Jyothy Labs Limited (532926) Earnings Call Transcript & Summary

Ladies and gentlemen, good day, and welcome to Jyothy Labs Q2 FY '21 Earnings Conference Call hosted by ICICI Securities Limited. [Operator Instructions]. Please note that this conference is being recorded. I now hand the conference over to Mr. Manoj Menon from ICICI Securities Limited. Thank you, and over to you, sir.

Hi. Good evening, everyone. It's our absolute pleasure at ISEC to host the 2Q FY '21 Results Conference Call of Jyothy Labs. The management is represented by Ms. M.R. Jyothy, Managing Director; Mr. Ullas Kamath, Joint Managing Director; Mr. Sanjay Agarwal, Chief Financial Officer. At ISEC, we have a constructive view on Jyothy Labs business and the stock. It's one of our preferred mid-cap picks within the consumer staples space. We remain long-term believers in the significant market opportunities which the business has got. Over to the management for the presentation and the Q&A later. Thank you.

Good afternoon, friends. Thank you for all dialing into Jyothy Labs conference call results. So before we talk about the results and the brand performance for the quarter gone by, we'll briefly update you on the current market scenario. So overall, consumer sentiments have improved with economy and life almost back to normal. We, Indians, and our business fundamentals have really shown an immense resilience, and the way we look at businesses have been either aligned for new normal or new abnormal. In terms of consumer trends, our ground level assessments indicate that we are at crossroads and underlying consumption trends are yet to settle. Second, the trust of the brands have become very important for consumers, more so during the ongoing pandemic times. Third, in terms of specific to channels, general trade is doing well, as consumers are preferring to buy at neighborhood Kirana stores or on e-commerce websites. While large format stores of modern trade and canteen store departments still are continuing to face operational issues. So they are either operating for restrictive hours and we have seen reduced footfalls also there. So there's been a shift of consumer shopping habits during this pandemic and general trade and e-commerce have become their channel preference. In terms of rural and urban trends, rural demand has been reaching superior than urban demand on back of good monsoons and government support. Government interventions have been there to provide good social security measures, which have really helped the increased consumption of various goods in the rural markets. Now talking specifically about Jyothy Labs. Despite the ongoing challenges, we've taken this crisis as an opportunity and recommitted ourselves and delivered a resilient performance. The way we look at our business, the way we are aligned, our portfolio plus our execution and keeping a strict financial prudence, I think, has been behind the growth what we have been [ seeing now ]. So portfolio, we have aligned and leveraging on our core essential and hygiene portfolio. Execution and planning has been key for us, and we have been quite proactive in using data analytics, help of technology, and also tactical marketing, which have helped us in growing all our brands. And while all this thing is good, also keeping a strict financial prudence and focusing on all key financial parameters at all times to enhance shareholder value. In terms of portfolio, again, just the core day-to-day essential and hygiene portfolio across our Dishwash, Personal Care, detergents, HI and toilet cleaner and floor cleaner, they helped us in doing a good growth across the brands. Now backed by the strength of the portfolio, we have focused on execution and execution has been quite on a laser-focused basis. And we've redesigned our priorities, and we've seen good results from it. The foremost first comes is the go-to-market. We've enhanced our depth of distribution in rural areas. We have been focusing on low unit packs across brands of INR 5 and INR 10 across markets. And also our growth and focus on e-commerce platform has been good. We've been -- we've grown in this quarter also 1.7x of our previous year numbers. So e-commerce is gaining share in our portfolio.

Sir, sorry to interrupt. Sir, I would request you to please come a little closer to the phone. You are now being too far.

Okay. Adding -- or continuing our efforts and focus on innovation and new launches. This quarter, we had launched Exo Bioh Fresh, 100% organic vegetable and fruit cleaner, which we have launched in Kerala. Also to ensure that the timely supply of goods is there across India, production at all our 27 factories have been very seamless. And in addition, we have been able to implement several rationalization programs and to improve the efficiency and productivity. Media activities. We have decided to do more focused media spends and increase to support our full business potential. We are present in large categories and a strong pan-India distribution. Hence, with increased media spend, we know our brands will see a good growth. Finally, most important, people. And having a motivated workforce is always important. And we believe, especially in this environment where everybody is working on a virtual mode, this has -- we had done across-the-board salary increments and incentive payouts, which has further boosted the morale of the entire organization. In terms of the financial prudence, proactive measures and cost management and alignment within all business teams have ensured supplies across channels, across India. And also, overall, all these results, all these steps have significant improvement in our net working capital days to 17 days now and with better cash flow management, working capital, for the first time, Jyothy Labs standalone balance sheet is on net cash surplus as of September 30. And even at consolidated level, our debt, which includes the short-term working capital, is only at INR 40 crores. So we are happy that our Q2 numbers have been better than Q1 on all the parameters. And the entire sales volume, EBITDA, PAT, free cash flows, everything has been good. In terms of the results, our net sales revenue is up by 6.2%, FMCG business is up by 7.6% and volume by 8.5%. Gross margins have marginally increased to 47.7%. Media spends have been increased by 6.4%, keeping in line with the sales growth. Operating EBITDA has improved to 17.3% and increased by 11.1%, and PAT has been at INR 60 crores, an increase by 12.2%. Similarly, for the half year, revenue is up by 4.5%. Gross margins have broadly remained flat. EBITDA has increased by 13.6%. And for the half year, our PAT is INR 110 crores, an increase by 21%. With respect to the category-wise revenue, Fabric Care sales declined by 11% -- 11.7%. And just to spend a minute on that. In our portfolio, Fabric Care, it's equally divided between Main Wash and Post Wash. Post Wash, as all of you would know, is Fabric Whitener -- Ujala Fabric Whitener and Crisp & Shine. Now Ujala Fabric Whitener broadly has come back to the pre-COVID levels, while Crisp & Shine may take a quarter or so. So the Post Wash portfolio has come more or less at the same levels. In terms of the Main Wash, because the operations are still restricted in modern trade and CSD, and we have Henko and all which are more premium packs, so the -- we have seen a decline. But again, it depends on how modern trade and CSD business normalizes in the coming months. We see that channel also coming back to normal. Also, third part to the Fabric Care is there's been softer raw material prices. And we have also taken some price off on select SKUs, that too has also impacted the top line. So on the other brand, which is Dishwash, has seen increased emphasis on hygiene and focus on our distribution has helped us to grow 23.6%. HI, which is the mini season for this quarter as well as consumers adopting a more cautious and a preventive approach to health, has grown by 22%. Personal Care, primarily a neem-based Margo portfolio, soaps, hand wash, face wash, sanitizer, has grown by 14.5%. In all, the total business has grown by 7.6%. Laundry business, which is 1.5% to 2% of our top line, it's a very small business, that has declined as it is more retail stores across metros, which is Delhi, Bombay, Bangalore, Puna. So that has seen a decline and which we think, as things normalize, will also be coming back to normal. Next slide is on the snapshot of our financial performance and key financial ratios. To sum it up, the way we look at it, it's a good all-around performance on all profit, loss and balance sheet metrics. A quick understanding on the next slide is our EBITDA movement from last year to this year. Last year, our EBITDA was 16.6% for this quarter. There's been a marginal saving in gross margin and EBITDA for this quarter stands at 17.3% and for the half year stands at 17.5%. In terms of the key balance sheet metrics, working capital days have come down. There's been -- it's come down from 23 days to 17 days. March is an aberration because everything had got dislocated. And therefore, from last year to this year, there's been a good considerable improvement. Similarly, on the net debt -- on the consolidated basis, our net debt is now at 0.04. We'll now move on to the brand performances and initiatives. Our category-wise business share has slightly been changed. Now Fabric Care is 34%. Dishwash is 38%, HI and Personal Care are 12% each. We'll begin with each of the category-wise performances. On Fabric Care, Ujala Fabric Whitener, where we are the market leader, we continue to increase our retail visibility. And also showcasing the benefit of using Ujala Fabric Whitener for post wash -- post detergent wash that has started giving good results. And as we are seeing the out-of-home activities getting normalized, our sales have reached to pre-COVID levels consistently now. In terms of Crisp & Shine, this is more of a specialty Post Wash product. Here, we still have to see the normalizing trends coming in, and we believe in the next 1 to 2 quarters, once schools and offices functioning become complete normal, we would see the growth again coming back. However, we -- it's a unique product, and we own this category. So we have launched new TVC with South superstar, Nayanthara, and we continue to give importance and seeing the potential of this brand. Similarly, for Ujala IDD, which has currently been only focused in Kerala, we have seen good GT sales growth in Kerala. And we believe, as you know, as modern trade and CSD stores also getting normalized, this overall growth numbers will be far better in coming months and quarters. On Henko, we are again focusing more on general trade as MT and CSD has yet to stabilize. And again, we have been focusing on a lot of retail visibility and drive in the focused markets and also initiating a pan-India national rollout with TV campaigns and spends being done on this. In terms of the Dishwash, dishwashing is 38% of our total business. There is a renewed focus on hygiene and also backed by our focused distribution, both Exo and Pril continued to do well. Also, consumer habits of staying at home has increased consumption of food and -- at home and resulting in more utensils being washed. So that's one of the reasons also where brands like ours are doing well. And smaller pack is, again, more of a strategy for us, which has enabled us to unlock new households in rural markets and propelling a good growth trajectory. Again, to catch hold of newer consumers in the Dishwash, as the category is less penetrated, we've been focusing on marketing for both Exo and Pril on digital and social media. And digital is enabling us to experiment with different content, messages and medium. So that's been a good progress for us. Similarly, we've been focusing on consumer awareness on Exo Gel. As you'll recall, we launched it a couple of quarters back. It has a power of bar and the shine of a liquid. So we have been doing, at various retail touch points, promoter-led campaigns. In terms of our innovations and product launches to meet consumer demand and -- in the past couple of quarters, we've launched Margo Hand wash, Face Wash Sanitizer. In the same trend, we saw a demand for vegetable cleaner. So currently, we have launched this thing only in Kerala. And based on the feedback, then we will decide on the next steps. So that's the launch which we have done in this quarter. And we think it's important to launch with the Exo, our brand stands for Exo family, healthy family. And it fits pretty well with the overall strengthening the Exo brand. Household Insecticides. We have seen a healthy growth in sales of coils and liquid vaporisers and [ fogging ] machines, primarily because for the rainy season has done well, and consumers are adopting more cautious approach to health. We have been focusing on continuing to spend on TV, media and additional emphasis on digital campaign, which is helping us to get good offtakes in some of the key states. Activities on digital campaign have been on rise. The fourth large category for us is Personal Care, where primarily Margo franchise and -- which has again been doing well. Here also, again, we are investing on digital medium to reach out to consumers in addition to our regular TVCs. T-Shine Floor Cleaner, which we launched in the last quarter. We've got good response because it's been, again, a unique product offering with 100% organic compound base. And given the positive feedback, we are supporting the brand with now new TVC with -- new TVC campaign featuring Southern superstar, Navya Nair. And that is, again, giving good offtakes. So going forward, we are quite optimistic on our business prospects, while business environment and consumer sentiment still remain volatile. We will continue to focus on our core essential and hygiene portfolio. And we aim to deliver steady, sustainable, profitable, volume-led growth. And how do we plan to do that? We -- our broader strategy is to make use of the full business potential of all the business categories in which we are present, which are large and growing categories. And more importantly, support them with additional media support and focusing on geographical expansion. Finally, softer input prices should or should remain -- if they remain in that, it will support on the gross margins. And in addition to that, several cost optimization measures and strict control on the business hygiene will help us in our healthy cash flow management. With that, I'll finish my presentation, and we are happy to answer any questions and any clarifications you need. Thank you.

[Operator Instructions] The first question is from the line of Ashwini Agarwal from Ashmore Investment Management.

Congratulations for a good quarter in a challenging time. So just wanted to get your sense on how should we think about rest of the 6 months. I mean you've delivered an EBITDA margin ahead of last year and ahead of your formal guidance despite spending INR 5 crores on the Prime Minister's Relief Fund. And you're seeing an improvement in gross margin, which, I suppose, is a function of those price increases that you've taken. Also comment on the working capital savings. Your working capital days are probably down to the lowest ever that we've seen. So is the gross margin improvement, EBITDA margin improvement, working capital improvement, are these things likely to stick? Or are you likely to invest some of these gains back into growing the business?

Yes. Thanks, Ashwini. Good question. And -- see, if we look at it from 3 to 6 months, our growth will be steady. Now what will and how would be, what numbers it would be, I think it will be difficult to predict those numbers sitting now because we are still not out of the woods. So -- however, if I look at it from most of the categories, which is Dishwash, HI, Personal Care, I think we will have a sustainable growth what we have seen now. Fabric Care is 1 category which, in Q1, we were down minus 23%. In Q2, we are minus 11%. And from the trends we are seeing, we are seeing a good improvement month-on-month on that. So that is the color on the top line. In terms of the EBITDA, see, one is the softer raw material prices has helped. However, at one side of it, certain brands, Fabric Care, Dishwash, the prices have been soft while in Personal Care [indiscernible] for soaps, the prices have gone up. So broadly, if I look at it, overall portfolio, gross margin should remain there, where they are -- they have been. In terms of the EBITDA, yes, we have -- for the half year, we have tracked at around 17.5%, and that's broadly coming in from very sharp execution and keeping a good business hygiene. Going forward -- this quarter also, we had seen -- in the past also, we had seen and we had called out in the past analyst call that whenever we have been spending, we still need to spend much more on media than what we had been spending. I think there, we have always figured out our ROI or investments on media has always been better. So as of now, we are still keeping our guidance of 15% to 16%. And since we are seeing the spending sentiment has improved across most of the categories and our distribution has become far more digital and technology and all that, we would believe any further investment in -- on our brands will give us much better results. So we'll still keep our guidance of 15%, 16%, and we'll keep that buffer with us for any tactical strategic marketing which we should do to grow the brands for long term. In terms of your last question on working capital, down, yes, we are at 17 days in September. We would call it at around 20-odd days, 20, 21 days as a metrics to keep for long term because this quarter, because CSD sales were lesser and therefore, the receivables generally for GT is always on cash with CSD and modern trade business is down, so receivables are lesser than what we had seen the last year. So 17 is a good number, we are happy with it. But on a consistent basis, maybe we'll be at around 20, 21 days.

Got it. Got it. Okay. And one quick comment on the HI business. So obviously, there's been some amount of consumer focus. There's also been fewer imports of the Agarbatti list with insecticides and crack down on that. How do you see the next 6 months evolving? I mean what are you seeing in the marketplace in terms of demand, in terms of spurious product or those Agarbattis coming back, et cetera, et cetera?

Okay. So HI, again, is a category which, in the last many years, things have been very volatile. One, for the first half of the year, the season had come on time and it remained and therefore, all of us have seen a good growth. For now also -- earlier -- see, this is 1 category, it is more purpose-driven. If there is an insect bite -- mosquito bite, it is when you will generally go and buy a product. But right now, nobody would want to even visit hospitals than even getting admitted. So in this scenario, the awareness about using a mosquito repellent is far higher. Mosquito -- the -- you spoke about incense sticks. They -- those -- the spurious ones which were active year back, they have come down, again, because it's difficult to operate. The smaller guys have not been able to operate. And government has also done a lot of activities to stop them because it has a negative health impact. So we are seeing HI, as a category, is doing well. And more so for us, our focus is on the liquid side of it. That is where our media spends have been and given the unique product offerings, the first automatic machine, what we have, we will be focusing more on the liquid side of it.

Last question on the insecticide -- HI. What's the breakup between incense sticks and the liquid -- the coils and the liquid, sorry?

So for us, it's been around -- coils is around 65% and liquid is 35%, 70-30, while we would want to take it up to much better on liquid side of it.

The next question is from the line of Prakash Kapadia from Anived Portfolio Managers Private Limited.

I have two questions. If I look at your operating cash flow, that has been a substantial improvement for the half year. So if you could give us some insights as to what has led to this and how much of this improvement is sustainable? And secondly, all of us are hearing about the rural growth being much better than urban. So any product categories, now we are seeing a structural headroom to grow or consumer changing habits in our portfolio, especially in the rural segment. If you can give some insights, that will be helpful.

Yes. So Prakash, on the cash flow, as we said, one, the profit has gone up from -- on a half yearly basis from INR 100 crores to INR 130 crores PBT. So that is one increase. Second is the receivables have been -- broadly been the same and the trade payables have increased. To that extent, our cash flow management has been good. So we think the cash flow, what we have, the cash generated is more on a sustainable basis. As I said, working capital may again go back to 20, 21 days. But overall, the cash flows where we have seen, our distributor stocks have been at around 2 to 2.5 weeks. All that will remain on a sustainable basis. Second, in terms of the rural demand, broadly, our portfolio is 40% rural and 60% urban. And some of the brands what we have, Ujala and Maxo and Exo, we have a good penetration in the rural market and which we think will give us good results. And we are also focusing a lot of addition of substockists in rural market, van coverage. And -- I mean nobody would have expected at this point in time last year when everybody was focusing more on urban and we all were saying urban is, say, 1.3x of rural growth, and now we are seeing a reverse of that. So it is a function and which we think -- the demand what we are seeing in rural, yes, it should sustain for long term. But given the measures government has taken, which are very excellent measures across the board, liquidity management, we believe that it should remain, but yes, it is anybody's guess that the demand in rural also need to sustain over a longer period of time.

And any insight on consumer habits or the hygiene sector coming in and rural is more accepted because of these times and some of these can lead to higher growth or longer term growth for us [Technical Difficulty]?

Yes, Prakash. So even rural, when they -- there's also an upgrade in rural India. So they also are watching TV and all the mediums to understand the Swachh Bharat, and nobody wants to fall sick. So there is an element of -- they want to -- see, why all the low unit packs are picking up because first time they are also buying a INR 5, INR 10 Exo or Henko or a Margo to use that. And it's again an aspirational thing that they also want to use better products when they have money on hand. Monsoons have been good. Government is taking care of a lot of their food requirements. So incrementally, there is an acceleration of these discretionary products for them in their personal lives.

The next question is from the line of Percy Panthaki from IIFL Securities.

My first question is on the Dishwashing segment, where the growth is in excess of 20%. So just wanted to understand what is driving this growth? And is this a sustainable kind of growth?

Yes, Percy. So see, for us, we have a very strong market share in both Exo and Pril. And because both the products have unique offerings in terms of Exo being the first antibacterial and Pril with, again, the first liquid which is launched long time back and now with Pril Tamarind. So one is the product offering is unique and consumers find much better value in using our products. Second is the distribution. Down South, all -- we may have -- we have a very high market share. We have to increase our distribution more in the rest of India and primarily in West and North. So that is, again, helping us in making it more of a focused brand for all our sales distribution. And last but not the least, what any one of us could not have done it, the focus on hygiene has come at the forefront for everybody. And the -- most of the Dishwash -- dishwashing in large part of India is still done by ash and in the conventional method. So using of a bar has been predominantly the key reason for the growth which we are seeing. And the category is doing well, and we are also doing better in this thing. So it is a sustainable growth, what we believe in dishwashing at least.

So basically, the category growth is also similar to the kind of growth you have reported?

So we will not know what the category growth would be, I think, but we believe we must have gained market share in this category.

Okay. Sir, second question is on Household Insecticides. Despite a good top line performance and also the fact that 30%, 35% of the sales now actually comes from liquid, we still have a loss in the segment. Sir, what's the long-term plan? I mean what's the growth to profitability? Unless we get a 10% kind of margin at least here, I mean in any FMCG category, why should we even consider being in the category?

Yes. So I agree with you, Percy. We also would want to increase our liquid share much more than where we are, and all our efforts have given results in the last couple of quarters. If we exclude the media spend on the EBIT which you are seeing in the results, we are very much positive. So if you exclude advertisement, we are positive, and it is again an investment we need to do for a couple of quarters, and you will see maybe next few quarters that HI, including advertisement costs, will also become positive from the EBIT perspective.

But is the ad spend like materially above what the normal level should be? Otherwise, I mean it makes no sense to deduct unless that is the case.

No, that's right. There is a disproportionate more investment needs to be done to get our liquid share increased in the overall portfolio.

Right. And last question, if I may be permitted. See, your Q4 last year, there was a substantial decline in the sales. So Q4 this year, how do we look at growth? Should we be looking at 2-year CAGR for Q4? And would you say that the 2-year CAGR would be similar to the kind of 2-year CAGR we are clocking right now?

So Percy, I think we'll take 1 quarter at a time. And yes, Q4 will have a higher growth because the base numbers were -- had moved. So we'll have to take some time to decide how the Q4 will go. And it will be -- definitely be much better than what we had seen because of the base effect. And yes, one can easily take 2-year CAGR number to decide on the Q4 performance when we reach there.

The next question is from the line of Shantanu Basu from SMIFS.

Well, I want to know the percentage of sales that was generated from the Kirana stores, e-commerce channel, modern trade and CSD?

Right. So modern trade, e-commerce, CSD has been broadly 20% of the business and the general trade, which is the Kirana stores or neighborhood stores, is around 80%. So it's 80-20.

Okay. And how much was e-commerce and modern trade, the breakup?

Yes. So e-commerce broadly has been around 2% for us in the past and it has been accelerating well, and now it is around 3% of our total portfolio.

Okay. And modern trade?

Around 7%, 8%.

The next question is from the line of Simran from SMC Global Securities Limited.

First of all, congratulations for the very good results to the management. Sir, I have a couple of questions to ask. First of all, I want to ask that, can you give any operating margin guidance for your next 6 months in the EBITDA side? And secondly, what is the top line from the CSD and how you see the situation in the CSD going forward? And sir, how you see the trend in the urban areas, means demand in the urban area? Because right now, we all are stating that rural India is outperforming at their level best. And sir, my last question is that the MD of a company appears less on the TV for the interviews. Any specific reason for that?

Okay. So a couple of questions. One, our operating margin or EBITDA guidance for the remaining half of the year. We've always given a guidance for the full year, and we believe we should be in a range of 15% to 16%. Second is, CSD business has contributed around 8% to 10% of our total top line. Third, the -- and which has seen decline for reasons which all of us know. Urban demand has been -- it's not that the urban demand has broken. It is that currently, rural is doing better than the urban. And for us, rural is 40%, urban is 60%. And so rural LUPs are growing, it's on a smaller base, the growth seems to be much higher. Urban metros and all, where we all live, it's seen people are buying more larger packs or family packs that we call it because consumers still prefer to avoid going out much. So both of the categories are growing well. That's how you see the numbers of all the companies doing well. But in terms of relative performance, rural has been better. And -- yes, so I think these have been the responses for us.

Yes. And sir, the MD of the company, Ms. Jyothy, we see less of her interviews on the business channels and she has very less appearance. Any specific reason for that? Means because she -- as she has taken newly charge in the company in the past 1.5 years. So any specific reason for that?

So -- see, I think she was on ET now last week itself. I don't know whether you were able to catch hold off that event or not. But I'll just -- Mr. Kamath, if he wants to add something. She's being there. I think we'll let you know next time when she's coming on any of these media channels.

And sir, my last question is, in the last year annual report of FY '20 on Page 144, I was going for -- I was doing the analysis, and there is a contingent liability of close to INR 120 crores appears on your balance -- on your -- in your annual report. Can you throw some light on that? Means how you're going to -- came down this contingent liability of INR 120 crores, which is showing in your annual report going forward?

Yes, yes. So this is -- out of that, INR 80-odd crores is the corporate loan or corporate guarantee, which was given for loan given to our subsidiary. So that is more or less the major portion of that.

The next question is from the line of Kaustubh Pawaskar from Sharekhan.

Congrats for good set of numbers. Sir, just I have 2 questions. First, on your new launch, that is Exo Bioh Fresh. Why it has been launched only in Kerala? Because most of your competitors have launched pan-India and -- their products considering whatever the opportunity currently it is there in the market? Or your thought process is like since you have a better distribution reach or presence in Kerala, you would like to first try the product in that particular state and then expand into the other markets?

Hello? Hello?

Yes.

Yes. The thing is, yes, Exo is a strong brand for us, and we have always followed that path that we launch first in Kerala how -- and we see how the results are and then we go the next step. And for this also, we have done the same way. We will be -- I mean, as we have launched it there, we will be doing our investments. We see how the strengths are and then we will take the next step. That's how we have been, and that's how we'll be following.

Right. But is it -- is this launch an opportunity launch or something like you want to continue into your portfolio? Means whether the plan for such kind of products will continue in the post-pandemic era or something that -- or over the period of time, such products will -- again, the demand for such products won't be there?

Yes. So that's also one reason which we need to see going forward. That's why we are taking that calculated steps. But for this product, among other products that are born out of COVID necessity, this one looks like will stick long term because it's not just the virus that you're concerned about, there was a need for this kind of product in the past as well, because on the fruits and vegetables, if you see, the consumers did have a fear of pesticides being used and, otherwise, germs and also the wax that is coated on fruits for the shine. So all of those, whether it used to get really washed away in water by mere -- just washing was always a point, especially also in the monsoon seasons where -- season where contamination and all of those happens. So it was only a matter of time, I think, is this virus gave -- I mean the product as such was born, the need for this kind of product. Looks like after the virus also, people who are used to hygiene and who give importance to hygiene and have got such things home, maybe would continue. While other categories, yes, only time will tell as the virus goes and whether those will continue. But for a veggie and fruit cleaner, looks like it should remain. Hello?

I hope that has clarified your question, sir? Hello?

Yes. My first question has been clarified. My second question is on your low unit pack. So what is the contribution currently of your low unit packs and whether it has improved in past few quarters?

Yes. So overall, across brands, across the portfolio, we would see that we are around 25% to 30% on the low unit packs of INR 5, INR 10, 100 grams. Whether it is increasing, improving marginally, yes.

The next question is from the line of Shirish Pardeshi from Centrum Broking.

Sanjay, hearty congratulations to you for smarter recovery in this quarter. I've got a few questions. The first question is on Fabric Care. We are seeing the competition is heating up and regional competition is also coming back very strongly. And of course, there was a period where input material was quite benign. Would you be able to help me understand how the competitive scenario is evolving in your stronger states like Kerala or say South India?

Yes. So -- see, most of the states, if you're looking at only for the Fabric Care, the issues have been, yes, the people are confined to home. So there's been a decline in consumption to begin with. But now things are now getting back to normal and things are -- I mean barring only the channel issues, everything seems to be fine. But in terms of Kerala, we are seeing decent growth, not anything abnormally high or any decline. And Kerala has always been our strong market, and we continue to focus on that.

Yes. So I was more interested in how your growth, IDD versus Henko?

So IDD and Henko both have done well in Kerala and -- in the general trade market.

So if you can give us some color on volume value growth, how it has performed in the quarter which is gone by?

So you can -- it is again -- if you are only talking about the general trade, it has done -- both of them are focused. And IDD and Henko have done better than what we were doing in the previous years.

Okay. I also wanted to understand, you have mentioned that there is a focus on Maxo brand and Maxo Gel is one of the key interventions you have taken. Tell me the purpose of this and what is it that one can make out? Because you also have some strong brand like Pril and now you're also trying to expand the Maxo franchise with gel. So what is the thought behind and what can be the opportunity in next 2, 3 years?

First of all, 1 correction, it's not Maxo Gel, it is Exo, Exo is in Dishwash. And Exo, we were quite, as a brand, very strong on the Dishwash bar segment. We -- now that we are seeing good growth happening on the liquid side as well, we had to -- we did launch Exo Gel sometime in the past. And that -- it's a thicker gel that is there for a value-conscious consumer. And that is the offering that is coming from Gel from Exo. And also Exo stands for antibacterial, which is a germ kill product as well. And precisely, what is the current need of the market, that's what we are offering. And Exo is quite a known brand in the Dishwash category, and we have only leveraged that brand to the next level.

Yes, thank you, Jyothy, for correcting me, I was talking about. So I was more interested in knowing who's the target audience? Or is it again going to be a South India focus where penetration of how -- I mean Hand Wash and Dishwash segment is much higher?

Yes. So -- yes, like our thing is to go first South. That's where the brand is relatively known and also the liquid usage is much more in the South compared to the rest of the country. Exo is a known brand, so -- and it operates in the antibacterial segment, and that's the reason we have launched it in the South. Sorry, and the other question was?

So I'm saying which is the target audience? So is it that Maxo...

It is -- it's not Maxo, it's Exo.

Yes. I mean are you saying that from bar to liquid is the transition which you're looking?

Yes. Yes. Bar to liquid. And so [indiscernible] people never used to come to liquid is the whole thing that is liquid is expensive, also the maids using liquid and a lot of wastage happening. So it is for a value-seeking consumer where this 1 bottle of liquid would last them for over a month -- more than a month. The gel is quite thick in consistency and it does multiple plates compared to your ordinary liquid that's there in the market. So that's the thing. So it's upgrading bar users to liquid.

Related on -- follow-up on that, what kind of margin difference you would have between bar and gel?