Eveready Industries India Limited (531508) Earnings Call Transcript & Summary

Ladies and gentlemen, good day, and welcome to the Eveready Industries India Limited Q3 FY '25 Conference Call. [Operator Instructions]. Please note that this conference is being recorded. I now hand the conference over to Mr. Nishid Solanki from CDR India. Thank you, and over to you, sir.

Thank you. Good afternoon, everyone, and welcome to Eveready Industries India's Q3 FY '25 earnings conference call. Today, we are joined by senior members of the management team, including Mr. Suvamoy Saha, Managing Director; and Mr. Bibek Agarwala, Executive Director and Chief Financial Officer. Before we begin the call, let me first share our standard disclaimer. Some of the statements that may be made on today's conference call could be forward-looking in nature, and the actual results could vary from these forward-looking statements. A detailed statement in this regard is available in the press release document, which has been circulated to you and also uploaded on stock exchange website. I would now like to invite Mr. Saha to share his perspectives with you. Thank you, and over to you, sir.

Thank you, Nishid. Good day, everyone, and thank you for joining us for our Q3 earnings call. Let me begin by providing some macroeconomic context as it relates to our company. India continues to navigate a high inflation environment with challenges stemming from a depreciating rupee and elevated crude oil and commodity prices. That said, improved agricultural prospects, strengthening rural demand and an anticipated higher consumption by the middle-income segment provide a cautiously optimistic outlook for our operations. I will now take you through our performance across segments and update you on the progress of key initiatives. But first, a few headlines on the brand, distribution and the business context. The Eveready brand has long been synonymous with leadership and innovation. As a consumer-focused company with a beloved brand, we have consistently invested in advertising and promotions. This quarter, our campaigns spanned electronic and print media alongside below-the-line activations. Our brand continues to stand-out and we are committed to sustained investments in A&P. We are continuously adapting to the evolving market by expanding our presence in modern trade, e-commerce and quick commerce, while maintaining a stronghold in general trade. As we have [Technical Difficulty] discussions, our top [Technical Difficulty] momentum is gradually picking up pace as anticipated. While we have experienced some expected cost increases in core raw materials, we have successfully maintained our gross margin within the targeted range. Our focus remains on safeguarding profitability by closely monitoring cost dynamics. Our thrust with the emerging alkaline segment of batteries continues to receive focused attention. We have finalized plans for a greenfield production facility for alkaline batteries with a capital outlay of INR 180 crores. This facility located in Jammu is expected to commence commercial production by the end of this calendar year. As the only facility in India dedicated to alkaline batteries, it will deliver operational efficiencies and support the gradual scale-up of our Ultima Pro and Ultima ranges. Additionally, we intend to expand this facility into a multi-product site for greater scale and cost advantages. In terms of recent highlights, I start with batteries. The battery segment has delivered robust growth, both in volume and value. Carbon zinc revenue grew by 7.6%, while alkaline batteries saw an impressive 90.8% growth, albeit against the low base in the previous year. Since our brand refresh, alkaline batteries have achieved significant momentum with Q3 volumes increasing 110% year-on-year. Our market share in this category has nearly doubled to 11% at the quarter's end, driven by strong product propositions, robust distribution and consistent marketing efforts. India's battery consumption remains below global benchmarks, and the rising penetration of alkaline batteries reinforces our confidence in growing this category further. Overall, we maintained a 53% market share in the total batteries market, spanning both carbon zinc and alkaline segments. Now on to flashlights. Flashlights have shown positive trends. On a 9-month FY '25 basis, the battery-operated segment saw a mid-single-digit volume decline compared to a 17% decline in FY '24. Rechargeables continued to gain traction, supported by new product introductions. Overall, flashlights revenues grew by 9.6% with rechargeables more than offsetting the decline in battery-operated models. Our new launches such as the Siren Torch and offerings tailored for [indiscernible] and farmers have emerged as key performers. Additionally, the recently introduced mosquito rackets are seeing substantial growth, simply helping us expand market reach and strengthen our brand's reputation for quality and value. Finally, lighting. The lighting segment posted marginal growth with improved volumes offset by continued market-wide price erosion. While this trend persists, the impact is gradually lessening. Our expanded product portfolio and growing presence in alternative channels such as modern trade, e-commerce and [ quick ] commerce are driving volume growth. We are also building our presence in professional luminaires, which though nascent, show promising potential. Our teams remain focused on expanding the electrical outlet channel, critical for showcasing premium products like consumer luminaire. Now I provide some highlights on the financial performance. Revenue for the quarter stood at INR 333.3 crores, up from INR 304.8 crores in the same period last year, thus a growth of 9.4%. This growth was driven by batteries and flashlights, while as mentioned, lighting faced pricing pressures. EBITDA margin improved by 18.7% over same quarter last year despite ForEx impacts and higher zinc costs. PAT grew by 56%. The YPD EBITDA and PAT margins stood at 12.1% and 6.9%, respectively, both improving over the previous year. A&P expenditures stood at 11% of revenue, reflecting our focus on consistent communication and market activation. On our outlook, we remain focused on sustaining growth momentum across key categories. For batteries, we anticipate continued robust growth in alkaline batteries supported by a reasonable carbon zinc performance. As for flashlights, rechargeables fueled by innovations in our product portfolio are gaining traction. We expect further growth as the BIS certification, which we talked about in our earlier calls, is now gazetted and is expected to strike at the very heart of all the unethical practices of the unorganized part of the market. On lighting, efforts are centered on growing retail and institutional segments while leveraging alternative channels. With a winning product portfolio, a diversified distribution network and a strategic focus on cost efficiencies, we are well positioned for growth in the second half of this year. Thank you for your attention. Bibek and I now invite your questions.

[Operator Instructions] We have the first question from the line of Bhargav from AMBIT Asset Management.

Congratulations on a good performance. Sir, my first question is on the rechargeable batteries. So we've seen a very strong growth in this segment. Would you want to highlight key drivers for this and also what's the update on BiS for rechargeable batteries?

Okay. I'll have to make a correction here. We are talking about rechargeable torches, not rechargeable batteries.

Sorry, torches, yes, flashlights, sorry.

The flashlight. So you know the flashlights has 2 segments. One is the battery-operated one, which is the normal dry cell battery and the other, which is the rechargeable part where you can charge the flashlight for a number of uses. So the rechargeable flashlights have come over the last 5 years and today occupy about 70% of the market. We are very strong in the battery-operated ones where we hold something like 70-odd percent of the market and we have been a somewhat late entrant to the rechargeable one. We have taken giant strides for the last 2 years. We have launched a slew of products and today we are about 30% of the market. The rest of the market is by and large unorganized with all kinds of unethical practices, which I did not go about in this call. The thing is BIS has now come out with a mandatory certification, which has been of course approved by the government, whereby all flashlight products would require mandatory certification, whether these are imported or they are manufactured within the country. We believe that this will weed out bulk of the unorganized and so-called unethical segment and that should turn more towards the organized part of the industry, which frankly speaking is basically us. I mean, there being some other small players here and there, but all as sort of fringe interest, we remain a strong incumbent player in the space. So that is why we believe that there are 2 strong growth potentials. The certification requirement has just been gazetted. So after a period of 6 months when the players are allowed to sell out their products, you know which they have already sort of got in their inventory, then they have to follow all the norms mandated by the government.

Okay. So therefore, you said that maybe in the second half, rechargeable flashlights should actually see a strong growth. Is that correct?

We see possibility of an immediate uptick on this.

Okay. Secondly, sir, your market share in alkaline batteries has now doubled to almost 11%. So what led to such a market share swing? Is it that we are entering into some price wars with the marketleader? And secondly, once the Jammu factory gets commissioned, what could be the savings in terms of your manufacturing cost for both Pro and Ultima range of alkaline batteries?

You know, again, we have been a strong incumbent player in the carbon zinc segment. We have something like 60% of the market share in that segment. And we were again a little hesitant to enter the alkaline segment, which was sort of emerging over time. But 2 years back, we took a decision that we would now also become a significant player there. So we started our journey with the launch of our sub-brands of Ultima Pro and Ultima in this alkaline segment. And so almost from a 0 market share, we have now come up to 11%. It is not a big factor of being sort of price competitive. It is a matter of focus because we have a very large distribution network and we have invested in the brand. So it is basically fundamental marketing and distribution job, which has caught us to this 11% market share and we believe that the market should offer us the potential of overall market-share of [ 15% ] in due course of time. I mean it is not going to happen overnight, but in due course of time. But towards that, we have taken this somewhat bold step of implementing executing the implementation of a factory to sort of bolster our growth aspirations and that is where we are.

And sir, this factory being in Jammu, you enjoy some tax benefits as well, right?

So you also asked the question on the impact on costs and the tax impacts, et cetera. I request Bibek to take on this.

So, of course, let's 2-part divide without any fiscal benefit from the state. So even natural progression also, if we see that cost optimized savings against the import, definitely, there will be a very substantial cost optimization in the domestic manufacturing because you avoid the import duty, you sweat your existing resources. So that will give a very substantial and alkaline is in the price as you know that the price point is at INR 22 and where the margins are very thin. So of course, it will add value to that margin. And we expect 8% to 10% margin improvement is possible on alkaline part of this operations through domestic manufacturing. Further, for the tax benefits, as you know, that the Jammu has a lot of fiscal benefits they are providing. We have also applied but we have yet to get this grant of registrations and certifications. In the due course, it may come, but we have already applied for that at this point of time.

And what will be the EBITDA margin in the alkaline batteries business today?

See, today, this is one of the segment product of the entire battery range. So we can talk about better on our gross margin or the net margin because today, if you invest more on advertisement of these products, right, because competition might have spanned over a period of time, and we are just late entrant in this category. And we all know globally that alkaline is going to be the new force while keeping a focus on our zinc carbon. So I can tell you that the gross margins are very thin because now in the market, 80% market is that which is a very normal alkaline battery and the premium segment is around 20%. So margins are much lower than the zinc carbon, and that is why we think that the moment the domestic manufacturing come up, that will give some hedge to that margin. And of course, we'll get a fiscal, if anything, from the government, it will be added to that particular operating margin of the alkaline product.

And lastly, sir, what is the plan for the debt repayment?

So we are very much on the course of debt repayment. If you see last year, INR 80-odd crores, we have paid the debt. This year also, by this time, we have almost paid around INR 35 crores, INR 40 crores debt. And in fact, we have funded the Jammu land purchase from that money. So we are in the course of the similar kind of, if you see like-to-like, we'll be ending the year at the like-to-like of debt payment like last year, we paid around INR 85 crores. So maybe year-end, we are targeting around, right now, we are around INR 245 crores debt. And year-end, we look for around maybe INR 230 crores to [ INR 225 crores ] type of debt number we are looking for on a like-to-like basis because now as you know that we have to pay for machineries and all. So project I'm keeping aside because, of course, as Suvamoy mentioned, this is a INR 180 crore project. On that INR 20 crores, of course, the land we have already paid. So for a lot of payment will be gone, but I'm think on a like-to-like basis, you could see that the borrowing stands at INR 225 crores. But the project cost will be addition to that.

The next question is from the line of Vedant Sekhri from Artha India Ventures.

First of all, congratulations for the results. I just had a question on the Jammu plant as well. What would be the annual revenues that we can expect? I know you mentioned the INR 180 crore CapEx. So if you could just give a revenue estimate for that as well on an annual basis? And is this totally financed through the debt that you had undertaken? Or is there any other financing that would be required for this as well?

So of course, some part will be going internally, I have already mentioned that like land, we have internally paid money. So maybe it's a 75-25 type of financing, 25% will be internal things and 75% probably will take from the banks and other financial institutions. So that is the point you are looking for. And the revenue will be, so today, [indiscernible] as you I said, is a primary alkaline plant, but there will be some other things to enjoy the better revenues from that plant. Easily to start with at least a minimum INR 100 crore revenue, and it could go to up to INR 400 crores scale up in that demo plant.

Sorry, I think your voice was breaking this second. Could you please repeat it?

I'm saying that first year, we may start with INR 100 crores revenue from that plant on an annualized basis and which could go up to the INR 400 crores.

I see. Okay. And my next question was on the battery-operated flashlight segment. You said that there was a degrowth in that segment, but the degrowth had come down. What would be the guidance going forward in the future on this? Are we looking to expand the rechargeable segment faster and sort of slowly phase this out?

As I mentioned earlier, the current split of these 2 segments is 70% to 30%. The battery-operated one has now come down to a 30% of the overall flashlight market. And we expect this degrowth to continue, but at, I would say, a gradually slower rate because there are some incumbent users who are not going to shift to rechargeable. However, rechargeable is the one which will continue to see growth. And so we are sort of putting a lot of focus and emphasis on bulking up on this segment. As I said, we are already about, say, 70% of the battery-operated market.

I see. And sir, my next question was just on some unit economics. I know you had mentioned in the last call that the blended consumer price of a carbon zinc battery was around INR 10 to INR 12, and the alkaline battery was around INR 22, so a blended price of about INR 15 to INR 16. Have these numbers changed? Or will these change going forward in the future when the Jammu plant comes in as well?

No. So you are talking of the consumer price. The Jammu factory is going to give us benefits on the cost. As far as the market is concerned, the pricing structure is like this. There is a popular battery, which is more rural oriented. That sells at INR 14. There is a premium offering of carbon zinc, which sells in the more city like markets, which is at INR 18. You have correctly mentioned the value alkaline, the popular alkaline sells at INR 22 and then there is a premium alkaline selling at INR 50. So this is the east condition today. The Jammu plant is not going to change this market per se. The Jammu plant is going to add margin to our P&L. But marketing-wise, whether we change the pricing structure from INR 14 to whatever, INR 18 to INR 20, INR 22 to INR 25, that is something that we need to take a call going forward.

I see. And just another question on the demand volume. So I know you mentioned on the last call that there's a 50-50 split between retail and OEMs. And within OEMs, there was a prominent usage in electronic voting machines. Is there any other particular segment that has come up as a prominent user of the carbon zinc batteries?

No. So OEM as in EVM is sort of kind of a spiky kind of volume. I mean it takes place only when elections are there. But there is a very steady throughput of OEMs, which is blood pressure monitor machines and a host of medical equipment and stuff like that and many other electrical tools like electronic tooth brush, shavers, these are all ongoing. I mean EVMs when the elections take place. So those times, the volumes take a spike. But that is as and when. But of course, in India, elections take place every year. So that's good news for battery manufacturers.

Understood, sir. Just 2 final questions. One is on the advertising expenditure.

I'll just take one more minute on this. That 50-50 split that you talked about applies only to alkaline. Carbon zinc is almost entirely B2C.

Understood, sir. Understood. Just last 2 questions. One would be on the advertising expenditure that you had mentioned, the promotional marketing. It was around 11%. Do we expect this to be consistent going forward as well? That is question number one. And 2, if you could just throw a bit more light on the electrical outlet division expansion. What are we exactly getting to in terms of numbers when we talk about revenues and margins for this particular division?

So I'll request Bibek to answer the A&P part. But as far as the electrical distribution is concerned, we today work with about 250-odd active distributors. Our aim is to make it at least double in the short run. That is something where we need to put in a lot of hard work because this doesn't happen just like that. It may appear simple that you go and appoint somebody and he starts taking your stuff and selling out to the market. But it's a little bit of hard part because it requires due diligence. It requires sort of verifying market credentials, et cetera, et cetera. So that is where the hard work and if you say the little bit of time in expanding that channel is taking place.

So with respect to A&P, while we are all looking forward to a 10% to 11%, but it does not mean that always it will be 10% to 11%. As the revenue scale up, maybe that we can restrict ourselves to 8% to 9% as well. But it is a matter of time. But at this point of time, I think quite some time, we have not advertised. And now since last 6 to 8 quarters, we are building on the TVCs and other digital media holding of the advertisement. So at this point of time, 10% is looking forward for the next couple of quarters at least. But once revenue become a sizable, then at that point of time, we will look for because at that point of time, we may restrict to absolute value rather than talking about the percentage.

Understood, sir. Just a final small question. On the alkaline segment, as you mentioned, you experienced very robust growth in market share for this quarter. Is there any guidance for next quarter and for end of FY '25, what we could expect for the market share for alkaline segment?

By end of this financial year?

Yes. So quarter end and the financial year.

11%. I would imagine to remain somewhere around this level in the next 2 to 3 months. But we would keep on this journey, whereby our next step would be to go to a 20% kind of level. And as I said, the aspiration, realistic or otherwise is to go to the 53% that we hold in the overall market.

The next question is from the line of Chirag from Keynote Capital. Ladies and gentlemen, the current participant seems to have dropped from the queue. We will proceed to the next question, which will be from the line of Arnav Sakhuja from AMBIT.

So I just wanted to understand a bit more on the alkaline battery segment. So I know that you said that, like you mentioned earlier in this call that it was our strong distributorship as well as the brand reputation that has helped us build our market share to the current level of 11%. But over and above this, do we see a strong growth in the entire alkaline battery market in India itself?

So as Suvamoy mentioned, actually, if you see alkaline is really growing up, like we may be growing 2x rate. But as a segment, it is showing at least very strong double-digit growth. And we look forward this segment to grow up, while the zinc may remain flat on a very marginal volume growth, but this segment has a lot of potential to grow. And that is evident from our initiatives that we have taken to set up our plant in Jammu that alkaline plant.

So what are some of the growth drivers that are driving the growth of alkaline battery segment as compared to carbon zinc segment?

So this is very much accepted for the high-drain devices. Now as you see the penetration of high-drain devices are coming up, whether it's toys or the like PlayStations coming up, a lot of housing complexes are coming with automated digital doors. As you know that alkaline batteries are having 4 to 8x depending on the premiumness whether you are doing the value alkaline or you are doing premium alkaline, that would be much better for you. Like in a blood pressure machine, you don't want to change in every 3 to 6 months. But if you put the alkaline battery, it can go for a longer period of time. So basically, more and longer usage durations. And sometimes they are more adaptable to the high drain devices. So this penetration leads to the more usage of the alkaline batteries in India right now.

The next question is from the line of Chirag from Keynote Capital.

My apologies I joined the call a little late. Is it possible for you to give me revenue bifurcation between battery, flashlight and lighting?

Yes. So for the quarter 3, right?

Yes.

For the quarter 3, the revenue of the battery is around 65%; flashlight, 11%; and 23% for lighting.

And what were the EBITDA margins for all 3 segments?

Battery holding around at our 14% and flashlight 4% and lighting is almost flat.

Maybe you give the YTD also.

Yes. So let's take the YTD, which will give you a better proposition because sometimes you do spend A&Ps and all. So I'm giving that while the revenue saliency almost remained the same during the year, but at the operating margin level, battery is 16%, flashlight 10% and the lighting is flat, which brings to 12% our operating margin for the YTD.

So is it correct to say that because of the increase in mix of alkaline in our battery portfolio, this is one of the reasons for fall in GP margin on a Q-o-Q basis?

No. Of course, the alkaline battery has a pressure on the margin because of the price point. But if you see compared to last year, we have negative [Technical Difficulty] rather we have grown on the battery operating margin marginally from compared to last year, but you are right, it had some pressure on the margin, but because zinc played a very important role and the material plays a very important role. So we are favorable compared to last year YTD numbers in the consolidated battery operating margin.

Sir, in factually, I was just looking at the trend based on last year's trend where we were improving our gross margin from 42% from Q4 to almost 47% in Q2 FY '25. In Q3 only, we saw that 43.7% gross margin coming. So zinc prices were up for like 10 percentage in last 1 quarter, and it is actually normalizing back to the earlier level. So can I say that going forward in the next quarter or so, our gross margin will revert back to 45 percentage levels?

It depends on the mix also, right? So it certainly could improve, but always we don't consume the material on a real-time basis, right, because the battery has a manufacturing time lag, you need to have a battery age for certain period. So at least 2 to 3 months price lag will come in the manufacturing cost. So we look forward that depending on the battery mix prices, it may improve. But at this point of time, it is very difficult because what has happened, as I said that this is a 2 to 3 months lag period happens. But certainly, we'll try to keep closer to this number.

Fair enough, fair enough. Is it possible for you to give me a revenue breakup of battery between carbon zinc, premium alkaline and normal alkaline batteries?

So YTD basis, I'm just giving you the numbers for that. Like out of the segment, around [Technical Difficulty] carbon zinc and alkaline is around INR 41 crores, 15% of that is a premium battery, alkaline.

15% is premium of INR 41 crores, right?

Yes, yes.

Perfect. And as you said that currently, the gross margins in our alkaline batteries is around 20 percentage. And once we start our Jammu plant, it would rise by 10 percentage more. I'm still able to see that the gross margin of alkaline battery is far lesser than what we have in carbon zinc batteries. But overall, on an absolute basis, the gross profit what we will earn on alkaline and carbon zinc would be similar, right?

May not be because if you see my premium zinc come at INR 18 and alkaline comes at INR 22, so the math may not work in that way. If alkaline claims to be a 2x or 3x, the better performance. But if you see the price parity, it's 2x between the premium zinc and the alkaline batteries at this point of time.

Right. So the performance of battery improves as someone shifts from carbon zinc to alkaline and the replacement demand of these products would be slower than, if I'm not wrong, the slower than the carbon zinc batteries. Plus I'm able to see that the margins, what we will be earning on this particular project, 1x the asset turn. I'm trying to understand this point what is the reason for us to shift to a lower-margin business with 1x asset turn? Is it just because the market is trending on that side? Or it is our strategic decision that we have to focus more on alkaline...

So let me first tell you that our focus remains to remain extremely engaged with the carbon zinc segment. If I were to cannibalize carbon zinc by getting in alkaline, I'll be shooting myself in the foot. So there is no aspiration on the company side to sort of improve on alkaline and sort of dilute our carbon zinc saliency. The only reason we give alkaline, and we also have to naturally nurture that part of the market, which typically is the high-drain market, which is gradually emerging in India. India has primarily been on very low drain devices like clock and flashlight and remote control. Now we are seeing the emergence. And that is where alkaline needs to be put and needs to be used. And if we stay away from that market, then other players will come. And now presently, because India is a very price-sensitive market, there is this concept of value alkaline, which, frankly speaking, does not prevail at these prices anywhere else in the world. And we expect that this is going to improve over time. we would have some advantage being a manufacturer, whereas the others who are playing in the Indian market [Technical Difficulty]. So I think we should not be ignoring this segment, while we should also not be giving up any position on the carbon zinc side. Have I answered your question?

Yes, sir, it was quite clear to understand the reason for you to take steps as it is well required. Sir, my next question is related to the mix of revenue in flashlight. What is our revenue bifurcation towards battery-operated and rechargeable?

60% is battery operated and 40% is rechargeable.

Fair enough. And sir, I wanted one update that keeps coming in our quarterly filings that there was a CCI penalty on us for INR 170 crores out of which 10% is for which we have already. Any update on the same that how legal matters are going in which way?

So this was there on hearing supposed to be on 28th, 29th of January, which has now been deferred to the 5th of May. So basically, not much movement has taken place on this case. We would, of course, robustly defend our position. Since the start of this case, maybe some 4 or 5 years back, there has hardly been any hearing. The case lies with NCLAT. And as Bibek has mentioned, the next hearing is only in May.

Right. Sir, last question from my end. It's about the peak debt levels, which we can expect in the coming year as I'm pretty sure because of the plant expansion, there will be debt increase on our books. So currently, as you said that it is around INR 225 crores, INR 225 crores, INR 230 crores, what can it be at peak levels?

Maximum, I think maybe another INR 100-odd crores because if you take some, we'll also pay back some. So as we have got INR 150-odd crores of debt we need for this plant. So maybe if I add that mathematically and INR 50-odd crores, I will repay as a part of mine. So maximum, I think around INR 325 crores to INR 330-odd crores would be the peak, and we'll try to [Technical Difficulty] within that limit. [Technical Difficulty] any other CapEx come.

The next question is from the line of Vipul Shah from RW Equity.

Sir, in the recent budget, the Honorable Finance Minister has rationalized or I would say, removed the import duty on zinc. So is that something which will be of direct benefit to us in our COGS in the future?

The duty removal on the zinc [ ash ], scrap zinc [ ash ], not on the virgin zinc material.

Okay. So there is no impact on us of this fiscal move, which the minister has made.

This is for the zinc [ ash ], not for the virgin core, which material we used in.

All right. Secondly, sir, it's just how should one read into this reappointment of Mr. Saha, which is now proposed and which is going to be there for 6 months from, I believe, March till September.

Yes. So what would you like to know about this? This is a factual statement that you've made.

No, no. So I said how should one, as an investor, sir, I think the company is in very capable hands. So just from that perspective, is there something which one should read into it? Or it's just a normal resolution, which will, again, at that point of time, be revised.

Understood. Let me respond. So roughly, given the extension, we have 8 months. The objectives for me are 2-pronged primary objectives. One is to see our succession plan installed and executed by the time I leave this position. Number 2 is we would focus on consolidating on the gains that have started accruing to the company. We have gone through somewhat of a difficult journey over the last 2 years. And for all the hard work, the gains have only started coming to us now. Again, it is very easy to filter away the gains. It will be my endeavor with the team to make sure that these gains are sort of consolidated and held on.

Got it. So in that respect, sir, is a formal announcement or something in the offing for the succession plan to be in place, sir?

So in due course of time, I mean, we are still talking of 8 months. So obviously, there would have to be an announcement at some stage and then the execution of that plan. It will happen in due course.

All right, sir. It's been such a pleasure hearing you on calls every time, sir. So that is the whole purpose. We believe the company was in or rather is in very capable hands.

I take that as a huge compliment.

The next question is from the line of Mehul Savla from RW Equity.

Yes. Actually, it's a half question, maybe half suggestion is that, I mean, our battery business is obviously the core and we are doing a lot on the alkaline side. Just wondering, while as investors, we love to get every tiny bit of information, but is it very okay to share the entire breakup of our batteries business between the zinc carbon and alkaline and within alkaline, the mix because I'm sure competition has their ears [ glued ] on to see what we are doing.

So I think probably you have missed. I was just [Technical Difficulty] one gentleman has already asked a similar point. So as you know that just I'm giving in a value term, around INR 615 crores is our [indiscernible] batteries, YTD basis YTD December and INR 41 crores is an alkaline business. And out of that 15%...

Yes, I can hear you, sir. My only suggestion was that whether we should be giving out this level of detail on calls which are publicly available to even competition from a business point of view.

Okay. Point noted, well noted. And so I understand. So you are just saying that segment-wise revenue number is better than if we publish.

Yes. I mean, yes, the color on the mix is good enough, I think probably sort of getting into very specific numbers specifically on the battery side, alkaline side.

The next question is from the line of Chirag from Keynote Capital.

Sir, I just wanted to know what will be the sustainable gross margins going ahead?

Can you please repeat the question? There was some noise in between.

Yes. What will be the sustainable gross margin going ahead?

Sustainable gross margin. Sustainable gross margin for any specific business you are asking or the company as a whole?

Company as a whole.

I think we should look for 40% will be our aspiration to be there in 39% to 40%, but it all depends on what. So as you know, as of now, we have achieved 38% plus. So if you ask me, aspiration will be towards the 40%, but it's a highly commodity-driven business. aspiration level, I say the 40%, but we are around 38% plus at this point of time.

If I'm not wrong, you are currently at 40% to 43%, right?

So material margin from the report you are saying there is a gross margin.

So in that, if you ask me, we are 45% actually. 45% is a pretty good gross margin level we are looking for because as I said that material mix keep changing time to time. Now zinc price has softened. So 45%, 1% plus and minus would be the good enough. Fair enough. And sir, just one suggestion as one of the earlier participants also said that it's sensitive information related to batteries should not be published to such granular level. It's fair to say that it is the internal strategy of the company. But as we already discussed the broad segment revenues for quarterly basis for flashlight, lighting and battery, it would be great if you can start giving that in your press release itself because this is something that we track on a quarterly level.

So quite well noted, and it will be considered from the next quarter. Okay, thank you so much for the suggestions. It will be done.

As we have no further questions, ladies and gentlemen, I would now like to hand the conference over to the management for closing comments. Over to you, sir.

Thank you, everyone, for taking time out to join us on this earnings call today. I hope we have adequately answered all your questions. If you still have more queries, please reach out to our Investor Relations team, and we'll be only too happy to address those. Thank you once again, and look forward to connecting with you again in the next quarter.

Thank you. On behalf of Eveready Industries India Limited, that concludes this conference. Thank you for joining us. You may now disconnect your lines.