Khadim India Limited (KHADIM) Earnings Call Transcript & Summary

Ladies and gentlemen, good day, and welcome to the Q1 FY '24 Earnings Conference Call of Khadim India Limited, hosted by Orient Capital. [Operator Instructions] Please note that this conference is being recorded. I would now like to hand the conference over to Mr. Sumeet Khaitan from Orient Capital. Thank you, and over to you, sir.

Yes. Good evening, everyone. Welcome to the conference call to discuss the results for quarter 1 FY '24 of Khadim India Limited. Today from the management, we have Mr. Rittick Roy Burman, Whole-Time Director; and Mr. Indrajit Chaudhuri, CFO. Before we start the call, I would like to give a small disclaimer that this conference call may contain some forward-looking statements which are based on the beliefs, opinions and expectations of the company as on debt. Actual results may differ materially. A detailed safe harbor statement has also been published in the company's investor presentation, which was uploaded on the stock exchange today. I hope everyone had a chance to go through the results and the presentation before this call. I would now like to hand over the call to the management for their opening remarks. Over to you, sir.

Good evening, everyone. On behalf of Khadim India Limited, it is my pleasure to welcome you all to this conference call to discuss the Q1 FY '24 results. FY '23 was a good year for us in terms of sales, profitability and store expansion. Our sales grew by 11.7% in FY '23 compared to the previous year. We expect this growth momentum to continue this financial year as well. We are able to maintain quarterly business performance, mainly because we are able to offer products within an affordable price range. The softening of raw material prices resulted in healthy growth in gross profit margins by 360 basis points year-on-year. The campaign Cholche Khadim Cholbe Khadim, which we started in last quarter, is getting a good response from customers, leading to increase in footfall across our outlook. During the quarter, retail sales contributed 62%, while distribution contributed 34% to the total revenue. We added 13 new stores in the quarter, taking our retail store network to 848 stores. As we move ahead, we plan to add 70 to 80 stores in financial year '24. And we aim to add 90 to 100 more retail stores by FY '25. Our distribution network is getting stronger as we added 44 new distributors in Q1, taking our total count to 732 distributors. Our retail and distribution business are currently present in 27 states and 4 union territories as of June 2022. Now as a part of the corporate restructuring, we are in the process of demerging our distribution business as a going concern into a company to be incorporated as a wholly-owned subsidiary of Khadim India Limited as of now. Going forward, the new entity would function as an independent listed company wherein the eligible shareholders of Khadim India Limited would be allotted shares in proportion to their shareholding in Khadim India Limited. It will be the mirror image of Khadim India Limited. The details of the demerger would be shared with you in due course of time. As you may be aware, the central government has issued quality control orders for footwear to be covered under BIS norms effective 1st July 2023. We are closely monitoring the situation and complying with the orders to ensure that we are compliant. Now I'm moving forward to the Q1 FY '24 financial highlights. Q1 FY '24 revenue is at INR 158 crores. It has de-grown year-on-year by 5%. Gross margin for the quarter stood at 45%, which is up 360 basis points year-on-year as higher contribution from retail sales led to favorable product mix. EBITDA for the Q1 FY '24 stood at INR 18 crores, up by 7%. EBITDA margins for the quarter stood at 11.6%, up by 130 basis points year-on-year. PAT for the quarter stood at INR 1.6 crores, down 51% year-on-year. PAT margins for the quarter stood at 1%, down 100 basis points year-on-year. With this, I now open the floor for question and answers. Thank you.

[Operator Instructions] The first question is from the line of [ Nakul Doshi ], an Individual Investor.

So I have a couple of questions. My first question is in the last quarter, as you had mentioned that you would be spending around INR 15 crores on advertising and promotions for the year. So for the first quarter, how much is your spend? And so, if you could provide our off-line versus online marketing expenditure for the quarter?

This is -- we have spent around INR 4 crores in the current quarter, okay? And out of that 85% is in the off-line and 15% in online.

So the guidance remains the same of around INR 15 crores for the year or we can expect more as the festival season would come?

Guidance would be around INR 15 crores. If the sales grows, then only we'll extend more. Until now, we are within our budget of INR 15 crores. In the second quarter, it will be high because of the festive season. But in third and fourth quarter, it will taper down.

Okay. And in terms of overall performance of our stores, how are the existing stores performing? Are we seeing increase in the sales? And also what are our current SSG levels?

The SSG level is almost the same level as we were in FY '23 with a minor de-growth.

And in terms of new store openings, what is the average size of the [indiscernible]?

Average size of the store is around for COCO is this 1,000 square feet. And in franchisee, it's 700 square feet. It's the same as it used to be previously.

The next question is from the line of [ Nina Sabnis ], an Individual Investor.

Thank you for the opportunity. So I would just like to understand from you, what would be the CapEx guidance for FY '24 and the margin guidance for FY '24 and '25?

CapEx would be around INR 15 crores for FY '24. And margin guidance, we'll try to improve the margin. As you've seen in the first quarter, the margin has improved in a long way, but would be around 100 to 115 basis points year-on-year. In the next year also, we'll try to increase the margin in the same level.

Okay. Also, could you provide us with the store openings and the store closures, which have happened during the Q1 and any -- like, which is on the higher side?

So, we have opened 13 retail outlets in Q1 and out of -- and 11 stores were closed because of the reason of inactiveness of the store and nonprofitable stores we have closed.

The next question is from the line of [ Darshil Zaveri ] from Crown Capital.

I hope I'm audible?

Yes, yes.

Yes. So in terms of the revenue guidance, what do we see this year and maybe next year? What kind of revenue growth do we see? Because you had a bit of a degrowth in this current quarter. So how do we see it going forward?

In the retail front, we are still upbeat on growing at 10% to 12%. And in distribution front, since we are taking steps on tightening the trade norms because in distribution, there's a lot of trade if you want to expand in more than 15%, it will be -- you have to release the credit, but we are tightening the trade. So the guidance would be around 12% to 15% in distribution. But since we are -- as we are -- Rittick has already mentioned about the restructuring. So in FY '25, there would be a retail company, which will be operating as KIL and distribution company, and it will be a separate company. So in that year, the guidance for retail would be the same. But in distribution, we will be restructuring the business, and we'll try to concentrate on products, which are more profitable, thereby to make this distribution company profitable. Maybe the sales will reduce, but the company would be profitable.

Okay, sir. So maybe we can assume around 12% growth for the full year currently and then FY '25 after demerger that we could see separately, but 12% growth would be a fair assumption, correct, sir?

Yes, in this year.

Yes, in this year. and sir, I just also wanted to ask, sir, in terms of margin, as you're saying you'll see improvement. So that's been driven majorly by gross -- raw material price reduction or premiumization or both. So could you just maybe give some color on what's going to keep on driving our margin.

Margin expansion is mainly because of raw material softening and mainly this is the reason because our ASP has remained in retail same level as compared to last year. So mainly, it has increased due to raw material softening both in retail and in distribution.

So sir, what was the ASP this year -- this quarter?

INR 627 in retail.

Okay. So sir, the 100 basis point margin improvement is going to be driven majorly by raw material price reduction, correct, sir?

Raw material and also maybe in the festive. You can see a price increase in the festive season.

And how much would that be, sir? Rough price would also be fine, sir.

Around 4% to 5%.

The next question is from the line of Sachin Kasera from Svan Investment.

Sir, when we do the demerger -- I joined a little late, I'm not sure if you already answered. But post demerger, what happens to the debt? Will it remain in the distribution company or it will be part of the retail business?

The debt would remain in the retail business. The distribution company will be without debt. Maybe a small amount of INR 1 or INR 2 crore working capital loan.

And sir, in terms of getting confidence from either the bankers or the key employees, have you spoken to them because that normally is also something that is required before...

Yes, yes. We are in that process because it's only a principle -- principle approval has come from the board next month, a detailed approval, formal approval will be there. And we are also preparing the -- all the documents relating to that. Bank, we have unofficially spoken, but there would be no as such problem. And the employee of the distribution business will be transferred with no -- I mean, at the same benefit they are getting in KIL. And since Mr. Burman and Rittick is there, so that will also give them confidence to work in that company.

Sure. Secondly, can you give us some idea about the EBITDA margin difference between this -- now that you're going to be 2 separate companies, how will be the EBITDA market that will look for retail business...

Excuse me, sir. I'm sorry to interrupt. Request you to please speak a bit louder, sir. Your audio is not audible.

Yes. I'm saying that now that it's going to be 2 distinct businesses, can you give us a sense on how the margins will look in distribution versus the retail business?

Retail, it will be around 16%. And distribution would be around -- at present if you segregate now, it will be around 5% to 6%. But as I have mentioned, that we'll try to improve the profitability by structuring the business in such a way that we sell only the products which are having more gross margin, thereby to increase the EBITDA in that company and to make it profitable.

Sure. And once we demerge the companies, do you think that from FY '24, FY '26 onwards, the retail business can then grow much faster because it will have a lot of cash flows in the business as of now because distribution is not making so much money? So there's some sort of a burden on the retail business. Once it is separate, can we expect to grow in the retail business much faster, say, more like 15% to 20% versus 10% to 12% that we are looking this year?

See, 1 thing retail is that SSG is very muted. Okay. The growth mainly is coming, one, is that your premiumization and opening new stores. So we'll definitely open more as Rittick has mentioned, from 70, 80 stores, we'll open around 90 to 100 stores. That will be a positive in the sales improvement. And as you mentioned that there will be free cash flow, we'll try to reduce the debt also, so that our debt comes down to around INR 50 crores in the next 3 years. That is also a target of the management.

The next question is from the line of Rahul Jain from Credence Wealth.

Am I audible?

Yes.

Sir, could you share details on some strategic measures, which we have taken post Namrata ma'am leaving. What exactly are the strategic changes which we are doing in the company overall? Are we changing some particular focus areas? What exactly are the changes which we are trying to incorporate?

The main changes that we are doing is in the product. I can -- Rittick can highlight on that.

Yes. So the -- so the main changes that we have done over the last 1 year is that our products, which had become a little -- the designs have become a little alienated from our customers. So we are trying -- we are making those products which are more sellable to our customers. And I can say that the designs are working well because right now, our festive orders are going on. And it's very good compared to last year. This year, the amount of orders that we are receiving from our franchisees and all are much better. So we expect during festive seasons and holiday seasons, the sales to improve from both CO and EBOs. So that's one of the strategic change and in certain merchandise categories because right now, there is a price-sensitive sort of an environment in all merchandise categories like chappals or shoes, formal shoes or even the sport shoes. We are trying to keep few, very few entry price point products, which we're missing, by which we will try to arrest the tarried degrowth and all that has happened. So this is how we aim to achieve the 10% to 12% of sales growth that Indrajit just mentioned. We aim to achieve that in this way.

Another strategic change that we have already mentioned is the demerging of the distribution business.

And another change is also that we are like -- we are finding out stores that are in -- because we are strong in East and South, so there are still many markets. So we have like pushed our team to find out good markets in West Bengal and the Eastern zone as a whole. And we are trying to open as many stores as possible for the next 2 or maybe even 3 years in the Eastern zone, along with other zones -- other zones also, we'll open, but there will be -- if we get, the first opportunity will be given to the Eastern Zone stores because we have seen that if we open a store in West Bengal, it just starts giving a good profitable sales from the very first month itself. So that's why we want to focus on that also. So these are the focus points that has been -- that have been done. And to increase ASP also, we are focusing, where we have launched many sports shoe designs, which is going to -- which has already started going to the shops. So during the festive season, we are very confident that these sports shoes that we have launched, which starts from INR 999 MRP and goes up to INR 2,699, even INR 3,000 MRP. These sports shoes were not there with us before. So this will also aid in increasing ASP, which is kind of muted right now, the growth -- ASP growth at this point. It should increase the ASP 4%, 5% from the festive season.

Sure. And sir, how are we working to improve the SSG? Because that has been a pain point for some time now.

See, in the SSG, the growth that we have seen coming is the renovation of the stores, okay? The stores, if you renovate, it will -- the SSG, it would make a growth of around 7% to 8%. So once this demerger is done, then our focus will be to renovate as many stores as we can because there we see cash flow. And another thing that increases your SSG is the premiumization of the product. So these are the 2 measures that are taken to increase the SSG. And obviously, if the economy -- we operate in the middle class and the lower middle segment, where the economy -- where the disposal income of the consumer has gone down after the COVID. So once these things improve, that will be a gain in the macro sense. But in the micro sense, the renovation of the store and premiumization with our sub-brands.

Sure. And just as a longer-term strategy with regards to these 2 companies. So how do we look at these 2 companies differently. One is the retail, one is the distribution. And typically, we will have a separate CEO going ahead then for 1 of these companies or Mr. Rittick himself to look at both the companies separately. Just trying to understand probably much more details in terms of how 2 different companies are going to be managed and probably the rationale to separate the distribution arm.

Yes. So see, the promoters will be -- they will be focused on both the companies, okay, retail and this distribution company also, okay? And -- but the teams for the retail. Retail, we will focus on -- like retail is our -- we are born retailers, like we are first -- so we will have our -- we already have a very experienced team in retail. So they will continue to work in retail. And the distribution also, we have got a decent team now. We have been doing this business for the last 10 to 11 years. So we'll restructure that team a bit. Promoters will oversee both the companies, but both these companies will have a separate person, maybe not something as heavyweight as a CEO or something in the -- especially in the distribution business, but there will be an important person in the distribution wing retail [Foreign Language] it already has. So like that, we wish to run both the companies. The distribution company will be restructured and tried to be run in the most profitable way possible. And retail, as we all know, once this happens, than the retail EBITDA margin and everything is already very good, but once the demerger happens, the retail will perform as a separate company by itself, giving that 16% EBITDA and around 5% of PAT, these things. And the distribution company will see -- will also give [indiscernible].

As I have mentioned, distribution company, we will try to structure it and make it a little volume -- lower in volume but more in profitability.

And with regards to the promotional marketing advertisement spend, as a strategy do we keep a limit as a percentage of sales? What kind of percentage of sales are we comfortable with, with regard to advertisement?

No, we don't have a specific percentage. But as I mentioned earlier, that it would be around INR 15 crores, mainly for ATL and BTL activities. And that would be focused on the retail front.

The next question is from the line of Abhishek Getam from Alpha Invesco.

Am I audible?

Yes.

So just I missed the point. So debt will be moving to retail entity, right, after demerger?

Yes.

Yes. So but all of our land bank is for the distribution business, right, all the assets? Because for retail, we outsource.

So in distribution, we have 2 factories. Out of that, the machinery and [ molds ] and all these are in the distribution company. But the land of 1 factory in Kanpur, which is our own land, that is...

Part of retail business.

No, that is owned by our group company, Khadim [indiscernible]. So land bank will not be moving to that company. Land will remain with Khadim [indiscernible]. And the machinery and all the things will go to this distribution company. And the another factory is run on a lease, that lease will move to that distribution company.

Okay. Okay. And sir, any -- what will happen to the receivables of UP -- from UP government, [indiscernible].

No, no, UP government receivable has already come. So that will remain with Khadim India Limited. So already by this quarter, all the UP government receivables will be received. We have already received around INR 22 crores. And INR 10 crores has left, that will come within September.

Received INR 22 crores?

Yes.

Sir, our total amount receivable was INR 70 crores, right, from UP government?

That is another means in Punjab. [indiscernible] in the Khadim India Limited.

That with distribution business?

No, no. Retail business. Only the distribution debtors, distribution stock, factory stock and factory creditors will move to the distribution company. Other things will remain with the main company, Khadim India Limited.

Okay. Okay. So sir, after UP government, you will have INR 50 crores receivable from Punjab?

No, no. We -- around INR 37 crores is left for UP government, total INR 37 crores and INR 32 crores from Punjab. So why this [ half yearly], September, we will receive UP governments. Only Punjab government would be left, that we'll be getting in this financial year.

Understood, sir. Understood. Can you share some light on what were the volumes for retail this quarter?

We have sold around 18 lakh pairs in this quarter.

For retail?

Yes.

And what would be the Q1 FY '23 number?

20 lakhs.

Okay. And Q4?

Q4 -- just a minute. 18 lakhs.

The next question is from the line of Aniket Kulkarni from BMSPL Capital.

So my question is a bit broad-based. So if you look at -- so I'm drawing comparison here with the close space. So just -- over the -- over time due to excessive competition here, pricing power has become a big issue. So due to this intensive competitive market when RM prices spike, even the branded players and the top players are not able to pass on prices to the same extent as they did before and their margins remain volatile. So my question is, will this intense competition not affect the shoe industry because we are seeing a lot of players are now coming into this space. So as the growth prospects are very high in this industry, so going forward, if more and more players keep on coming, so are you not concerned about the pricing power diminishing? And if there are too many players cutting prices on the market share, then how will we go about it? I mean, whether to maintain prices or we'll just have to follow what the market is doing?

So see, in the retail business, we don't have any fear from other company because the reach and the geographical presence that we enjoy, they will -- a new company will not be able to have that presence. And retail, we are very much popular in East and South. So we are concentrating our strategies on this region so that we can increase the sales. So that is a definite edge against other new entry in this footwear segment. And again, we have seen that the government has come up with the BIS standards. So these type of standards are maintained by the players who are already in the industry for the last 3 decades. So that is an effective tool of edges over the new entrants in this company. Obviously, in the distribution business with small distribution company, price cutting is there. And also with the increase in distributors, there are lots of freebies and all these are given by the small companies. For that reason, I have already mentioned that we will structure the distribution business in such a way that we will generate profit in that company with lower sales and selling profitable product portfolio.

The next question is from the line of Sachin Kasera from Swan Investments.

Yes, sir, you mentioned about this improvement in terms of the collection from UP government. And you also mentioned that in the second half, you're expecting even the Punjab government collections to come through. So is it that we have on a back-to-back basis, a lot of creditors that need to be repaid or we can use these receivables to reduce our debt?

UP, we have back-to-back creditors, so we are paying off the creditors. But if the Punjab government pays, there's less creditors and some funds will go for repayment of debts.

So net-net basis, the entire collection from UP and Punjab, how much of debt reduction could happen, sir?

Around INR 25 crores.

INR 25 crores. Okay, okay. And how much of debt reduction you're funding this year from internal accruals other than this collection of dues from government?

So this year, the cash profit that we will generate from UP, we'll be giving a free cash flow of INR 5 crores that will be used for reducing the debt.

No. I'm talking of, sir, so these are basically the sales that we've already done from the government. I'm talking the normal operations. Also we'll generate...

Operations, means that we are also opening new shops. So funds will be utilized in that. We have a target of reducing debt around INR 8 crores to INR 10 crores from our internal accruals.

So INR 25 crores from the government receivable and INR 8 crores to INR 10 crores from internal accruals. So totally around INR 35 crores of debt, we should be able to reduce this year?

If the Punjab payment comes within this year.

In comes this year. Okay, okay. You mentioned that next year onwards, you're looking at INR 15 to INR 20 crores reduction every year from the retail operations?

Yes. From the free cash flow generation that comes in.

Sure. And sir, you mentioned about 16% EBITDA margin. What would be like the PBT margin in the retail business below EBITDA?

Around 7.5% to 8%.

This is as of now. And that should improve by about 100 basis points every year, next 2, 3 years?

If the retail performs like in 10% to 12%, definitely, there is a scope of increase in the percentage.

Sure. And one of the things that we have been doing is improving the product mix and hence, improving our sales realization. So do you think that next 3, 4, as we have the opportunity of continuously working on the product mix and getting a 4%, 5% higher realization, that is there? Or there we are more or less now peaking out?

No, no, we are not peaking out. Like I said, actually, this year, because the economy is bit -- at least in the first quarter, it was like that. During the holidays and any kind of holiday, be it Eid or be it like we had weddings, Eid, then now the 15th August weekend, 11 to -- these -- all these holiday times, the sales is happening. But the other times, the sales is a bit subdued in the week days. So we expect that whenever the festive seasons comes or the wedding season comes, people will pay a higher MRP -- higher price to purchase a good-looking pair of sports shoes or formal shoes. So we are investing and our designing team is investing in a great range of sport shoes, formalwear for men. We have this brand called British Walkers. So we are selling leather shoes almost INR 3,000 nowadays, which used to be lower before. Like before we used to sell below INR 2,000 British Walkers only, but now slowly, slowly customers are buying even British Walkers leather shoes at near about INR 3,000. So every merchandise category, be it leather shoes, for workwear for men or sport shoes, or workwear for women, we are focusing on the design in such a way that our ASP increases 4% to 5%.

So basically, this product mix changes is a value addition that we are doing and for the next 2, 3 years, it will be done because you know our sub-brand is 60% and Khadim is 40%. We have scope of increasing the sub-brand to 65% and Khadim going down to 35%. So there are also ASP growth will come.

And the gross margins in these ones are higher or as a percentage, the gross margins are similar when you go for the higher ranges?

Slightly higher in the sub-brands compared to Khadim. So that is a double impact on the gross margin.

And sir, this volume that you gave 18 lakh pairs versus 20 lakh, this is both retail and distribution combined, right?

No, no, no. Only retail. Distribution volume has increased. We have sold around 63 lakhs this quarter as against 58 lakhs against first quarter FY '23.

No. Can you repeat it, sir. Last year was 58 lakhs and this quarter was how much?

63 lakhs.

63 lakhs. And this decline in retail from 20 to 18 lakhs, is this the company's internal strategy where we are letting go off some low margin products? Or is that a function of loss of market share or the market being subdued or both?

I think market subdue is 1 reason. And another reason is that last year first quarter was a quarter which was after third wave of COVID, in fourth quarter of FY '22. So that's the reason that last quarter in FY '23 shown growth in the volume. But if you see the fourth quarter this year, 18 lakh pairs was sold. So same 18 lakhs pairs was sold in the first quarter. But definitely, we can -- once the economy and the subdued thing goes out, the volume will be in the range of 20 lakhs.

We are attacking the -- not attacking, we are trying to protect our sales from all fronts, like we have certain -- which was not there before, like I mentioned, that every merchandise category, we have introduced some entry-level price points. So we want to arrest the tarried degrowth from there. Plus, we are also working on some of these sports shoes and formal shoes. We are increasing their look. We are also working on this plastic footwear products, comfortable plastic footwear products, which are doing well now. We call it EVA products. So that is also doing very well now, plastic footwear, clogs type of products. So those -- we are attacking from all merchandise categories and all price points to ensure 10% to 12% growth in value and reduce the tarried degrowth.

Sure. But as for your questioning, in your key regions or key markets, there is no major loss of market share that you have seen?

The market share as such, if you see these products -- our product segment, there is a subdued and slump in this total INR 1,000 MRP. So it is also evident in distribution business where the retailers, the small retailers are also facing the same problem.

The next question is from the line of [ Falguni Thacker ] from Jet Age Securities.

Yes, sir. Sir, what was our volume for FY '23, full year, both in retail and distribution?

Just a minute. 78 lakh was for Q1 FY '23, whole year volume. And now Q1 FY '24, the volume is 81 lakhs.

I meant for the full financial year FY '23.

Sorry?

I mean for the entire financial year FY '23, what was the volume in retail?

Retail was 76 lakh pairs in FY '23. And distribution was 2 crores 42 lakh pairs.

Okay. And sir, this is -- another is a basic question, I just saw FY '22 annual report, so these warehouses that we have been buying. So sir, what is the objective? I mean, where we get rentals also?

So we have shifted from the buying mode to the rental mode warehouse.

Okay. But -- so we will -- no more we investing money in buying warehouses as we used to do earlier?

No, no. We have bought warehouse in the year 2010. But after that, in 2022, we have sold that...

Yes, you sold one, reasonable size, in '22. So that strategy continues?

Yes, yes. We are not buying any warehouse. Neither we are buying any retail also. Everything is on rental model.

And that warehouses are meant for both equally or they are more lopsided towards any particular segment, be it retail or distribution?

No, we have 2 warehouses, one in Panchla that is fully catering to the retail business and one in Serampore which is catering to the distribution.

The next question is from the line of Bharat an Individual Investor.

Can you hear me?

Yes, yes.

Yes. So just want to check, now that we are wanting to principally demerger. Could we also expect the accounts to be like presented in a manner where we know what is segmentally going to happen, like, from the next quarter?

See, once demerger thing -- once the court approval doesn't come, we have to keep on in our books, accounts -- we have to maintain in both in 1 financial package. But we will definitely present the distribution business EBITDA margin and retail EBITDA margin from the second quarter this year in our presentation, not in accounts.

Okay. Okay. So I mean, not on the accounts as such. But yes, but that account is -- I understand, that's for what, our financial presentation. But if you are intending to demerge the business, you already know what is the balance sheet of both the divisions? Okay, you may not present the balance sheet, but at least the P&L broadly, what's the P&L and the capital employed. So that can be presented. I mean, there's no regulatory requirement for it. But in the interest of understanding what is going to be in the demerged entity and what is going to be in what you call the continuing entity.

EBITDA level, we can definitely present. But once the demerger things happen, how much [ loan ] will go and how much will remain, what is the debtors number, we cannot exactly figure out the capital employed, but that will obviously -- once the demerger is in the process of 9 to 12 months, then we'll present the accounts of both separately.

Okay. I understand. Okay. But my personal point was like you know exactly what your -- even in your EBITDA, you know exactly what is [indiscernible] in the demerged accounts. So why would it not be possible? Like I know theoretically, what you're saying is okay. But practically, you know exactly what your -- what is the exact contribution from each business?

Once it happens, we can show it, you can come and you can -- I can show it to you. But now since we are in the phase of demerger thing going on, we will provide you 2 EBITDA numbers, but ROC and all this, we can provide once this demerger is finalized.

Ladies and gentlemen, that was the last question for today. I would now like to hand the conference back to the management for closing comments. Thank you, and over to you, all.

Yes. So thank you to all the participants, all the investors. Thank you for trusting in us. And this is a very strategic call that we have taken for our company. And all of us are -- the entire team is working really hard to make this company a very growth-oriented and a performance-oriented company. So this decision that has been taken by the team and the promoters, we really believe in it that it will make Khadim a very, very performance and growth-oriented company in the near future, [Foreign Language] quite soon, it will be like that. Thank you.

Thank you very much.

Thank you very much. On behalf of Khadim India Limited, we conclude today's conference. Thank you for joining. You may now disconnect your lines.