FSN E-Commerce Ventures Limited (NYKAA) Earnings Call Transcript & Summary

Good morning, and a very warm welcome to everyone. Thank you for being with us today and taking the time to be here. I'm Vishwani Uberoy, and it is my absolute pleasure to welcome you to Nykaa's Third Investor Annual Day. We're excited for this opportunity to connect with our community of investors and analysts. Present for today's event are the following members from Nykaa. Falguni Nayar, Executive Chairperson, Managing Director and CEO; and Anchit Nayar, Executive Director and CEO, Nykaa Beauty E-commerce; Adwaita Nayar, Executive Director, Co-Founder, Nykaa and CEO, Nykaa Fashion; Ganesh, Chief Finance Officer; Rajesh Uppalapati, Chief Technology Officer; Surender Mehta, our CHRO; Nihir Parikh, CEO, NykaaFashion.com and CEO, Nykaa Man; Preeti Gupta, Chief Business Officer, Nykd; Vishal Gupta, CEO, Nykaa Distribution; Rozita Norouzi, CEO, Nysaa; Suyash Saraf and Anisha Saraf, Founder and CEO of Dot & Key. We have other management team here as well. Today's session will broadly be conducted in 2 parts from 9:30 a.m. to about 12:30 to 1 p.m., our management team will take you through following various business verticals and focus areas. Post that, we'll open up the session for questions. Before we start, I'd like to point out that some of the statements we make today will be forward-looking and are based on certain expectations and anticipated developments. These forward-looking statements are subject to inherent risks and the company, therefore, cannot guarantee that they will be realized. With that, I now want to introduce our first speaker, Anchit Nayar, ED and CEO, Nykaa Beauty. Anchit has played a pivotal role in making Nykaa, India's leading omnichannel multi-brand retailer. He crafted Nykaa's multi-brand strategy of exclusive brand partnerships with the best global brands in beauty which is given Nykaa its sharp competitor edge. With that, over to you, please, Anchit.

Okay. Great. And a very, very good morning to everyone, and thank you for joining us on this Friday morning. Thank you. So I have the -- I guess, the privilege of being the first to present today. And as Rajesh, our CTO said, I'm kind of the opening batsman. And I think the cricket analogy is relevant given we're in the middle of the World Cup. So I think without further ado, I'll kick it off. Just to give you a sense of how this presentation will go today, it is going to be similar to how we actually like to -- how we like to do our retail business, which is -- this is going to be a very -- both an educational and an entertaining presentation. There will be a lot of content, which we will show you which will put you in the shoes of our customers and hopefully give you a sense of how is it that we truly communicate and build the kind of equity we have done over the years with our millions of loyal consumers across the country. Okay. Okay. Great. So -- sorry, give me a second, the mic is very low, can I pull it up a bit? Great. Okay. Thank you very much. So with that, we'll kick it off. Okay. Great. So we -- so I'll start with our first slide, which is to really convey the message to all of you who've been following Nykaa for the last few years since we went public that Nykaa is a lot more than just a beauty retail company. In fact, today, Nykaa is India's beauty category creator and market builder. And I'll speak a little bit about the different businesses which we currently have within the beauty space that shows you how we truly are -- almost we cover pretty much the entire addressable market as well as different business models to address the beauty needs of the country. So first, of course, is our Nykaa e-commerce business, which is our oldest business, it has been around since 2013. We are, today, India's largest online beauty and personal care -- online retailer with over 30% market share. And I think this number was recently even published in an HSBC report that was released a few days ago. Second, we have over 187 stores, which are company-owned and operated, which makes us also now the largest brick-and-mortar retailer for specialty beauty in India. Third, we have a business that's called Nykaa Global Store. Nykaa Global Store today is India's largest beauty brand, importing and distributing business. I think sometimes, this business has historically not been segregated out and maybe it's not spoken about enough. But in today's presentation, you'll see a lot more information about how we've built a very strong importing and distributing business that gives us a lot of leverage in terms of the kind of brands we're able to bring into the country and continues to create a very differentiated assortment on Nykaa in the India context. Fourth, of course, is our own brands, which many of you have learned about in the past from the various presentations we've done. We today have about 13 own brands within the beauty vertical itself. Three of these brands are now at an annual run rate revenue of over USD 20 million. And we have 5 other brands which are also growing very rapidly. Fifth, we come to our eB2B business, which is our superstore business. That business is currently distributing to over 2 lakh retailers across 1,000-plus cities. These are 2 lakh retailers who are actively engaged and transacting on the Superstore app. Sixth, we come to our ads business. As many of you know, we are a large advertising platform for a lot of brands in the country as a specialty beauty platform. It is a very relevant audience to whom to advertise for beauty brands. And as a result, they do see us as very core to their go-to-market and their digital marketing strategies in the country, and that has become quite a substantial business over time. Next, I come to content and media. We are also today one of the largest content creators for this category in India. And in the eyes of our consumers, we are an influencer of this category. We are somebody who our consumers watch to understand the trends that are emerging in the beauty industry, and they look to us to advise them. And this is a very strong part of our overall strategy as we look to drive education and awareness, which is the best way to drive future consumption of the category. So as you can see, there are many aspects to our business. And sometimes it gets all bunched into a definition of a retailer. But as you can see, we are much more than a retailer, not just to our brand partners, but also to our consumers. So to summarize the entire $30 billion BPC market online plus offline is totally addressable by us across our various business models. Second, we are handling end-to-end sourcing and distribution for global brands and domestic brands. Third, we are probably the only O+O model for this category at scale in India today. There are some retailers who are playing the offline game. There are some who are playing online. But at this scale in an O+O fashion, we don't have any real -- other retailer that comes to mind. Fourth, we are a specialized player with a very deep market understanding, almost 12 years of consumer data and understanding as a specialized player. This is all that we really do. And we know our consumer, and we know our category better than most. And finally, using our marketing initiatives through social media and influencers and other channels of platform, content strategies to really trend -- to set trends and set the market for the years to come. So just to take you back to a slide which we feel is very important as you think -- as you take a step back from quarterly numbers and performance and you think about really what is the opportunity that exists for Nykaa in India. I think this slide summarizes it best. Today, India is -- has some of the lowest BPC consumption in the world. As you can see, it's roughly about USD 15 per capita. And in 2013, when we first launched Nykaa, that was sitting at only USD 6. So through a lot of the initiatives that Nykaa has done by democratizing access to beauty for the Indian consumer, from our store rollouts, from our customer acquisition, from our education, we've managed to double the size of the per capita consumption of beauty in India. That being said, it is still the lowest -- one of the lowest levels of beauty consumption in the world. So this is what gets us most excited. This is what keeps us going, what we are most optimistic about is the potential for this number to grow dramatically from here. We believe that markets like Indonesia and Vietnam, which have similar GDP per capita, but much higher per capita spends on beauty is a level which we can reach in the near term. And our projection and our understanding, and I think its market consensus is that BPC spend in India on a per capita basis should reach about $50 by 2030. That being said, Nykaa's 25 million customers who are already transacting on our platforms, are already spending close to $80 plus per annum on the platform. So Nykaa's consumers are heavily engaged, they are, what we would say, as the most sophisticated consumers and also a lot of work has been done by Nykaa to get these consumers to this level of consumption. And this is a big part of our strategy is to get customers to continue to increase their purchasing habits and their purchasing behavior. And I think that reflects on the right-hand side, you can see what are the 4 main key levers that we have that are going to help us to expand the market. Finally, market expansion is our responsibility. We, as a dominant player as the beauty company -- as the largest beauty company in India have a responsibility to grow this market for our consumers and for our brand partners. And I think there are 4 main key levers, which will help us reach that $50 per capita consumption value over the next several years. First is we believe that there is an opportunity to continue to grow the category with. What does that mean? It means that currently, a majority of our revenue still comes from makeup and skin care as categories. But there are many other categories that are considered beauty and personal care categories where we have an ability to accelerate growth. These include categories such as fragrances, hair care, premium bath and body, appliances, wellness, et cetera. And by increasing the awareness, and therefore, the demand for these categories that in no way should lead to the cannibalization of our existing business in makeup and skin care. These are purely additive categories to the consumer's card. So by growing category with, we think we have the ability to increase the frequency of purchase as well as the average basket size of our consumers. Second is increasing the category depth. Category depth is something which we feel is something which we can achieve through a lot of education. And later in this deck, you'll see some of the initiatives we've taken around what we call the stepification of beauty. How do we get consumers to buy more subcategories from within the same category. So for example, in skin care, if consumers are predominantly buying only a cleanser, how do we also get them to buy a moisturizer and a sunscreen and a serum. So that's what we call increasing of category depth, and that should again help us to influence the frequency of purchase and the average basket size. Third is the premiumization initiatives that we are taking. In India today, if BPC is small, premium beauty is an even smaller share within that. So very under-indexed compared to global markets and a huge opportunity for a retail platform like ours. So what we mean by this is we have a very strong assortment of premium brands and we continue to onboard new brands in subsequent months. And I think premiumizing what our consumers are buying through CRM and through other initiatives on platform will allow us to increase the ASP as well as the average order values of our consumers. And premiumization is a natural trend that occurs in any market as consumers' affordability and disposable income levels increase and their discretionary spends rise, you will see a natural trend towards premiumization, especially in a category like Beauty, which is an aspirational one. All these events, experiences in retail. So leveraging our physical retail store is not only for transactions and for footfalls, but really using our stores is a great way to introduce customers into the world of beauty through events and experiences. We host many, what we call, smaller events in smaller towns like beauty bars and master classes and then large scale flagship events like Nykaaland, which I think some of you had a chance to visit. And this is a great way to continue to build awareness for this category in the country and should ultimately help with customer acquisition as well as the annual consumption value of our customers. So this goes to show you that we are taking a very comprehensive approach to growing the market. There are many levers we have to pull, and we have the ability to invest behind. And this is the big focus for us in the coming years. So just to reiterate a couple of key metrics for you. Today, Nykaa is India's largest omnichannel beauty company, not just retailer. And a couple of high-level statistics. First, we have reached over $1 billion of omnichannel revenue, and it's been about a 39% growth CAGR over the past 5 years. We have 187 stores across 68 cities, and we have now built and opened 44 warehouses across the country. And through the years, we have managed to service over 150 million orders across our online plus off-line channels. We always say that in a country like India technology is the greatest enabler and from inception, we have used technology to build an incredibly sophisticated and powerful app. We would like to say it's -- we believe it's world class, if not better. And I think it reflects in some of these metrics that shows you just how engaged we have managed to -- just how engaged our customers have managed to become due to this sophisticated and powerful app that we've built, we get over 1 billion visits to the app annually. 25 million customers have shopped till date and 3 billion impressions are served per month on the app. And each of our visitors will visit the app 50 times in a year, which is over 4x in a month. And as we know, the frequency of purchase is roughly 3.5x to 4x. So it goes to show you just how engaged our consumers are. They want to educate themselves. They want to learn more about the category. And they see Nykaa's app and its content features and all of its education that we do as a great way to keep themselves up to date and also learning more. So that as their affordability increases, as their requirements improve, you will start to see a lot of these visits turn into potential transactions. So this is a summary slide to tell you a little bit about how we look at where we were in 2021, FY '21, when, of course, we launched the IPO and we went public as a company, where we are today in FY '24 and our ambitions for FY '28. I think the key call out for everybody here is that quality growth is the priority for us for the years to come. So to give you a sense, the BPC vertical at Nykaa was roughly INR 33.5 billion in terms of GMV in FY '21 year-end. Today, as you all know, in FY '24, we disclosed that the number has more than doubled to INR 83.4 billion. And the ambition is to grow the GMV in mid- to late 20s over the next several years, which should be in line, if not faster, than industry growth despite already being the largest player within the BPC vertical. So there is a commitment from us to continue to drive market beating growth and we think mid- to late 20s is a very, very healthy and ambitious growth number to take over the coming several years. In terms of our retail business, our retail business was roughly a INR 1.9 billion business in FY '21. And today, it's touching almost INR 7 billion in terms of absolute value of GMV delivered. And the plan for the future of retail is that we think it will continue to remain -- it will continue to account for roughly 8% to 10% of our total GMV. However, it will continue to grow very rapidly. So the -- if I look at FY '21, we had about 77 stores. That number, again, has more than doubled to 187 stores today. And the plan is to take that to about 400-plus stores by FY '28. So again, continue to double the footprint every couple of years and the retail business should grow in the 40% plus over the next several years. Now if I look at contribution margin, our contribution margin was at 22.7% in FY '21. So a very healthy number for predominantly a retail-focused business. That number has improved quite significantly by almost 300 basis points to 25.5% in FY '24. And our goal is that we want to keep this contribution margin in line with where it is today because we feel that, yes, there is an ability for us to improve this number from here, but we are quite committed to reinvesting that capital back into the growth of the business. Reason being that India is in its earliest winnings of its beauty journey and it would be very shortsighted of us to not invest behind continuing to grow the market and taking our fair share of the revenue and the customer base that will exist in the coming years. In terms of customer metrics, our cumulative customer base was roughly INR 10 million in FY '21, that number has increased to INR 25 million in FY '24. And we -- the plan is to continue to invest behind customer acquisition and also, equally importantly, in how we continue to drive improved retention as well as improved annual consumption value of our repeat customers over time will be a big lever of growth for us. As many of you know, we believe strongly in the quality of growth. What that means is we are not interested in acquiring customers for the sake of showing high MAUs or high DAUs, et cetera, or high app install numbers. We feel that customer acquisition can be like a leaky bucket. If you acquire the wrong type of customer using the wrong incentive structures, you can end up losing that customer very easily, and you end up reacquiring the same customer again and again, which is a very expensive and inefficient proposition. So we feel strongly that acquire the right customer, the right way, and there are millions of customers in India for us to still go after in that fashion. And that is our commitment to continue to drive quality growth and get the right type of customer who shows the same level of engagement and stickiness to the platform that gives us the kind of repeat behavior and LTV to CAC that we have seen historically on the platform. Just a quick note on our category mix. Our category mix, as you can see, has evolved meaningfully since 2018. In 2018, color cosmetics was a large -- very large meaningful part of our business. In fact, it could be fair at the time we used to be called a cosmetics retailer and as you can see today, that color cosmetics accounts for less than 1/3 of our business. It's only 31% of our total category mix. So it goes to show you that we are truly a beauty retail platform. And it shows you how we have managed to build categories like skin care and hair care, bath and body and fragrance at an accelerated pace over the past few years. So this goes back to my earlier point, which is expanding the category with which can only help improve the annual consumption values of our customers. And we think longer term in FY '28 to look like a true beauty platform in other more mature markets. We think that categories like skin care, hair care, makeup and even fragrance should have a much more comparable market shares on the platform. And that is something which I think you will start to see play out. That doesn't mean that color cosmetics is going to grow slowly. It doesn't mean that skin care is going to grow slowly. All it means is that you will see much higher and much more rapid growth coming from categories such as fragrance and hair care today, which are relatively smaller on our platform compared to our other categories. So I just shared with you what has been our journey till date and where we see ourselves going from here? So let me just double-click on a couple of things that have been important areas of investment for us over the past several years. And maybe we have not really gone into detail with you before. So the first is, there has been meaningful investments that have been made in our supply chain to deliver best-in-class service across India. As you can see from this slide, in FY '21, we had about 18 warehouses across a handful of states, maybe 3 or 4 states. In 2024, today, we have 44 warehouses across almost 12 to 13 states in the country. So today, we can get you your Nykaa order from the time you place the order to the time it's delivered within 48 hours pretty much anywhere you are in the country. So what has this investment in supply chain and warehousing done for us? Firstly, it's reduced our order to delivery time lines by almost 18% to 20%. It has allowed us to reduce our fulfillment cost by 19% and reduce split shipments by 24%. So these have a benefit to us from a P&L perspective, of course, from a fulfillment cost perspective. It has an excellent benefit for the consumer because they're able to get their packages almost 20% faster than they did historically, and that number continues to improve with every subsequent quarter. And of course, reducing split shipments helps us to lower our cost, but also helps to reduce the inconvenience that can sometimes be caused to the consumer from a split shipment. So this has been a big area of investment for us in the past 3 years. I think now there is a lot of talk of quick commerce and speed of delivery. So I'm very happy that we, as a company, have made the investment over the past several years and continue to invest behind improving our O2Ds and our speed of delivery to our consumers. The second thing which we focused a lot on is what we call the art of retailing. And that is to always continue to improve the experience that we're delivering to the consumer on platform. So as you can see on the left side, where we used to -- where we were in 2021, it was a lower level of sophistication on the app, not only in terms of imagery but in terms of consumer journey, in terms of search and discovery, et cetera. There was very limited avenues for brand storytelling to be done and we did not have the unique capabilities of video content and animated content on brand pages, et cetera. These are just some of the examples of things that we're missing. We've invested a lot behind that consumer journey and creating an environment that is engaging for the consumer as well as an environment which our brands can use to be able to do meaningful storytelling. And as you can see on the right-hand side, how that is reflecting from a consumer perspective in terms of the app experience. So larger assets, more brand imagery, video content, gamification of the app, personalization, we even have built an on-site property called Nykaa Play, where all of the content we create across third-party channels is all viewable and shoppable directly on our app as well. And what's our ambition from here? We feel very good about how our app is now looking and how it's -- how our consumers are able to interact with it, but there's always more to be done. And I think the ambition over the next few years is what we call as personalization or even to an extent hyper-personalization, where we will be able to really tailor the consumer journey -- sorry, tailor the assortment that we show to the consumer basis their browsing behavior and purchase behavior in our platform. So very, very strong capabilities. But I won't spend too much time on that because our CTO will present more on the personalization initiatives later on today. So this is a very important piece of the puzzle, and this is what we call as edutainment, something I spoke about in the beginning of the presentation, which is how do we use content and education -- how do we use content and entertainment to actually drive education. The biggest -- we believe the biggest reason why India's BPC consumption is the lowest in the world. It's not affordability. We all know India GDP per capita has increased meaningfully and will continue to do so. It's not availability. Now anywhere in India, you can order beauty products online through Nykaa or you can visit a Nykaa store if you live in any of the 70 cities where we are present or you could even get access to beauty products from any of the 200,000 retailers which we're servicing through B2B. So I think we've democratized access. It's not an availability issue. It's purely an awareness issue. And the best way to drive awareness for the sophistication of beauty, the importance of beauty and consumers live is through content. So I always say a picture speaks 1,000 words. So instead of me trying to explain why each of you in this room should have a 4-step skin care routine, I'll let Soha Ali Khan explain that for you. [Presentation]

Great. So I hope we all learned the importance of sunscreen in our lives, and it should be used every day. So this is the kind of work which we do to really drive that education across the consumer base. And this initiative that we called, India's Skin care Routine, CSMS, cleanser, serum, moisturizer and sunscreen, we launched in June 2023, and we have invested across platforms, online, offline, in our stores, through events, through influencers, content creators, et cetera, to really drive this message home. And as a result, we managed to deliver a reach over 270 million. We've managed to expand the category width from 1.5 to 3.5. And today sunscreen and serums are some of the fastest-growing and largest categories on our platform. We've also done the same thing with hair care and makeup. In hair care, we call the routine as healthy hair habits, and that consists of treat, wash and nourish and on the color cosmetics side, we have a 3-step routine called prep, set, cover -- sorry, prep, cover, set. And again, it's a 3-step routine. So the point is to really take the consumer a longer journey. We're not saying that Indian consumer needs to go from using just face wash to using a 10-step Korean skin care routine overnight. We're saying there are baby steps to be taken. This is a journey. And will India ever reach a place where our consumers are shopping or are they have a 10-step skin care routine at night and use makeup multiple times in a day? Absolutely. There's no reason why culturally, socioeconomically, there's no reason why that should not happen. But it's upon us to kickstart that journey and to bring them up along that consumption path. Now because of all the work we've done around education, content, enhancing the supply chain, acquiring the right type of customers, building physical retail stores, building a world-class experience on the app through the work that we've done, working with our brand partners in terms of localizing their brand relevance and helping them with their go-to-market strategy in India, as a result, we have played a very pivotal role in actually bolstering growth for BPC brands across various cohorts. If you see FMCG brands like Lakmes and L'Oreals of the world and D2C brands like Minimalist and Dot & Key and Honasa and other luxury brands like Estee Lauder, Dior, Aveda. And global store brands like Charlotte Tilbury and Sol de Janeiro, we have delivered growth for everybody over the past several years. And as a result, as we've shown you before, our business has grown more than 2x, 2x to 2.5x in the past 3 years. And a lot of our brand partners have benefited from that growth. Now coming to our physical retail business quickly. So today, we have 187 stores. As you can see, this map is quite accurate. We cover the full length and breadth of India. I think what's unique about us as a physical retailer is, we have a tremendous amount of consumer data that tells us exactly where our consumers live. And those consumers, what they are buying in terms of the assortment and the price point at which they're transacting. So we are able to be very, very specific and accurate in terms of where we open our stores and what assortment we merchandise in those stores. I think this kind of data is very rare in the physical retail industry. I think that's what's allowed us to build a successful retail business, whereby our stores tend to breakeven within the first year, they tend to pay back within the first 2, 2.5 years, and they continue to show very healthy revenue growth. As you can see, we have 4 different formats now. So we have different formats basis the different demographic, which we're trying to address. We have a luxury format. We have a flagship format. We have an on-trend format and a kiosk format. So what is the role that retail plays beyond just being a point of sale for our brands? So retail actually, if done the right way, and we've managed to do it in a very unique way given that we come from a digital first background is we've actually managed to really integrate our off-line channel very comprehensively with our online business. So what are some of the benefits that we see from having a true O+O go-to-market strategy? First is our O+O customers tend to transact at an annual consumption value of 4x to 5x higher than that of shoppers who are only transacting in either e-commerce or only in physical retailer. Their frequency of purchase also tends to be 3x to 5x higher. So it's a very valuable customer, which we managed to acquire through our physical retail stores. And then because of this ability to seamlessly transition them onto online for replenishment journeys, is allowing us to really maximize the annual consumption value from our customers. Second is events and experiences. As I spoke about in the past, there's a lot of education that needs to be done for this category. A lot of it can be done through online as I showed you some of the videos earlier. But there is a very tactile element to beauty as a category and therefore, our physical stores, especially in smaller towns, serve as an excellent venue for us to physically engage with our consumers and have them to actually come and experience the product, experience the brands and learn more about this category. So we host something called Masterclasses and Beauty Bars. We did 50 master classes in this past 1 year itself and 14 beauty bars for almost 1 a month across cities like Chandigarh, Guwahati, Siliguri, et cetera. And then, of course, all of these events, which we do on ground, we amplify it through our online channels and have managed to deliver 65 million impressions of these on-ground events through our online channels. Second is consumer technology. We don't believe in having tools in the store just for the sake of having it. We really want the technology in stores to truly add value to the consumer. And so we did invest a lot of time and energy in finding the right solution in our stores, and we have launched a Skin Analyzer tool, which should help our beauty advisers to really give the right advice to our consumers in store about the kind of skin care products they should be buying. And this has gone live across a few of our luxury stores already, and you'll see that continue to expand over the coming years. Third is services. I think services is incredibly important. Consumers visit stores not only to buy product, but to also engage and to be trained and to receive services and I think we have done over 1 million makeovers and skin care consultations across our 187 stores till date, which is quite a large number. Finally, in terms of how does O+O come together in the store. We have something called a store locator in the app. So if you have our app, if you -- we can -- basis your PIN code, we can advise you where the closest store is as well as what is the product that's available for sale in that store. Second, hyperlocal delivery, if you live close to a store and you order something that is present in the store, we can dispatch the order to you from the store directly. Basis your online cart, things that you've abandoned, things that you've not checked out, we're able to nudge you into our physical stores to experiment and to try the products as well. And finally, endless aisle, which means if something is unavailable in the store, our beauty advisers who are very well trained can help you to check out online, while still in the store. Now coming to the third main business within the Beauty segment is our Nykaa Global Store. As I said in the beginning of this presentation, I would give you some more context on this business. Today, Nykaa Global Store is India's largest beauty brand importer and distributor business. The GMV in FY '21 was -- I mean, if we rebased it to 100, today we're at 5x where we were in FY '21, and the plan is to get to 15x by FY '28. So very, very strong ambitions here, but this is a very fast growing part of our business. Roughly, the growth has been about 50% CAGR over the past few years. So you can tell faster than overall platform growth. And it's driven by existing brands that we were distributing already as well as new brands, which we've won the mandate for and you can see that we had about 19 brands in this portfolio in FY '21. That number has jumped to 39 brands today, and we have a target to get to about 80 to 100 brands by FY '28. Some of the key launches in FY '24, I'm sure you saw some of them. Fenty Beauty, which is the world's largest celebrity color cosmetics brand, which is owned by Rihanna, the celebrity singer as well as the LVMH Group. Second was Urban Decay. Urban Decay is a brand that is owned by L'Oreal, and they trusted us with the mandate to actually import and distribute this brand exclusively in the country. ColourPop, AHC, Dr. Barbara Sturm or some other names of high-profile brands, which we launched in FY '24. So if I look -- if I take you to the next part of the slide, in terms of the brand partners in FY '21, our import model, our Nykaa Global Store was mostly being leveraged by what we call as independent niche brands such as Huda, Pixi, elf TONYMOLY, who were stand-alone brands and not part of larger beauty companies. And the distribution model was predominantly that we would retail those brands through nykaa.com and our Nykaa retail stores. But I think if I look at where we are today in FY '24, today, not only do we work with strong independent global brands, but we are also being trusted by some of the largest global beauty companies to take on the mandate for the importing and distributing of their brands as well. So for example, L'Oreal, the Puig group, AmorePacific, Unilever have all trusted us to import, distribute and manage their brands end-to-end in the country. We are also able to now distribute these brands across not only Nykaa's own channels, but also through third-party e-commerce as well as through our B2B business superstores. So this is a big advantage and a big benefit for a lot of more mass and masstige brands who look for slightly wider distribution than just Nykaa when deciding their go-to-market strategy. And in terms of the future plan, I think we continue to unlock a lot of key brands. In fact, I was in the U.S. last week, meeting a lot of brand partners, and I think there is tremendous interest. As I've mentioned in the past, with growth slowing in China, a lot of brands are looking to India now for -- to make up for that loss of growth and the time is right, the time is now to come into India, and a lot of them who don't have the ability to do this on their own are looking for partners like Nykaa to bring them into the market. So I think you continue to see a lot of interesting brands we launch in the coming years. And we have also now strengthened our distribution model, whereby we can distribute brands not only across our channels and third-party channels, but also we are offering the ability to do brand -- run brand boutiques, do brand clinics, spas and run their brand websites for them as well. So really end-to-end services and distribution capabilities for our brand partners. So just to give you a pictorial representation of how the global store business has grown over the years. As you can see, in 2021, it was a handful of brands. 2024 already, that number has increased meaningfully. And I'll just allow you to take in some of these brand names. But for those of you who track the beauty industry, these are some of the best-performing, most valuable and trending brands that currently exist in the world. So we are also slightly selective in the brands which we choose to take into the Nykaa Global Store because as you can see from the right-hand side, this is a 360-degree approach to servicing the brand partners in a way we become the brand proxy in India. So we will handle end-to-end for these brands in the country whereby they don't have to have offices. They don't have to have employees in the country. And so it is a lot of work for us. And as a result, we are a little bit selective in terms of the brands, which we choose to work with, those that we do believe have a right to win in the India market. So you can see by 2028, there is thousands of brands who are still yet to access the India market. And this is a big opportunity for the businesses. [Presentation]

So I just -- the video I just showed you is the kind of work, the kind of content which we create for on behalf of our Nykaa Global Store partners, it is content that is localized, it's content that's relevant and it's just an example of how we really do end-to-end servicing for these Global Store partners. Now I just want to show you one more video. I hope you're enjoying this very entertaining presentation in terms of at least the content that's been shown. But I thought it's worthwhile for you to hear directly from I would say, probably one of the biggest beauty brands in the world. This is Charlotte Tilbury, and the lady on the screen is, of course, Charlotte will be herself, the founder of the brand. Charlotte Tilbury is one of the biggest makeup brands now globally, and it's a brand which trusted us to become the importer and exclusive retailer for the brand during the COVID years actually, and the brand has only grown from strength to strength. So here's a short video that I think will help you to understand what it is that we do for our global store partners. [Presentation]

Yes. So I think the point of the video was to show you just how we can do pretty much everything for the brand. There are very few players in the market today who can deliver this level of excellence in terms of online, offline, eventing, experiences, understanding the local consumer and creating relevant go-to-market strategies. And also finally, importantly, delivering revenue to these brands because, of course, we have the largest base of beauty shopping -- beauty enthusiasts and beauty shoppers on our platform as well. Now finally, I just wanted to spend a minute on the future. And what are some of the key trends? And what is the outlook for the beauty market in the coming years from a trend perspective? So first, I'll just talk quickly on color cosmetics. 3 key trends. One, there has, of course, been the rise of D2C brands in color cosmetics. I think this was a big trend in skin care over the past few years, but now this has become a bigger trend in color cosmetics over the past 18 to 24 months. And you are seeing historically brands who are in the skin care space like Mamaearth and Plum and others getting into color cosmetics. Second is you're seeing a massification and a premiumization happening simultaneously. And you're seeing a lot of brands launching slightly lower priced products like Sugar POP, Blue Heaven and Swiss Beauty. And then you're seeing a lot of demand on the premium end, like the Charlotte Tilbury and other brands in the world. So there is a bit of a divergence that's happened in the last 12 months. And look, for us, as a retailer, it's okay. It's -- we benefit from -- on both ends of the spectrum. We are finally a retailer with 3,000-plus brands. And where the consumer demand goes, we have the ability to meet that demand. Third is what's most exciting is we're seeing green shoots in very unique subcategories that shows you that the Indian consumer is evolving, and they are moving beyond the very basic requirements to do much more sophisticated requirements. And we like to believe that is in some small part driven by a lot of the education and content which we've done and created over the past several years. So categories like lip gloss, compact, foundation, which are sophisticated categories, which historically have not been very large, have become some of the fastest-growing categories on our platform and shows you how Indian consumers are starting to look slightly more similar in terms of their purchase behavior to other global markets. If I look at skin care, Dermocosmetics has been a big trend. So brands that are dermatology driven or dermat approved have really picked up. Active ingredients. So ingredients like niacinamide, retinol, et cetera, have become key ingredients. And you're seeing a large growth in terms of the search terms. So how many people are searching for these ingredients has increased. And again, it's quite -- this is where education is important because it is actually quite -- it is important for a consumer to know which ingredient they're applying onto their skin, niacinamide, retinol, vitamin C. These are all extremely potent ingredients. And so Nykaa sees a responsibility to also really guide and advise the consumers as they discover the world of active ingredients skin care. Third, I already spoke about the growth of sunscreen and serum. Within Hair Care, we're seeing very interesting trends as well. You're seeing a widening of the category in 2012, 2013, when we first launched, it was very basic. It was predominantly shampoos and some conditioners were being sold. Today, in 2024, not only are we selling shampoos and conditioners, but also categories like treatment masks and hair serums. And we think that trend will continue in the coming years. The biggest trend in hair care is actually the skinification of hair, so active ingredients which became very important in skin care are now also becoming very important in hair care, and we think we'll continue to see the skinification of hair, which should bode well for us because historically, hair care has been seen as a personal care category. And with the skinification of hair, it's going to become a much more beauty-focused category and retailers like us should benefit from that. And finally, the last video I wanted to show you is an example of how we set trend in the market, how we explain trends to our consumers. And as I said, how we really are an influencer in the world of beauty. This is the last video I have. Please enjoy. [Presentation]

Yes. So this is incredibly enjoyable for a lot of our consumers, and this is really how we like to drive education in an entertaining fashion. Finally, I just wanted to, as I wrap up the presentation, just say a big thank you to -- I just want to come back to really who are we here doing this business for. It is for our partners, our brand partners without whom we would not be in this business. Our job as a retailer is to really help take care of our brands who are listed on our platform who choose to work with us in a manner that is in a very intimate fashion. In fact, the relationship between a retailer and a brand in most markets is a very, very intimate one. And I feel sometimes in India, it becomes a transactional relationship. So for Nykaa, it's all about how do we build relationships and really build trust amongst each other so that we can help each other deliver our business objectives, which are a lot more than just revenue, which, of course, we deliver for them, but also how do we help them build brand equity, not for today, not for tomorrow, but for 10, 15, 20 years down the line. So just some examples of the kind of trust and faith our brand partners have put in us. We have, obviously, senior management from some of the biggest consumer companies and beauty companies in the world who have come to spend time with us to learn about us, to learn about how we have managed to build such a unique O+O retail model, which they've not seen anywhere else in the world and how we managed to have such a good understanding of our consumer and how we've helped them to really localize and bring their brands alive in the country. I think these are some of the reasons why they continue to trust us and continue to partner with us the way they have. And finally, of course, to all of our customers as well, we are -- every day, we really wake up thinking about how could we serve them better. We want to just thank them for their constant support and encouragement as well. So with that, that's the end of my presentation. Thank you very much for the time, and I will hand it over back to Vishwani.

Thank you very much, Anchit. It's inspiring to see how far we've come already from 2021. And our ambition for 2028 isn't only limited to Nykaa but also boosting the ecosystem as well as the industry. I'd now like to call upon Falguni Nayar, Executive Chairperson, Managing Director and Chief Executive Officer. Falguni Nayar founded Nykaa in 2012 with the vision of building a multi-brand omnichannel beauty-focused retail business within a decade and entering into other businesses like Nykaa Fashion, Nykaa Superstore and Nykaa Man, Falguni and under Falguni's leadership, we've emerged as India's leading beauty retailer, playing a critical role in developing the market and further being recognized on TIME's 100 Most Influential Companies list. May now please request you to join us here Falguni and take us through our own brands across fashion and beauty.

Hi. Thank you, everyone. My own presentation, I'm doing a little later in the event flow. I think here, I'm right now here on behalf of Adwaita, who now leads beauty brands business as well as Fashion brands business. Unfortunately, she's down with viral and couldn't be here today, so I'll present on how behalf. I feel I may not do as much justice to it as she would have, but I'll try my best. So just talking about it that we are extremely proud of -- we always called our own brands, not private labels. And although casually internally, we used to refer to them, which was injustice to the brands. But over the years, we've built a series of brands, which we are very proud of. And many of these are organically built and some are acquisitions. But we are proud today to sit on a bunch of brands, both in beauty and fashion, and I'll take you through some of those. So our vision was to build a Nykaa house of brands that is founded on quality, trust and focus on enriching the customer experience through the trendiest and the high-quality products. And our guiding principles for these were to be very consumer-centric in our proposition. We always solve customer needs and wants and build brands on consumer love. If I give you one of the first examples when we started the business in 2012. Just as a simple consumer, I was aware that nail polishes were very hard to get. And all of us who went to the beauty parlors didn't see a full collection on offer in terms of range. And Nykaa launched its first nail polish in 2013 to fill that gap. The entire journey of some of our early launches began to fill those market gaps. We used to market those days Bath & Body Works and Victoria Secret and Victoria Secret wrote to us that they are not present in India, and we felt that if a brand was not legally present in India, we didn't want to sell the products because they could be fake. So we actually withdrew those products even in spite of a lot of consumer demand. And we introduced Wanderlust, which was Nykaa's Bath & Body range to fill the gap and the needs of the consumer in the bath and body space. So this is how Nykaa's own labels came about in the early days, and the journey has since continued. We are also building for long-term endurance. Most of our actions will be very strategic and sustainable for the long period of time. I think we are creating brands that stand for something that stands for delivering a certain consumer proposition rather than being copycat me too brands that just copy whatever is the latest trend. So many of our brands are thought through. Actually, we are very fortunate. And personally, I've been very fortunate to be inspired by many of the world's biggest beauty companies. And many of my team members are also privy to that where we are meeting companies like Estee Lauder, AmorePacific, Chairman and CEOs of these companies and understanding their brand philosophies on what finally matters well for brands is what is the kind of customer retention you're achieving for brands. Because without that, you can keep going to the next customer, but finally, customers will run out and your brands won't have a place to go. So we are really building it for long-term endurance, the brands that we are building and high quality always. We will not launch products unless they are of the highest quality. I do believe that with all of the responsibilities that the brands carry for consumer health, I think it's very important that we don't compromise on quality for sake of price and profitability. So moving on. So what we are doing is -- today, what we are doing is that we are supercharging most of our scaled-up brands. We have had many -- I mean, we have a bunch of brands like you can -- if you look at and some of those are spelled out later. But if you look at beauty, we have Nykaa Cosmetics and Kay Beauty, both at very high scale. Similarly, in skin now, we had invested in Dot & Key. So that's part of our range of brands, and we have many others like Nykaa Naturals. We also have SkinRx, so in each of the subcategories in fragrance, we have Nykaa Perfumery a new brands, also in case of Bath & Body, we have Wanderlust. So in each of these, we already have scaled our brands. So what we are currently doing is we are supercharging the scale-up of these brands. And we want to make sure that each of these brands achieve the top 5 space in each of their subcategories or subcategories for each of these scaled-up brands. Investing also in high potential segments through our up and coming brands. We are always aware of what are the upcoming segments, and we want to make sure that we service those and this is being done, for example, in case of athleisure, which is coming up in the fashion segment, we are servicing it through 3 brands. So sometimes, if an upcoming space or category is seen, we may service it through more than one brand. And because of our bunch of brands that we carry in Beauty & Fashion, we are able to do that. We're also focusing on large subcategories like Derma skin care and also particular niches like Ayurveda, where we now have Nyveda as a brand that we want to scale. We are also expanding our omnichannel because we do believe that brands once they get a certain scale, they must go beyond D2C. And this is being done aggressively, but sustainably. And what that means is that we are very conscious that we must monitor not just the primary, but the secondary sale is very important to monitor and build these in a way that we don't regret the push and then not being able to sustain the consumer demand. And this is being done, not just on Nykaa platform of our B2B platform, but also beyond that. So we continue to also be present in all of our beauty stores for most of the beauty brands there in each of our 187 stores including the kiosks. And also outside of that, we are trying to grow through: GT/MT where we are now in more than 8,000 plus doors, and this will only expand. Also acquiring the right customers and driving loyalty through brand love is very important to us. And what this will manifest is in terms of investing in brand building targeting carefully curated customer cohorts, which aim at high retention. So this is just in summary, I think we are really proud that now our beauty GMV of all the beauty owned brands is touch more than INR 1,000 crores. We are at INR 1,095 crores of GMV in year '24 and we account for about 13.1% of our overall Beauty GMV. So really proud of being able to keep up with the retailer, so to speak. And if you look at the channel mix, it's quite varied, not just the online nykaa.com, but Nykaa stores contribute now 13%, 54% is on dotcom, 13% in our stores, as much as 20% of our sales comes from GT/MT. I think when the brands succeed in the broader world of GT/MT, I do believe that means there's true demand pull also. And beyond that, we are also going into certain other platforms selectively. So about 13% of our sales are coming from other platforms. So if you look at BPC, Dot & Key has been an acquisition that we're really proud of. And today, we have Suyash and Anisha, who will talk about the brand more later. So I won't spend too much time on that. But we are really proud that as far as Dot & Key is concerned, it's right up ahead with revenue momentum of almost INR 6 billion in terms of current run rate. Following that is Nykaa Cosmetics, which is also at INR 3 billion plus and Kay Beauty at INR 1.5 billion revenue run rate. In fashion, we have 2 brands, both Twenty Dresses and Nykd which have now reached that run rate. And then there are many upcoming brands where which we are currently nurturing and growing. And we are very confident that many of them will also continue to progress upward. So these are the bunch of brands that we own. I think amongst these Earth Rhythm is the only one where we don't have a -- we have 18% stake and not controlling stake. Most of the others are either 100% owned or in fact, all of the others are 100% owned by the company. So what is our right to win? So I think, some of the -- what we believe is that we have strong brands with much consumer love, almost 9 brands across 5 key categories, and each of these 5 brands have top 10 category shares. So we do believe that we have the right bunch of brands that they'll continue to nurture and grow through additional distribution and marketing and customer acquisition, both on our platform as well as external platforms. And the distribution reach that we can provide to our brands is very unique. I mean, 25 million customers that are present on nykaa.com, strong and growing retail presence at currently at 187 locations in 68 cities, which is you heard all this in Anchit's presentation. He's done a lot of job for me because our stores will go to -- they'll double and so will our presence for our private label be available in those stores, 40-plus EBOs across cities, and we also have very aggressive plans for expanding EBOs. And access to 1.95 lakh retailers through our B2B network in about more than 1,000 cities. So this is the entire captive distribution that is available to our brands. And we are also investing in being an innovation powerhouse. Today, we have 50-plus dedicated innovation team members, and we've launched more than 100-plus products in financial year '24 alone. So I think this talks about a little bit about the history of when the brands were started and how they have scale. So Nykaa Cosmetics was one of the first brands started in 2015. I think their sales and contribution has to be seen in light of the fact that Nykaa Cosmetics because it contains the word Nykaa, we have only sold on Nykaa platforms, and it's never been sold outside. So to a certain extent, Nykaa Cosmetics has been more of an internal brand. Kay Beauty and many of the other brands like Dot & Key, Earth Rhythm many of them are able to launch on multiple platforms. In terms of scaling the brands, early brands, at the original core, I mean we started with makeup because that was our key strength, as you saw. But very soon, we became aware of the skin care as a growing category. And we had Nykaa Natural as a category representation then, but around 2021 is when we decided to invest both in Dot & Key and Earth Rhythm to fill the gap in skin. Today's skin is the largest growing segment, and I do believe that it will continue to grow at an accelerated pace. And as a result, this whole bunch of brands that we have between Nykaa Naturals, SkinRx as well as Dot & Key and Earth Rhythm will grow very rapidly. So will makeup, and in fact, makeup is a harder category to track for D2C brands and the fact that Nykaa has 2 very strong brands, which rank in top 5 is a very big asset. Ayurveda, I've big hopes for Ayurveda, including taking it global, but it needs a lot of education and investment kind of a pace at which -- slow pace at which Forest Essentials and Kama have grown that kind of approach is necessary because it's a very specialist product range, little more premium pricing and has to be built carefully and cautiously with the right customers. Wanderlust is a very promising category. It plays in a category which are very large, Bath & Body Works. And internationally this category is very large. So we do believe our brand has done very well. and we are really investing in scaling both Wanderlust and Perfumery because these 2 categories are growing exponentially. Anchit also mentioned about that. These are some of the recent blockbuster innovations. We are very innovation-led, and you can see here that some of the recent launches have been quite blockbuster. I think if you look at pH lip gloss that we launched for Nykaa Cosmetics, it was #1 product in the lip gloss category, #3 in the lips category, 20 million plus organic online reach and 1.2x surge in overall brand search volumes. Similarly, Kay Beauty launched to lip oils sold out on day 1 5 million plus organic reach from Katrina Kaif post as well as overall 20 million online reach. And Nykaa Naturals, Rosemary is a big popular ingredient. Our Rosemary shampoo is in the top 5. And again, more than 10 million plus reach is delivered through that. Talking a little bit about fashion, what is our right to win in fashion. So again, in fashion, we believe we have some strong brands. Nykd is the #1 lingerie brand on our platform. And it has a strong presence. And you'll again hear more about Nykd through Preeti who's making a deep presentation later. So again, I won't jump too much into it. But it's a fantastic brand doing really well in its category, and we'll talk more about it. Also, we have a strong presence in Western wear at 10% of category share on our platform. And there are 5 brands which are consistently in the top 30 brands on the platform. So again, we think that our platform gives advantage to our fashion brands and they serve a focus for the platform and platform serves as focus for -- I mean focus for them. So it's kind of complementary. And again, each of these brands, we are going to grow through diverse distribution. So obviously, the platform gives immediate reach of 6 million transaction customers to each of our fashion brands. And there is a significant sales volume from on -- from on-platform sales but also off-platform sales offline and in other D2C websites. So I think we are also starting some amount of EBOs for some of the selected brands. So like Nykd is starting some EBOs and some of the brands like western wear brands are present across 1,500 plus GT doors -- sorry, Nykd is present across 1,500 plus GT doors and western wear brand is present across about 100 MBOs in the more far off market. So with this, we do believe that we have a differentiated assortment mix, top brands considered a design differentiator for the platform. And we are also leveraging key platform insights to curate a winning assortment for the customers. So this is the summary of the Fashion brands. You can see here that women's western wear, Twenty Dresses was acquired in 2020 and we've grown it since then, and it's also entered athleisure and accessories category. Similarly, RSVP was an extension of Twenty Dresses for evening wear. Nykd was launched in the lingerie category in '21, and Nykd is also now extended to athleisure. RSVP is extended to bags and footwear. Indian, first Indian wear brand, Gajra Gang was launched '22. We also acquired Pipa Bella, the jewelry business in 2022, and that has extended the team has also launched IYKYK, which is for bags. MIXT was a label and launch in '23 for -- it's a Gen Z label in Western wear. And Likha and Nyri are the Indian wear solution. Likha is more affordable Indian wear brand and Nyri is the saree collection. And KICA was another brand that we acquired, which is mainly focused on performance athleisure. I'm really proud on how that's also growing. And finally, Azai is our accessory and jewelry brand that we have launched in 2023. So these are just some of the excitement that brands create through brand collaboration. So you can see our RSVP with Lisa Mishra, Gajra Gang with Rishi & Vibhuti collection, RSVP with Nikita Mhaisalkar as well as Gajra Gang with Mahima Mahajan, all of them very popular amongst the customers and was sold out. Yes, I'll just talk briefly about Dot & Key. So Dot & Key, like I said, was an acquisition that we did 2 years ago, and we're really happy how it's performing very well in some of the core categories like moisturizers as well as underarm roll-ons and sun stick. In Nykaa Cosmetics, again, like we said, it's a makeup brand with a full collection of makeup range. Kay Beauty is our joint venture with Katrina Kaif, that is managed by us, but Katrina is as a joint owner of big support in terms of what she brings on the marketing front. Nykaa Perfumery has a range of other brands like Wanderlust for Bath & Body, again, new packaging launches. Aveda, NYVEDA which we are growing currently in terms of the ayurveda space, SKINRX, which is the science-based skincare brand as well as the perfumery. This is the Nykd, where again, I said we'll talk more later. Twenty Dresses I just show some of the imageries for you to relate to the brands. This is Gahan. IYKYK. Gahan is mostly online-only brands. So in fashion, we do have some brands which are only for the website and may need to facilitate sales on the website. Gahan, is one such example. MIXT also similar. With that, I'll hand over to back to Vishwani.

Thank you so much Falguni. It does sound like a large part of our owned brand strategy started from seeing white spaces in the market and then really trying to find out how to best give consumers what they really need. As we sort of double click into Dot & Key, who better to hear it from than the very passionate founders of Dot & Key. Could I please request Suyash and Anisha Saraf to take us from here.

Hello, everyone. I'm Suyash Saraf.

And I am Anisha Saraf.

And we are the founders of Dot & Key. We started Dot & Key back in 2018 with a vision to create a fruit-first beauty brand, which is effective, yet fun. We wanted to cater the brand to younger millennials and Gen Z. I think since 2018, we've come a long way. We're now a team of over 100 members. We do revenue of INR 600 crores ARR and are profitable. Our key focus is face care because that's typically with the highest gross margins with about 8 different subcategories of face care we operate in. Moisturizers and sunscreens, are our key product categories where we are actually dominating in the Internet space, we get top 3 across key marketplaces for these 2 categories over the last few months. We have about 70% of our audience as female and we typically cater to metros Tier 1, Tier 2. As you can see here, our growth has been at speed of light. You've grown about 10x over the last 3 years. And I think we've just started on our journey and we can just grow probably 10x over the next few years. Our objective for the next 2 years is to get to a INR 1,000 crore revenue, and we've been profitable since Jan '23. We've received a lot of consumer love over the last few years, which we can see in the numbers. And of course, all the accolades that our products have received over time. The question is how we did it.

So how did we do it? Firstly, we strongly believe in offering only differentiated quality products to our consumers. Everything that we bring to the market is based on very strong consumer insights. Only consumer need gaps that we identify are worked on and products are delivered on very strong KPIs and only then launched to the consumer. For instance, sunscreens, which we saw tremendous growth in were purely based on the insight that it's hot and humid outside where you use sunscreens. Typical traditional sunscreens are heavy, greasy, oily. Dot & Key reformulated sunscreens to make them completely water light almost invisible on skin and hence, consumers lapped up on the product category, and we grew and see the sales numbers here.

And you can actually see the consumer love through our numbers. Typically, we just had a presence in the sunscreen category until OND '22. We really launched our first solid sunscreen to actually dominate the market in JFM '23. And you've seen in the last 15 months, we've actually grown from a presence in sunscreen to be the top 3 sunscreen brands on the Internet, and we actually have much larger market share than a lot of traditional brands today.

Secondly, packaging. We believe that sort of very strong sustainable brand for the future, the visual identity of the brand is super important. And for us, it lies in the packaging. Since the inception of the brand in 2018, we have invested heavily in the packaging of the brand, which today stands at a very -- has a very distinguished easily identifiable packaging, which we can see in the hat-capped packaging that we extend across categories which has helped us really acquire customers by quickly to the brand. Thirdly, our always-first approach. So we believe in bringing categories and trends to the Indian landscape even before the consumer wants the product. So basically preempting consumer needs before the consumer knows of it. For instance, we brought about the barrier repair range, the Cica range and SPF-based lip balms first in India, and that's obviously been a huge reason for our success. Fourthly listening to the consumer. So we absolutely obsess over consumer reviews ratings on an average on a monthly basis, we make about 500 hard calls to the consumers to understand all their pain points, anything good, bad, ugly, that they have to say about our products, about our services, and we try to at least work on alter, innovate, change whatever we can, honestly, to regain consumer love again to the brand.

I think unit economics is one of the key reasons why we are succeeding we're making sure that each product that we sell is profitable. In order to achieve this, we make sure we invest a lot in R&D, where we own our own formulations. And our cost to MRP ratio is actually among the highest in the D2C space today. So one of our key learnings has been that if you want to grow a brand over time is you need to pick deep categories with very large consumer bases or else you will hit your ceiling too soon. So we've been able to actually grow in very deep categories like moisturizers and sunscreens, which still have a lot of headroom to grow for us in the future. I think any product that we launch, we launch that product to be #1. So we are always either all in to win or we're not in the game at all.

Typically, within the first 30 days of the launch of a product, we know whether we want to make it one of our top rank holders or not. And whatever is required to take the product to the top ranks we do in terms of investments and energies. For instance, I mean, a large reason for this, obviously, is also our obsession to perfection. We don't offer half-way product to the consumers. Till the time that we achieve all the specific KPIs that we have to, we keep innovating. We keep rendering, altering the formulations. For instance, a sun stick, which was again a first in India, made in India, we had about 60-plus iterations of the formulation till we offered the final prototype to the consumers. And obviously, we became close to our top 3 rank holders again in the category.

I think key highlights and the key wins for us over the last couple of years has been -- in 15 months, we've been able to launch a category and be in the top 3 of that category on the Internet. I mean it's achieved by very, very few brands. We haven't spoken enough about moisturizers. But over the last year or so, we've been actually top 3 players in the moisturizers category online. We have a lot of consumer love over the last 1 year, 1.5 years, we have more than 50% consumer retention rate on our DTC side. And over the last 4 months, we've been the #1 skincare brand on nykaa.com and top 3 skin care brands across the Internet today. A little bit about our journey. Anisha and me obviously started the brand in 2018. The first few years was more about a product market fit, finding right product, what product consumers love, understanding our consumers better so we can serve their needs. Because we believe that the entire space is very large, and as long as we understand our consumers very well and we cater to their needs, we'll be ahead of competition and everything else will just be noise. In 2021, we joined hands with Nykaa. Nykaa acquired 51% in Dot & Key and that was a game changer. Since then, we've grown about 10x, and we've grown to be a very, very strong formidable brand in the D2C space. Now obviously, we've just shared we have about INR 600 crores in GMV. Currently, we are highly profitable. We have top 3 brands across the Internet, across sunscreen, moisturizer and overall as a brand as well. And I guess, we're just getting started. I think over the next couple of years, we want to strengthen our innovation funnel. So we typically launch products to increase the pie of consumers that we can serve through product differentiation and absolute clear leadership in differentiated products. So we're going to launch a lot of interesting products over the next couple of years. And I think content is key. So we've invested in a content lab as we see it on the right. We have an R&D lab because of our own formulation, differentiated formulations, reduce time to market, et cetera. So that is what we want to stand in over time. And I think overall creativity is what we want to work on as a brand moving forward. Thank you.

That's awesome. Thank you so much Suyash and Anisha. I feel like as a consumer, what inspired me the most from this was even though at the end of the day, I'm holding on sunscreen stick knowing that there are passionate brand builders out there who are actually creating 60 versions or something before the final piece is out is incredibly inspiring. Up next, I'd like to call on Vishal, CEO of Nykaa Superstore. Vishal has had a distinguished career spanning over 2 decades in leadership roles across the world, most recently with Unilever before us. Superstore By Nykaa is our e-B2B business that aims to serve the underserved retailers across the country to source beauty, personal care and wellness products in a convenient and reliable manner. Over to you, please, Vishal.

What an amazing success for Dot & Key, INR 600 crores, big round of applause for Suyash and Anisha. Bigger, not big enough. Bigger. Thank you. Good afternoon, everyone. My name is Vishal Gupta. I'm going to talk to you about a super exciting business, our e-B2B business. And what I'm going to do is talk to you about 3 things. First, why we should be in this business, why it makes sense for us. Second, how are we using technology to really build a differentiated and sustainable long-term success business. And third, how are we going to scale up, and we are scaling up profitably? So why are we in this business? As Anchit said in the morning, see, the beauty BPC market in India is a highly underpenetrated, underdeveloped market. And as we go along, this market will continue to grow more than double digit. While a lot of the growth will be driven by online, but a lot of that growth will also trickle to offline and even in Tier 2, Tier 3, Tier 4 cities and ultimately, rural as well because the whole ecosystem will develop and the offline traditional stores, while they will decline in percentage, but will still remain a big part of the market. And with technology, we can disrupt that market to e-B2B. And we have in front of us examples from other markets where e-B2B has already become 10% to 15% of the market while the starting point in India was 1%. And if we see in the last few years, then that 1% has already become 2.5%, 3%. So in a few years' time, it will reach 7%, 8%, it will reach 10%. And as a digital-first kind of a technology-led company, we are actually very nicely placed to lead that transformation from offline traditional distribution to actually e-distribution. So it's a big large addressable market. The other thing is this is a market which is ripe for disruption because there are a lot of challenges in the current model. The current model is very complex. The products have to change multiple hands. There's a lot of leakages in terms of margins, in terms of availability, in terms of service, et cetera. So that's one part. Also, it needs a lot of scale to be able to have your own distribution system and most of the D2C brands and challenger brands and we saw from Anchit's presentation, there are so many of these brands and these are the brands which are going to power the growth of BPC in the future. And for these brands, it is super difficult to have -- to build an efficient physical distribution system. So that's where we come in. We can offer that service to them. Interestingly, even established beauty players their whole distribution system is geared to sell their bestsellers, while a lot of their innovations actually don't find the -- find the space to actually grow. So even for them, it makes sense to partner with a player like us, right? And then the whole data and consumer feedback, advantages to having a digital business. And same for retailers They don't have access to the wonderful new D2C brands that are charging the consumer landscape, the lack of credit, pricing is not very transparent, they don't get the stocks that they want. They have to deal with multiple brands, et cetera. So from both the sides, supply and demand, actually, there is need for disruption. And that's why e-B2B makes a lot of sense. And therefore, for us, we are one-stop shop. So the D2C brands need to talk to only to my category team, my category managers, and we will do the rest and take them to hundreds of thousands of stores all over India. And we're choosing to focus on the BPC and wellness because that is Nykaa's core strength, right? And we are focusing from the retailer side on, again, the underserved, which is the beauty centers, the pharmacies, et cetera. And so our reason to exist is basically to serve the underserved by technology, whether it is the D2C brands or the retailers. Yes. And ultimately, Nykaa as a retailer is #1 in the beauty ecosystem. And the more the beauty ecosystem develops, whether online or offline, at least Nykaa, the retailer will benefit a lot. Therefore, it is very important for us strategically as Nykaa to offer not only dot-com, but also offer this e-B2B because then in the beauty space, we become an end-to-end player, offline and online. And even for -- like I said, our D2C brand partners who are becoming big in dot-com, at least for them also, we offer them value propose because ultimately, D2C brands only reach a certain level, if they're online. For scale up, they have to go offline and who better than us to partner with them, having successfully partnered in dot-com, right? And like I said, so it's good for the ecosystem because more customers in the funnel. Same for our brand partners. For them it's very -- like I said, very difficult to get physical distribution. So we are able to give to them even the FMCG core brands, they cannot do justice to premiumization to innovation, et cetera, they're stuck in the core. So a lot of places, right? And even to our global brands, Anchit spoke about, we become one-stop shop across all the formats, dot-com, modern retail, GT distribution, actually, we are one stop. Yes? And for the retail, obviously, there are a lot of advantages. And our actually purpose, if you ask me, what excites us is that we are doing our part in improving the livelihoods of the retailers because we help them to grow their high-margin category, which is the beauty category. So we have win-win for everyone. And then -- and how we are disrupting is actually really using technology because what technology does, it helps the retailer to actually get access and discover new brands they're able to get very transparent pricing. They're able to get like if I buy X, I will save Y money. But if I buy 2x, I can save more money. There are coupons, et cetera. So we are able to actually ensure that the retailer in every order can actually maximize his earnings because he has full transparency and control over what to buy and how much to buy and when to buy, right, unlike our distribution system, which is very static in terms of their beat plans, et cetera. So digitization actually really puts the power back in the hands of the retailer to maximize their earnings. What we have also done to make it easy, now different types of retailers have different needs. So there are beauty centers, there are pharmacies, there are general stores. You can see from this because the assortment is different. So we have customized, it's personalized. So depending on the type of the retailer, the shock that they experience in our Superstore app is different. So the recommendations they get, what they see is very different because it is personalized to what their shopper is coming to their shop to purchase. And like I said, we want to increase the earning potential of the retailers, so during their journey, there is a lot of offer assistance throughout the journey, right, in terms of cart rules, in terms of quantity purchase, et cetera. So continuously, we keep actually technology helps us nudge them. Like you have bought INR 3,000 worth. If you buy 500 more, you'll unlock X coupon, right? If you buy a certain brand, if you along with that brand, you buy another SKU of that brand, then again, you can earn more. So which no salesman can ever do, yes. So technology actually really helps us maximize the earning of the retailer. And then we do loyalty programs, and we came up with this again small innovation called our own wallet and super cash, so when they earn some money, it goes at super cash, which means then to use that money, they have to place an order again within a certain period of time. So that also incentivizes them to actually keep coming back to us again and again through the super cash. And most importantly, technology helps discovery of new brands. All the beautiful D2C brands, all the beautiful innovations that we saw from Dot & Key from Nykaa Cosmetic, Kay Beauty, all our brands. Retailer is able to discover those amazing innovations because we are able to, through technology, through their purchase behavior, recommend to them, like you can see on the left, we have the advantage of dot-com data. So we know what category or innovation is trending in a certain pin code. So we are able to leverage that data to recommend to the retailer that this is trending in your neighborhood. So you can actually buy this, and you can see. So our recommendation engine actually works beautifully. That's really the power of technology. So that's -- so it's a large addressable market. We have a purpose, which is emotional to improve the livelihood of the retailers. And we are able to do that by democratizing availability and through technology allows the retailer the best chance to buy the right brand and make the most money and increase their overall sales. And we have scaled up nationally. So we already have 13 warehouses. We serve 1,000 cities, you can see the numbers, so we're [indiscernible] and with such a great kind of a service, no wonder, then it reflects back in numbers. And you can see great product market with rapid scale. So we almost doubled our business. So we have done a GMV of INR 600 crores and you can see that even now even the last couple of months, so we are growing month-on-month. So we are 80%, 90% kind of growth year-on-year. And we are already touching 2 lakh retailers. Actually, we have crossed 2 lakh in April, and you can see a lot of our sales is coming from Tier 2 towns and in the underserved beauty centers and pharmacies, et cetera. So there's a lot of product market fit. But I think it is important for me to also land this message that we can scale up even faster but actually, we are very clear, we are very conscious that we have to scale up in the right way. Anchit also mentioned many times, when you acquire a customer, you have to acquire a quality customer, right, so that your economics work out well. Therefore, we are very careful in which customer we acquire, how we acquire and our journey to scale up should go in the -- so it's quality growth, not just growth, right? And you can see that our average basket size is increasing, our average order value is increasing. And even in the purchase basket, the composition of more brands which are more margins for us, right? That is increasing because that's how our path to profitability becomes better. So growth but growth with the right quality. And we have become a scale now with so many visits that our ad income itself is going up, right, which becomes a key contributor to our profitability. So you can see the numbers. So big in service income. And obviously, with scale, and we are a digital-first business. I can't tell you the amount of data we have on every order I can actually see every order is it going to be profitable or not every warehouse every day, we have that kind of data system. That's the power of a truly digital technology business and you can see fulfillment costs have come down to almost 700 bps. Salesman, S&D cost has come down, contribution margin has improved this last year. But going forward, again, in our path to profitability, 4 things we are going to focus on: Gross margin improvement, which, like I said, is better order quality, lower fulfillment costs, lower warehouse cost and lower sales costs. And I'm going to tell you how. So I spoke a bit about order quality, which is selling more profitable brands. So how do I drive? Mix, right, so that I grow my margins. You can see if my average gross margin is x my profitable brands, which are the D2C brands is 1.4x. So the more I sell these brands, my mix improves. And we are also through technology, making it easier for our system for retailers to understand. So we have called it something called featured brands. So everyone. So my supply chain team needs, I need to ensure availability, my technology team knows the salesman now, the retailer knows everyone knows, featured brand means good. So more featured brands and more orders means good. So we drive that very rigorously. Even in terms of -- so therefore, gross margin will improve by increasing the contribution of these feature brands 40% to 60% visibility income will go up as we are scaling up and we're already a proof of that in the last couple of years. And overall, so therefore, our gross margin will improve by 1.4x in the next 8 quarters. And as you see -- read reports of other B2B businesses, actually, our gross margin is already very high, and that will become even higher because they've chosen to play in the beauty vertical, yes. Then when we look at our warehouse costs again, very interesting. Like when I use a third-party warehouse, my cost is 1.8x. If average is x, okay? My own warehouse average is point at 0.8. But within the warehouses, 13 warehouses, some warehouses are already at 0.6, right? So we know how to space utilization, scale, we're using or technology like handling in cases, more technology-led pick and pack, where to place, so a lot of stuff we can do to improve efficiency, and you will see we'll reduce the semi fulfillment variable cost by 40% through all this. We're already moving away from all third-party warehouses within the next 2, 3 months. Same in our fulfillment cost. So the more we sell in bulk, right, in terms of full cases, higher the AOV, the freight cost obviously comes down. And then our location strategy. So a lot of our warehouses are based on location strategy, economic close to the warehouse, all orders. So through all that, our fulfillment cost will also come down by 20%. Our salesman productivity. If average productivity is x, then we know that there are people, productivity ranges from 0.5x to 1.5x. That's a huge gap, right? And a lot of that is driven by the time the salesman has spent in the system because then he builds a relationship. He gets used to it. He knows which are the, like I said, more quality customers versus less quality customers. So he's able to -- and you can see the differences from x to 3.3x in terms of time. So we have -- and what through technology, we're also using like the same salesman will cover more and more outlets. And so that the retailer actually does more and more. So overall, we will again improve our salesman productivity by 60%. So this is my last slide. So -- so what I've shown you is why we should be in the -- why we should be in the market, how we are leveraging technology, what's our advantages. We have done an amazing job so far in scaling up, and we are very conscious of how we are improving profitably. So in the next -- so like I said, we improved 22%, right, in last year, and we are going to improve another 20% in next 2 years and we have to scale up by 9x, in a few years to ultimately achieve EBITDA of 3% to 5%. So look forward to an amazing growth story and profitability.

Thank you so much, Vishal. I'd now like to introduce you to Rozita Norouzi, the CEO of Nysaa. With a career spanning over 15 years in the retail industry, Rozita joins us from the Sephora LVMH Group. Over to you Rozita to address us about the exciting business opportunity in the GCC and our ambition to grow there.

Good morning, everyone. Rozita just joined over a year ago. Pleased to be here. So today, I'm just going to talk. Okay. I will talk about Nysaa. Nysaa is Nykaa. We just place a S with K in Arabic means women. So as you can see, we managed to keep the brand's logo, the brand is Nykaa and we are going -- we are just only going with the name of Nysaa in Middle East. So just a little bit background about the GCC markets and how -- what's happening in GCC. Just a little bit of perspective. Okay. So it's a really evolving market. GCC with a 59 million population is demographically super strong. Starting with KSA with 35 million population with a really, really futuristic vision that is coming in this region, Neom, that is going to be a sustainable city in this region. The country is hosting over 5 million to 6 million pilgrims on a yearly basis in Makkah and is expecting to grow by -- in terms of tourism to grow about 50 million by 2025. So great potential in Saudi. Myself, I lived in Saudi for the last 2 years is an amazing place. I don't know if whether some of you have been there is a place to be in the place to invest in the future for most of the large international organization and many organizations such as Apple, Microsoft, now they are moving their head offices to headquarters to Riyadh, which is capital city of Saudi Arabia. UAE I don't need to talk about it much. We all know Dubai. It's one of the places to be a place where all investors and all the rich people are going there as well as a younger generation, so the country is moving really fast in terms of innovation, Dubai Mall and Mall of the Emirates being one of the largest malls in the world with the highest turnover in the terms of footfall. So it's an amazing place to be. Qatar, again, I don't need to talk about it is one of the countries with the highest GDP per capita, which is around $80,000. The average transaction value for customers in this region is really how each customer our $400 to $500 when the used any normal retailer store. I'm not just talking about the niche brands. Kuwait, again, one of the countries, oil rich with a very high GDP per capital as well very. In terms of the investments, they've got largest investment Kuwait Authority Investment that are investing all over the countries around the world, not only in Kuwait, yet again, very strong country in terms of investment And Bahrain & Oman geographically really, really in a good location with close to countries around the Persian Gulf. And as we can see, these countries along with 59 million population, the high disposal income from the consumers, very good relaxed taxation rules that is attracting many people from around the world, whether from the celebrities around the world or investor to invest in these regions or even just live in these regions. So with that perspective. So just talking about a little bit of the beauty market in this region. In fact, in terms of beauty market, these are the data as at 2022. $30 billion is a beauty market in that region, each customer, we are looking at around $500 per capita and 40% of the population of female and under 25. So it's a really great region to be, it is a really great region, and it has got amazing opportunity for the growth. As per some of market data, we see that some female customers who are spending around $300 for only beauty products. So they're just buying make up, they're just buying any perfume that is coming to the market. And they love newness, and they love new brands. And this is where we can see that Nysaa is born in Dubai. So just a little bit perspective about beauty market, what's happening? And what is the current competitive landscape in this region. So I'll just go slide by slide. Currently, the beauty market in this region starts with the department stores, which were more traditional like Debenhams, Harvey Nichols, Bloomingdale's, and mono brands, mono stores such as Christian Dior, Charlotte Tilbury, there is lots and lots of mono brands in this region as well. As you can see Kiko, Make Up For Ever. And of course, we've got the online business that Amazon & Noon, Ounass, Cult Beauty has a lot of a lot of cross-border business as well. So looking at overall the size of the market, we've got the Prestige Beauty. This is at end of 31st December 2023, we are looking at in total, around $2.4 billion, $2.5 billion of the business. And this is where Nysaa is coming on. There is a gap in the market. There are only 2 retailers in this region, multi-beauty chain retailer. It's Sephora and FACES. That's where we have decided to enter very right place to be. Consumers in Middle East, they have 2 option in GCC, either go to Sephora stores or go to FACES. FACES is mainly in Saudi, most number of their stores in Saudi Arabia, but Sephora with 90 stores are in most of the regions, including Qatar, Kuwait, Bahrain, and they're entering Oman as well. So it was a right move for Nykaa to enter GCC. There is a gap in the market with Nysaa just answer in this perfect spots that was missing, and this is where we are filling the gap obviously with Nykaa. So we entered the GCC beauty market. Obviously, that was a right move to do. And in a strategic partnership with Apparel Group. Apparel Group is one of the largest retail firm in Middle East with over 80 brands over 2,200 retail stores, they keep expanding and with 15 platform of the e-commerce and are present in 14 countries. And obviously, Nykaa is self explanatory, I don't need to talk about it, and this is where is Nysaa is born. So that's how we are entering the market in a JV partnership with Apparel Group in this region. So what is our ambition? Our ambition for both online and offline is to stand out in the Middle East with an experiential multi beauty retail concept to engage customers at every level of their journey. This is whether offline or online and this is where we are going to head and we will make sure that we make that right footprint the way that Nykaa has done in this region. What is our brand pillars? Superior service that is going to be, again, both online and offline. We built a store concept that is offering the customer a freedom and we have playtable and editable, We had a fantastic feedback from our customers. In the store, we are providing services to them. And obviously, that includes our dot-com, seamless shopping experience and [indiscernible]. We just launched in March 1st, and we have customers for the past 2, 3 months. They're coming back to our stores and they're also coming back to our platform and our shopping, and obviously, is memorable. What is good about our service, what we do, and we are different with other retailer brands in our store, in our #1 store the team is our team. It's our own team. We do not have other brand BAs. This is making customers to feel much more comfortable we are giving that freedom. We are training our team members, all our team members are either skin care specialists that have great background or they're makeup artists. So each customer enters our store. Our team is unbiased and offering the best service to our customers. That's why in the first feedback for the first 2, 3 months, we had amazing customers who are coming back and they're shopping with us. And what's happening is the customer that's buying expensive products, they are also buying Dot & Key. By the way, they love the Dot & Key products. And so great, great feedback we receive from all our customers in our stores. And we launched in March -- 1st March 2024, very successful launch. And I'm just sharing with you the video. [Presentation] I hope you like it. This is Nysaa song. We are playing our stuff. It's just a little bit -- is it still at an early stage, but we thought it would be good to just give a little bit on what's happening and how the business is performing right now. It's a promising performance, as I said, very good both qualitative and quantitative KPI. In terms of conversion rate, we are reaching around 16%. I have not put in the slide, but this is very good for a new retailer that to reach 16%. We started with 8%, 10%, 12%. Right now on a daily basis, we are around 16%. In terms of the platform share we are around 10% -- YTD is 10% online but in the month of June, we jumped around 18% of the online business, which is fantastic. Our online is doing really good. And we see increase in traffic on a daily basis. Average order value in Middle East is already high as we know that consumer, they have high disposal income. In off-line, we are doing around $75 and online we are doing around $55 and we are expecting this to grow by $100 when we open our #3 and #4 stores as well. Category, category mix makeup is still as strong as any other retailer as Nykaa's 65% contribution is makeup and skincare, 25%, and we've got 10% of fragrances and other brands. So overall, what we see that consumer they are getting -- we are getting very good response from all consumers. We've got Gen Zs who they come to our store. They love our stores. They have that freedom to shop. They are buying minimally, they buy Dot & Key, they buy Augustinus Bader and they're buying Dr. Barbara. They are buying Kylie Cosmetics. So they are getting the products that are not available in any other brands in this -- in the Middle East region. So this is the feedback we had. Looking at the current performance although it still is really premature to talk what we are looking at around $2 million average run rate. But I'm pretty sure we should end up higher than this number, but we just wanted to be a little bit conservative. So as I said, we created so many great brands. Kay Beauty is doing fantastic. Soon we are going to have Nykaa brand. We've got some of small section for now, but it's going to come in a bigger format. We've got expensive brands like really niche prestige brand, and we also have affordable in the hot brands. And we keep bringing new brands in the market in our retail. So this is just some of them. Sorry, let me just go back -- it's just Mix & Match -- so it's all of them. But right now, we have plus 60 brands in the store by the end of September number of brands will reach to 80 brands, because you know the registration and all those regulations takes a little bit of time. And in terms of online, we have over 200 brands, and we are aiming to -- by next year to go over 1,000 brands by the end of next year. So what is our vision? So our vision is to -- by 2028, to be everywhere in Middle East, in GCC to basically to focus on KSA well and obviously, UAE with this huge market. We are aiming to be everywhere to have our footprint everywhere. So we are aiming to reach minimum 7% of the market share. So all of beauty of GCC Beauty via our prestige land and to open 70 stores. So that's why 2028, we will be -- the way I see it, the way I see that Saudi Arabia is growing, the way I see that there is that gap in the market that customers are hungry for a new retailer. The new generation, they want newness. They need fresh environment to shop. And this is what we are offering. And this is where this partnership has worked perfectly well. And myself, I feel that this is going to be -- I really strongly believe it's going to be fantastic, and we are looking at 7% to 10% market share by 2028. Thank you.

Thank you very much, Rozita. I feel like Nysaa has a great extension of a lot of things that we stand for at Nykaa. At Nykaa with our sharp content to commerce strategy from day 1, we focused on educating and empowering our consumers. As we sort of take a break for the next 10 minutes to get some refreshments feel free to step outside and actually experience a lot of the things that the folks today have spoken about. As you exit, on your immediate right, you will have a Nykaa fashion pop up. Play around with the app. You get to see a lot of the collaborations that's Falguni took us through. Next of which are 2 beauty vanities where you get to touch, feel and explore and play with a lot of our global offerings as well as a lot of our own brands. A lot of the tech that Anchit talked about through in-store retail experiences are also available out there. So you can actually get your skin analyzed by our beauty advisers and they'll be able to recommend products to you based on your immediate concerns. Next to which on your left, you have an Aveda pop up where our beauty experts will do a quick scalp analysis using tech. And they'll be able to recommend products that will work super well for your immediate concerns to our immediate right and left as you exit the Aveda pop up, you get to experience some of Nykaas top performing IPs. You'll see Nykaa Mauve Saree on the left, and there's a lot more information there. And on the right, you'll get to see a lot of a stepfication and the education that we've been trying to drive to consumers. So go ahead, take the time to experience, touch, feel the products and me and our other beauty advisers there will be around to help you out. While we're currently at about 11:35, we look to start our next session by 11:45. So please join us back by them -- thank you. [Break]

Please who're just joining us on the back, we're just about to get started with our next session focused on Nykaa Fashion. Over to you, Nihir.

So we're talking about super and Nykaa Fashion business. We all know fashions of super large. Next slide. Awesome. Thank you. As we're good to go. So we all know fashion for large market, right? The e-commerce space is massive. It's like $14 billion, growing to $50 billion. But within that, we are very specifically focused on the premium fashion landscape, which is a phenomenal $3 billion market. So that's why Nykaa Fashion focus lies out of the large e-commerce market, just to put that in perspective, our entire beauty amazing business is built on a $4 billion e-commerce market, right? So it's a very large, sizable market, which we can focus as a company and build some really good business, and it's also growing to $10 billion. Truly, the premium fashion space is where we are differentiating and where we are focusing. And the way we are doing that is across 2 different businesses. One is obviously the women space. We know the premium women landscape very well. And obviously, from the beauty history we have. So within the big fashion premium women space already, we are 20% market share, right? That's phenomenal. Guys, we've already achieved really, really large number in a really short time. And it's really commendable to the consumers who really appreciate the platform that we built, we've got 20% market share. And the way it's defined is above INR 1,500 is the premium landscape. If you look at the entire India fashion basket, you have the mass, the masstige, premium and lux. we're entering from the premium landscape and we are striving into the lux as a business, right? And also on the on the men's side, we know that in important space, yeah guys. It's all of you in the audience. As men, we don't really have a premium platform for us to buy what we need from a grooming and fashion perspective. So we're building Nykaa Man. It's a stand-alone app, I request all of you to download it please. It's an amazing app to be our customers. And really appreciate what we are building for the Indian ecosystem for the future. It's a very small business for now, early days, investments are tight. But it's something we're building for the future to play in the premium men's landscape where we also see a market gap. And also on Nykaa Fashion, there's a mens portal. Again, women play an important role in influencing men, and a number of men do appreciate the Nykaa Fashion mens portal that we built. So we're playing the entire premium land -- fashion landscape, the entire $3 billion market, which is going to go to $10 billion. right? And now why are we here? What is the -- we saw a market gap, right? And what is the market gap in fashion? It's exactly the same market gap that we spotted in Beauty years ago, what Falguni spotted years ago. Beauty when we started had mass distribution MTGT. It had lux and certain pockets in [indiscernible] , but there was more premium landscape, like more premium player and the premium consumers are really looking for something unique. They are completely different from mass and lux consumers. So we built an entire beauty premium platform, which then dominated lux. We've been in the same thing, the fashion, we realized there's a premium landscape the certain e-commerce players doing mass very well, there's few lux pockets. We are fashion building a very nice premium platform. I'm tracking the market gap. Over and above that, look there's very little trend and trend focus. There's a lot of cool trends in fashion. It's a very exciting space. And also to bring the brands alive in the real world or across all of these platforms. There really in the platform. So we saw these market gaps. And we realized the entire beauty playbook, which we have built over the years and it's a phenomenal playbook and can really apply to fashion. So that's what got us in the fashion market. And we -- over and above that we have a few strengths. We understand the premium women customer better than anyone in this country, right? So leveraging that strength. We have amazing tech capabilities, which is fully built in-house. So leverage into that 2 strength. And also, we've done this over the years with extremely tight unit economics and very tight investments. And we knew we could definitely give a fashion space as well. And what to be done, right? Over the last few years very, very quickly, we have got amazing product market space. We've got consumers who really find our platform unique to engage with, amazing assortment, which is, again, a lot of it is unique and a discovery, which is unmatched, right? And this is very, very exciting. So I want to give a sneak peek into a new stay stylish branding campaign. You guys are the first ones to see it guys. Super secret, super cool. You are the first to see it. We are going to launch this next week. [Presentation]

So that's a super cool, super excited to build Nykaa Fashion brand in the next level. And what we do with the stay stylish is not only something we're connected with our consumers about. It how we live and breathe as an organization internally, bringing style to the forefront. It's also how we work with our bank partners and why we exist in this space. So for that, we've also got an internal Nykaa Fashion anthem I want to teach it all of you guys. Put your cells down. Put your laptops down. Look here. I will teach you all of it. Like how we live? How we breath? And the decisions we take are based on this anthem. So follow me and you will have to do what I say guys, this forward. Yes? So when I say Nykaa, you say fashion. When I say stay you say stylish. Clear? Nykaa, Fashion. Stay, stylish. Nykaa, Fashion. Stay, stylish. Nykaa, Fashion. Stay, stylish. Nykaa Fashion. Great. So guys this energy enthusiasm we are bit tracking into an amazing new market. The internal teams and all the decisions are based on style, premiumness, discovery, and that's how we're really changing India, changing the landscape and changing our consumers by fashion in this country. And with that, you can see the numbers, right? In a super short time, we've achieved phenomenal growth, and we've done that with amazing differentiation, right? One of the -- couple of big things. Are AOVs are twice that of industry. Right? India is a huge market, right? So there's a very clear differentiation from all competition and for consumers from an AOV perspective, our top quartile customers actually spend 5x of the industry average, right? So we're getting really good love from the consumers who have understood our platform standpoint. We're adding value to their lives. right? All our consumer metrics have been tracking really well, right? Our unique visitors have been growing. They're investing in growth. Within that, we are also getting a higher number of annual transacting customers. And our orders are growing. But that's happening with a very, very cool thing that our conversions are going up, right? So not only is our business growing, the quality of business is also improving year-on-year, and we're still young in our journey. We have a long way to go, and we're looking at more continued improvement across the customer metrics that we're working on, right? And in the short time, what have we done? This is our BofA survey that was done. It's really cool. It -- last year, only this part of the chart came out. When Nykaa Fashion already was the second most appreciated and loved consumer online platform, right, in fashion, which is phenomenal, but we've come in and we've already become a #2 player. We're taking mind share from some of the top players in the industry, and that feels really good. And what came out this year, which is even more phenomenal, right? This came out before our brand campaign guys. We are the #1 platform of choice for latest trends and styles, right? And latest trends [indiscernible] is what we stand for and what we want to also -- it feels really, really happy, but consumers and their service actually relate to what we are trying to build and how we are driving this business. And that also plays out in the metrics, right? Our percentage of new season sales. Right? Fashions all about new season. Our new season sales is 2x that of industry. Talk to any of the brand partners, they will tell us that also leads from a brand perspective, higher margins for them because you're selling at full price versus discounted sales, which allows our relationships to get deeper and also invest in marketing and build brands on our platforms, right? And the way -- there's obviously a lot of cool strategies we are trying to do, we have to put the consumer -- premium consumer at our heart and build backwards from them. We build backwards for them a number of strategies across discovery as well as our platform key pillars that they're attracted to. And to support that amazing assortment across in each of these pillars and categories. . I just talked about a couple of them, for example, fitness and athleisure. We've all known for killer trend across the world. It's picked up on our platform. It's gone twice the platform strength and will be investing very aggressively by building like the supply on athleisure the category and for women-specific fitness. This is a conversation nobody in the country is really doing well, and we are going to dominate and bring these conversations to the forefront to add value to the consumers. We also have Gen Z store. Gen Z a big trend, bringing cool stuff, Fast fashion to the consumers who have been investing aggressively in that as well. And all of this comes from delight, right? If your going to be stylish. One is the single thing our customer relationship is built on delight. Right? And delight is a key strategy for us this year. So we've got amazing curation and quality, again, hand picked brands. We also have lots of stuff for curations which are really trending. We go deep as experts within the category, and we've got some really cool trends which really consumers appreciate and be part of their lives like the Bharat eStore. Really be part of their lives in terms of what would help them? When in the occasion across the country, right? And through this, we've done a lot of hard work We're still young on our journey, but it's a lot of hard work. In the last few years, we've gone from 1,500 to 3,200 brands, right? It's a lot of onboarding. We have a team in place. But all of these are handpicked and curated. There are a lot of brands, we say no to at least 100 brands a day, right? Because there's a lot of stuff in India, which are labels, low quality or we believe are not on trend. We actually don't onboard a lot of that. So this is extremely handpicked growth across that. And within that, we've got 20% brands which are only with Nykaa Fashion because the brand chooses us as a preferred platform, right? So again, assortment and differentiation is very important. And when you look at a premium landscape of women, most of these are sitting there. We actually have more than 30% to 40% uniqueness within that specific category. So again, it makes it really interesting for us that we are actually providing differentiated assortment to the consumers in the country, which has not been available here before, because we're taking a premium angle to it, right? Even of Nykaa, we've got some really unique styles in terms of growth. Hidden gems are one of the categories like strategies. Which you saw a little earlier on the slide. What this is, is we travel India across the country, go meet hundreds of brands. And within them, we look at the quality, products, style and our expert team onboards only those brands. And with them, many of them choose to be only with us, both in India wear and Western wear. We've got some amazing designers in this country, who the consumers don't even know about. So we are building a long-term relationship with these partners, allowing them to grow and for consumers to have something new and interesting to buy. And then we also going across the globe. And we've got a couple of huge global partners who've chosen us Nykaa fashion to be their preferred partner in India. One such example is Revolve. Revolve is a $1 billion U.S. company. It's super trending. Most of the revenue comes from brands that they have built on their own as well. Which is super trendy, super cool, you got the U.S.A, everyone's talking about Revolve and its growth and how it's adding value. They did market survey in India, they came and met everybody and they chose Nykaa Fashion to be their preferred partner. And what we did is we made life really simple for Revolve. We brought all their amazing brands to life to the Indian consumers. Did a super cool launch, brought in influencers, did an event. It was really well appreciated. The partnerships getting deeper as we speak. So not only did we work really well with the brand partner. We also changed the customer experience in India for global cross-model goods. So this is an inventory-light model, all the inventory sitting across the world. When a customer orders, we actually get the product shipped to the consumers pretty quick. And we've done that a lot of close collaboration with them. What is on the consumer side? It's a big hassle generally to get products in. You have to put with your partner on calling you. There's hidden costs, there's pricing. So all our early studies showed that the premium consumer doesn't want to deal with this hassle. So we've taken all that load on ourselves. We can get a very slick process for consumers. They order on our site. We manage everything at the back end and simplify consumer lives. So we've done consumer simplification and unlock amazing global brands to the Indian consumers, and we are locking a lot of international supply over the next year or 2 as well. So this is a big one for us. Generally -- yes. Another huge win for us was Foot Locker. We just announced this earlier this year, Foot Locker is an $8 billion company. And they are amazing. I think everyone who's traveled Europe has definitely bought from Foot Locker. They were looking to India. They again came in to do the deep market research, spoke to everyone in the country and with all their knowledge and experience, they chose us. Nykaa Fashion to be their preferred partner. So we actually are running the entire online business of Foot Locker and bringing a shop and shop of Foot Locker on to the Nykaa Fashion platforms. So one of its type partnerships, be innovated to be your partner with us and bring this alive. And this really both these examples and there's at least 20 more, is a testament that we are adding value to brand partners who are looking for premium consumers and to premium consumers who are looking for amazing brands. Because both of them Revolve and Foot Locker chose us because we're the only ones in their view, who understand the premium consumer in India well. And this is the consumer with the high amount of money to spend. So that's really where the focus is. So it's a very strong partnership, very excited about this. And also with this, we are bringing 30% assortment of some of the sneakers that they will sell, which don't exist in India before. So the premium consumers are going to be super stylish products, right? We can all have them, which were not available in this country. That's a huge unlock for the consumers of India. So moving to what we've told you about how this amazing business is being built. Obviously, eventually, it's about the P&L as well. We understand the P&L deeply, and we want to drive improvement in that on a day to day basis. Right? So what we is we've done is we've grown NSV over the last few years, right? You guys have seen that earlier. Moving forward, we are going to go to 2.5 to 3 years growth from here over the next 3 years. We feel pretty good about this. I think the value add and all the stuff I spoke about gives us the confidence. The brands assortment growth is something we're still on in the journey. We've got a very good assortment, very good portfolio, but there's no work to do. And that's really going to help drive like Foot Lockers actually launching in October, November this year. So that will give us additional growth. So a number of growth levers from an assortment perspective that are going to add. And we are continuing to invest in new customer acquisition. We are a young business, and we do need to get more and more customers on the platform. So that's going to lead to good amount of growth. And then the core thought. As we move a better job on the platform, as we do a better job on tech, and on discovery. We are just going to have the existing consumers give us more love. And as they give us more love, we will love more consumers who spend more with us. So the repeat customers and their behaviors would improve. Right? So that's also going to lead to significant revenue growth for us. So key levers we're working on in detail. Our gross margin is in a very, very healthy space for the fashion retailer business. We're already at 44.8%. We've had a 0.6% margin expansion in the last year, right? This is super healthy. Within this we still believe there's room for growth over the next few years. right? We're saying we'll improve about 150 to 200 bps over the next 3 years. It's going to come from 3 things. One is ad income. Like I said, we are providing making some really deep brand partnerships, people who are looking for our consumer side, which is very unique. They started investing in us pretty aggressively, also investing in ad tech in a better way, which is going to improve how that partnership works. And across the world, now across the fashion business, everybody, everybody has started charging consumers' fees and consumers are now ready to pay small fee. The convenience fee, COD fee, et cetera. So that's also going to drive a certain amount of gross margin growth for us as the entire world changes, and they're going be following suit. Our own brands share which Falguni spoken about earlier, our own brands share going to grow on the platform and that's going to lead to gross margin own brands are at a higher gross margin. And the category composition with a number of categories like athleisure and few others which are good margin categories, we're going to be driving growth on those. So all of these strategies will lead to good gross margin. Again, reasonable objectives here. Our fulfillment costs and regionalize is something that has already reduced by 0.8%. Again, we are a younger business, all the teams across Nykaa are focused on fulfillment cost. And we are driving a lot of learnings across other businesses, improve regionalization. So the products go within a particular state and not cross state. All of that is going to improve our fulfillment cost as well as leakages, which is cancellations. RTOs, mainly RTOs and returns, which is something we have to live with as a fashion industry, but we're improving the quality of the business, quality of customers as well as quality of faster shipment to consumers. All of that is reducing our leakages, which is obviously reducing to a lower fulfillment cost. And also depending on the goods we are optimizing air to land ratios. So again another 100 to 150 bps reduction plan there in the next 3 years. Our marketing efficiency, which, again, marketing comes of an expense from a financial perspective, I disagree with this comment. It's actually a marketing investment. We are investing in customer acquisition. We're investing in getting our repeat customers back. Our marketing investment is going to get more efficient over the years. Last year already, we've had a 2.5% improvement in how efficiently we're using our investment. And we are saying this is the biggest cost row within the P&L. And we're looking at about 550 to 650 bps improvement further as we look at the future. And this is going to be driven. It is inevitable. It's going to be driven by a few key factors. One of the big one is the ratio of new to repeat customers. New customers are more expensive than getting repeat customers back from a marketing expense ratio. So as a young business, our new to repeat ratio is heavier in the new market at about 40% -- from last year it's already gone up some 36% to 48%, but it's still 48%. And over the next few years are repeat. We go to 75% to 80%. This is the majority of any e-commerce business. It's a natural trend. Because the consumers will come back, our cohorts will get better, they'll spend more time with us. So this is a natural progression, which is going to lead to a significant reduction in marketing expenses. Other than that, is the priority of business and conversion rate improvement right? We're getting better customers through marketing. Our platform as we do a better job and assortment is improving. All of that is leading to better conversion, which will lead to a lower marketing cost. Absolute overheads and team, we had to invest ahead of the [indiscernible] from -- a team perspective because to build what we've built from a product-type business, everything we had to invest upfront. Those investments have been made, and we have to peak of sort of where the team needs to be of aggressive growth. This year already be streamlined, and we believe the existing team is actually amazing. Actually the team is amazing. It's in a very, very good place to take a business ahead for the next few years, and we want to get overhead leverage. So already this year, it has only been a 10% increase in overheads while business grew a lot faster. So already, this financial year, we've had seen efficiency come in. And looking forward, we're going to see further efficiency come in. So the next years, we see about 500 to 600 bps improvement from a P&L perspective coming through. So how does this all come together? How do we all come together? What we're saying is over the last year, this financial year '24 versus '23, we've had a 380 bps improvement in contribution margin, which was all the points I shared earlier, and 250 bps improvement in overheads, which is about 640 bps improvement in EBITDA for the Nykaa Fashion business, right? There's a phenomenal 640 bps, while we've had good growth right? So something -- and looking further based on what our optimization and efficiency and what we're confident of, we believe that our contribution can expand another 800 bps, to 1000 bps. Our overhead will get another 500 to 600 bps leverage. So EBITDA margin will expand by another 13% to 16%. Yes, so this is pretty exciting right? That we have a P&L and one of the magic things which you can see is our positioning of the platform. All of this is possible because we're focused on the premium consumers, because our AOVs are twice that of industry. It's something we are going to be very focused on in that $3 billion market space. So coming to actuals, right? I showed you on the deltas, what does that actually flow out? So for the unveiled first time ever, we are showing you our absolute EBITDA. You guys will blown away, right? So absolute EBITDA for last year was minus 10%. For a business that has grown so fast, so quick and change the dynamic, we managed to hold it on minus 10% EBITDA. And what we're saying by financial year '26, this is what you guys can clap for financial year '26, we are going to be EBITDA positive. Okay. So again, all the drivers of growth are amazing, and we're moving there. And over time, we see this as a 10% plus EBITDA margin business, right? We're working across the P&L, improving efficiency and adding value to the consumers. All right. That's it for Nykaa Fashion. Thanks.

Thanks. Thanks, Nihir. The team that seems to be emerging for me through having now heard Nykaa Fashion and having heard Nykaa Beauty earlier, is that a reason a lot of brands like to work with us is that we give them the space as a retailer to do their own brand storytelling. We saw that in the video from Charlotte Tilbury. We're saying that for partners like Revolve and Foot Locker like to work with us is that, as a retailer, we still give brands the space online or offline to do their own brand storytelling to their exact terms. Next, I'd like to call upon Preeti Gupta, Chief Business Officer for Nykd. She goes with more than 2 decades of experience in the industry and have crafted and launched leading brands across the apparel and non-apparel categories for men and women. Under Preeti's leadership, Nykd has become a success story in a very short span of time. Over to you, Preeti, to take us through the exciting journey of Nykd.

Good afternoon, everyone. Sorry, tech glitch. I know we're not looking at you, Rajesh. The joke in the office is that, any tech glitch, and we look at our CTO. So yes, that's the joke. Great. So Nykd, yes, if all -- how many of you were here last year? Show of hands. Excellent. So how many of you remember Nykd? Show of hands. Amazing. So yes, so this is a lingerie brand that we've been building with a clear vision, as we had done for Beauty, to state that the category is underdeveloped. And we'd really like to educate women in this space and help them sort of explore this category, understand this category, why it works for them, et cetera, et cetera. And we've built this amazing brand called Nykd. So the vision that we have set for ourselves, that we'd really like to simplify lingerie for the Indian women, women over the years. It's not been a point of conversation. They've not really understood their body. There hasn't been enough brands, enough experiences for them to pick up from, and that's where we wanted to come in and really build this brand called Nykd. The positioning was, of course, very sharp, and glaring that we've added product and distribution, which is where we've really taken the brand and product to where the consumer is, which has led to a lot of consumer love for the brand, which led to kind of 25% kind of repeats, which are really benchmarkable repeats in the category. So overall, the milestones that we've achieved last year is really, we believe, that we've -- we are servicing more than 2 million consumers so far with Nykd. We are #1, of course, on Nykaa platforms, by far the largest player on Nykaa platforms. We're top 3 in bras in Amazon as well. We've started EBOs last year. This year, we've already taken to 17 EBOs. We've opened our own master franchisee. And above everything, I think we are profitable completely as a brand last year, which is FY '24. In the last 3 years since we've launched the brand, 3 years, full years, I'll let you absorb this slide, we've actually hit a run rate of INR 200 crores in this March. For the full year, we have already scaled the business 14x in the last 3 years. The first one was just a quarter that we were there, and we were EBITDA positive. So I think it really shows the culture of Nykaa, if I may say, which is to state that we just can't look for growth without -- with losing money, and we want to ensure that the businesses that we are building in are EBITDA positive and not just gaining market share at the cost of losing money. Next slide. And this is what we've accomplished in the last 3 years. And just to show you and contextualize it as to where the other brands were, competition, when you look at the top brands in lingerie, they were at INR 15,000 crores. It took them 25 years to reach there. Even when you look at brands in 10 years, 15 years, it's taken them -- they've reached to -- like, for example, if you take brand 2, 65 -- INR 650 crores, sorry, and it's taken them 12 years, and they are completely bleeding for the last 12 years. And here, in 3 years, we've been able to create this brand. And most importantly, there's a significant headroom for distribution growth, which is still available. So if you look at the charts below, the -- while Nykd is present in about 1,500 GT stores and about 17 EBOs, when you look at the larger brands, they are present in about 40,000 or at least 10,000 doors, 5,000 doors and about -- between 200 to 600 EBOs. So there's a significant amount of headroom, which is still available for growth. And hence, we believe that we can really amplify the brand even more in the coming years. Next slide, please. And of course, the point remains that the total addressable market for lingerie remains large. This is the same slide that we had shown last year, which is that the CAGR is strong at 16% and the market opportunity is extremely strong. And as we grow and grow the brand, the business only like to move more and more from unorganized to the organized space. Next slide. So we've done this on the back -- like I was saying, we've done it on the back of excellent products to begin with. In our efforts, we really believe that Indian women deserve the best products that the world has to offer, and we really work extremely hard to ensure that we get sourced-from-across-the-world products into the brand. And which is the -- even Dot & Key's Suyash and Anisha has spoken about the fact that we really are consumer-obsessed. And the amount of research that we do to ensure that the product fitment is incredible, is extremely high. Every product goes through between 50 to 100 bodies. So imagine that every single product has been tried on 50 people before we launch that product, which is probably the reason why the products are extremely successful as we launch. And we have had -- the next slide. And the business is built on a very strong Pareto principle, which means that 80% or a large part of the business actually comes from head styles for the brand, which essentially mitigates for all the challenges that typically fashion has, which is that there is volatility, you're not sure of what you can forecast in terms of sales, in terms of inventory management, in terms of gross margins. Everywhere, this Pareto really helps in -- as you're scaling the business. Next slide. So besides the product, we've really taken this amazing product to channels where the true consumer is. This is a slide about -- of our EBO. Next. When you look at the distribution for the brand, it's very important to realize the third-party versus own channels. So we are actually fairly evenly distributed between 60-40 in third-party to own channels. And between offline to online as well, we are 56-42. What this helps us in achieving is that we are really clear that it's not just the Nykaa channel which is growing. But as we continue to grow, there's enough and more space that is possible for us to grow in, number one. Number two, Falguni earlier mentioned, true consumer love can only be seen in offline retail. Because when you are in offline, you are between all the competition brands as well. It's not just your space. And people are able to touch, feel, see the pricing, really experience the brand. And when you win in these general trade stores, that's really when consumer loves gets built. And I think this is what this slide show. Next slide. So in terms of online, like we were saying earlier as well, that we are #1 in the lingerie category in terms of -- in our own business and #3 in bras in Amazon. We are also extremely strong in repeats, 25%-plus consumers are repeats, and they're shopping from us in 12 months. And a lot of consumers are shopping within 6 months, which is amazing performance even for a new brand. Forget for a new brand, even for the largest brand. And lastly, we -- I'm super proud to also share with you that a lot of times when people launch their own websites, you end up bleeding in your own site. We have, last year, launched our own site last, last year. And all of last year, we've really worked hard to ensure that we're now profitable, not only in other channels, but even in the website of the brand website that we've created, which is nykdbynykaa.com. It just shows how frugally we are building the brand and how very, very conscious that we are getting scale as well as profitability. Next slide. In terms of offline, we are present in 1,500 doors and trade. We've got now 17 EBOs already. We launched franchisee model last year, in this financial year since my last presentation. And we've, in fact, signed up our first franchisee -- master franchisee in Gujarat as well. And we're really scaling that up nicely as we speak. Our stores are between 400 to 700 square feet, and fairly strong powerfully. This is a 400-square feet store, but the way we do it, it makes it look much larger than what it is. Next slide. And all of this is purely possible because of the consumer-first, consume-loved brand that we've created. And the campaign was called Bra Aisa, Braless Jaisa, which basically means that you're wearing a bra, but you feel like you're not wearing because you're as comfortable as comfortable can get to. Next slide. We are a technology firm at the end of the day, and we wanted to ensure that even in lingerie, technology does play a large part. So we actually launched this tool, which is called the Bra Advisor tool. We realize that women -- 80% of women don't wear the right bras, and they don't wear because of lack of education. And then how can we solve for that? So with technology and a few questions asked, and you can actually come up with the right solution of bra. And our tool has actually won many awards for this solution that we are providing. And we are also -- it's got a 90%-plus efficacy as well, 99%, actually. Next slide. It'll just be a short video of the tool. [Presentation]

Yes, also very direct messaging, which is also what the consumer is looking for, rather than beating about the bush and trying to figure out where it leads to. And all of this, I think this is my favorite part about the entire brand, it's really been built on very, very relatable content that we create. So for example, this is Anshula Kapoor. And women typically struggle with body image issues, right from puberty till probably till maybe 70, 80, you still keep on struggling and thinking whether you're looking good enough, whether you are good enough, et cetera, et cetera. So here, we do some series called Nykd self-truths, where Anshula Kapoor has actually shared that how she used to hate her body, and how she is, with positive talk, with realizing that it's good to be comfortable with yourself is when you really are truly happy. So you can really see these journeys, and there are many, many women who have shared such stories with us. And just these are the kind of contents that women finally hold close to their heart and dear to them, and they really realize that they can have open conversations about these issues rather than believing that you are the only one suffering in that journey. Next slide. The second campaign, and this was actually our favorite campaign of last year, which is called All Boobs are Beautiful. This was -- as you can see, the kind of women that we use, it's a lot of -- a couple of them are actually normal women. The rest of them are models. We've actually addressed age. We've addressed color. We've addressed size of women. And we are saying all boobs are beautiful. And this campaign actually came from the insight, which is that when you look at internationally, globally, 70% of women are unhappy with their breasts. 70% of the women are unhappy with their breasts. Somebody believes it's too small, somebody believes it's too large. But really, is there anything called unhappy -- is there anything to be unhappy about here with your breasts? Because we believe all boobs are beautiful and all women are beautiful just the way they are. And it's important for us to recognize that and have these open conversations so that you can really build the brand love. Next slide. And the campaign won several awards, and we've also won many awards last year, a couple of them that we'd like to talk about is that we won the Economic Times Retail Awards for the #1 Lingerie Retailer of the Year. Now it was a very special moment because just 3 years to win this kind of an award was really very, very close to -- very dear to us. And of course, we also won the Emerging D2C Brand of the Year Award. A couple of more slides. I think some of our favorite comments that we've seen, "Nykd, where have you been my entire life?" We've actually seen quite a few consumers posting this, which just shows how they relate to the brand, how they are -- there is an actual market gap, which we are really filling with the brand that we've come up with. And lastly, I think all of it comes together beautifully in the flywheel that we are creating. Next one, please. In the flywheel that we are creating, which is that we've -- we really have the ambition to become one of the top lingerie brands in the country in the coming years to come. We have made the right investments in the team. We have a very, very strong, passionate team behind me while I'm standing here, there's a whole very, very excited, passionate team who actually works on these products and campaigns. We're positioned well. We've taken the brand to where the consumer is. We are distributing it well, and I believe that we can soon look at becoming one of the top few brands in the country in lingerie. Thank you very much.

All right. While we give our tech a quick minute to sort of make sure the clicker is working I wanted to take a second to also think about another key theme that was emerging for me while Preeti was taking us through the remarkable brand journey that Nykd has had. When you think about it, being able to use technology to solve for consumer insights that you have is remarkable, especially in a field like lingerie, and trying to solve for it online. I feel like that's quite a remarkable way to look at things. Up next, I'd like to call upon Ganesh, our Chief Financial Officer. He has almost 3 decades of diverse experience in financial reporting, business finance, taxation, investor relations, banking, M&A and corporate law, serving as the CFO across companies such as TAFE Group, Pidilite Industries, Godrej Group, Glenmark Pharmaceuticals, prior to joining Nykaa. So, so far, we've taken you through our businesses. We've taken you through some really great insights and deep dives into specific parts of the businesses that we want to highlight. And now Ganesh will take you through our financials. Over to you, Ganesh.

Thank you, and good afternoon, everyone. We have had an exciting set of business presentations. And I can see all of you being very super charged with how the day has progressed, thus far. So what does it all add up into in terms of financial numbers at One Nykaa level? Let's take a quick sneak peak. Yes, if we can go to the next slide. So as you can see, it's been another strong year for Nykaa, both in terms of top line as well as bottom line. And as you can see, the GMV grew 28% in FY '24. The revenue growth was about 24%. And given our strong impetus on cost optimization, on leverage benefits, which have started kicking in, what it has also meant is that the EBITDA margin has expanded during the year by about 44 basis points. And what I would like to add over here, you see something called an adjusted EBITDA. The reason why we are calling this out is that there have been a few onetime costs as well as a few first-time costs. So we had this presentation from Rozita, which showcased our foray into GCC. So some of these were not there in the base. So that's the only reason why we are also showing on a like-for-like basis that the EBITDA expansion has been even higher and coming net up of 6%. All of this has also translated into strong PBT as well as PAT growth, with both of them growing at 80% to 90%. And while that was the FY '24 performance, it's also heartening to note that this is something Nykaa has been doing consistently, so both in terms of revenue growth as well as in terms of gross profit growth. As you can see over the last 3 years, we have actually grown 3x. And that, I would say, is a great performance to maintain consistency over time. And how is it that we have achieved this? Because beyond gross profit, there are various cost optimization initiatives that has actually helped deliver this. And in terms of fulfillment expenses, we heard Anchit, we heard Nihir, we heard Vishal, all of them talked about it. So whether it is in terms of reduction in split shipment ratio and in air freight as far as Beauty business is concerned, Nihir spoke about the reduction in leakages and, therefore, reduction in both RTO as well as cancellation percentages. All of these are meant that fulfillment expenses have actually moderated and significantly shown benefits over the years and especially over the last few quarters. So also, we saw about marketing, both in terms of improvement in conversion ratio as well as increasing share of GMV from existing customers, Nihir spoke about it. And as you can see in the numbers, Fashion, while as a relatively new business in FY '21, the repeat percentage was just 9%, that has scaled up significantly and close to 50% now. Beauty is a much older business, 12 years, 10. So obviously, the repeat percentages there are higher. But even over there, consistently, as you can see over the last 3 years, some as high as 70%, we continue to grow, and it's inching up closer to 80%. So all of these in terms of whether it is fulfillment costs, marketing optimization, et cetera, has all contributed towards cost optimization and better margins. Then when we look at selling and distribution expenses, we heard Falguni earlier in the day in terms of owned brands. And as you can see, the share of distribution beyond the Nykaa ecosystem is something which is quite sizable. It's about 1/3 in Beauty. And in the case of Fashion, it's about 43%. Vishal spoke about BD productivity and how we are ramping up distribution on the eB2B front. All of this is something which is auguring very well for the future. While all of this has happened, we had invested significantly ahead of the curve, both in terms of employee costs, in terms of our office infrastructure, in terms of tech expenses, et cetera, especially in FY '23 coming out of COVID. And with -- while all of this has happened over the last couple of years, what we have started to see over the last few quarters is the leverage benefit starting to pan out, which is why you are seeing the percentage to NSV starting to come up smartly, both in employee costs as well as in G&A, and this is something while we continue to invest both in tech as well as in web. So now a quick look in terms of how is it panning out on the balance sheet front. And this is something which we have shared in the past as well. Coming out of COVID, over the last couple of years, we had significant investment in CapEx. Offices, which we had given up during COVID time, they are all back. Now we are working fully out of office. So there was a significant addition in office space, especially in FY '23. Warehouses as well increased capacity by more than 70% in FY '23. And this is something which has helped us get to the customers faster, deliver faster to them as well as reduce our fulfillment expenses. Physical retail stores is something we have continued to expand. We are at 187 stores as we speak. While going forward, and this is something which you are seeing in FY '24 as well, while the physical retail stores rollout is something which will continue to chug along, as far as warehouse costs are concerned, the bulk of the investment is already done. Same thing holds good for office space as well. And that is where our moderation in CapEx spend is something which is panning out. And versus FY '23, which was our peak CapEx investment of more than INR 200 crores, if you look at FY '24, the total spend is down to about 50% of those levels. Now that brings us to vertical reporting, and this is something which all of you are familiar with in terms of our verticals, where we have BPC vertical, the Fashion vertical and Others, which is predominantly NykaaD. And this is something which we have been reporting consistently on a quarter-to-quarter basis. One thing which I'd like to share over here is that over the last couple of quarters, we have been sharing about the streamlining of business operations, which is underway. NykaaD business, as you saw in Vishal's presentation as well, is something which has scaled up significantly over time. So in a sense, it's no more a small new business. And we have also -- we also announced integrating that into the Beauty fold by demerging NykaaD business into Nykaa e-retail, that's something we had announced last quarter. Our content development company, LBB, is also being merged into Fashion. And our business or fashion owned brands, is catered into FS and e-commerce, which is a listed entity, similar to the Beauty owned brands business, which is already sitting over there. So with all of these developments, what we would also be sharing with you is a realignment in the vertical reporting to factor these changes, which I just articulated. So if you were to look at how this would pan out and for comparative purposes that we are sharing with the realigned numbers, where you'll have the NykaaD business getting folded into the Beauty vertical. For comparative purposes, the superstores, if we were to strip it out, how would that look like, i's something which is there on the screen. Fashion will have LBB, which is going in, also Nykaa Man, which Nihir spoke about. That has got Grooming as well as Lifestyle. So the Grooming part would sit in Beauty, whereas the Lifestyle part would sit in Fashion. So -- and in the new businesses, what we would have primarily is the International business and GCC business, which is in U.S., up the block, which Rozita presented, is what would sit over there. So the realigned vertical, this is how it would look like. And this is what we would be reporting on a consistent basis going forward. One of the other asks from many of you has also been to give visibility up to EBITDA level when it comes to vertical performance. So that's what we have attempted to do over here. And to show how this will look like in FY '24 is what we are showing over here. So broadly, if you look at it, the Beauty business accounts for about 90% in terms of top line, Fashion and New businesses account for about 10%. And what we have done is the overheads have been allocated. And in terms of allocation percentage, if you look at it, in terms of Beauty, that comes to roughly about 80%, in terms of Fashion and New businesses account for the balance, 20%. Primary point to note over here is that Fashion is a marketplace model, unlike Beauty, which is an inventory model. And to that extent, the revenue, which gets reported is lower, and that's why you are seeing this allocation of overheads. So broadly, broadly on this basis, what this is reflecting is that in terms of EBITDA margin, the Beauty business, including NykaaD, would translate to an EBITDA margin of about 8.7%. Fashion, as Nihir mentioned, is minus 10%, giving you the blended One Nykaa number of 5.4%. Moving ahead, a quick look at the balance sheet. And as you can see, the health of the balance sheet has been only improving over time. So whether it is in terms of fixed asset turnover, working capital turnover, all of that has improved versus FY '23. The debt-to-equity ratio, while it stands at 0.5 in terms of net debt to equity, it is even lower at 0.3. And ROCE has also been improving over time and now stands at 7.5% at One Nykaa level. I must just point out, these are all One Nykaa numbers. And this includes the newer businesses, Fashion, NykaaD, et cetera, where the path to profitability is something which we have seen in the early presentations. So all of this augurs well in terms of how the future ROCE should move from here. Now one thing which I would like to highlight, and this is something we have been talking about, is in terms of building value, long-term value, for all stakeholders and doing it efficiently with capital efficiency. So what I would like to showcase over here is that Nykaa, in its entire lifetime, has raised all of $140 million and nothing more. And what have we created with this $140 million, which has been raised over the last 12 to 13 years, is that we have a Beauty ecosystem, which includes the Beauty.com business, which includes owned brands, which also includes NykaaD, which is scaling up very well. All of that, in terms of GMV, translates to about $1.1 billion. We have also built up a very successful Fashion business, which is scaling up really well, and which is already about $425 million in terms of GMV and built in less than 4 years. As Vishal spoke about, we have also seen how the NykaaD business has grown. And the latest is the launch of our GCC foray, where you had the presentation from Rozita. And all of this has been achieved in this 12- to 13-year time frame and with all of $140 million raised. So the point to be noted over here is that strong businesses are being nurtured, created and grown within the ecosystem. And a good part of all of this is happening currently through internal accruals. So if you look at a couple of the larger newer businesses, Fashion, which I mentioned, in terms of NSV, it's already up to about $123 million. The total investment till date is less than $50 million. And we clearly believe we are over the hump in terms of losses. And Nihir shared the path to profitability, where, as early as FY '26, we are expecting this business to turn EBITDA positive. Which, again, means that the further incremental investments, which would be required in this business, would be in the range of $12 million to $15 million versus about less than $50 million, which has been invested till date. As far as eB2B is concerned, yes, the path to profitability journey is a little longer, for no other reason but this is the newest business, and it's just a couple of years old. So total investments, which have gone in, is about $30 million. And what we expect this business will need before it breaks even would be still less than what has already been invested. So the point to be noted over here is that, as an organization, we are very much focused on unit economics. I would go to the extent of saying that, as an organization, [indiscernible] on this. And what this means is valuable businesses are all getting generated, getting built with very efficient use of capital. So on that note, I would like to take a pause and hand back to Vishwani.

Thank you very much, Ganesh. I'd now like to call over Falguni to address us about the macro industry overview and strategy going forward.

So hi, everyone. My job has been made very easy by each of the colleagues having come and already told you about each of the business strategies going ahead. So what I'm going to do here is literally share just very few slides, and they comprise of 2 main components. The first part is what I call as North star data points that I watch to know that the company and the businesses are on the right track. And that gives me conviction, these data points are the ones that give me conviction that we, as a management team, are looking at business in the right way and chasing the business growth in the right manner. So I'll start with those. You may find many of those slides very familiar because we tend to remind our investors about those pretty regularly, but it will give you a bird's eye view of how we look at guiding metrics on the industry side. And then the final slides talk about what I see as ambition for each of our businesses and what that means for One Nykaa. So really happy that, today, Nykaa is truly India's preferred lifestyle retailer, with 33 million customer base, 138 million app in stores, 1.7 billion annual visits across all our platforms, 17 million social followers, which allows us to be both the broadcasting and the influencer machinery, 6,700-plus brands listed on all our platforms and growing, 187 beauty stores. And again, each of these are growing quite strongly. 3,250 strong team members and 19,000 pin code service across India. Very soon, GCC numbers will start getting included in this. We are at 30%-plus online market share in Beauty, even when other external players talk about our share. And like you heard earlier, 15% to 18% share of the online premium market share in Fashion. This is all resulting in a consolidated GMV of $1.6 billion in the year '24 and obviously coming through 4 main platforms, which includes nykaa.com, which is a Beauty one, on Fashion, Man and the Superstore. Our journey so far, over the years, just to remind you, we started in 2012. Partnership with HUL and L'Oreal was started way back then, and it's nurtured all the way till now. And by -- I mean, I won't go through this whole chart because it has a lot. But you can kind of, in a summary, see that Nykaa has been busy all through the years adding many things in terms of platforms, brands, marketing formats. It's been just hastening to make sure that we offer all the ingredients that are very much needed to develop the ecosystem. We call it 360-degree execution. Talking about the industry outlook. I think, again, I've been saying in the last few calls that e-commerce in India has a long runway for growth. We do believe that our growth will accelerate again. '22 to '23 was a bit of a disappointment, with e-commerce growing at 17% to 20% against previous growth of 25% to 30%. And -- but we do expect the growth to accelerate, and we do believe that the long-term growth will be robust at 23% to 25%. This is based on external reports like Bain and other reports, which endorse this kind of a pace of growth for Indian e-commerce market. Also, the reason why we believe in it because there is a headroom for e-commerce penetration, similar like it was in China. So if you look at active Internet users, the number is 800 million. Digital payment users are 350 million. And again, this is the online shoppers are only 230 million. E-commerce penetration in India is at 15% to 19%. Beauty category and Fashion category are in that range. But if you look at China, it's a 35% to 37%. And that tells us that, similarly, the e-comm penetration in India will grow in that direction. Even if you look at online shoppers as a percentage of Internet users, they are only 30% in India, like I showed you on the top. And in U.S. and China, that number is 70%. So greater portion of Internet users are likely to adapt shopping online going forward. Again, if you look at the BPC market size, in 2006, BPC was just a $5 billion market with very limited being online. By 2022, Nykaa worked very hard to create a $3 billion online market for BPC, of total $19 million market that it was. It was about a 4x growth. But what we are excited about is that, going forward, over the next 15 years, we think that the growth is going to be 11% CAGR and almost a 5x growth to it being a $90 billion industry. Everybody is talking about how Beauty is likely to be the most exciting market. Of course, such an exciting market will draw a lot of participants. But like you saw earlier in our presentation, we have grown with each of the category. Entry of D2C has benefited Nykaa also. So the entire ecosystem -- entry of imports has benefited Nykaa, International brands has benefited Nykaa, which comes through imports. So I think the entire ecosystem benefits also are being leveraged by Nykaa. So this kind of excitement and size of industry at $90 billion, with almost $40 billion being online and $50 billion offline, with Nykaa having play in the entire ecosystem, augurs very, very well for Nykaa. And if you were to also look at comparison with China, a lot of people are comparing China. India today is where China was in 2007. You can see that in the GDP per capita comparison. And BPC spend per capita was similar. China was $15 to $18 in 2007. And today, China is at $40 to $45. And today, India is at $15, and we have conviction that India is headed to almost $50 per capita consumption over the next few years. If you look at GDP per capita in metro cities, I think this is a case in point that we wanted to make. While India's per capita GDP looks low at $2,500, many of our cities like Mumbai, Delhi are already enjoying per capita income similar to China. Similarly, many of the cities like Kolkata, Bangalore, Ahmedabad, Chennai are on their way to higher per capita incomes. So within India, there are a lot of cities, which have higher per capita consumption. And if you look at discretionary spends with higher disposable income, we are quite surprised to see the way the penetration of every category is increasing. For a long time, all of us who are in the finance sector for many years, we have seen that we complained that there are only 60 very few income taxpayers. That number has also gone up to 67 million. Credit card user number was always a complaint, all those numbers are going up, demat account openers. So I think the consumption is getting more and more integrated in the country, and this is going to flow to discretionary consumption, too. And this is another North star metrics that really excites us. That 29 million households in high income by 2030, every 1 in 2 households with high purchasing power. And it's not just futuristic. By 2022, this data, which is from World Economic Forum, that shows us that upper middle class has already grown to about 34% of India's pyramid. And even at the top high income, the numbers are growing from 3% to 5% and reaching 7% in future. And upper middle income, which is at 34% currently, will go to another 44%. With these high per capita income, discretionary consumption is bound to increase. So we love the shape of the pyramid that is developing. And finally, the BPC e-commerce penetration in India, which currently is at 17%, we feel will move to 45% over the next 15 years or so to be at a similar level as what it is in China today. And premium BPC also has been underrepresented in India. We talked about premiumization throughout our previous presentations. We believe that Indian premium consumption is only -- Nykaa has it higher. But overall, in the country, 25%. China is at 38%, World at 29%, and there's only one way to go. There will be premiumization of Beauty In India, and Nykaa, again, will be the biggest beneficiary. So with that, what is our One Nykaa ambition? So I think you saw that in terms of -- I think we heard a lot of investors tell us that give us information up to EBITDA level. So we're going to do it across 2 verticals, Beauty and Fashion, and this is broadly the definition of the 2 verticals, with maybe some amount of Fashion stores coming up in future, especially the EBOs for our owned brands. I wanted to explain one important thing for everyone. I don't think the investor community understands that Beauty -- I mean Fashion contributes 27% when you look at GMV terms. But even on NSV terms, Fashion business contributes 16% of our mix. However, on a revenue basis, it only contributes 9% because we do Fashion business on marketplace, whereas we do beauty Business on inventory led. And most of the Indian finance ecosystem is used to seeing retailers which book it on the basis of inventory-led principles. And there are not too many marketplaces, business, which are listed in the market. So how to value the marketplace as a revenue is a little bit misunderstood. So if we were to look at revenue composition, where fashion represents only 9%. In my opinion, that is understating the Fashion revenue by 7% to 8%. So our revenue would be 7% to 8% higher, should Fashion were to be reported on an inventory-led basis. So that's just one important point I wanted to make. Internally, we look at all of the metrics on net sales value basis because that's the only way in which we can compare the unit economics. Also, going forward, we wanted to just project 5 years out. And we feel that Fashion will contribute 21% on NSV basis. That is up from 16% in this financial '24 to 21%. So even with our rapid growth, Fashion share is only going to go up by 500 basis points, from 16% to 21%. So this is good news from every perspective. Fashion is growing. You all should be happy. But we continue to remain predominantly Beauty, which is what you all want to see. So we will continue to be 79% Beauty. And definitely, some from the perspective of net revenue, I think that Beauty representhation tends to be higher. So if you look at current Beauty representation on a revenue basis, almost 90% of Nykaa business is Beauty. Of course, we are going down the ecosystem and everybody believes that some businesses have lower gross margins. We have defined that. And we said the gross retention margin in eB2B is good for us, and they will only improve. Similarly, we have defined that all these businesses can be done with path to profitability, and we've done it in Beauty. We've set that example in Beauty because of which the entire industry, where suddenly people don't feel that Fashion business or Electronics business are profitable, beauty has been built as a profitable business. Same thing can be achieved if done right in other segments. So we want to believe that we will create profitable, valuable businesses in each of the segments going forward. And how will we do that? So if you look at Beauty, we will continue to maintain our market share at 30% plus and grow ahead of the market as well as we will maintain margins. This doesn't mean that margins won't have tendency to improve. They will have tendency to improve with all that we are doing. But we want to make sure that we continue to invest those extra margins back into the business to continue to stay ahead of the curve, acquire more customers, do more exciting stuff, including building our own brand platform, so that we can continue to build this business. On the Beauty physical stores, we clearly are at 187 stores, largest specialty beauty retailer in India. And we are definitely going for a 2x store count in next 3 to 4 years. On the Beauty owned brands, we are focused on growing the contribution of Beauty brands in our overall Beauty business as well as the info profitable growth. And we want to have a collection of 5, 7, 10 Beauty brands, that we will cherish in the long run. Our long-term ambition is to be a consumer brand company in addition to being a retailer. So clearly, we want to be both a retailer, which is a very fair retailer and is not eating our brand partner's lunch to be successful. But we also out of all the knowledge that we have of the industry and of the ecosystem, we want to use it to build successful brands. Similarly, on Beauty eB2B, like which Vishal talked about, we do believe that there has been already 900 basis point contribution margin improvement, as well as almost a 22% improvement in EBITDA over just last one year. And I think the same momentum will continue over the next 2 years, leading to better unit economics for this Beauty business. So none of you need to fear whether this business that is going to scale will dilute our earnings. We will be very cautious to keep watching for the right mix. On the Fashion front, the Fashion NSV will grow by almost 2.5x to 3x over the next 3 years. And we've also said, Nihir said it earlier that we will be EBITDA positive by '26 and a very limited investment remains to be made, but we will continue to make because all the numbers are known to you. In Beauty, we have 25 million customers who have ever bought. We prefer 2 vertical app routes rather than 1. We think 1 app leads to cannibalization. We are big believers in customers being different. We need to give them different journeys, different priorities. Both are very wide businesses, can't be all clubbed into one. We don't like -- we feel that if we were to put Fashion and Beauty into 1 app, it would lead to cannibalization. So with that logic, we have more to do in Fashion where currently, we've ever dealt with 6 million customers, and that number will grow to similar to where Beauty is today. And along with fashion.com, we'll also support Nykaa Man. Similarly, on the Fashion owned brands, again, similarly, Nykd has grown. There could be more brands out of Fashion so that can have a journey of its own. Some will be in western wear, some in ethnic wear. So there'll be more excitement there. And everywhere, they could be build or buy a model. And finally, on GCC. We think that this year alone, there will be about 5 stores and Rozita talked about the KPIs of the current stores. And I think the revenue in '25 itself, I think, could go to $10 million to $15 million. So the business there can get very quick scale. It's a great market with high per capita income. And we've had the successful launch, the product market fit has been seen, a lot of brans are excited about being on our platform. And I think that gives us confidence that we should be able to achieve our business ambition in this market. With that, thank you for today.

Thank you so much, Falguni. We've heard from all of our business today talk about how they leverage a lot of technology to bring to you solutions on the consumer insight to make sure that our consumers have the best possible experience there. I'd now like to introduce you to a Chief Technology Officer, Rajesh Uppalapati. Rajesh has over 2 decades of experience building world-class products, platforms and services for large-scale organizations as well as start-ups. Over to you, Rajesh.

Thank you, Vishwani, for the generous introduction. You have been doing a fantastic job today. Good afternoon, everyone. I'm Rajesh, and I'm here to share -- it would be like about 20 months since I joined Nykaa, and I thought I'll use this opportunity to share my learnings from this awesome journey so far. Let's see. I hope there are no technology glitches. Okay. So let's start right away. I love this quote. This is by a mathematician and a data scientist, because the analogies are like really perfect between data and oil, just as oil is a key resource to fuel growth, data is also very powerful. The catch though is just like crude oil, we need to refine and process to generate the right insights and then magic starts happening. So, Anchit has beautifully laid the land, he specified how we have 12 years of rich customer data. Let me try and bring it to life on how we are leveraging this oil and essentially like taking the crude oil and converting it to a high-grade rocket fuel propellant. The 12 years of data is allowing us to study our customers very closely and very deeply. And a lot of things can happen. Let me bring the whole thing to life with a simple example on what we are building. For the first time, we are looking at customers in a very different lens by mapping them to what we call as their life cycle stages. So I mean life cycle stages can come in like much more micro stages, but just to like simplify things, we have 5 such life cycle stages, starting with a new customer to becoming unsettled, then becoming settled, then eventually like becoming loyalist and advocates. Now what we are realizing is, when we start looking at customers by their life cycle stages, we are able to see very interesting patterns and how their behavior changes, especially as they graduate from one life cycle to another life cycle. For example, customers who are more loyalist and advocates, I think the occasional delivery slip doesn't seem to matter at all on how they interact with our platform. Not that we want that to happen, but I'm just sharing the kind of insights we learn. Now the second thing is the moment you start looking at customers and behaviors and you have this rich data, you're also able to study what are some of the successful journey paths that customers are taking to graduate from one life cycle to another life cycle. And when you study this over lots of data, you're able to actually identify the most efficient paths that customers can actually take to graduate. Now why is this interesting? Because now that we know that customers, when they graduate, their behaviors also changed dramatically, including how frequently they purchase, the size of their baskets, the frequency of purchases and all that. And we also know the journey paths we are able to build sophisticated machine learning algorithms that recommend the precise next step a customer can take to graduate in the life cycle. And we are also able to build like a smart rewards engine that gives the most optimal reward for the customer to complete that path. The whole thing like I tried to create a simple visualization, it's pretty much like a snakes and ladders game. As you can see, like these are various journey paths. And through the journey paths, there are definitive actions that our data tells us that if we take the chances of going to the next data are higher, and there are what we call as dynamically created incentives that act as the ladders in the snakes and ladders game. Obviously, like any negative value action, like failed deliveries, or like a bad returns experience could be the snakes in the game. And this is something we are building as we speak, and we are super excited about it. Okay. Personalization is a very, very big theme. And over the last 18 months, we have made some big strides in it. What you'll see here is a combination of multiple personalized recommendation widgets across Fashion and Beauty. By the way, recommendation widgets is one aspect of personalization. There are a lot more things that we do, including personalizing display banners, CRM, search results and so on and so forth. But I thought I'll share a good success story on something that we have been working over the last 18 months. Let me speak a little bit about a couple of these widgets, so that I can bring to life what goes behind building a widget like this. If you see the top left side, there is a widget called Handpicked For You. It is essentially -- there is a lot of machine learning going behind it. And the way the algorithm works is very simple. It uses a powerful technic called collaborative filtering. Let's say, I, as a consumer like brand and category combination of A and B, then the algorithm looks at a cohort of consumers who are similar to me and like the same brands and categories. Let's say, this table to my right is such a cohort. Now within that cohort, it again finds what are other brands and categories that they share as common interest, right? And then it starts recommending to me those brands and categories. And once you do that, more often than not, customers start discovering new brands and categories that they might like. The widget right next to it, in the middle is called Explore Your Favorite Brands. It is actually one of our highest performing widgets. It uses altogether a completely different machine learning technique. We have lots of data like we spoke about. We build what we call as a probabilistic machine learning model. We essentially pick an outcome like, I want this widget to maximize chances of a customer adding something to cart, and with that objective, we train it on a lot of data. We look at past historical data of customers' browse behavior on the app, whether it is searching for a product, viewing product detailed views, whether it is adding to their favorites, adding to carts. We take all these actions, and then we look at it in relation to the time. For example, someone might have added something to their card 1 week ago, but they might be browsing something more recently. We try to understand through a machine-learned algorithm, what is the related importance of each of these actions in relation to time and the machine learning model skews for what I call as an optimization function so that when the customer next comes on the app, based on the browsing history, we are able to predict the categories and brands that they are most likely to interact with and eventually add to cart. I'll just share one more example to show how nuanced and different these techniques are. If you see on the left bottom, there's a nice Fashion widget called Similar Products. It's one of my favorites. This widget actually is on the Details page. Interestingly, it is not a personalization widget at all. because you're deep in the funnel, you have shared your firm intent that this is the kind of product I am interested in. It doesn't matter whether you're a new user or I know about you for more than a year, we want to latch on to that interest. And here, what we are doing is we are taking the image of the product the customer is currently viewing, we are representing that image in an n dimensional vector space, and we have already taken our entire catalog and represented it as a numeral. And then we have algorithms to find based on image recognition, what are the nearest neighbors. For example, if I'm seeing a very floral pattern dress, even if there is no mention of floral in the catalog, this algorithm will find similar patterns visually and then start recommending those widgets. In a nutshell, these algorithms obviously take time to learn and perfect. But the good thing is like as you start investing, you start seeing such awesome results. You can see both on homepage of Fashion and Beauty, there is a steady improvement in the click-through rates and it's only going to get better. I can promise you that. Okay. Let's move to the next learning. So we all are aware that to create a good 2-sided network, the interest of both the parties have to be very well balanced. And typically, if you want your partners to succeed on the platform, there are 3 undeniable truths, which if we cater to, there is a high chance that our partners can succeed on our platform. A, partners can come in multiple shapes and sizes. One size doesn't always fit. How well your product solutions for them cater to the diverse partners is going to be very critical. Can you share the right data and insights that are meant to be shared with them to succeed on the platform? And the third thing is, can you give them self-serve tools that will empower them to control their destiny on the platform. Let me share an example of how we are bringing it to life using our Ad Tech platform. As you can see, and we have spoken about this last time as well, I think our Ad Tech platform has ad formats that cater to all 3 needs. We have display ads on homepage, which talk at an awareness level. Then we have, again, displays ads at our category periods where they are more getting into the consideration set for that particular category. And then we have also launched what we call as PLA ads, right deeper into the funnel, where you can see them on the Search listing and Category listing pages. Not only that, we have pricing models, whether it is CPM or CPD cost per day or cost per click and we are essentially taking care of partners with varying needs through this. We are also sharing very powerful insights for them to be successful on our platform. If you can see there, we have just marked out some of the actual numbers. I hope you can understand. But what I like about these insights is there is a good amount of customer empathy, customers here being our brands. And if you can see, for example, we are showing to them some of the highly searched keywords, which are currently having less competition and might be a great opportunity to bid on them and leverage, right? So this is just one such example on how we are sharing insights to our partners to make them successful. I also want to clarify about Self Serve and lot of effort has gone into making our platform Self Serve right from creation of an ad campaign, to managing your budgets and then reports and eventually insights that we just talked about. They are all available at the fingertips of the advertisers through Self Serve. And building an Ad Tech platform is a fairly complex engineering problem because there is a real-time aspect of it. We are actually processing hundreds of thousands of events near real time and are taking decisions on what's the budget available for advertisers? How are customers interacting with that particular ad? And how do I rechange what ads I need to show? All of these decisions need to happen in sub-millisecond. And we have to use complex machine learning algorithms that optimize for multiple, sometimes even conflicting priorities, right? There is a consumer relevance to be taken care of. There is a brand ROIC to be taken care of, and there is a marketing income as well. And that's the challenge that goes behind the curtains. Okay. The next one is my favorite. How do we -- I think Ganesh briefly talked about creating scale and leverage through your investments. I'll talk about like how Nykaa Technology stack is creating the leverage for us. But before going into that, I want to briefly talk about our Nykaa platform and the apps. Nykaa Technology has been built and perfected over the years. And there are a few things that differentiated, given the fact that like we have been working on these tech stacks for multiple years. The first thing is what I call as resiliency engineering. It is not easy to take a plethora of services that need to be highly available and at the click of a button, make them scale for 10x traffic, 20x traffic and 50x traffic. It seems simple and trivial, but a lot goes behind in terms of how you partition the data, how you define and choose. And we are proud to say that our technology stack scales with a mere push button, by adding of new instances. A lot of platform services that are built like the catalog, the identity service, search and so on and so forth. And then the second part is some of the consumer-facing features that we have iterated and built over the years, whether it is the Nykaa Stream or we have talked about the Ad Tech platform or all the personalization and discovery widgets, that we have built and learned and iterated over the years. Those are all strong assets of ours. And our belief is consumers are more similar than different. Of course, there is an aspect of localization and like local geographic nuances. And with that spirit, we want to take the Nykaa Technology stack and start offering it to our strategic partners. We are -- Nihir ready spoke about Foot Locker launch and how that selection is going to be available on Nykaa Fashion. Footlocker is also launching an independent website and app in India. And it is going to be on Nykaa's tech stack. So all the goodness that we just talked about will be available for FootLocker. And we are also considering leveraging this stack in the future for Nysaa. We believe, like obviously, as part of taking our stack and offering it to like some of our partners, there are additional investments that we need to make in terms of making our stack compliant with the local laws, data privacy and stuff like that and even localizing like and adding multi-language and multi-currency support. But we believe that the goodness that comes off it makes it a key strategic investment that will overall improve our tech leverage. Okay, controlling your destiny, I think today morning, Anchit has beautifully set the tone, he touched upon quick commerce and how it is really redefining what we call as the norms in terms of convenience. What we have also realized is that delivery speed is going to be a key differentiator. Anchit has already clarified how we are expanding our warehouses so that we can deliver to customers very fast. Let me share my side of story from a technology perspective. Before last year, Nykaa's warehouse management system used to run on a software called e-retail that is owned by Vinculum. We realized the need to control our destiny in areas that disproportionately impact customer convenience. And we made a big move to in-house that entire software. It was a massive undertaking, but I'm so happy to share that now the warehouse management is in-house. I have my own engineering and tech teams that are working on it. Talk about some of the things that we are doing. To begin with, we are investing in in-housing the forecasting algorithms. Very early days. We have built a model, and it is already outperforming the existing model. And we are going to invest in 3 other areas, now that we have in-housed this is our entire warehouse management software, starting with what we call as the allocation. Allocation is essentially the process of taking a customer order and deciding pseudo real-time, which warehouse will I allocate it to? How will I split the order? Should I optimize for shipment speed? Or should I optimize for shipment costs? And this has a direct relationship to how fast we deliver as well as our unit economics. So we are investing a lot in redefining our allocation logic. We are also taking it a notch above and investing in improving some of our algorithms on how we do put aways when inventory comes into our warehouse so that the most popular products are easily available to the pickers in the warehouse, so that they don't have to travel the length and breadth of the warehouses. We are also doing optimizations in the way we pick, by taking into cognizance the cutoff times of couriers so that the packages that need to be sent to a particular courier are picked in a certain order and they meet the cutoff for the date. And we are also investing in terms of picking the right courier partners based on their availability, their performance metrics and so on. And all of this is possible because we could make the strategic call to in-house warehouse management. Okay. The last one, embracing external trends. I'm sure, a lot of you are waiting anxiously. Over the last 2 decades, there have been numerous technology seismic shifts. We have witnessed most of them, and there is one that is happening right now. It is more real than any of the other trends we have seen like Metaverse or Crypto and stuff like that, and that's Gen AI. So we'll talk a little bit about it. But one thing I wanted to share as a learning is you could resist some of these trends, you could pretend as if they're not happening or they won't matter to your business, but you're doing it to your own dooms. I think you're better off adopting them, embracing these trends and making them as tailwinds for your business and the sooner you do it serves your business. So I'll quickly share what we are doing in Nykaa. First of all, it's similar to the San Francisco many, many years back, the gold rush, right, like everyone is jumping on this bandwagon. There are also some flip sides around Gen AI. Obviously, it comes with heavy computational cost. The language models make the explainability very opaque. I get a result from ChatGPT, but good luck explaining the source of truth for that recommendation, right? And then there are privacy concerns as well. So we have taken like a 3-pronged strategy or a principled approach towards embracing this trend. First, we wanted to obviously be very, very closely tied to everything that is happening around us. Number two, we wanted to stand on the shoulder of giants. And that's a very important tenet, given there is so much ML work that is already happening on the data to build some of the things like the customer state machine, we thought we should partner with the Googles and the Amazons and the Microsofts of the world and very smartly leverage what they bring to the table and innovate on top of that by bringing our own expertise. So that's what I mean by standing on the shoulders of giants. And the third one, obviously, is run low-cost experiments. So if you see here, in terms of the Gen AI usage you would see like most of the applications today that are bearing fruit are largely around productivity, conversational AIs, chatbots, content generation, having co-pilots like coding co-pilots, that will help the developers while they're coding. I want to share very quickly like how are we operating or where exactly are we dabbling our hands on. So we have picked the 4 core themes, and you can see our partners to the left, the giants that we are standing on. We have made some progress on all these areas. We are doing interesting pilots. By the way, I have a couple of interesting demos as well that I'll show to you. But yes, we are being very surgical as well. And I'll share, like now so we are doing things in the funnel itself to improve conversion. We are doing stuff, obviously, to generate content and improve our catalog. We are doing a bunch of stuff that enhances developer productivity using Microsoft's GitHub copilot. And we are also doing what we call as a sales coach assistant. I'll share a demo of it. And then we are getting into conversational AI as well. So let me not waste any more time and walk you through what exactly we are doing. First, let's start with some of the things we have done on the shopping funnel. Again, you would notice, these were all done as low-cost experiments. They were done very surgically and they are actually happening on the shopping funnel in a way that doesn't intrude the core shopping behavior of a consumer. Because we have learned from the Swiggys and Myntras, that whenever you do something that is radically different, like a fashion GPT or a fashion assistant in the core shopping funnel, at least now consumers are feeling a little distracted. So I'll start with the -- the one on the bottom right, the catalog enrichment, very obvious. This is a classic case of content generation. We are using Gen AI, LLM models to look at an image and extract attributes out of it. Especially the key attributes that you see there, like the pattern, occasion, the collar type, neckline, we are seeing 80% accuracy. And overall, we measure ourselves in terms of the feed turnaround time, right? So we get a feed from a seller and we have to take it live. We have been able to shrink the time to take a feed live by almost 30%. The second one is right above it. Pair it with ChatGPT. So this is something done using what we call as prompt engineering. So let's say, through all the ML artifacts that we have built, we have been able to say that a particular top is something that the customer is interested in. Now what we do is, we go and extract all the attributes behind it. Then we do a prompt engineering where we frame a query to ChatGPT saying, "Can you give me the bottom where that goes with a top that is a western wear of this color, this neck type, this collar type". And then the ChatGPT use a response. And then we take that response and then we reformulate it as a search query, and we find matching products. Now we have done this in a very, very short time, and we have done some manual QA of the results, and they have been very promising. Almost in 70% of the cases, the results are actually very good. And we are actually running an AB test as well to see how consumers interact with it. On to the left is another example where for one specific category, we experimented taking consumer reviews and creating themes on what customers are talking about and then elevating those themes as search filters. And again, like we saw like a good impact from it, the cart to order has improved by almost 3.4%. So with that, we are coming to the close of the presentation, I want to leave you with 2 interesting demos. One that is directly like talking to our top line. Let's see. So on the left side would be the way the current search works. Let me actually start by highlighting the problem statement. There are these regular search queries, like you're searching for a certain western wear. And then there are what we call as these nuanced search queries, right? For example, searching for dresses for a Haldi function. And it requires a lot of semantic understanding of the query to pull out the right matching results there. And if you can see right on the left side, is the current results and the right side is where we are headed to. By the way, this is not a fake demo, we have built it, and it is all working, and we are going to take it to production very soon. So, we are first showing it on fashion. This is the haldi outfit results. Now, we are picking a Beauty example, right? Anchit has already mentioned how the search for Beauty is evolving into distress and condition-based. People are beginning to search like for more nuanced queries like I have a skin psoriasis condition, what kind of products can you recommend? Now let us go and see like what have we built? And this is in close partnership with Google. I'll exactly share what Google has done and what we have done to bring this magic. So this is a real demo happening on real catalog on our pre-prod instance. You like the results better, right? Okay. So what is the magic that is happening behind the curtains? I think the first thing to remember is we have built in-house technology to take any product in our catalog and represent that as a numeral. What I mean by that is all the attributes in the product are collated and vector in an N-dimensional space. You can see there, right in the slide, it clearly highlights how you take a product and if it has 10 attributes, each of them represent a dimension. Now we have also built algorithms where if I give one product, it translates that to a numeral. And then in my catalog and it does a special first to fetch all the close by neighbors and all of this works in milliseconds and this is the technology we have built. Now where does Google come? Google, obviously, is a giant in terms of understanding search. They have millions of queries that tells them that when people have searched on Haldi outfits and they eventually end up clicking mustard and yellow colored dresses. And obviously, those dresses also can be represented similarly in an n-dimensional space. Now what we get from Google is these additional attributes that we can use to enrich the exact, they're all yellow and mustard in color. And once we get this enriched attribute into our catalog, the same search now starts getting more powerful and start bringing out the semantic nuances. So now you can start searching by conditions and distresses and whatnot. And all those are encoded in these numerals and the search starts picking those up. With that, let me -- I'm coming close to the presentation. I'll share the second demo as well. So this is where we are investing in a productivity tool and again, this a prototype that is actually working. So what we are doing here is we have trained a model on our Beauty advisors data, where they are coaching the Beauty salesperson on how to manage your sales in the stores. We have taken a very barebone like 8 to 10 recordings and we have built a basic model. And even then, it is extremely powerful to see how well we are able to create a bot that mimics these customer role plays and coaches our sales team. Let us see the demo. [Presentation]

I think you get the idea. I think if we take a pause and think about the future possibilities of what this can do, a, as we train with more richer data, the bot starts simulating infinite, role plays is on the persona of customers. And we are building what we call as an assessment module. So right at the end of this call, the LLM that we built actually does the scoring and it tells how the salesperson performed on various dimensions. And once we have that, the salesperson can obviously improve upon it and then we can get them ready to the store. Not only that, as new products come we can start building refresher courses, educate them on like new products, formulations, routines and stuff like that. And the next logical extension of this, we want to use this bot to even help in terms of interviewing. And we also want to try it out for our B2B business. I want to very quickly touch upon a couple of things we are also doing in the store, apart from the sales coach. And a lot of this, we are actually working with third-party vendors. There is a tool called Squirrel Vision, which uses advanced image recognition techniques, and we are partnering with them. Their technology helps look at the videos of customers and tracks their movement, and it creates a heat map of the most sections of the store that these customers are moving. And once we have that data, we can totally optimize the layout so that the right assortment and the right marketing collaterals are placed in the right areas. And there is also one more use case, we are evaluating with them is to use image recognition and look at a certain aisle and a section of a store and figure out if there are any assortment gaps. Yes, and we already talked about the skin analyzers. So these are all some of the things that we are doing to embrace external trends. And with that, it brings an end to my presentation. Once again, to summarize, it's been a wonderful, wonderful journey. It's been a privilege to be part of the Nykaa team. And thank you all for this opportunity.

Thank you so much, Rajesh. A lot of those demos were fabulous to understand really how we can optimize search while using Gen AI. I wanted to now call upon Surendar Mehta, our Chief Human Resources Officer, to take us through an ESG focus. With about 20 years of experience in the industry across India and global operations. Suren, if you would please join us here to take you through our ESG strategy.

Thank you, Vishwani. I was telling Rajesh, you made my job a little difficult after all the exciting stuff. But what I quite like the fair at one. Imagine we could search spouses, with [indiscernible] we could search candidates on job platforms. That's what we spoke about the other day. Good afternoon, everyone. I know I'm standing between the exciting coming up Q&A session and lunch -- followed by lunch. In -- across forums outside when you go and meet people, one of the things which is often spoken about, particularly in the talent market is people love to be part of organizations, which have larger purpose, which do beyond businesses. And my experience in Nykaa, in the last 3-plus years, I've been around is this, company believes in not only doing -- create businesses, building sustainable businesses, but doing them very responsibly. And in many ways, the ESG strategy of Nykaa is in continuation to that in terms of building it responsibly and to do good governance. So in the next few minutes, I'm going to walk you through a few glimpses about this theme as ESG. This is a theme, as we all know, has become very, very critical across the world. And a lot of progressive work has started to happen, and I'm very happy to share that we also, as a young, early-stage company have made some good beginnings on this. But before I go, let me begin to -- by drawing your attention to our values and values as we all know, are what define our cultural fabric of Nykaa. Particularly when it comes to ESG, 3 values become our guiding this thing. If you look at the picture of their values. So it's Be Bold, Be Good. I think we like to do bold business decisions at the same time being good. Look, doing business in a very sustainable way, every action. And you heard across whether Falguni was speaking, Anchit was speaking, Nihir and everybody, that making sustainable decisions of doing business. And the last one is a belonging culture. I think in the ESG regime being able to do things which are very inclusive and make it in a very belonging way starts to make organizations really admirable. So if you look at on the right-hand side of the screen, on both our platforms, whether it is Fashion or Beauty, you will see Nykaa is being very aware about onboarding responsible Fashion brands, almost 600 of them or it's on the Beauty side of -- is with the consciousness towards Green Beauty, 150 -- 150 brands. What I feel very good to share with all of you is that last year, we've partnered with a company called TUI, which is a global agency, which does certifications and is an expert in the area of safety, in the area of certifications. And we have for FY '24 with respect to our BRSR assurance review, we've got them to certify us already. So while we don't fall into the category of high environment impacting businesses, but happy to share with you whether it is in the area of building sustainable packaging or in the area of plastic recycling, we've been making very good progress in the last few years. And I think we feel very proud of making those beggings. Nihir, some time back did the anthem with you in terms of staying stylish. One other secret about Nykaa is that Nykaa does very effective and very good coordinated dance, whether it is inside or with our ecosystem. So what you see in this slide is a very wonderful ecosystem where we are trying -- we work with a large supply chain partners, a direct indirect employee strength of 11,000 plus network of influencers, creating economic opportunities not only with influencers, but also in the large physical retail setup, which we are trying to do through super state. And we do believe that as the journey of ESG commences, I think this ecosystem will work with us in a very effective way to make not only what regulation requires as of today. But I think as the definitions of regulation for listed and for well-governed companies goes in advance. I think we feel very proud that having built wonderful relationships with our ecosystem, I think we'll be able to leverage it to advantage of even doing our ESG objectives in a very targeted way. Moving on. This is my favorite slide. I'm sure many of you attend other organizations in terms of their practices and how they are. So if you look at this slide, it gives you a very clear indication that how Nykaa is well diversed, whether it is in respect to demographic of the workforce. But more importantly, a lot of focus in the last, I would say, 10 years or even more has been on gender mix. I think I feel very great about the fact that when you look at the Nykaa, starting from the Board right until rest of the organization, you see a very, very healthy mix. A few quarters back, we had, I think, one of our investor firms reaching out to us that we're really keen to understand whether are some of the numbers flash in the pan? Or is it really deep dive when we walked in through and I took the opportunity to build that slide into it. So look at that gender balance whether you look at people who we are hiring now who are less than 1 year in Nykaa or for people who are 2 to 4 years, you see a very, very healthy mix. Organizations have an aspiration to visualize these kind of numbers and Nykaa is really up there. Another important topic in the area of social and governance comes gender pay. Rajesh spoke about being on the back of the large ones. This is an area where the zone of tolerance of gender pay equity is considered to be less than 5%. Here, very happy to share with all of you at Nykaa, we manage this really, really objectively, meritocracy based and with a clear focus on not having genders being done and our pay gap is plus/minus 1% -- within plus/minus 1%, much superior to what even the global zone of tolerances. So I think you'll be very happy to know this. I think a lot of international investing agencies asked this question to me many times, and we share with them. So very happy to share with you that. Now as -- when you do good work, I think recognitions come by. And in the last year, not only LinkedIn on their own, basis their own research, ranked us as a workplace where people are growing. Also Economic Times with respect to preferred work places. So thank you for all the support extended by everyone here. Moving on. So while I spoke a while back about a lot of the stuff which has been happening with respect to essentials we are required to do on ESG. We've also started doing a lot of internal self-audits with respect to energy emissions, the way we consume our water, all our offices, which we -- Ganesh was sharing about a lot of infrastructure created, how we are investing in them being energy efficient and stuff like that. But what I feel also great about is that in our CSR initiative, we've been able to do in the last few years, very, very meaningful engagements. In the CSR area, we've chosen some areas where some key themes where we want to make impact. And the -- it has been around in the area of skilling and education, bringing livelihood and particularly working with the marginalized and underprivileged one. So what you see on the screen right now is -- and entrepreneurship, sorry. Yes. So what you see is our association with IIM, Ahmedabad, in terms we have had a chair there, and it is to foster innovation. We are working with them in the last 1 year. This relationship got furthered by organizing Hackathon, organizes some panel discussions. And I think the institute is working very closely with us to take this agenda forward. On transforming education, we partnered with Rangeet. I think it's very credible to -- for progressive organizations to make sure that how we are investing in future generation. So almost 20,000-plus children in the age group of 7 to 16 in the state of Rajasthan with the help of Rangeet, we've been able to inculcate education through this program of SEEK, where it is about sociological, environmental, through an app-based program. And I think it's making -- to make them holistically very, very well-groomed children is happening. Transforming Lives, I think this is, again, 800 women. We have 6 centers in the country. I'm very happy to share that a lot of underprivileged women who are being trained, not only there is skilling happening, but it is skilling to livelihood. And we believe that we will be taking this program forward further even trying to see if the agency can get people from economically weaker sections and districts as defined by the governments, and I think we'll be sharing updates as we go along in the subsequent years. Recently, very happy to share because focus on developing women, recently Falguni got recognized at the American Indian Foundation and we have announced an initiative where Nykaa, would want to work with AIF to furthering the agenda of STEM as an area. And I think we'll have more updates to share as we go along in this journey. Continuing on this in my last slide, focus on children health. This is a collaboration with an agency called Anushkaa Foundation, where not only we are helping treat, I think we've treated already more than 100 children with respect to club, but also at the same time, skilling doctors to do this better. The uplifting of women initiative. I think 2, I'll pick it up here. Beauty and You. We've done 2 stellar additions of our partnership with Estee Lauder in terms of, again, finding new generation of entrepreneurs, who will work in the area of beauty and innovation. I think we've had 2, and I think the additions have brought in that people are really thinking of very different ways, whether it is makeup or skin or fragrances and I think many innovative ideas people have there, and we are looking forward to some of them flourishing -- flourishing big. The last but not the least, I think this is, again, in the area of uplifting communities where it's been a couple of years of our association with the Indian Deaf Cricket Association, where we sponsored -- where again, women from underprivileged and Tier 2, Tier 3 have been coming forward to express their area of passion. And this is what we really have really -- you see that has been really been appreciated by some of them. So I think I'll end here only to leave you with the fact that good business being that in our -- being bold and being a good way and more to share with you all as we go along in this journey of building a very robust and a forward-looking ESG-focused organization. Thank you.

Thank you very much for that, Surender. I feel like there was also a great reminder in reiterating that we're not just a retailer. We share to serve not just our consumers but entire communities at large. We now -- this brings us to the end of our presentation session, and we're now going to set up for a Q&A panel. While we set up for the panel, we'll take your questions and try and answer all of them accordingly, post which we will break for lunch.

Thank you so much for being such a patient audience and listening to all of the exciting updates we wanted to share with you. We are now going to open the floor for questions. Please raise your hand if you have a question. And our team on ground will come to you with a mic. I think we have a question there. Could we get a mic over there, please?

Percy from IIFL. Firstly, thanks a lot for this wonderful presentation and all the useful data information you've given, it's really very helpful. My question is on the common costs. So this year, the common cost growth at an overall company level has come down to a very reasonable 15%. Surely, for the India BPC business, it would be even lower at maybe, I don't know, 10% to 12% approximately. So my question is, is that even if we have a flat contribution margin for the BPC business, and I'm excluding Super Store and other beauty businesses here just talking about BPC, even if the contribution margin is flat, assuming a low double-digit growth in the common cost there because it's a mature kind of a business. should we not be seeing expansion in the EBITDA margin for the India BPC business?

Actually in the retail -- I mean, in beauty business, the retail businesses do need investment in stores as well as which results in depreciation. There is also the interest cost that is involved when we -- obviously, the store rollout has a different inventory mix compared to e-commerce. So I think it's very simplistic to assume that there will be definitely margin expansion. I think our beauty business was quite tightly run. In fact, we are making investment in terms of adding more management bandwidth to the business. So I'm not saying that the overheads will grow faster or slower. But I think to assume that it will definitely result in EBITDA margin improvement would be a wrong assumption because it's a mix of the accelerated store rollout. We are also premiumizing our stores in terms of going for more what we call as we talked about flagship stores. So I think the investments we're going to continue to make, but yes, manage it well rather than trying to reduce it.

Can we get a mic over here, please?

This is Avi here from Macquarie. I just wanted to kind of take in that margin question a bit, but I think you've rephrased it with what you've already disclosed. Now what -- and sorry for that long. But if you -- if I look at it from an explanation perspective, you're looking at Beauty now as Super Store plus Beauty only. And we've done almost about 8.5% margin or so in the current fiscal. You've given us a trajectory of what it can be as we move into, say, 3 years, 4 years down the line, would you be able to share some understanding of how should we look at it from overall beauty EBITDA margin? Because you only have the Super Store here. So clearly, there's some benefit that will come in from that. Is there an overall number that you could share for us for the Beauty segment itself in the new disclosure notes?

No, I think it's, again, very simplistic view because the Beauty margin is the combination of e-commerce, physical retail, eB2B growth and also private label and also private label profitability. And as a result, and like we have always said from the beginning that we don't have any mix composition in mind. We are allowing each of the businesses to grow at the pace that, that business justifies and can sustain because of the size of their current scale and the opportunity that is available. And as a result, the mix is far more difficult to predict rather than the individual components. And that's why we went -- deep dive so much today to give you components of each of our businesses and give you a very good feel of what those components look like. And try to show you the discipline with which you are building each one of them so that there are no fears of some excessive spending in any of the environment. But we are managing like both verticals, Beauty and Fashion, extremely complex vertical with underlying 3 to 5 segments making up that vertical.

No. But in the Beauty only Falguni, that 8.7%, do you think that -- that should logically move up, say, 3 years down the line given that you're expecting the eB2B to be itself to do 2,000 basis points expansion at the EBITDA level.

I think the worst of B2B in -- to beauty margin maybe behind us is all you can say, yes.

Okay. Okay.

Maybe I can expand on it. So look, I think if I look at before the reclassification of the segment to include B2B, it was predominantly the online plus off-line beauty retail business as well as our own brands business, right? And we had historically disclosed what the contribution margin was for the BPC vertical prior to, including eB2B in that segment. And you know that, that number was roughly mid-20s, 25% plus. And you have a good sense for what our cost below contribution margin are. They mostly just overheads and employee cost and you have a good idea of what that could be. So I think there is a very healthy -- our beauty retail and beauty owned brands business have a very healthy EBITDA margin profile. And it's the eB2B business, which currently is EBITDA negative. So as the eB2B business continues to improve its profitability and given that the eB2B business now sits inside of the BPC segment as a whole, theoretically, yes, of course, the overall EBITDA margin could improve. Because there should not be any dilution to the EBITDA margin of the erstwhile BPC businesses. I hope that helps to answer your question. But I think to Falguni's point, it's also a mix, it's also a mix thing, right? Because if eB2B grows faster than expected, even if it continues to improve its profitability faster than expected as well, if it starts to contribute a larger percent of the total revenue to the BPC segment, then the consolidated level of profitability improvement may look slightly more muted than it would have looked had the B2B business growing slower, if you understand what I'm saying.

Got it. No. Fair enough. Fair enough. Any time lines on when do you expect this to be breakeven? Like the Fashion you've given us a very clear trajectory. For the eB2B. Any expectations?

No. I think we don't like to do is really do what we call as like star grazing or pie in the sky kind of this thing. So what we try to give you today is what we are confident about. So if we could stick our neck out on Fashion, but in B2B, we've given a path, which leads to much more improved EBITDA but not yet at the breakeven level.

Got it. The next question for Ganesh from a CapEx perspective, now with bulk of the CapEx behind us. What are the -- what is the level that we should kind of look at from a consolidated basis given that the new businesses, I'm not sure if they need any support. So any number that you could share with us over there?

Yes. So if you look at CapEx, and as we saw in the slide a while back, the peak CapEx happened in FY '23, which was upwards of INR 200 crores. And in FY '24, we've already seen it come down to less than half of the FY '23 levels, which is indicative of the fact that our investments in terms of new stores rollout, et cetera, will continue, but some of the catch-up investments, especially when it came to warehousing, when it came to office space, et cetera, that is behind us. So the shift we are seeing between FY '23 and FY '24 is indicative of what to expect.

So 24% would be the more steady-state number?

Yes, you could say that. Yes, there will be some incremental investments, which will still go into warehousing, offices more or less done. Stores roll out, we are at 187 stores and over the next 2, 3 years, so thereabouts, we are talking about doubling the number of stores, those parts we continue.

If you could pass the mic on to the man behind you.

This is Harit from Investec.

Yes. Just one other point I would like to add is that we have a majority share in Dot & Key, where over the course of this fiscal, the balance acquisition is also something which is likely to come underway. So in terms of capital outlay while it is not CapEx per se, it will be more of investments.

This is Harit from Investec. Over the last 2 quarters, you've mentioned that contribution margins in BPC are healthy and in an endeavor to grow the market, you would like to reinvest, but last year was a year also where ad income did not grow at the pace at which it normally grows. Also, you had discounting, et cetera, which was there as well. In a normalized environment, some of those factors start to improve, ad income starts to grow, which is a huge positive for EBITDA. Discounting probably over a longer term would reduce from what it has been. So in the context, is the commentary here that there will be a further increase in advertising and promotion spends in order to grow the market. Is that the way you guys are thinking about it? Because I felt that there could be more levers to contribution margin expansion. That's my first question.

Yes, maybe I'll kick that off. So I think you're right. There are multiple levers to improve the contribution margin profile of the BPC segment. And let's keep eB2B to the side for now because there, the improvements have been quantified earlier. But on the BPC retailing business, of course, there is -- we're quite optimistic that there should be a revival in ad income from whatever slight problem we saw in the last fiscal because of increased discounting by brand. So I think that should definitely normalize. It's a short-term phenomenon. Also, our own brands, if they continue to perform well, they will continue to take share, that could have a positive impact on gross margins. If premiumization happens at a faster rate than we expect that's also margin accretive. So yes, there are many levers even at the gross margin level, which should flow down. But what we are seeing is that the opportunity to acquire customers is still massive. Even at 25 million life-till-date customers, it's still just a drop in the bucket in terms of the size of the country and the opportunity which we have. And we want to ensure that we continue to accelerate and focus on customer acquisition and equally, importantly, focus on customer retention and driving better repeat behavior from our existing customers. Now the former requires investment in the form of customer acquisition costs. The latter, there is some costs associated with it, but it's not as high as the cost of new customer acquisition. So I think what you'll see is we will invest what is required to achieve our customer acquisition goals. But we always overlay that with the lens of quality growth, which I spoke about. So you will not see us acquiring customers just for the sake of it. We have set our customer acquisition target at the beginning of this fiscal year. That is the number which we need to achieve. If we achieve that, and we see improvements in certain other parts of the P&L will be allowed that to flow through, of course. So we have certain objectives in terms of customer acquisition and customer retention. If those get achieved and we -- on top of that we still have capital that has accrued because of improvements in the P&L, then of course, we'll allow that to flow through. If that's kind of what you were asking.

Very clear. Just one question on fashion. So at the end of the presentation, you also mentioned that 2 levers are the fact that fashion portals are now charging cash on delivery service, convenience fee. Do you see this as a significant change in the last 12, 18 months where the entire industry is moving to slightly better economics. Or is it too early to kind of say that? And is that also underpinning some of the improvements in economics in fashion for you as well as for the industry?

Yes. No, I think 100%, it is definitely a move that the entire industry has made, I think, across the world. We track the U.S. sites. We track the European sites. We track the India sites. And clearly, there was a time where retailers were actually spoiling consumers too much. We have made -- as an industry, I would say, make things too lenient. And then we complain that the customers are behaving badly. It's actually an industry issue. So now the industry is getting a little more sensible. There are a lot of costs of shipping a good fashion product, getting a return of it, et cetera. So across the world, and there's a lot of -- all companies have basically come to the new normal that we are starting to charge customers for certain aspects of that business. So I think it's a new normal, and it's definitely helping, I think, the entire world and the Indian industry. It's even in food tech, food delivery and all, you can see charges. So I think the consumers are now getting used to a new normal, and it's going to play out in Nykaa Fashion as well.

This is Abhisek from ISEC. One question on eB2B. Could you give us some clarity on what is the working capital days in that business? And what is the contribution of the top 20 SKUs for your GMV?

Yes. So as you know, we buy on credit, right? And we sell on cash. So we have -- but we obviously have some stocks in warehouse. So we do have a much leaner kind of a working capital. It's between, I think, 5 to 10 days. Yes. And your second question. So we have about 5,000 active SKUs, 700 SKUs account for 80% of our sales. I don't know the top 20, but the 80% is 700 SKUs.

That's very helpful. And just one question. You spoke about your LLM model. So is it your own model or do you partner with somebody else for that?

Yes. It's a combination. In some cases, we are building our own models. More importantly, when we are taking like a Microsoft or a Google's model, the thing that we are being extremely cautious about is, a, like those models are built on our servers and our instances, and they are trained and grounded on our data. So we are doing a combination of both.

This is Siddharth here from [indiscernible]. Sir, my first question is on the Fashion side. I mean, in the past, we have seen that we have focused more on curation and premiumization and probably sometimes at the expense of growth. Now we are talking about a very strong 2.5x to 3x GMV growth in the next 3 years. So will that continue with the same focus on curation, premiumization? And do you think taking them both together is sort of possible to see the type of growth we are trying to achieve? Or there can be some strategy normalization or a change in the curation in this Fashion vertical going ahead?

Yes. I think our strategy from day 1 on Nykaa Fashion has been extremely sound and extremely well put together. The only thing we've gotten better at over the years is executing and doing a better job at it. So our core principles of curation and premium are unchanged, and they will stay unchanged in the possible future that we are currently thinking of. But the market itself is big. It's already a $3 billion market there, growing to a $10 billion market in that space. So from a macro perspective, we believe it's big enough of a market that we -- our current strategy will hold and take us over -- take us through the next few years. So even at a 2.5x, 3x, it's not too far from market growth for the premium consumer base that we're talking about, right, going from $3 billion to $10 billion from a macro perspective. So the growth that we are executing -- or we are planning on is sound based on the current principles.

Okay. The second question on the BPC side, clearly, on the category side, we are talking about maybe a stronger growth in the Fragrance and Bath & Body Care segments. How does the competition or in terms of the segments do you see -- what will drive this growth? And how does it impact the contribution margins? Is it similar? Or if you can share some color there?

So I think the category expansion work, which we're doing, which I spoke about should not have any impact on the margins from a gross margin perspective. As I said, the reason why we are seeing an acceleration in categories like Fragrance and Hair Care is because if you look around the world, actually Fragrance and Hair Care tend to be the largest categories within the beauty industry in other markets. In India, Hair Care has historically been a big category, but it's been traditionally a personal care category with an over indexation towards hair oils. So our goal is to make Hair Care into a Beauty category, which means selling more serums, shampoos, conditioners, masks, et cetera. And on Fragrance side, of course, India has historically been a deodorant market. But there is a large opportunity for premiumizing that end of the market into what we call as fragrances, which is EDT and EDPs. So these are, as I said in my presentation, initiatives that should only help increase the consumption of our consumers. It should help to increase the category with that we're able to retail. It should also help us to derisk from any -- from overdependence on any single category. And it should make us into a very holistic beauty retail company. And again, we're also quite optimistic that if you sell more categories, you have the ability to drive more frequency of purchase from the existing customers as well.

This is Vivek Maheshwari from Jefferies. A couple of questions. First is you briefly mentioned about -- you referenced to quick commerce, from your business perspective, in terms of delivery time lines, what are your thoughts as we go into the next couple of years? What does this entail in terms of infrastructure of, let's say, warehouses, what will be, let's say, cost implication and so on and so forth.

Yes. Maybe I'll kick it off and -- I think quick commerce is -- as I've said on our earnings call a few weeks ago that quick commerce is a demand -- it's a demand fulfilling platform. There's no demand generation that happens on quick commerce. It's a platform that lends itself well to consumers who know exactly what they want to buy. And therefore, it lends itself well to much more FMCG-like categories and Personal Care and less so within Beauty. That being said, we do believe it is incredibly important to continue to improve the speed of delivery for our consumers. And as I showed you in the presentation today, the order to delivery time lines have reduced by almost 1/5 over the past 2 to 3 years. And now a majority of orders across 19,000 pin codes of India are being delivered within 48 hours. And if you live in major metros, which is where currently quick commerce tends to be dominant, within major metros, we're able to deliver usually same day. So that means within 24 hours. Now let's also keep in mind that the quick commerce assortment is very limited. When I say we're delivering a majority of our orders within 48 hours. I'm referring to all 250,000 SKUs which we retail will be delivered within 48 hours. So I think it's a slightly different model. Of course, we watch it closely. We do think it is meeting a consumer need. That being said, do we see beauty as a category where discovery is important, education is important. These are purchases that take time to build conviction for. I've spoken to you, Vivek, about how each visitor visits us 50 times in a year and they transact 4 times in a year. So the process of actually deciding on making a purchase in this category is slightly more elaborate. And as a result, it's important to have what I say is best-in-class delivery time lines. But do I feel that we need to be doing 15-minute delivery for all 250,000 SKUs today, I don't think that's a good use of our capital at this point in time. But I think what you will see is definitely continued investment behind getting closer to the customer. Over the past 3 years, we've gone from 18 warehouses to 44 warehouses from 3 or 4 states to 12 states. Majority of our shipments are now intrastate, which means from -- the package is dispatched from within the same state. Would we like to get to a place where we're doing more intracity? Yes, absolutely. So I think we're developing a hub-and-spoke model, which we've been building for the past few years, and we'll continue to invest behind that. I think you'll see us -- this hub-and-spoke model only continue to get more robust over the coming quarters and coming years. From a capital investment perspective, it should not be massive. I think, as Ganesh said, peak CapEx for us is probably behind us, at least for the next several quarters. But yes, you will see us continue to expand the warehouse capacity, not such large warehouses, but much smaller warehouses in more metro areas to continue to improve that speed of delivery? So that is an investment we will make. But as I said, it's not going to be as heavy as what it had been in FY '22 or '23.

We probably have time for just 1 or 2 more questions.

Sorry, one more question I have. The other question is on the fashion bit. And it's a different, let's say, side of equation from where I want to come. You are 15% of the premium apparel market. And you have guided for, let's say, breakeven and ultimate margins. But if I flip and ask you the question, why don't you keep the losses flat for next few years and actually gain market shares at the time when you are seeing that customer habits are changing a bit, they are happy to pay up, et cetera, et cetera. Why go after profitability at this stage when you are convinced about the model, forget about what investors and markets think about. But why not gain market share build category and then think about profitability and breakeven after 3, 5 years. Why the rush?

Yes. I think -- so the point is that all we are trying to do is build businesses with discipline. And I think when we say the path to profitability, what it means is that the business is cutting out unnecessary expenses and irritants to unit economics. And once we are anyway at good unit economics, choice remains ours to accelerate growth. So in even current numbers, certain pace of customer acquisition for fashion is being built. We are, of course, using technology more and more to allow more cross-selling between Beauty and Fashion platforms, because Beauty has 25 million customers, where Fashion has 6 million so far. So there's a lot of kind of what we call as low-hanging fruit and optimization and marketing that we could use. And we are trying to use that with the discipline of trying to stay focused on getting the right unit economics. And that doesn't stop us from raising our ambition of new customer acquisition beyond that. But we will also make investment on establishing more international partners like Revolve and Foot Locker are 2 examples, there could be more going forward. And we won't hesitate if we have to make investment. Like already in this investment, what is built in is dot-com generalized sites that we are creating, which can be used not just for footlocker.in, nysaa.com and also similarly, any other brand partners, like even with Revolve, we have an extremely complex B2B2C model, which we are using. So a lot of tech investment has been made in the last couple of years and current state of saying we don't need such investment is coming out of the confidence that these investments can be leveraged to continue to push the pedal on growth in each of the businesses.

I think just one thing to add, Vivek, is it's how we approach each of our businesses is its quality of growth also matters. That's the additional lens which we add to our forecast. And even when Fashion -- when Nihir came and spoke about fashion saying that the profitability will improve by a certain amount. It was -- it's not occurring at the cost of that quality growth. So I think our understanding is that there is a certain amount of quality growth in the market achievable every year, and we plan to maximize that and maximize our share in that part of the addressable market. And then -- and at the end of the day, after maximizing the growth, the quality growth that's out there, we'd still be able to improve profitability. So why would we not? I think as a company, we don't have the DNA of chasing low-quality unprofitable growth, just to put up numbers to impress investors. We would rather acquire the right customer, retain the right customers, sell the right assortment at the right price. And I think there is -- and that is a -- that's a journey India is on as a market and as a consumer. And we are taking the consumer on that journey on Fashion and Beauty. And so I think delivering the kind of growth that Fashion has delivered over the past years and will continue to do so and delivering profitability, we don't think it should be a choice actually.

But so, we fear that you can become a non-preferred destination because if you don't stay as a premium destination, you don't attract the premium customer. So the branding of Nykaa and where it stands in terms of what it offers to the customer is very important to us. And we don't want to compromise on that. And start -- once you start having wrong customer, you start showing wrong products and SKUs, the whole website starts functioning very differently. So we want to keep that premiumization focus and investment needed to grow, that we'll do. I think on the previous question, I'll just address that a bit about express delivery. I think what didn't come out today is a big plan that we have this year to improve delivery across the entire network. So I think the teams in operations have promised that without too much incremental cost, they are going to be able to increase the delivery time lines for all of the Zip codes due to the scale that Nykaa is gaining and due to what we are able to do in terms of like the network organization through the hub-and-spoke model. And that we are quite excited will allow us to also do express delivery in metros. And I think we are quite excited to work on that part. But for us, there's a lot to lose by not facilitating discovery and education and at the cost of just trying to fulfill a quick order. We don't want to lose that. So trying to do that in a balanced manner is what we will try to pursue.

Yes. I think I covered it, of course, when I answered your question earlier on express delivery. But we wanted to have something for next year's Annual Day, so we'll bring it to you next year. And just generally, as a culture we prefer to do before we speak. And that's why I showed you the work we've done over the past 3 years as opposed to trying to tell you what we're going to do. I would rather come to you next year when we've done it. So stay tuned. I think there's -- you'll see more on the express delivery front, hopefully, in next year's Annual Day.

We have 1 more question here. That's the last one today.

Sheila Rathi from Morgan Stanley. 3 questions, actually, short ones. The first question, Falguni in one of your slides, you showed that Beauty -- 5% of the beauty market is premium. What would be that number for us?

So I think it's very hard to answer that question because the definition of premium and Lux is little bit overlapping. So I think very often, we have said that about 15% to 20% is Lux. Premium -- prestige to Lux and premium definition sometimes is outside of that. So yes.

No. So I mean, just to 15% to 20% is a slightly wide range. But the point we're trying to make is, it's still underpenetrated. Premiumization is still, in India, of course, it's at 5%. If roughly you equate the definition of premium for the market to our definition premium sales 15% to 20%. So it's still underpenetrated. If I look at China, at average is about 35% to 40%. You go to slightly more premium beauty specialty retailers, that an even higher share of prestige and premium beauty. So even at 15% to 20%, we feel there's still a long way for us to go. And it's 15% to 20% by value, so please remember that means by volume, it's even less. So -- because the ASP obviously is higher for premium products. So that is a huge opportunity actually on premiumizing the assortment and the consumer behavior.

Understood. Second question was on eB2B. In your slide, you showed that how we are using the app to place the orders. So just wanted to understand what percentage of retailers are now using the app?

Actually, all the retailers are using the app, but what happens is that habit change takes time. So we have feet on ground who go there who remind the retailer that there's time to place the order, and then the retailer is placing so the app is used by the retailer. But our feet on ground are helping the retailer right? And we have seen that over time, the requirement of the salesman to go and engage with the retailer comes down. But this is a hybrid change, right, because over years of different. So it just takes a little bit of time, that's all. But actually, all orders are placed on the app.

Also virtual circuit that you do now.

Correct, which is what we are starting now, which is where -- it's a lot of technology at play, okay? So what you're also starting now is that the salesman has the potential to actually build a cart from his device but will not be able to place the order. So then that's how we're going to improve our BD -- our sales and productivity. So they cover more outlets in a day, right? By building the cart based on the history and behavior and understanding and then the retailer actually places the final order after making the changes. So a lot of stuff happening to go towards less touch kind of a model.

And the final question, just to clarify on the CapEx split, how should we think about the GCC CapEx? Because we're talking about 70 stores in the next few years?

So I think in the current estimate, the GCC CapEx was not included, I think, because it's a subsidiary of -- it's a joint venture under a subsidiary. But I think at the moment, the plan is to about up to $3 million to $5 million. So $3 million to $5 million is the investment that is being envisaged. It will be also parallelly contributed by our partners. And also, we do believe that the deep investment that is required in Indian market may not be required in GCC, which is extremely high income, high consumption market. And with physical retail getting breakeven levels much faster in that market, the investment needed in e-commerce can be funded through profitability of the physical retail. So this is on a 5-year horizon, not necessarily in 1. So -- and a lot of investment in technology are also very efficient because of being part of a Nykaa ecosystem. So I think all that tells us that the only unique investment we made in that market is, of course, the stores as well as some amount of marketing investment, but all of those could be quite efficient. So I think being in India is a very adverse market from size of the country, the income. So succeeding in India allows you to do well in other developed markets, I think.

And just to add, as far as the investment score, we have a 55% holding in this entity and our partners at 45%. So of the total investments, which would be required, about 55% is what will go from us.

And $3 million to $5 million over the next 3 years or next 5 years, the investment?

No, that is more of near term.

Okay. Well, thank you so much for your questions, investors and analysts. If you have any more questions, please feel free to reach out to our Investor Relations team. And thank you, panel for taking the time after being with us today. We hope you have enjoyed listening to our leaders and are as excited and joy as we are about the vision and what we hope to accomplish over the next few years. Nykaa started with Falguni's vision to empower consumers to shine the spotlight on themselves. It's for the very same day 0 enthusiasm that we march on to bring consumer delight at every single touch point through everything that we do. So as you step out and as some of you are towards lunch, take the time to experience our booths to experience the joint Nykaa collective offering that we have for you. Thank you, everyone.