Macfos Limited ($543787)

Ladies and gentlemen, good day, and welcome to the Macfos Limited Earnings Conference Call hosted by Hem Securities Limited. [Operator Instructions] Please note that this conference is being recorded. I now hand the conference over to Mr. Prabal Maheshwari from HEM Securities Limited. Thank you. And over to you, sir.

Thank you, Danish. Very good afternoon, ladies and gentlemen. Thank you for joining Macfos Limited Q4 and Full Year ended 31 March, 2026 Earnings Call. Joining us on the call today from the management team are Mr. Atul Dumbre, Chairman and Managing Director; Mr. Binod Prasad, Whole-Time Director and CFO; and Mr. Nileshkumar, Whole-Time Director of Macfos Limited. We will now commence the call with the opening thoughts from the management, post which we will have -- we will open the forum for the Q&A session where the management will be glad to respond to any queries that you may have. Before we move to the main call, I would like to read the standard disclaimer. There may be forward-looking statements about the company and its subsidiaries, which are based on the belief, opinion and expectation of the company's management as on the date of this call. The company does not assume any obligation to update these forward-looking statements if those beliefs, opinions, expectations or other circumstances changes. These statements are not just guarantees of future performance and involve risks and uncertainties that are difficult to predict. Consequently, listeners should not place any undue reliance on such forward-looking statements. With this, I hand over the call to Mr. Atul Dumbre, Chairman and Managing Director of Macfos Limited to take it forward. Over to you, sir.

Thank you. Dear shareholders, we are pleased to share our business progress and financial performance for financial year '25-'26. This year reflects the steady and focused efforts made across all areas of the organization. During this year, we have achieved a revenue of roughly INR 312 crores, with EBITDA margin of INR 39 crores and profit after tax of INR 25.65 crores. For a fair comparison, we have excluded one-time bulk sales of roughly INR 71 crores, which was done in H1 of financial year '24-'25. On a like-to-like basis, this represents a strong year-on-year growth of roughly 67% in revenue, 103% in EBITDA and 105% in PAT. These results reinforce our confidence in the strength of our business fundamentals and our execution. With the completion of this financial year, we mark 3 years as a listed entity. We are proud to have sustained our growth trajectory despite global uncertainties. This reflects the resilience of our business model. We would also like to thank you for keeping faith in Robu.in. And trust me, this is just the start. We have a long way to go together. This demand -- accordingly, we continue to invest -- sorry, I think I just misread something. So, we believe that the market opportunity remains strong. The key challenge lies in building capability to effectively capture and serve this demand. Accordingly, we continue to invest in strengthening our capabilities, which are; enhancing our customer support experience, expanding our product portfolio, upgrading our IT systems and improving our fulfillment infrastructure. Demand for our products remains robust. We are witnessing increased traction from corporate customers, along with encouraging repeat purchases from existing users. This growing trust in Robu reinforces our confidence in the sustainability of our growth. Our expanding product portfolio, competitive pricing and reliable customer support continue to be key drivers. Additionally, our participation in domestic exhibitions has helped improve brand visibility and enhanced more organic, cost-effective marketing. Our key business indicators, including website and app traffic, order volumes, average order value and customer retention, continue to show positive trends. Our business is built around 2 strategic focus areas, which are Robu 1.0 and Robu 2.0. For those of who are new here, Robu 1.0 is our electronics distribution business, while Robu 2.0 focuses on developing our own products. Now, let's talk about them one by one. Robu 1.0 is our core distribution business, and it remains the backbone of our company. We are focused on delivering quality technology products at competitive pricing, supported by quick deliveries and dependable customer service. We continue to work closely with suppliers and invest in systems to improve procurement efficiency and reduce delivery time lines while steadily expanding our product portfolio to strengthen Roku as a one-stop platform. Roku 2.0 is focusing on developing our own products, particularly in drone segment. Over the past 2 years, it has gained strong momentum while increasing acceptance of our in-house solutions. These capabilities have enabled us to undertake customized development projects, including engagements with government and defense organizations. Additionally, we have launched key drone-related products under our proprietary brand, Simplify. We sincerely thank you for your continued trust and support. It inspires us to keep improving, innovating and building a stronger and future-ready Robu. Apart from the regular updates, I would like to clarify some data mismatch in the updated presentation. So, first one is total orders served in financial year '25, '26 H2, that is second half of the year. In the presentation, the number is 3 lakh. This was a typo mistake. Actual number is 267,126. Second is total unique visitors data, which is on our website and app. So, up till last year, that is financial year '24, '25, we would download the data from our system, let's say, for quarter 1, then for quarter 2, then for quarter 3 and then for quarter 4 and add that data up to keep an annual unique visitors on our website. This year, we have changed the methodology and downloaded data from first quarter to last quarter, that is first day of financial year to last day of financial year in one go from our systems and reflected that data in the presentation. However, this has created a mismatch with quarterly data of financial year '25 and '26. I have just explained how this has happened. So if you download, let's take quarter 1 data and it reflects that we have 1 lakh unique customers. And then you download quarter 2 data and it says that we have 1 lakh unique customers in quarter 2. But let's say, 20,000 customers which visited us in quarter 1 also visited us in quarter 2. So, they are common in both the quarters. So if you download the data for H1 in our system, it will not be 1 lakh plus 1 lakh equal to 2 lakh. It will be 1.8 lakhs. You have to reduce those 20,000 from -- the system will reduce those 20,000 from the overall data. So, I think to avoid any confusion here after, what we have decided is that we will continue with the old system that we will download the data quarterly and just represent sum of 4 quarters as annual data. That way, everything remains clean and trackable on a quarter-to-quarter basis also this year to last year's quarter basis. This new corrected presentation we'll be uploading very soon so that any new shareholder or any new investor looking into our numbers, will not have the same confusion while studying the old data. With this, I would like to end my presentation and move on to Hem Securities' team for Q&A session.

[Operator Instructions] First question comes from the line of Kiran D from TableTree.

Sir, many congratulations Macfos team for a fantastic set of results yet again. You've outdone yourself almost every quarter, every year. I have 2 questions. One a clarification and one more of a strategic question. So the clarification is, in H2 '25, '26, the average order value was INR 6,776 as per presentation. Now in Q3, you did INR 6,000. So, that means Q4 is almost INR 7,300 per order. So, that's a substantial jump from -- I mean, INR 6,000 to INR 7,300 almost in Q4. Could you just elaborate the reasons why we are seeing such jumps in average order value? Is it the nature of customers? Or is it the basket or anything else? If you could clarify, that would be great.

So Kiranji, if I -- let me just summarize what you asked. So, you're saying that average order value from Q3 to Q4 of this financial year, there is a substantial jump and we just want to know why, I mean, the basic, for FY -- are you there, Kiranji?

I'm sorry, but the participant has left the queue.

Okay. So, I'll just answer his question. So, I think in last quarter of financial year, there are a lot of B2B customers as well as B2G customers, which are consuming their yearly budgets. And that's why we generally see this jump in last quarter of financial year. So, I think it is very normal to see this jump for us.

Our next question comes from the line of Swaraj from Perpetual Capital Advisors.

Congratulations on a good set of numbers. My question was, are you seeing any increased demand for Raspberry Pi and similar development goods due to AI-led use cases? And how is this trend shaping your product strategy?

Overall AI-related products, I would say we are seeing a jump, but it is not substantial because if you look at AI, currently, more or less, it is based on things like ChatGPT, Claude Code or some similar applications, which are driven in cloud. So, though there is a lot of AI hype, a lot of those people are using cloud-based hardware for doing their AI thing. We may or may not see this converting to local AI. So tomorrow, because of security and all other reasons, people would like AI on the edge. That means they would like to run AI into their laptops, into their mobile or some hardware like Raspberry Pi or similar NVIDIA boards. So this -- everybody in the industry is saying that this trend to run it on the edge will grow, but nobody knows anything for sure now. And no, I don't think this will shift any strategic -- this will make us to shift strategically in any direction because we are already covering the hardware side on the edge. So, we are selling NVIDIA boards, we are selling high-end D boards, we are selling Raspberry Pi, some others boards, which may come in higher demand in future. And I'm not claiming they will again. But yes -- so we really do not need to do any strategic shift.

Okay. Got it. And which product categories have been impacted by memory chip shortages? And have you been able to pass on those cost increases or benefit from any inventory gain?

So it is very -- so any product which have memory, so I think mostly the development boards or drone controllers, they have all been impacted. I mean, the prices have increased because of memory shortages. And about passing the gains to customer or keeping it to ourselves, as a business, we have to be opportunistic to maximize our profits. However, we also have to keep an eye for what other people selling it for, what international markets, how are they are reacting. We have some agreements with our suppliers where we may or may not be able to increase the prices and profits. So, I think it's a balancing act, and we just take the decisions at point in time. Of course, who doesn't want higher profits? But yes, we have to balance it with the competition as well as the customers' expectations as well as the suppliers' rules and all those things.

Got it. And you mentioned new products that were launched. So, what are -- like agri-drone frames and ready-to-fly FPV kits? And how has been the early market response to this newly launched proprietary products?

So, we have seen market adoption. So whenever we are launching these products, our expectation is that we see some sales in the retail segment, and then we get some feedback. So we have launched our charger, drone charger, agricultural [ frame ], drone remote very recently. Then we have some ESCs of our own. We have some video transmitter receivers of our own. So, we are seeing good initial response for some products, moderate initial response for some other products. However, what the expectation is that the products will go into market, we'll get customer feedback, what's going well, what features they would like to have, the price and everything. And we'll learn along the way. So it is as per expected basis. That's it, I think, for now.

Okay. Great. And you've collaborated with platforms like Raspberry Pi, Arduino to develop SmartElex products. And what specific product categories are being built under these partnerships?

So, I think it's out in the public. We are already developing -- I think you're talking about what we are doing with Arduino. So, we are developing some educational kit from school level to the university level according to the syllabus that are taught in universities or schools and colleges. And that's a very normal thing. I mean, I don't want to set expectation high suddenly because this is happening because it's very common. We have been doing this with multiple brands since we started. So, I think it is a part of the business, nothing new, and we do not expect it to have a substantial impact on our revenues in short term or long term for that matter.

Okay. But -- so I saw one product called Raspberry Pi Neo board. So, are these in line with the existing products or these are new products that are being built?

I think it is some misunderstanding about that product. So basically, Raspberry Pi is also a silicon company. They make RP2040 as an IC, small IC, RP2040 and RP2350. So, that IC we have used in our products. So basically, it's a SmartElex. So as a part of Robu 2.0, we have this SmartElex modules, which are small, small 300 models in our portfolio right now. They are small products starting INR 100, INR 200 to INR 2,000. One of those models, one of those 300 models uses a Raspberry Pi silicon, Raspberry Pi IC. And whenever you use Raspberry Pi IC, you can name your product as Raspberry Pi 2350 development board, whatever. So it's not some association with Raspberry Pi. It's just a very normal thing. I think the board sells for INR 600. So it's not something very substantial.

Got it. And just one last question. SmartElex products are also being sold on product marketplaces like Amazon to players like Robocraze. So, just wanted to know your thoughts on that.

That's good to hear. We have planned it that way, which is something that we are making in India. And India is a big market. Why wouldn't we like it to be sold in as many places as popular so that -- sorry, as many places as possible so that it becomes popular and we get more traction for our products, better branding for SmartElex. I mean, that was the whole point of calling it SmartElex and not Robu models so that we can distribute it through other people as well.

We'll take the next question from Aman Soni from Nvest Analytics Advisory LLP. As there's no response from Mr. Soni, we'll proceed ahead with a different set of questioners. Our next question comes from the line of Urmish Shah from Moneywisers.

Am I audible?

Yes, you're audible, sir.

Yes. My question is on the previous participant question only on Robu 2.0. Could you just elaborate because you have mentioned that your long-term goal is for 5 to 10 years, that is why you are aligning Robu 2.0. So what's your goal? I mean, in terms of revenue share, how much from your own proprietary products do you expect in the next 3 to 5 years? How is the order inflow and order size, if you can just quantify as a ballpark number?

Okay. So, we are not giving any revenue numbers as of now for Robu 2.0 because I think Rob 1.0 itself is a huge revenue. And if we start putting [Foreign Language]. So we started, I think, roughly 2 years ago. We started with 2, 3 segments. One was drones. Second was modules. Third was sensors. So far, we have seen the best response for drone products, as I have already mentioned earlier that the response is both from retail market, we see some traction from government side. We see some traction from military side. So, we are finding space. We have allocated a lot of -- I will not say lot of, but we allocated resources accordingly. [Foreign Language]. So, currently, our focus area, you can say in Robu 2.0, major focus area is drone. Second is SmartElex. [Foreign Language]. It is steadily growing. So, this is where we are. Two years down the line, [Foreign Language]. However, I mean, we are very clear on this. [Foreign Language]. That is a totally different dynamics. That is a totally different B2C business kind of thing. [Foreign Language]. So that is the whole philosophy. We are happy at the point where we are. [Foreign Language]. I think we are on the right track.

[Foreign Language] I know you will not give a guidance. Currently, it is too early. If you can just quantify because our margins are quite healthy that way?

[Foreign Language]. That is what we are targeting. It is what it is. We are honest people, honest company. [Foreign Language]. So it will be what it is, what it will be in time.

I'm new to the company. So, could you just tell me what are the OEM products in Pro-Range? I mean because we have added 650 SKUs this time. So, what are those products? And how are we bullish on that?

So if you talk about Robu 2.0, I will just give you an overview of Robu 2.0. [Foreign Language]. One is our SmartElex products. Other is our Simplify products, and then our Pro-Range products. [Foreign Language]. Pro-Range is really something that we have been doing for last, I think, 4, 5 years. [Foreign Language].

Our next question comes from the line of Parin Gala from SageOne.

Atul, sorry again harping on the same question on drones a little bit and all. I understand it's preliminary and everything. But can you just explain in drones, what exactly have we developed? And when you say in the defense sector, right now, there is -- the sector is very hot and there is a lot of inquiries and there's a lot of competition also. So, what are you doing there? And are you collaborating with somebody? Are you directly engaged with the defense ministry? Or how is it working?

Okay, Parinji. So I'll explain that scenario to you guys. So basically, in drone segments, 2 years ago, we started making our own products. And then I think as you said, the sector is very hot. We started receiving inquiries. So, we started working with defense directly. As of now, we are working directly and we are supplying some low value and low volume products to them. The strategy right now is [Foreign Language]. So there is a vast array of drone. [Foreign Language] I don't want to share the details exactly. [Foreign Language] If we catch that, we will have a sustained long-term business. That is the whole strategy or philosophy. [Foreign Language]. On the other hand, we don't want you guys to get too much excited. [Foreign Language]. I know it will have a good impact on share and all this, but I don't want to do that. [Foreign Language] So, we are trying our best developing new product. As you said, there is a lot of competition because [Foreign Language]. So, that is the situation as of today.

Next question comes from the line of [ Yogesh Bhatia ] from [ Sequent Investment ].

Sir, I actually wanted to understand that we have grown from a INR 30 crores top line in 5, 6 years to a INR 300 crores top line company. So, what is the addressable market of the products that we sell because it's quite niche products that we are selling. And I wanted to understand that what is the TAM that we think is available for other products that we sell or we can sell going forward?

Thank you, Yogeshji for this question. [Foreign Language]. Because if you go 2 years before today, there was no growth and there was no hot segment called as drone. [Foreign Language] Because we are into new tech and those kind of business [Foreign Language] because there are no conventional setups and conventional models in this. [Foreign Language] Having said this, there are international companies. Somebody like DigiKey, Mouser, Arrow or Farnell, element14. [Foreign Language]. Those companies are doing -- like DigiKey is, I think, doing $2 billion to $5 billion. So it's a big difference number. But yes, I think they are doing $2 billion, $3 billion revenue a year. [Foreign Language]. So it is very tricky. [Foreign Language]. By 2030, we will have around INR 10,000 crores Indian market.

[Foreign Language]. Or if they are not bulk orders, then are there lots from education institutions or from research institutions or from people who are prototyping? [Foreign Language]. So, trying to understand.

[Foreign Language] So that is one market which is very small segment, small revenue purse right now. [Foreign Language]

So, 20%, 30% sales must be coming from educational institutions for this kind of...

I mean, we have stopped giving the breakup of the revenue because of the competition thing. But yes, I would say that this is one of the customer base. Then second is research. [Foreign Language]. And then engineering. So, engineering is something which is going for production. [Foreign Language]. So, this is overall business of Robu and overall customer base of Robu, I would say.

And do you only sell products, which are with you in inventory or depending on the requirement, you can import and then sell it also? So, you are more efficient just in time.

[Foreign Language].

How much of your order generally would be an order, which can get and people are okay with 15 days, 20 days delivery time?

So, most of the orders we serve from our inventory because as I said [Foreign Language]. Because we are doing business for almost more than a decade. [Foreign Language] So, that is also what the customers have done this side. [Foreign Language] They are waiting for whatever, generally around a month's time to get the product.

Okay. And do you think that the past growth can be achieved or you think it can plateau because frankly, not able to understand the size of the market only? So, you think we will be...

[Foreign Language] I mean, I would love to have it as long as possible. But yes, your guess is as good as mine [Foreign Language]. Short term, I think it's a good segment, good high-growth segment.

And I think you will definitely do well because demand is there. We can't understand, but I think it is definitely there.

Our next question comes from the line of [ Rohit Prakash ], an Individual Investor.

And amazing performance as always. Sir, my first question is, I mean, as you indicated that the growth is remaining strong. But if we continue to grow the same way, we would have to take more debt to fund the growth. So in terms of debt-to-equity ratio, we are already probably at the highest we have ever been. So, any thoughts on till where we are willing to be comfortable to take on debt to grow? Or at some point, do you think we will need equity? Any thoughts on that?

Thank you, Rohitji, for this question. So, we are not worried about the debt any time like -- [Foreign Language]. So, we are never worried about the debt for company because [Foreign Language] most of it or almost debt, we convert it into inventory. Which inventory we are going to sell and make revenue for company? So, I think it is part and parcel of our business model. So it is a very low-risk debt, if I understand our business model correctly. [Foreign Language] Because our fundamentals are strong. [Foreign Language] So, we are never worried or afraid of debt. We are confident. [Foreign Language]. So once that happens, I think our system will automatically take care of it. [Foreign Language] Secondly, our inventory management is very good. So, we have been focusing on building a good inventory management system. [Foreign Language] So, I think with these strong fundamentals, I would not say we don't care. We do care about that. But we are not afraid. [Foreign Language] We don't have to worry anything about it.

Understood. So similar, any question or thought from the bank, I mean, we have a INR 90 crores equity, which will get to whatever number, let's say, down the line. [Foreign Language] We are not comfortable giving that? Or no conversation like that at this point in time?

So, I mean, they are comfortable as long as they see the revenue. [Foreign Language] And every year, whenever we are having more debt, [Foreign Language]. So, I think with these numbers around us, they are very comfortable with the debt. I don't remember a conversation where they are uncomfortable with these ratios and everything. I think it's how -- when you are converting it into revenue. As long as it is happening, everyone is comfortable; us, banks, investors. So, I think the focus should be on that.

No, no, perfect. That was helpful. So, I want to follow up on the average order value question. I mean, very strong growth on the average order value, right? So, year-on-year growth itself is quite strong. Like we were sub INR 4,000, INR 5,000 or something last year. I mean, last quarter we said about INR 7,000, but let's say, more than -- between INR 6,500 to INR 7,000 right now. So is that order -- I mean, are we bunching up orders? Or is it that the average order value is increasing? And why is it -- I mean how is it increasing so strongly? I would understand a number of orders increasing because you've also already discussed the trends of -- I mean, we are in the right market in terms of trends and a lot of things are called. But how is the average order value increasing? And is the number sustainable and is the growth sustainable?

Rohitji, I think we have -- there are 2 sides to it. I think one is overall, the Indian market is maturing. There are a lot of companies who are working in electronics. They are growing from start-up to mid-range companies also from mid to high. So, since we are catching them early and serving the requirements when they are small, they trust us when their requirement holds. [Foreign Language]. So it's more of that kind of phenomenon. Yes, we would also like to take a small credit, small one to increase average order value. [Foreign Language]. So, I would not like to discuss of this issues but yes...

I'm sorry to interrupt you, sir, but your voice is breaking.

Okay. Is it better now?

No, sir, still breaking.

Is this better now?

No, sir. I'm so sorry.

Yes, is this better now.

Yes, sir. We can hear you.

Yes. So, I was just saying [Foreign Language]. So, I think that answers your question, Rohitji.

Yes. Yes. And I think we are close to listing -- main board listing. 3 years is up and I think we're meeting the network requirement also. Let's say, I remember it's around INR 75 crores. So are we there? And what is the plan here?

[Foreign Language]. However, we don't have any specific date or time in mind as of now. Whenever we have -- we'll have any update regarding to this, we'll just announce it publicly. I think that's the best way to do it.

Perfect. And last question on margin. So again, a very healthy margin. Gross margin of 24%, which is among the best we've done and even PAT margin also among the best. So with scale, are we getting the scale advantages and these margins are sort of sustainable going forward?

Margin, we have taken conscious effort during last year to put on margin and say [Foreign Language]. I think it has worked well in last year for us. And we believe -- rather we hope it will work in future as well. Let's see. It is a very -- I would say [Foreign Language]. So then we will obviously some little bit leverage in margins. [Foreign Language]. But we are getting better margins out of that. [Foreign Language] So, this kind of efforts we have taken and there are some market factors as well. [Foreign Language] We would like to keep the margins higher. [Foreign Language]

Our next question comes from the line of [ Parimit Gomishetty ], an Individual Investor.

Sir, in terms of -- I was trying to understand our own branded products. I understand right now, we are investing and we've seen how it is going to go. So at this point of time, how much are you investing into this? And what is the kind of outlay we expect to invest in the next year?

Thank you, Parimitji for the question. So, we are not investing in terms of either equipment or in terms of inventory in those products compared to our main business. [Foreign Language] It is the team that we are building, rather we have built or development of these products. Just to give you a rough idea, maybe [Foreign Language]. Now, we have a strong team of roughly 20, 25 people, whatever, 3, 4 brands that we are doing combined. So, that is number one. Second, I think, is the investment in terms of my, Binod's and Nilesh's time and attention. So it's a conscious effort. [Foreign Language]. The teams knows it is important. And I think these are the key investments that we are doing. [Foreign Language]. Mostly it is in the product development team, plus out time and attention. [Foreign Language]. I think 3, 4 years down the line, we think it will help us to control margins in a better way [Foreign Language]. Let's hope for the best. We have been able to do that so far. [Foreign Language] I think that it is a bit tricky. [Foreign Language] Time will have to tell us [Foreign Language]. We want to scale it. [Foreign Language]. So let's see. And I hope for the best.

Okay. Understood. So, you mentioned that in this business, team is a big part, right? So in terms of scaling our revenues, team will also be a huge part. So, are we actively hiring more people or with the existing -- I'm not talking just about the own brand products. I'm talking about the remaining team who are running Robu as it is like the Robu 1.0, which is going forward. So are we going to aggressively hire more people in terms of -- to grow sales? So, how are we going to grow sales? I understand that you can do development and all of that, but it's mostly a people thing, right? They have to develop their own sources and customers. Could you explain on how are you planning in terms of team and growing the pie from there?

[Foreign Language] We try to reduce it slightly lower. [Foreign Language]. So, I think we are more aggressive when it comes to Robu 2.0 and more conservative when it comes to Robu 1.0 in terms of at least manpower development.

Understood. And one more thing. In terms of the margins, you mentioned that the own brand once it develops is likely to help with the margins. So, could you explain? You mentioned the 10%. Is it 10% higher than our existing gross margin? Or is it 10% extra? So it's -- let's say, if it's 25% today, it's 35% for that? Or is it only like 27.5%?

No, it's roughly 10% extra than our existing gross. [Foreign Language]. That is the expectation from our own branded products. And that is when it will cut off, right? [Foreign Language]. I'm not committing number. Just an example. [Foreign Language]. And I think you guys know it better than me [Foreign Language]. I think we are just striving for that plus 1%, 2% in long run. So, that is the whole philosophy. And second is control [Foreign Language]. It helps us in new products. All those factors are also there.

Got it. And in terms of the company positioning in the last year, 2, 3 years, we grew quite a bit. But there also have been existing players that are also growing at equal pace or let's say, a little lower than Robu in terms of execution. Could you give an idea on like what kind of market share we might occupy in some of the segments, at least the popular segments? And how are the other people competing? So in terms of understanding the overall market because it's extremely unorganized market, especially locally. So, could you explain on how the market -- how the market is positioning Robu and where do we want to be?

[Foreign Language]. It's very difficult to reach to a number [Foreign Language]. Maybe 10 years down the line, I don't know. Maybe then you can say, okay. [Foreign Language] But those companies are like -- DigiKey celebrates 50 years of their existence just, I think, '23 or '24. [Foreign Language]. I think it is very hard to convincingly put a number to it.

But at least, could you tell, like how the market is split? So let's say, organized players like you and Millenium versus, let's say, more unorganized smaller players versus the international players like Mouser because Mouser and all these people also have basic presence with website or like a basic team, right? So, could you explain how it is split between these 3 categories?

So, since you're insisting, I think [Foreign Language].

Got it. Understood. Sir, one more thing I wanted to ask is in terms of exclusive partnerships we're making with some of, let's say, the component makers because in this business, SKU duration is one thing and the exclusivity of a product also can play a huge role in terms of moat, right? So, do we have any exclusive partnership of such or those things might not be in the future? Could you explain that?

There are some exclusive partnerships, but I've been telling this time and again [Foreign Language]. They don't mean a lot in a market like India. [Foreign Language] That is how I feel about this.

Understood. So basically, in terms of SKU addition, did we do any substantial SKU addition this quarter or next year?

Every year, we keep on adding new SKUs. I mean, that is -- adding the SKUs is part and parcel of our business. [Foreign Language] But yes, doing this revenue requires us to add SKUs. [Foreign Language]. So it eventually leads to new SKU addition. It's a result of targeting a particular revenue for a category or a segment. [Foreign Language]. And I'm not sure with the number. [Foreign Language].

We'll take the next question come from the line of Swaraj from Perpetual Capital Advisors.

One question was on the line in terms of warehousing capacity. Do we have enough space at the current infra to fund growth for coming years? Or are we looking at expanding?

We are always looking for expanding because one thing which is unavoidable with this kind of growth is the higher the number of SKUs you have, proportionally higher space you need to keep them, proportionally higher space you require to manage the shipments. I mean, until and unless you just think of some automation, which will reduce the -- which will increase the space requirement. Obviously, it will reduce the manpower requirement. But yes, increasing our warehousing space, increasing our order processing capacity has been part of our annual targets since I think day 1. [Foreign Language]. So it's always part of the business -- part of the game. [Foreign Language]. So, I think we'll have to take a leap of faith at some point in time [Foreign Language].

Any plans for this year and any CapEx that you're planning this year for the warehouse?

Not as of now. Not as of now.

One thing was average monthly visitors, they were, I think, 723,582 in December and 891 around in March '26, but average for H2 was far lower at around INR 6 lakhs. So, was there a steep decline in January and February? And what explains this decline? So, was there an element of seasonality or...

[Foreign Language]. It's not the right data. It would not be appropriate to performance. [Foreign Language]. Next week, we will update the data. So, I think it will remove this question from your mind.

And number of unique customers, how much was it in quarter 4? And what initiatives are we taking to expand customer base?

I don't think I have that number on hand for quarter 4. Annual, that is 1.85 lakh roughly. [Foreign Language]. And it is not part of our KPIs. [Foreign Language]. Because there are hundreds of things that you can try. [Foreign Language]. I think these new customers and new orders -- new customers and more orders, it falls into place automatically.

Sorry, you said new customer and...

Number of customers growth and number of order growth [Foreign Language].

And you said [Foreign Language], we are deploying all our debt for inventory currently rightly. But how do we optimize inventory days going forward such that the transition towards -- it becomes a transition towards sustaining accruals for inventory rather than debt?

So, I think increasing debt is a function of how fast we are growing. [Foreign Language]. We have nothing to worry about. And inventory rotation days, it's always a target to people reducing inventory rotation days. I don't want to share the number [Foreign Language]. But yes, that is one of the key parameters along with sales, even on company level [Foreign Language]. Revenue with margin and inventory -- dead inventory leading to optimization [Foreign Language].

[Foreign Language]. I think slowdown of inventory, that has increased from 2.5 to 6.0 something. So, could you provide [Foreign Language].

[Foreign Language]. So, we are okay with that. It is not aftermath. It was a calculated move. [Foreign Language]. It was a one-time thing. [Foreign Language]. That is from the component category. And rest is under control. So, we have nothing to worry about it. [Foreign Language]. That is the thought process behind it. So, I think we are okay with it. It's a calculated move.

Right. And what would be a normal industry range of that, which is an optimal slow-moving inventory?

It varies vastly. [Foreign Language]. So it varies very vastly from company-to-company. I would not like to share the numbers here, but yes, it varies. There is no industry standard as such.

Okay. No problem. And last question was what proportion of short-term loans and advances relate to advance given to suppliers in FY '26?

[Foreign Language]. So it's not an advance as such. [Foreign Language]. So, you can consider it as material in transit.

But what would be the number for FY '26?

[Foreign Language]. It keeps on fluctuating based on day you look into it. [Foreign Language]. It is what it is because it's just material transit. [Foreign Language].

The next question is from the line of Chinmay Nema from Prescient Capital.

Sir, hope I'm audible.

Yes. Chinmayji, you are audible.

Sir, since you're not giving the split between B2B and B2C, could you give some directional understanding as to how much each of these segments have grown or some color around basically how each has done individually?

It's a bit tricky one because we have already decided [Foreign Language]. That will be more of placing low value but higher number of orders, or B2B customer, that will be placing high value but less number of customers in that sense. [Foreign Language]. I don't know which number. [Foreign Language]. That is the best that I can tell you.

And secondly, the increase in -- if I compare the working capital days to end of last year, there is some 20-odd day increase. I mean, I think this is a repetitive question, but like could you explain which component of the business is driving this part?

As of now, I don't have the relevant data in hand to explain this. But maybe you can reach out to us on mail and then we'll look into the relevant data and reply you with the right data or appropriate facts.

Ladies and gentlemen, we will take that as the last question for today. I would now like to hand the conference over to Prabal Maheshwari for closing comments. Over to you.

Thank you, Danish. On behalf of Hem Securities Limited, I would like to sincerely thank the Macfos management team for taking the time to join us today and for responding to all the queries in such a detailed and insightful manner. I would also like to thank all the participants for joining this call and for their active participation. With this, I would now like to hand it over to Danish for closing remarks.

Thank you. On behalf of Hem Securities Limited, that concludes this conference. Thank you all for joining us. You may now disconnect your lines.