JSW Dulux Limited (JSWDULUX) Q1 2027 Earnings Call Transcript

Ladies and gentlemen, good day and welcome to JSW Dulux Ltd. Q1-FI27 Earnings Conference Hall.

The conference is now being recorded.

At this moment, all participant minds are in listen-only mode. Later, we will conduct a question and answer session. At that time, you may click on the Q&A tab to ask a live question. Please note that this conference is being recorded. And now, in the conference, over to Mr. Anitghar Joshi from ICICI Securities. Thank you, and over to you, sir.

Yeah, thank you. On behalf of ICICI Securities, we welcome you all to Q1FI27 Results Webinar of JSW Duelups Limited. We have with us today Senior Management, represented by Mr. Rajiv Rajgopal, Joint Managing Director and CEO, Mr. Krishna Rallapalli, Full-Time Director and CFO, and Mr. Rajiv Jha, General Counsel, Company Secretary and Compliance Officer. Now, I hand over the call to the management for initial comments on the quarterly performance and then we will open the floor for question and answer session. Thanks and over to you Rajiv sir, for ah reading out the ah the disclaimer. Thanks.

Sir, good afternoon.

Sir, sorry we are not able to hear you.

Ah Rajiv sir, please please go ahead.

Sir, Anirudh, are we audible?

Yes sir.

This media release contains statements which address such issues as the company's growth strategy, future financial results, market positions, product development, products in the pipeline, and product approvals. Such statements should be carefully considered, and it should be understood that many factors could cause forecasts and actual results or outcomes to differ from these statements. These factors include, but are not limited to, price fluctuations, currency fluctuations, developments in raw material and personal costs, pensions, physical and environmental risks, legal issues and legislative, fiscal and other regulatory measures and approvals, as well as significant market disruptions. Stated competitive positions are based on management estimates supported by information provided by specialized external agencies.

Good afternoon, everyone. You know, delighted to be back on a call with all of you on the quarterly earnings for the first quarter of the fiscal. As all of you have seen, our Commentary. We've had a pretty strong quarter, but just so that, you know, I am able to clearly explain, we have to look at the quarter from a like-to-like perspective, because when you look at the first quarter, the quarter also had certain remnants of the business which has got, you know, taken off or carved out as a part of the ExoNobel India. Deal with the JSW Group. So, the JSW Dulux, like-to-like, houses now all the brands and businesses which are now a part of this journey, right? What's got carved out is the powder coating business, the IRC business, and a few customers, which Nobel has retained as a part of its unlisted entity. So, with that, I just want to quickly run you through first the financials at a high level. We've loaded the entire presentation on the stock exchange, and most of you would have by now gone through it, so I'm not going to spend a lot of time, but just for being, you know, very clear, I just want to sort of inform you first the numbers so that we then can move quickly. And Krishna, our Krishna, our CFO is here, I am here, and Rajiv is here. We can quickly run through how the quarter has gone by and give you more time for Q&A. So the revenue, revenue we grew, we hit 965 crores in the quarter. The like-to-like last year was 812, which is an 18.8% growth blended between... Creative Plus Industrial. The gross margin was 360.8 crores against last year 353.6, which is a 2%. EBITDA, we delivered 115.1 against 100.4 last year, which is a 14.7% growth. And the PACT was 135.5 against 67.2, right? And the fact we, as mentioned in our press release, have two one-offs, which we want to clearly highlight. One is an interest on IKD fund of about 21.5 crore and a dividend income from ICI RMT, which is for the property sale of assets which were under that entity of about 5.9 crore. So that's really the commentary at a high level. So, really, if I were to look at the quarter, what I would like to start with is we had a volume growth of 25%. I think the quick question will be, yes, you know, when you look at volume price mix and, you know, we've got various, you know, industries calling it underlying volume growth, etc., UBG, right? Right. Now, we've delivered a volume growth of close to about 25%. And if you were to just adjust for the key, we would still have a volume growth of close to about 18%. So really, 18 to 19%, right? So the pretty strong growth, if you just take out, you know, some of those, which is again, a very high growth, in our view, close, almost close to 20%. Right? So really, 20% growth giving you 18.8. Very good. There's very little I can complain. So, first, before running through the other metrics, I need to talk about really complementing the team. Our decorative business grew pretty high double digit. Our industrial business all grew upwards of 25%. So, really, it's been a fantastic performance and my kudos to the team. One is to also keep in mind that in this quarter, between April and May and June, many of the employees, we shut our Delhi headquarters and moved the headquarters to JSW Center in Mumbai. So it involves the transition of a team. And as I told one of the channels in the morning, it almost felt like you are having to rewire the house without switching off the mains. To me, I really want to compliment the team for being able to achieve one of the highest growths, right? Because I don't, you know, the COVID was a base effect. So if I take that off, this is one of the highest growth I've ever seen since I took over as MD in 2018 at the Nobel area. So really, fantastic growth under tough circumstances, right? Obviously, a lot of shifts happening, massive change for employees speaks volumes of the way the teams have been conducting themselves, right? So that's one. And also a huge kudos to Mr. Pat Jindal, our chairman, for welcoming us into the family and making sure that we feel at home, right? It was also an headline of our VT campaign a couple of years ago, right? So really, I think those are the two pivots in which helped us to accelerate faster. Of course, there are brand pivots, there are distribution pivots, and there are strategic pivots, which we've done. Now, quickly to then get into the granularity of the gross margin. The gross margin, if you look at, was at 37.4, largely impacted for two reasons. One, that we had lower inventory, particularly in our decorative business. So our blended inventory was about 95 odd days against the industry, which has been about 110 to 120 days, right? And within that, decorative was, you know, was just at about 60 days. And so in the decorative business, we've seen a hit in our margins, which is the reason why it came in, because we have to immediately buy high price stocks almost end of March. And that's sort of, and we see some improvements right now as we enter August. On that, because obviously the high price stocks, you know, those stocks have got exhausted and we are now obviously at much lower rates than that rate there. We had some benefits in industrial for the same reason, because we had close to about 100 day plus inventory cover, right? And so one has to keep in mind that the gross margin had an impact of approximately about two points because of the crude challenges. The other is a painter, a reclass, which we've done on promotional spend, which we moved to Grosstunet in line with the industry. And this is something that we wanted to also proactively do so that we are not speaking the same language, right? Maybe we've taken a little more of a cautious view here, but suffice to say that also was the reason. And that's another two and a half points. Really, if you look at it, the underlying gross margin and maybe Krishna will also walk through it. It was closer to about 39.5 to 30, 40 percent, which is really then changes the picture of the results. The second is the EBITDA margin of 11.9. So obviously there is a flow through from the gross margin to EBITDA. Remember that we've decided to reinvest in the growth. I mean, to start growing faster than the market, it was imperative for us to start adding people, particularly two areas. One, R&D, because, as you know, I am a strong believer that innovation and brand differentiation is very important, particularly in a hyper-competitive environment. Second, we've decided to add people in many parts of India. I'll just give you an example that when our chairman visited Hyderabad recently, he was a little astounded to know that he had only two area managers and about six, seven people until a few years ago. And with his approval in, you know, end of March, we decided to hire people. We've added approximately about 100 people. And so obviously that cost, the salary plus our travel cost is going to see an imperative. But I call this a correction, because what we are doing is we are laying the strong foundation. And we are not planning to add this every year. You know, we will obviously add incremental thereafter. And hence, we see the EBITDA margins coming back to the band that I used to talk about. But given the crude prices, I've said that the EBITDA margin would be in the range of 13 to 15%. You know, that's the sort of margin I think we should be able to hit for the reasons that I mentioned. Right. So with this, let me just quickly hand over to Krishna. Krishna will give you, secondly, Thanks, Raju.

I think Raju clearly summarizes the overall situation. Thank you very much. So, this is the last question that we have been talking about, but we have been talking about the cost of the price increase in line with industry and then there is also a cost prudence measures which was applied. We confined our effects to the growth initiatives and we ended the quarter with around the 14.7 percent growth in the absolute EBITDA on a like to like basis And, of course, because of the. The Ebitda percentage has diluted by around. And we have also notified about the two exceptional items, one-off items, one is the dividend income, which we received from the ICI R&D, which is a wholly owned subsidiary, 59.9 crores that has been posted as the other income, and which is resultant of the real estate monetization transaction, which we have completed last quarter. The second is that as we are moving towards bringing the efficiency, optimizing the cash, our rigor towards pursuing the old income tax litigation. Resulted in a 108 course of refund of pertaining to the assessment year 2013-14, which includes a interest income of 21.5. So, these are the summary of the key financial metrics and what happened during the last quarter. And with this, Anirudh, I would hand it over back to moderator for the question and answer.

Thank you very much. We will all begin the question Thank you. Anyone who wishes to ask a question may please click on the Q&A tab on the panel below and click on the raise hand button. The operator will announce your name when it's your turn to ask the question. Please accept the prompt on your screen and mute your microphone while proceeding with your question. My click on the reason I click. Ladies and gentlemen, to ask the question, you may click on the Q&A tab, and click on the raise hand button to ask your question. First question is from the line of Pratik Gauthier from HSBC. Please go ahead.

Hello. Am I audible? Yes, sir. Yes. Thank you for taking my question. This is Pratik Gauthier from HSBC. My first question is, can you elaborate on some of the changes that you've brought on on the ground in terms of meta-execution, especially on the deco business? You talked about that, but any other distribution or any other changes? I think good question.

What we've done is we are looking at a very micro-market strategy now. What we are doing is we are going to first look at markets where we've got a significant higher market share in the states like Bengal, Gujarat, parts of Punjab, Delhi, etc. Then where we've got, you know, about, and these are places that you've got market shares of above, you know, weighted average of four and a half, you know, about almost eight to 10% sort of market shares. Then we've taken the second, which is between around the weighted average, right, where there are bulk of states. And third is absolutely the states where our shares are very low, very low signal digits. Now, what we've done is we've broken that into saying two parts. One, how can we start having the right portfolio for the right market? And within that, we made sure that we, during the quarter, put in, particularly into the states where there has been, for us, a huge decline in certain undercoat categories, products like Promise Soon 1, Primer, etc., which has seen fantastic growth. Also, what we've done is on the top end, we redoubled our efforts on Velvet Touch and Weather Sheet to try and make sure that we grow. Now, what we've done is we are present in more than 5,000 towns, but our meaningful presence is roughly about 3,400, 3,500 towns, you know, which we call active presence, right? So, what we are doing is we are first taking that to about 4,500 this year, and again, we are focusing on towns with population greater than 20,000, And then we are trying to redouble our efforts to say that, look, at least in the large cities, metros, et cetera, how do we really pull back if there was a share loss or how do we really build our share? The focus is really driving the three categories first. Premium. Second, adjacencies, which is led by waterproofing and wood care. Third, obviously, the red market. Now, where we've had good success in the quarter, to answer your question, has been in premium and in the adjacency. In mid, I think we've still got some miles to go in terms of growth. What we've also done is we've been on, to be specific in some of the town's engagement with the painter and also started our architect interior designer program. Some of the other players could have been doing it, but we really sharpened it and we've gone digital. So what we are trying to do as we move forward is use a lot of analytics and use a lot of AI to help us to be able to sharpshoot, given the fact that, you know, we cannot afford as a number four player to have wastage. Hopefully, I've answered your question. And one last piece is we are also looking at where the distributor model works because all of you know that distributor model, one of the reasons we went into it was because we never got approvals to open many depots, etc. That's changed. So one of the things that we are looking at is we are looking at high share markets, high potential markets, where our ability to win is going to be very high because of the residual strength of the Dulux brand. And there, in about the top 20 times, we will start moving to a direct-stroke hybrid model and obviously continue on the distributor model wherever that's yielded us great dividends all these years. So that, in a substance, is what we are trying to do. Thank you for the detailed response.

A follow-up to that is you mentioning that the growth in the mid-premium segment was still below the premium growth, the premium portfolio and efficiency growth.

Not premium. The premium and luxury grew high double digits, right? Almost close to the blended growth that we've done with volume value. The mass market and the economy segments grew for us a little lower than, yeah, it grew in the early double digits.

Right, right. So, towards that, so mix was sort of improving year on year in this quarter. In spite of that, we haven't seen much of a margin impact. I understand you mentioned the, sorry.

Yeah, I, I, explanation for that. Go ahead.

Yeah. So you mentioned the margin impact from consumption of high cost inventories and higher promotional spend. Anything else that explains the volume value gap, so to speak?

So. Two, as I told you, one was the inventory, second was that the painter went gross to debt, which was almost about 2.5% on the blended revenue. And the third is obviously the business mix, because while premium grew in decorative and automotive grew, but in some of our other business like industrial coatings, etc., actually, we grew significantly faster than some of the other places. So, obviously, if you're growing at 20 in one and you're growing at 30 in another, you know, the mix still tends to. So that's sort of a positive challenge we had. Krishna, you want to add something?

If you ask your question, moderator, then we can take the next question.

Prathip, do you have any follow-up questions? Thank you. Participants, you may click on the raise-up icon to ask your question.

Next follow up. Next question is from the line of Anisdha Joshi from ICICI Securities. Please go ahead.

Yeah, sir, just two questions from my side. So, now the company is going to be a bit more in investment mode to gain the market share. So, is there any target that you would like to indicate? I guess the earlier target was we want to be in top three paint companies with Dulux as well as the paint both businesses put together. So, how do you see any timelines for that, any inorganic acquisition plans to be in top three? If you can elaborate a bit more on that, that is question number one. And then secondly, if you can elaborate a bit more on the painter program, how is the painter program working out, what can be the potential benefits in terms of additional revenues, and how it will help to reach to more consumers, what will be the investments, etc., anything that you can share. Yeah, thank you.

So, Anil, now, first question, what exactly would you want me to cover? Because the second one is very clear.

No, sir, I guess our target earlier was to be in top three.

Okay, okay, okay, okay, strategy, okay. So, look, I think. Our strategy, you know, I think obviously given, and you're talking of both JSW Paints plus JSW Dulux, we currently are close to, if you add the two, are close to almost about 6,000 crores, right? So obviously that gives us a pivot, and I'm talking of both decorative plus industrial. So, you know, when you look at that, obviously the pivot has to be to something which is far more ambitious, and that's where the craft is. How can we be a number two player? I know there are a lot of players gunning for the number two position, but suffice to say that, look, we will do that and do it in a very prudent, efficient, and a value-equipped way as we move forward. How are we going to do this? Obviously, in decorative, we still see that, look, we would end up being in industry. Our challenge is, we believe that, look, in industrial, we've got a sweet spot, primarily because of the brand strength of what JSW Dulux will bring in on the international side of the business and some other propositions that we are going to bring alive. So we believe on the industrial side, we should now start gearing ourselves to moving to top tier, along with JSW Pains industrial. I think we want to be, hence, positioning ourselves over a period of, you know, a couple of years, a year and a half to a number one position, right? So our vision, of course, is a 2030-2031 vision. So it's not like we have to do this, but you're right, we have to start getting those sort of growths now, and unless we are able to do that, we will not be able to release that. So that's something industrial side. Decorative look, I think the market is still very competitive, and our endeavor is to continuously start outperforming. In decorative, the mission is very clear that we want to now start gaining market share, because at the size at which we are in, if we only focus in terms of playing in, you know, select pools, then you will not be able to add it. But while doing it, make sure that we are delivering absolutely well done. So one of the things that we've said as an organization is that we will continuously focus on driving market share gains and to deliver absolute EBITDA. So that Anirudh is the plan and that's where we are working ourselves towards. Hopefully, I've answered your question. The second one is in terms of your painter program. Look, what we've done in painter is we've obviously moved the whole thing digital. You know, I talked about it in a smaller manner last time. I think we use what's called a customer life cycle management, which is used by Charycom companies, and I talked about it also once earlier, where we break our painters into high, medium, low usage. What we try and do is ask painters, and then we try and give offers to try and move people up. Why do we do it? Because otherwise, there's a lot of wastage in the other offers that are going into the market. And so, that's where we are trying to smartly do things to try and make sure we gain. Hopefully, with this, I've answered your question. Anirudh.

Yes, sir. This is very helpful. Many thanks.

Thank you.

Thank you. Participants, you may click on the raise on icon to ask the question. Next follow-up question is from Zaino Pratik Gauthi from HSBC. Please go ahead.

Pratik, may I request and meet your line and proceed with your question?

Yes. Am I audible now?

Yes, go ahead.

Yeah, Pratik. Yeah, yeah. Thanks again. Sir, your comments on the cooperative dynamics in the deco business. Can you also elaborate on that, please?

Yeah, well, all I'm saying is it will continue to be very competitive for the next one, two years. So, you're seeing the arrival of new entrants, there's nothing that happened, right? I still believe that there is going to be competitive intensity. Maybe pricing may have, in a certain manner, looks stabilized, but there is a lot of discounting that the new entrants are still sort of pursuing as a strategy. So hence for us, building our brand, making sure that we are driving, you know, continuous Sell out is the only way that we'll be able to sustain ourselves in the long term. So really, that's the area of focus, Prateek. Hopefully, I've answered your question.

Yes, it does help. On discounting, if I look at Agso's annual report, even your rebates to gross revenues ratio has gone up to about 25%. So how should one lead into that? Your rebates have also probably increased. Have your discounting strategy also tried to match the incumbents or to try and match the new entrants? Any comment on that?

No, we don't match. So there are two parts of it. So whenever the project business grows, the projects obviously has a higher because of the rates, not discount, but because you have to give rates to the customers, that has an impact. And remember, we are also large in the, we don't give segment results, so we're looking at it blended. We've also got large industrial business. People have asked for prizes to be able to manage their projects over a period of time. So that's one second. Remember that when you look at our discount, it also includes distributor commission, right? So that's a big difference versus the industry. So when you negate or take out close to 4.5, 4.7% of that, yeah, that's distributor margins, then it's not, you'll see that we are pretty underwhelming in terms of what we do in terms of the dealer commissions. And that's also a known fact when you go to the markets. You see, we're not looking at benchmarking on pricing versus the new competitors. We benchmark ourselves on pricing versus the market leader because we believe that... It's really, you know, that's pretty disciplined.

Thanks a lot. Yes, thanks a lot, sir. That is.

Thank you. Participants make click on the raise on icon to ask the question. Next question is from the line of Abhishek Mathur from Systematics. Please go ahead.

Hi, sir. Thank you for the opportunity and hope I am audible. Sir, in your opening remarks, you said that the price hikes that we have taken have been in line with the industry. But despite that, our decorative specifically seems to be far ahead of the number one and number two players. I'm guessing decorative would be probably the low teams in terms of volume growth. Just wanted to check what is driving this outperformance? Is it the expansion into newer towns that you talked about earlier or is it probably the higher absolute niche contribution of the mid market or the mass economy categories? Specifically, what is driving outperformance in terms of decorative volume growth?

Yeah, so decorative, I was very clear that our largest contributor, 45%, comes from premium. So if premium doesn't grow in the 20%, you cannot do a 25% volume growth. So very clearly driven by decorative premium, right? So I want to be very, very categorical. Yeah, categories like adjacencies have grown even faster, but it's premium that led the growth, and that was a bit of a, you know, a good news for us. Yeah, so that's one. Two, as far as, you know, the industrial business grew, industrial also the businesses grew in the 20s. So it's not that decorative was in, you know, mid double digits or early double digits or any of that stuff. Decorative, it's 60% of the business. Unless you grow 20% in decorative and volume, you can't get a 25% volume growth. So, it's led by decorative and it's not done by the undercoats of Patti or something this time.

Got it, sir. The value

per outlet is largely, the growth has come from value per outlet, right? So it's an increase in value per outlet from existing town, existing outlets have largely contributed, and it's been fairly secular across the types of outlets. So it's not that large outlets have contributed. We've seen that growth coming in. We used to have a problem about two years ago with the new entrant coming in in our solar dealers, but that's something that the team has managed to fix well over the last year. Hopefully answered your question.

Yeah, just a quick follow-up, sir. I appreciate the answer, but, you know, we have seen that probably Asian Pains and Berger have reported 8 to 9% sort of volume growth in decorative. Any comments from you as to how, what could be driving our relative outperformance in decorative?

Look, I think there are two, three things. I think one, you know, I think... Look, you're talking of fairly strong brands and players. I don't want to talk. I think what we've done is we redoubled our effort starting from last year, same time, maybe August last year, once the acquisition was announced to the group, even before the formal acquisition started, in putting our strategies to say, how do we really start growing in, growing faster than market? Because that is a very clear goal or task given by the chairman to me, right, even before the acquisition saying that, look, it's free acquired, you know, he made me really understand how JSW Group operates. And that was very helpful because it gave me a context on how to start building the organization for tomorrow. So really, it's very difficult for me to say, you know, it's one or two things that have done it, or we've put a, you know, you know, some, some pick. We've been working on this pretty assiduously, and that's how we sort of developed it. It's come. There has been obviously good work on distribution expansion on decorative, but also it's come across. The good news is it came almost quite secular across the country, as I said, except the mass market, where obviously the growth has been a little underwhelming because obviously the other players have done better. Other than that, we sort of looked at it. We've also done a lot of work on digital. So we've improved our lead management system. It's all completely digitized. We've worked on the AID and contractor program, which we've also talked about. We are using a lot more data to be able to make decisions. In our, you know, we've grown, the focus on distribution, as I told you, was how do you move from about 3,500 meaningful, while availability may be there in 5,000 towns, how do you really start making that availability count, which means how do you really make your presence in a town, and that's where we've really redoubled on our strategy to say that, look, focus on where you're very strong, and then start really growing it up. So that's all the creative business on automotive. It's absolutely stunning growth by premium with a lot of marquee brands coming in for us into our portfolio. We've been large players in terms of usage with companies like Mahindra, etc. As you may know, we also signed up with Porsche. We've got, of course, MG now being a part of the group. And, you know, JSW, MG will not just take us because we are a part of the group, but unless you're a better paint, it's very difficult. And with the credibility of seconds, we've been able to get into, you know, some of the body shops very quickly. And we are working with a few other players that we've sort of just sort of begun to work on, right? There's a lot of work happening on automotive and specialty. We are also working on, you know, our industrial and coatings and marine and protective, where we are really looking at saying what can, you know, there are a set of products that we've been working on for the last, you know, seven, eight years. Are there some new things that we need to add on? Because the world is changing, the environment is changing, are there new propositions that we need to bring in? And there are some work that we've started, but some of that you would appreciate. I would not be able to talk on a call because of confidentiality, but that's what we really try to do.

Yeah, great, sir. Appreciate it. And just lastly, do you see these strong growth trends continuing into July and August as well?

Well, July is a short season because of the rainfall, even if India rainfall started a bit late, so yeah, it hasn't been as strong, but yeah, I do expect that the quarter would be in a similar band. I mean, it's very difficult today to sit and predict what the quarter will look like. But yeah, as I started, even before this quarter, for which I'm giving the call today, I said that, look, I endeavours to get to double-digit growth, both in volume and value, and I definitely maintain, right? So, finally, for us, you've got to remember, the adage of the group is W is better every day. So, that's something that I have to live up to. Hopefully that answers your question.

Yeah, it does, sir. Great. Thank you for the detailed answers and all the best. Thanks.

Thank you. Thank you. Participants, you may click on the raise an icon to ask the question. Ladies and gentlemen, you may click on the QNET app on the panel and click on the reason icon to ask a question. Participants, you may click on the raise on icon to answer the question. A reminder to all the participants, you may click on the Tune It tab on the panel and click on the Raise Hand button to ask your question. As I know for the questions, I would now like to hand the conference over to the management for closing comments.

Okay, cool. I'm glad that the note today was clear. Thank you all for your incredible support. But before I close, I want to talk about, you know, how the integration is proceeding between, I thought I'd get out. The question between JSW Deluxe and JSW Paints. We've started a program called Project Akshaya, right? And what we are doing is obviously to look at unlocking surges, and I will give you the outline and alas, Krishna, comment in terms of the impact of the last quarter. So what are we doing? Basically, what we are doing is to look at areas where we can reduce duplication, look at cost efficiencies, and move forward. So, some of the areas that we've started work on is cross-manufacturing. So, today we make JSW paints in our Golia factory, and we make JSW deluxe in our end-up. We have a plant of JSW Paints to start with, right? And I'm giving you one example, but actually we started in a much higher engagement. We also, for example, manufacturing some of the products for JSW Paints in Mohali, etc. So just to give you an idea. Second, supply chain. We are going to redesign our end-to-end supply chain to maximize efficiency and get a faster response to market. Third, ERP and systems integration. So a lot of work is happening at our end. Obviously, the ERP migration will happen by end of the year. That's planned because obviously it's a very laborious process. We want to make sure that we are not just doing it, but doing it well and making sure that we are not just building a system for today and tomorrow, but building. As a chairman, we wanted a system that could last for us to meet the vision that we've outlined. The fourth, alignment of functional structures. What we are going to do is we've already started integrating the functions, and other than the CEOs, And the CFOs and the marketing teams and the retail team, we've started integrating. So our projects team, for example, is we've got a unified project business. And the idea of that was to create a unified business model that enhances customer value and also offers the entire plethora of products and services to the customer. So that's broadly what we've started with. Krishna, can you just quickly outline how this is going in the last quarter?

I think Rajiv summarized this quite well. The entire genesis of the project structure is that we have alluded that we wanted to become number two player, number three player in decorative and number one in industrial clothing and it also requires a good amount. Re-channelization of the resources and the funding which is required. How do we do a self-help program, which will bring the efficiencies to fund the growth initiatives? And then we also have a context is that we also have a entire digital ecosystem was based on the. As well, the parent organization, which is Axe Noble. Now, we have a limited period of TSA. We need to move out of that systems, and we need to create a system which is agile enough to capture the growth initiatives with a robust control framework. So, in this context, we started evaluating every single opportunity on a first principle basis, which has resulted in terms of funneling it down to the initiatives, which was mentioned by Rajiv. Thank you. Thank you. Core of the application of any of these initiatives is how do we ensure the 100% governance, and we are taking help of a few before in terms of the framework. It has to be robust enough to ensure that there are no... What we have in the chat room is the first priority in the chat room. How do we bring the synergies and what will happen is that when the synergies are there, we fund the growth initiatives. This is a three layered approach which we are taking. We started yielding results despite of the extremely volatile situation in the Q1, and And the savings of around 2.4 course was realized, which was part of the first initiatives part of the P&L which was presented to you. With this Rajiv, I think this is the part of the journey, and we also said that very clearly It's a rear roadmap which is very clear, which requires Yeah, which requires a sustained and a consistent strategic approach towards delivering and disciplined execution. Yeah.

Thank you, Krishna. Thank you for setting this up. I think there are a couple of people who are reaching me on WhatsApp because they've not been able to join the call. We take that back. We'll make sure that we get back to our normal call next time. I really look forward to be able to connect with all of you. I wish all of you a fantastic Independence Day ahead and wish all of you, you know, all the happy festive that we do before we enter our, you know, Ganesh Sathurthi and Norvala festive, before sort of we meet the next time. Suffice to say the following. I think we continue. Of course, it's not an easy one. I've been at the helm since 2018, and I understand. But I must once again say this, that look, I think this is a journey that we are committed to. And as a team, I think the larger team now is very clear in terms of direction where we get it to. So you can count on us. And I want to thank each and every investor on the call for all the support that you have given us over the years. Good luck. Goodbye. I wish you all the very best. Thank you.

Thank you very much. On behalf of ICICI Securities Limited, that concludes this conference. Thank you for joining us and you may now disconnect your lines. Thank you.