Thank you. Good afternoon, everyone, and thank you for joining us on Vaibhav Global Limited earnings conference call for Q1 FY27.

We have with us Mr. Sunil Agrawal, Managing Director, Mr.

Nitin Panwad, Group CFO, and Mr. Vivek Jain, Head of Investor Relations.

We will begin the call with an opening remark by Mr. Sunil Agrawal on the business operations, key initiatives, and broad outlook, followed by discussion on the financial performance by Mr.

Nitin sir. After which, the management will open the forum for the Q&A session.

Before we get started, I would like to point out that some statements made or discussed on today's call may be forward-looking in nature and must be viewed in conjunction with the risks and uncertainties that we face. A detailed statement and explanation of this risk is included in the earnings presentation, which has been uploaded and shared with you all earlier.

The company does not undertake to update this forward-looking statement publicly. I would now like to invite Mr.

Sunil Agrawal sir to make his opening remarks. Over to you, sir.

Thank you, Natasha. Good afternoon, everyone, and thank you for joining VGL's Q1 FY27 earnings conference call.

I trust you have a chance to review our results and the investor presentation. We have commenced FY27 on a healthy note, building on the momentum of FY26.

For the June quarter, we reported consolidated revenue of ₹917 crores, a growth of 12.7% YoY. EBITDA came in at ₹102 crores, up 37% year-on-year, with EBITDA margin at 11%, a strong improvement from 9.2% in Q1 FY26.

Profit after tax grew 50% year-on-year to ₹56 crores. Reported growth benefited from favorable foreign exchange and US tariff refund during the quarter.

On a constant currency basis, revenue was broadly flat, largely due to Middle East conflict-related disruptions early in the quarter, and a cautious consumer spending environment across our key markets. These are near-term factors and do not change the long-term growth potential of our business or our progress against strategic priorities.

Let me briefly touch upon the macro backdrop. In the US, consumer confidence stayed weak through the quarter, with households prioritizing essentials over discretionary categories in face of increased fuel costs.

Against this backdrop, our US business delivered a steady performance, a resilient outcome relative to the wider caution across the discretionary retail sectors, and one that flags a continued strength of our value-oriented omnichannel proposition. In the UK, the overall operating environment remained challenging during the quarter, with consumers staying cautious on discretionary spending.

While the core TV business was subdued, our proprietary brand, Rachel Galley, and Ideal World continued to perform strongly and helped offset the broader softness. Overall, UK performance remained flat, but the momentum in these two brands remain encouraging and gives us confidence in the medium-term recovery of the market.

In Germany, consumer sentiment showed early signs of stabilization on the back of improving income expectations. Our Germany business also delivered good growth of 6% in local currency, with improving margins during the quarter.

As you recall, Germany achieved EBITDA breakeven for the full year FY26, and I am pleased to confirm that the business is now on track to contribute positively to group profitability from FY27, consistent with the trajectory we had guided to. Coming to our strategic priorities, our in-house brands now contribute around 57% of B2C sales, sustaining the milestone we crossed during FY26 and continuing to support our margins and sourcing efficiencies.

Digital sales accounted for 45% of B2C revenue during the quarter, and we remain on track to reach our 50% digital mix target by the end of FY27. Lab-grown diamonds continued their strong momentum at around 13% of retail revenue, broadening our price architecture and meeting a clear shift in consumer preference.

Our growth continues to be guided by our 4R priorities, that is reach, new customer registration, retention, and repeat purchases. During the quarter, our TV networks reached around 127 million households globally, consistent with recent quarters.

Unique customers stood at 6.77 lakhs and retention at 38%. I would like to share a bit context here.

The moderation in customer count and retention reflects our deliberate shift towards higher value, higher lifetime value customers, primarily with scale-up of our lab-grown diamond portfolio, which has a higher ASP of around $250. Average pieces per customer on a trailing 12-month basis remained healthy at 23, and customer economics have improved meaningfully.

During the quarter, we have successfully migrated all our key e-commerce platforms from Salesforce to Shopify enterprise e-com platform. This is a significant structural step and marks an important milestone in our journey towards becoming a truly digital-native organization.

With this migration, we now operate on a unified, cloud-based, and highly scalable technology backbone across all our brands and geographies. This gives us several important advantages: faster deployment of new features across markets, a single unified view of customers across TV and digital channels, seamless integration with modern marketing technology, analytics, and AI tools, improved site performance and conversions, and lower long-term platform costs.

It also positions us to launch and scale new brands, categories, and geographies with far greater speed and efficiency. On AI initiatives, we have implemented many important AI tools encompassing product sketching, content generation, personalized marketing, and demand forecasting, etc.

This transformation is helping us fundamentally reengineer how we operate, evolving from traditional TV-led retailer with digital add-ons into an integrated, digital-first, AI-led, omnichannel retailer. We believe this shift will be a key structural driver of both growth and operating leverage over the coming years.

Sustainability and community remain at the core of our business. Our ICRA ESG rating stood at 74, marked as strong, in line with FY26.

Under our flagship Your Purchase Feeds program, we have now served over 115 million meals to school-going children since inception, currently providing around 58,000 meals every school day. We remain committed to our long-term goal of 1 million meals per school day by FY40.

On capital allocation, the board has recommended a first interim dividend of ₹1.5 per equity share. On the outlook front, we reiterate our FY27 guidance of 9% to 11% revenue growth with EBITDA margin expansion of 50 to 100 basis points over FY26.

Looking further ahead, we remain confident in our journey towards achieving 12% to 15% growth in mid to long term, as we continue to scale our digital platforms across geographies, brands, and channels. With that, I will hand over the call to Nitin to take you through the financial performance in greater detail.

Over to you, Nitin.

Thank you, Sunil. Good afternoon, everyone, and thank you for joining us today.

I will now take you through the key financial and operational highlights for the first quarter of FY27. We have started the year on a strong note, delivering another quarter of profitable growth.

Revenue from operations stood at ₹917 crores, a growth of 12.7% year-over-year, despite a relatively soft consumer spending environment across some of our key international markets. EBITDA increased 37% year-over-year to ₹102 crores, and EBITDA margin expanded to 11%, up from 9.2% in Q1 FY26.

Profit after tax grew 50% year-over-year to ₹56 crores, with PAT margin improving to 6%. The improvement in profitability reflects the continued benefit in our strategic initiatives around product mix, operating efficiencies, and cost discipline.

In local currency terms, our Q1 FY27 growth was 4% in US, flat in UK, and 6% in Germany. Overall B2C growth is 2% in US dollar terms, and excluding the impact of tariff refund, it is largely flat.

In the US, our vertically integrated model and diversified sourcing helped us to expand margins despite ongoing tariff-related pressures and softer consumer demand. In UK, Ideal World continued its strong momentum with healthy double-digit growth.

Overall, UK performance remained flat, but momentum in Ideal World and Rachel Galley remained encouraging, and gives us confidence in medium-term recovery of the market. Germany continued a meaningful improvement in bottom line.

While EBITDA for the quarter was marginally below breakeven, the underlying trajectory remained on track. We remain confident that Germany will contribute meaningfully to our group profitability from FY27, in line with our earlier commitment.

Mindful Souls, our first digital acquisition brand, also continued its steady performance with strong gross margin and growing consumer base. On channel mix, digital revenue grew 21% year-over-year to ₹398 crores, while television revenue grew 9% to ₹484 crores.

Digital now contributes around 45% of our B2C revenue, and we remain firmly on track to cross 50% mark during FY27. This digital transition is important because it allows us to build a stronger customer relationship, improve customer acquisition economics, and generate better lifetime value through first-party customer data.

Lifestyle products contribute around 40% of B2C revenue this quarter, with a medium-term target of 50%. Our budget pay option, which allows consumer to pay purchase on EMI, remained popular and accounted for 36% of our total retail revenue.

Gross margin for the quarter was 67%, reflecting the strength of our vertically integrated business model and our in-house brand mix. On the cost side, we continued to see benefit from headcount rationalization, better logistic efficiencies, sharper airtime negotiation, and higher utilization of automation and AI tools across the organization.

Our digital marketing spend remained focused on acquiring higher quality of customers with better lifetime value, which is helping strengthen long-term customer economics. Net cash position stood at ₹287 crores as of 30th June 2026, giving us the flexibility to continue investing in growth while maintaining strong capital discipline.

Returns ratio remained healthy: ROCE at 24%, ROE at 18%. The board has declared a first interim dividend of ₹1.5 per equity share.

While we remain disciplined on cost, we continue to invest in the areas that create long-term shareholder value: scaling digital commerce across geographies, deepening own brand penetration, expanding lifestyle categories, growing our lab-grown diamond portfolio, embedding AI across customer acquisition, retention, merchandising, and strengthening customer engagement through our omnichannel platform. These investments are designed to improve customer lifetime value while simultaneously expanding margins over the medium term.

To conclude, we are pleased with our progress made during the first quarter. We have entered FY27 with a healthy business momentum, improving profitability, a robust balance sheet, and multiple growth drivers that position us well for the future.

Thank you. We can now open the floor for the Q&A session.

Thanks for the opportunity. Great set of numbers.

Congratulations to the team. My first question is regarding the guidance which we have shared, that FY30 vision, that is ₹5,000 to ₹5,500 crores, which looks very skeptical when I do a CAGR of roughly 10% revenue growth.

What sort of margins are we thinking when we are talking about FY30? Can you just clarify on that?

Thanks, Aditya. For mid to long-term guidance, the macroeconomic is very volatile.

Considering the shift from our TV to digital, we are confident that we continued our expansion in our digital platforms like Meta or social commerce or TikTok and other platforms. We have given a guidance to hit ₹5,000 crore mark.

In margin terms, it is continuously improving with the vertical integrated business model we have. Our target is to improve the margin higher than our revenue growth that we do, and that we have delivered in past two years as our digital share is expanding.

In terms of the margin, where it will drive from, mainly improvement in gross margin that you see in our current quarter as well. Gross margin will continue to improve, keeping in line our digital investment will continue to increase.

Overall EBITDA margin guidance will be in terms of improving trend.

It will be 15%

to 18%?

What will be the ballpark?

Specific number is difficult to guide, but it will be in improving trend.

Okay. Still, sir, 10% revenue growth, if you talk about 12% EBITDA or PAT growth, now we are making roughly this year we are making ₹4,000 crores, and in the next three to four years, three years, we are talking about this number, it's very difficult to think that, okay, we are just doing this much because we have made our investments in Germany, and we thought that, okay, the revenue growth and this should be higher when the environment improves if you are going to digital.

That's what it is. Second question.

Aditya, we agree, but the macroeconomic environment is very volatile as things keep on changing with how the world is moving towards different war, oil prices up and down. Considering all in our mind, we have kept our numbers like that.

Okay. Secondly, my question is, every year we are throwing lot of free cash flow, right?

We are returning as a dividend. Here I have two questions.

One is, why are we not doing a buyback, which is shareholder accretive? I've asked in the last call also.

I'm asking again, why are we not doing that? Secondly, when we are throwing this much cash, why are we not being a little aggressive, like starting a initiative we have experience now 50% of revenue comes through digital, right?

We have a good experience. We can pivot into a small team and start venturing how do we explore the India market?

Because here, a lot of new brands are trying to create a lot of value. I think there has to be some initiative from the board that we need to think about how we can grow 15% to 20% rather than 10%.

If geo-economical are not good, then we have to focus on India market, how we can create a brand, because right now with AI, website building is not a tough initiative to do in, and you have a lot of e-commerce channels where the delivery can be fast. I think we should be little aggressive in order to create a shareholder value in the long run.

If we are growing at 10% CAGR for 4 to 5 years, and there is no margin improvement, how shareholders will make money sitting in Vaibhav Global? These are two straight questions from my end.

Thank you, Aditya, for your questions. First in terms of free cash flow, we keep on generating our cash and distributing dividend almost for ₹100 crores every year.

Our internal assessment is that we need to create some cushion of $50 to $100 million with us for any opportunity comes with us for not only just acquisition, or any other thing to expand our business. That internal strategy we are keeping for not doing buyback right now until we have a $50 to $100 million kind of cushion with us.

Apart from that, the other question in terms of coming into India market, India is definitely a lucrative market, but the first opportunity for us is that we have last 20 years operating in Western economy, and that itself has a larger potential like US and the Germany market has to grow digital business much faster. The changes we are doing internally from shifting our live television to a digital-native business that recently transformed from Salesforce Commerce Cloud to Shopify platform, also one of the major step to expand our digital platform.

Margin improvement, we are giving the guidance to improving margin every year comparatively, but the growth in terms of we have considered keeping all the macroeconomic fundamentals how the other business and the economy is evolving. Right now board is not just throwing out the idea of coming into India, but right now our first focus is to expand our existing digital business, what we have in US, UK, and Germany.

I understood that we are expanding, but what I was saying that if management is very occupied in that, we can have a new leader in place and where he can explore that part, and it can create a pivot. Basically, once the idea mature, we can scale it up rather than if you're not spending it today, then after 5 years also we'll not be able to, then there is always delayed, right, if we're not thinking right away.

I would suggest that we put some thoughts into it. From a real shareholder perspective, I'm just sharing it for the future of Vaibhav Global.

That's all. It's up to you.

Noted, Aditya.

Thanks.

Good afternoon, everyone. Sir, can you break down the revenue growth between let's say how much we are benefiting due to currency or pricing and volume?

Hi, Yogesh. Our growth in largely driven by the currency in the current quarter, and part of it also driven the tariff refunds that we have received.

If we exclude that, our growth in terms of US dollar is largely flat.

Okay.

The volume has increased as we are seeing traction on the lower price point. Our average ticket size in US is reduced from $50 to $46, but the volume we are seeing a good traction.

Okay.

What are the key drivers for US business? I think we done ₹530 crores, but what are the drivers in future?

I rightly said that you've already mentioned in your opening remark US is now I think the consumer spending is changing slowly slowly. What is our expectations and how do we see what could be the good driver?

Because see, the cost of money and inflation is going to be very high in US in coming years also. Obviously we as a company we also acknowledging that part, but in future what is our strategy basically and what could be the growth drivers?

Yogesh, this is Sunil Agrawal. I'll answer that question.

The key growth drivers for us, number one is digital. We made investment over last two, three years into talent development towards digital to becoming digital-first.

We invested in technology, that is from Salesforce we went to Shopify enterprise platform for all our brands, and then we invested into AI tools across the business. That is to enable us to become digital-first across all our brands, not just US.

The digital will be the key driver of our business. There are two additional drivers.

One is the OTT, where the connected television and we have presence into pretty much all platforms, whether it's Roku TV, or Fire TV, Samsung TV, Apple TV. Where we have our apps on those OTT platforms, and we are having decent revenue growth and customer engagement on this platform.

The third, that is small right now, is the live streaming. The live programming is our strength.

Over last 20 years, we refined that. Right from storytelling to product identification to engaging content, with 24/7 live programming, that we have launched on TikTok, on YouTube, on Instagram in US, and then we're getting customer engagement with that.

This is small. It's still just about $2 million business for us, but we see that as a growth driver for future for us.

Now again just to summarize: number one, digital; number two, OTT; number three, live streaming on e-commerce social networks.

They're

all powered by AI.

Okay. What's your initial your observation, do you think what we are doing actually will showing a good results in future?

Most definitely. As you see, our digital contribution is increasing.

We're almost 45% of the B2C revenue as a digital. We expect it to reach 50% by the end of this year, and that'll continue to grow, and eventually we'll become predominantly digital in few years down the road because of investments and understanding of the business that we acquired over last few years.

I'm fairly confident.

Sir, our lab-grown diamond—

Just last question. Sir, our lab-grown diamonds contribution is increasing.

How do you see in next two, three years? Is there any big margin difference between the lab-grown diamonds and our normal business?

Thank you very much.

Yeah. Lab-grown currently is about 13% of our revenue.

I think it'll increase somewhat more because we're seeing good traction on digital properties for lab-grown. I do not know where it'll go, maybe it'll go to 14%, 15%, 16% in coming years.

The margin is slightly better on lab-grown than compared to the natural gemstone or gold jewelry or plain silver jewelry.

Okay. Thank you very much, sir, and all the best.

Thank you, Yogesh.

Thank you for the opportunity. In your medium-term guidance, if you are hoping to get to almost ₹5,500 crore of revenue over the next four years, can you just sort of throw some light on how much is your assumption on the currency side?

Currency, the past 20 years is roughly depreciating around 3%, and similar kind of depreciation we expecting in upcoming years. Okay.

Out of 12% sort of growth, if you're expecting, 3% is what you have factored in on account of currency, right?

Yeah.

Okay. The other thing is, in terms of our gross margins, what is the difference in gross margins when it comes to the digital side of the business and the traditional television side?

Gross margin on the native digital, pure e-com is higher than our TV business margin as it requires the higher spend on the social media marketing or the other paid mediums. Native digital gross margin is higher than our TV margins, yeah.

Okay. For the past couple of years, we've been at almost 20% in terms of our ad spends, and you've maintained that as our mix is shifting more towards digital, those spends will continue.

Do you see those spends getting capped somewhere, and at what point do you think that the benefits will start to accrue towards us, and the spends can be sort of much lesser in terms of growth versus what the digital revenue can grow?

How we internally look, we look that how much the spend spent to the paid media, and then how much ROI we are generating through that. As long as they are giving us a good margin, double digit our margin lines, we continue to invest on that.

Guiding may not be right that it will capped somewhere, but definitely all the spend whatever we are doing will result positively in our profitability there.

Typically, what is the ROAS that is your hurdle rate when it comes to digital spending?

ROAS is roughly around right now currently at 2, and we expecting to expand to over 3 in coming years.

Got it. Thank you.

That is for the new customer acquisition. Now, overall ROAS for the business is much higher, because we have our TV customers also coming in through digital platforms.

Overall ROAS is substantially more. When you look at pure digital—

Sorry?

When you look at the pure digitally acquired customer, Nitin's guidance is between 2 to 3 is for those pure digital customers. With our 67% margin at this 67% margin, at 2 they've become profitable for us.

Got it.

Got it. Thank you.

Thank you for the opportunity. First question is, can you just quantify the amount of refunds that we've received this quarter?

Hi, Pulkit. Our refund, we have received around ₹38 crores in the current quarter.

The part of it went to the inventory, as we keep on lying the earlier stock, and the part has gone to our P&L.

How much is part of the revenues, or where does it figure in the P&L? Can you help us understand?

It's a other operating revenue. It is ₹25 crores in other operating revenue, and ₹13 crore is in our inventory.

I should subtract 25. Okay.

That ₹25 crores will flow entirely to your gross profit and EBITDA and PBT?

Yes, right.

Because if I were to then remove that, then the financials, they suggest very less kind of growth in terms of profits. There's still,

Pulkit, there's still good decent leverage on that B2C revenue. Because last year, we had good foreign exchange gain.

This year, we didn't have the foreign exchange gain in other income.

Last year, we had around ₹8 crores of foreign exchange gain, which came to almost nil, mainly because of at the end of the quarter currency appreciated much faster, but then now become again depreciated. That the gain reduced.

The other income you're saying is kind of have been lower because of that.

Yes,

right. Yeah.

Okay. Secondly, we talk about consumer sentiment being lower in the US, but then, US Census is reporting data, there is at least 4% to 5% kind of retail sales growth across different categories on a YoY basis.

For us to be doing flat even in this environment just suggests something else. Can you help us understand, because now this is consecutively reflecting low constant currency growth and we are just putting it on macro.

How do we understand what the management is doing to pick this up?

Yeah. Let me take that.

US GDP growth is driven by two factors: one is the AI investments, a lot of capex investment into AI, and the second is the gasoline prices have gone up, gasoline and groceries. Larger consumer income is going into gas and groceries and leaving less amount for discretionary income.

When you look at the discretionary spend, they have gone lower for major retailers. When you look at the Target, or JCPenney, or Kohl's, they are not grocery-first retailers.

They're having the impact of their revenue. Walmart or Amazon, they have different space, a lot of AWS, a lot of other structurally advantage they have.

They're getting the most of the growth in the market. The major retailers are not getting much growth at all.

In that environment, we are completely discretionary, with jewelry or accessories. In that environment, we also seeing the lower price points fact having better traction, and we are seeing the lipstick effect into all these economies where lower price points getting better traction.

That to me reflects the consumer pull back from discretionary spend.

Understood. I would suggest that, because while you're talking about certain customers, the whole category-wise data in US, as is available on a monthly basis, and you'd realize that various discretionary categories are still growing out there, including clothing, etc.

We've also talked to some of those players. I think the best thing is just to look at macro data.

The reason I'm constantly mentioning this is because if we kind of look at that and be comfortable with the constant currency growth of flat, then how would we kind of try to outperform? Because in a way macro is what it is, but the TAM is also a lot bigger, right?

We are a very small player in this whole space. How do you get comfort that things are going to improve for you going ahead in terms of

constant currency? That's a fair point, Pulkit.

My comfort or my confidence is in our investments we made in digital over last two, three years. Primarily, we just moved on to Shopify.

We are still into the full integration. The initial hiccups are there for last couple of months, and once we go over those hiccups, we are fairly confident that our learning will get us to much higher momentum given that our vertical supply chain, our storytelling abilities, and our cost advantage.

I'm fairly confident. Sure,

just one last suggestion from a presentation standpoint. It would be great if the management can very transparently disclose some of these aspects which are impacting the quarter.

For instance, ₹25 crores is a big amount to flow through the P&L to not quantify. Secondly, constant currency growth rate for every country that we're operating in should be very transparently disclosed in the presentation.

I don't know why we have to constantly ask on the call for this. I think previously we used to have a lot more disclosures around some of these things, but I'm noticing that the call is more about asking for data points, whereas this should just be present in the presentation.

Hi, Pulkit. These disclosure are in the accounts, in the notes we have done a disclosure in accounts.

All the notes are there, but we'll discuss that what data points are missing, but the notes are there for tariff and other impact.

Pulkit, let me reiterate on that. From our point of view, we are highly transparent company.

We've never hidden any data from anybody. Could be that we may have to disclose some more to your comfort, we'll take that as an advice, but as a principle point of view, we've always been highly transparent in sharing the customer data points, the financial data points, more than pretty much any other company in our space.

Yeah. I'll just take it offline with the IR as well as to what can be added.

Sure.

Thank you.

Hi. Thanks for the opportunity.

Sir, if I were to remove the ₹25.5 crores of the refund, the EBITDA growth obviously is not as per our expectations, and obviously the margins also tend to just improve by about 40-odd bps. My second question around this is, when you're saying volume growth, but when I'm just looking at your presentation and trying to match the two, digital we have sort of grown by 20% overall, but when I just look at the volumes and the ASP, ASP has grown by 10%, but volumes are down, largely flat, maybe 0.7%.

The other question is, your presentation you also mentioned you have added about 3.5 lakh new users in the trailing 12 months on the digital business, and your repeats you're saying are at 23. Ideally, this number should have increased in terms of volumes, right?

My point is either two things are happening: your existing customers are not buying as much, they're not doing repeats, or the thing is you're adding new customers, but they aren't buying. Can you just help me sort of understand this point?

Hi, Shreyans, Nitin here. In terms of volume, our TV volume has a good jump from 1.3 million to 1.37 million compared to last quarter same time.

Digital, as we are moving towards more on lab-grown side, as the consumer traction and lifetime value of those customers high, ticket size from those digital medium is increased from $33.8 to $37. Resulted that we have grown in digital, but the volume is largely flat, 1.13 million to 1.13 million.

The 21% growth is the large part coming from the currency conversion around 11%, and the 10% is coming from our local currency growth US dollars, which is mainly because of the average ticket size is improved.

Sir, if lab-grown diamonds is 13% of your business and the ASP is about $200, $250, then the ASP increase should have been far higher than 3%, 4%, right?

Last year was also 11% lab-grown. 11% was this.

From 11% to 13%.

Okay. Just wanted some clarity on this lab-grown.

I'm trying to understand how are customers buying lab-grown diamonds. I'm just trying to understand our ASP historically used to be $25 to $45.

Now, for a customer who's shopping on our sites, she's used to these price points. Obviously, you also compete with a lot of jewelry retailers doing lab-grown diamonds, right?

I'm just trying to understand how does Vaibhav Global differentiate for a customer to come to VGL and buy these lab-grown diamonds? Do you have better SKUs, higher number of SKUs in that sense, better designs?

Because when I look at the US market, 60%, 70% of engagement rings are now lab-grown, right? Just on that part, there'll be a lot of players.

In that sense, to be able to increase your lab-grown by 200 bps, just some sense that and obviously, the customer is not used to paying $200 on your app or your website, right? What has led to this change?

Let me answer. This is Sunil Agrawal.

There are two aspects: one is the digital, and the other is the television. On digital, when we pitch to the customer through social media or Google, Google is a intent-based platform where the customer is already looking for, and our product appeals to them from price point, being vertical into jewelry manufacturing ourselves and our own retail in US.

Unlike most other players in US, there's a separation between the two. We are a better price than most other pretty much every other retailer.

Second advantage we have is once we acquire a customer on lab-grown, we are able to sell them other types of jewelry, that is the color stone jewelry, or plain metal jewelry, or even our other products, which other jewelers cannot. We can afford to pay a little bit higher to the customer acquisition than others can.

That's our advantage. On television side, it is selling lab-grown to customers who watch and who are loyal to us for many, many years.

They trust us. They engage with our host.

They have loyalty to our programming, to our talent, and they would trust us to buy lab-grown from us rather than from another player that is new to them. For TV, it's more to trust.

On e-com, it is our pricing that is competitive than others.

Got it. Sir, just last question.

You have written somewhere, I think page 15, that the take rates for marketplace on primary channels is 0%. How are we able to do that?

Can you help us understand that?

Okay. I got it.

Right now, it is hardly anything we do on marketplace. Pretty much all of the sales coming to our own proprietary websites and mobile apps.

It is minuscule number, less than 1/2%, which is why it is coming as zero. Got it.

Got it. Just last final question.

This ₹25.5 crores of tariff refund, ideally, when you would have paid this, which entity would have paid this, and what would have been the accounting treatment for this? I'm assuming India and rest of the world is the manufacturing base, right?

How does the Indian entity adds this tariff to its COGS and then sells it to VGL US, or can you just explain to us?

For Indian entity, this is not a prepaid duty. All the duty and tariff has been paid by our US entity.

US, we have also a sourcing unit and also our retail. Both units had paid last year that 50% tariff, and both units has received that refund in US only.

Got it.

Got it. Thank you, and all the best.

Hi. Sir, first question of mine would be the company has set a revenue target of ₹5,000 to ₹5,500 crores by FY30.

Given the current top-line growth of 9.2% in FY26, what specific organic and inorganic levers are prioritized to bridge this gap?

Aditya, your voice is a little bit breaking, couldn't hear your question well.

Yeah. Yes.

Hello?

Yeah. Am I audible now?

Yes.

Yeah. My first question is that the company has set a revenue target of ₹5,000 to ₹5,500 crores by FY30.

Given the current top-line growth of 9.2% in FY26, what specific organic and inorganic levers are prioritized to bridge this gap?

Our major lever, as Sunil mentioned earlier, is our digital growth. We have a multiple mediums, from our own websites to paid marketing to OTT to live TV from TikTok, whatnot, and other mediums.

These are our major levers we have. We have done our presence a very little in this platform.

Now with the new platform we have from Shopify, we can expand our presence much faster compared to early. That are the larger medium to fill the gap and achieve our guidance number.

Great. The second question is that Europe currently accounts for 12% of the B2C revenue mix and is noted as the fastest growing segment.

Are there specific European markets under evaluation for the next phase of expansion?

Our focus is to mainly to expand our existing digital markets, from paid media to different sales platform. Inorganic side, we are open to have any opportunity if it comes with a very good price, but our main focus right now is to expand our existing business.

Okay. The next question is that with the ₹296 crores in net cash and strong free cash flow, what are the strategic criteria for future M&A, particularly following the successful integration of Mindful Souls and Ideal World?

This is Sunil, Aditya. For us,

M&A,

any acquisition that we make in future should be complementary organization, not just for the EBITDA accretion, but also strategic fit for our business. If there's a fit and we can have synergistic benefits to the overall business, we will do the M&A.

Any M&A for us will wait till we have achieved double-digit EBITDA growth in all our markets. We want to make sure that we are robust in every market before we do that.

Okay. Great, great.

Another question is that as the Vaibhav Global launches 100 new products daily and 14,000 to 15,000 new jewelry designs annually, how do you manage the inventory risk and aged SKU profile associated with such high SKU churn?

Good question, Aditya. We have a multiple levers for exiting the tail inventory.

On our TV specific platform we do a one clearance in a quarter to exit the tail inventory. Apart from that clearance and the other section that we have on our website and the other mediums that we do, but the most important thing is that we have a rising auction model in our website where customer comes and bids and fight against each other to win that tail inventory.

That is kind of very engaging platform we have, and customer loves that program and bid against each other. That is not only exiting our tail inventory, but also increase customer lifetime value, repeat, and the omnichannel presence with us.

These are the medium to exiting our tail inventory.

Okay. My next question is that the company reports a 60% gross margin compared to 40% for typical importers.

As you scale towards FY30, is there further room to optimize the supply chain to expand this margin gap?

In the evolving world, actually there will be always opportunity to improve our margins, not only from supply chain, but also having a good storytelling and better designs of the product. There's always opportunity.

As we are expanding more on digital side, our target is to increase our gross margin even further. There is always opportunity.

Company keep on looking through multiple AI initiatives we have done internally, better sourcing models, product designs, what is working, going viral right now on our TikTok or other medium. That we keep on looking and improving not only just our storytelling, but also on sourcing capabilities as well.

Okay.

Okay. I have only one last question that how is generative AI being used specifically to scale ad creatives and SEO content to lower the customer acquisition cost for digital shoppers?

Very good question, Aditya. I believe most of the retailers are doing, but we are also using generative AI in all of our meta marketing that we do, from ad creation to landing pages optimization to images and customer reviews and trust builders.

Though all of the things, we have our internal tools, CRO Genius and the other. We keep on optimizing our different landing pages, images, meta marketing through that, and many other upcoming tools are also coming to get the best of these AI knowledge.

[unclear]

Hi. Can you hear me?

Sunil. I have been an investor in Vaibhav Global for 10 years.

For the first time in 10 years, I had to really struggle to kind of correlate revenue, gross margin, profitability by reading the presentation. I had to go back and read the notes of the accounts and then figure out that you have actually adjusted ₹25 crores to the gross margin and hence the spike in gross margin.

Like the previous participant was saying that it's not that you are trying to hide anything, but I think I was expecting a kind of default transparency, which was not there in this time. This is just an input.

Coming to your guidance, what Nitin is assuming that the rupee will depreciate at 3% over maybe a longer time. In the last 2 years, rupee has depreciated by 20%.

That essentially means the next 3 years the depreciation might be zero. What happens to the 10% guidance then, if assuming that rupee depreciation is zero for next 3 years, to that 10% guidance, will it come down to 7%?

Dilip ji, thank you for pointing it out. We take pride in our disclosures.

If we have erred inadvertently, we'll make sure that going forward disclosures are even further more forthcoming. Thanks for feedback.

Next question about the guidance, we believe that the long-term depreciation is around 3%. Even if there is not enough depreciation till FY30, we've given a wide range of ₹5,000 to ₹5,500 crore revenue with leverage.

That is a very comfortable range for us to achieve, and we are confident to achieve that number.

Sure. So, 10% is a given irrespective of rupee movements, that's what I take it from.

You have been, last couple of calls very confident about digital, the work that has gone into digital, and hence the confidence to grow at 10%. Can you kind of break it down into this 4Rs you talk about, which R is digital going to really impact the most starting from registration to retention to repeat and all?

Can you just take it through that bucket so that we understand where exactly the impact is going to come from? Because last 3 years, digital has helped us because the growth has been flat in our core markets, right?

What will change?

Good question. The key area it helps is the customer acquisition, the registration.

The TAM for digital is pretty large, much, much larger than television, that is a pure digital customer. The customer acquisition is going to be the number one leverage for us.

The retention and the repeat on digital is lower than television. Those two will take a hit when we accelerate our digital journey.

Therefore, we've been investing in digital for almost 10 years now, but we've shortened the period of a customer becoming profitable over the period of last two or three years. The current profitability of a customer comes around 10 months, 9 to 10 months.

Our aim is to take it to 3 months. If you take to 3 months, then we can scale the spend quite rapidly and get the customer acquisition coming in.

Now, that will impact our retention and repeat, but the velocity of acquisition will offset the impact on retention and repeat for us because you're looking at 3 months profitability.

The first two Rs will get impacted, you are saying. How do we monitor that as a investor?

Dilip, was that clear?

Yeah. That I understood that.

Hello? Can you hear me?

Can you hear me?

Operator, line is still on.

Yeah. Sunil— Sunil.

Natasha? Hello?

Hello?

I can hear.

Natasha, are you there?

Yes, Natasha.

I'm on the line. I can hear Sunil quite clearly.

Yeah. Sunil, I think somewhere you are explaining how the 4Rs getting impacted through digital investments, right?

I explain, I do not know where I dropped off in the middle. I was explaining that the customer registration, that the second R for the new customer acquisition will be the biggest impact, positive impact in the digital journey.

That will accelerate quite a bit, but the retention and repeat will go down because the digital customer's lifetime value is lower than a typical TV customer. Currently, our digital customer is profitable in about 9 to 10 months.

Our effort is to get its profitability within 3 months. If we can get to that level and steadily we improve over the time with the next few months or a couple of quarters, and once we do that, we can scale the spend and acquire a good number of new customers into different product streams.

Lab-grown is one, the gold is another one, the mobility product that is doing well for another one, the color gemstone jewelry is another one. They are all having promising stream.

Even $1 rising auction is a good stream that we are seeing good traction on. We are investing into different streams to acquire the customer profitably and improve the profitability period from current 9 to 10 months to 3 months.

Sure,

sure. Going forward, in the last 2 to 3 years at least, most of our growth has come either through acquisition or investment in new geography like Germany.

How is that going to look like in next 3 years? Say like we had Mindful Souls or Ideal World, this question is already been asked, but I'm just trying to figure out, one is, of course, the organic digital investment, which I think we are on track.

How is the other piece going to shape up in terms of inorganic business, either in terms of geography or acquisitions?

Good question. As I mentioned earlier also, we are creating cash pool for potential acquisition opportunities or potential greenfield opportunities as well.

We want to acquire the company when we acquire not for just EBITDA addition, but for strategic fit with the group, where we'll have leverage benefit also our supply chain, vertical supply chain that we have. If there'll be a leverage of cost benefit after acquiring, we will look at that position.

Or if there'll be a product category that we are not yet strong in, for example, beauty or supplement, and we want to get into that product category where we would have a leverage for our existing business. For example, for television business, we want a supply chain strength of a vertical retailer on say supplement or beauty, which can support our television channels, then we would look at.

There has to be synergy for our business when we acquire a new company. Or for greenfield, we may look at India or Japan as a future good potential.

We want to come there once we have the digital humming and continuously giving a good growth for digital itself and overall for the business, and for Germany to become PAT positive for us at a decent numbers. These are the two qualifying criteria for us before coming into new geography.

Great, great. That makes a lot of sense.

My question to Nitin is that this ₹25.5 crores, which you have shown as other operating income, doesn't have any COGS element attached to it, right? That means it flows completely to the gross margin.

That's how I understand it. Is it correct?

It flows completely to the gross margin and the bottom line. If we exclude the impact, as I mentioned in my commentary, the margin is 67% gross margin.

Sure. My suggestion is that since most of our business comes from outside in dollar or pound or euro terms, don't convert everything to rupee, because that takes away a lot of information.

We then use our imagination to backward calculate all the regional performances. I think it will be great if you can give a dollar US revenue, pound UK revenue, and a euro German revenue, and then maybe give a unified rupee revenue.

That's fine.

Noted, Dilip.

Yeah. Thank you so much.

Thank you, everybody, for your participation and great set of questions. If you have any further questions, please feel free to reach Vivek Jain at Vaibhav Global or [Sumed?]

of E&F, and they'll take care of your questions. Thank you very much.