere between at least 12 to 20 years.

I will explain this in a very simple and clear manner so that you can understand. The geographies in our cities are very different.

For example, if you look at Delhi, there are very clearly two or three furniture markets that have emerged. There you can continue to do business for decades because they're established as furniture markets.

Whereas cities like Bangalore there is no restriction of any ocean or anything and it has been growing all over. The old stores, the catchment is completed.

There is the new catchment coming up, so that is having a micro market effect. Those are very rapid changes happening in certain cities like Bangalore, Hyderabad, where Mumbai and Delhi is [well-protected?]

, fine, because you already have markets that are established. I think it's a bit challenging for organised retail players.

We have to keep our ears to the ground, we have to understand where the shifts are happening. We tend to follow RERA to understand where the next big inventory for full homes are going to come.

I think this will continue I would say, for some more time to come because in a fast growing cities like Bangalore, Hyderabad, even Pune, you have a lot of new micro markets coming. We have to be a bit cautious and unfortunately, like I said, there is no clear established marketplace or a high street for furniture or a marketplace for furniture.

This is the kind of situation we face. I think we are definitely getting a little more matured in terms of identifying and putting up our larger store formats going forward.

Hope I've answered you.

Thank you everyone for joining us today. We remain confident that the strategic investments we are making today will lay a strong foundation for sustainable long-term growth.

While this reflects calibrated investment and transition, we believe we are approaching an inflection point where operating leverage, localisation benefits, and store maturity will more meaningfully reflect in margins. We sincerely appreciate your continued support and engagement.

For the future queries, please reach out to our investor relations partner at Factor. Thank you once again and we look forward to speaking with you on our next quarter results.