Exonoval India Q2 FY26 Earnings: Volume Growth and Strategic Outlook

Ladies and gentlemen, good day and welcome to the Q2 and FY26 earnings webinar of Exonoval India Limited hosted

by ICA Securities. As reminder, all participant lines will be in the listenonly mode and there will be an

opportunity for you to ask questions after the presentation concludes. Please note that this conference is being

recorded. I now hand the conference over to Mr. Aneruta Zooshi from ICICA securities. Thank you and over to you.

>> Yeah, thanks Yasri. On behalf of ICICA securities, we welcome you all to Q2 FI26 results webinar of Exon Mobile

India Limited. We have with us today senior management represented by Mr. Rajiv Raj Gopal, chairman and managing

director, Mr. Krishna R uh CFO and wholetime director, Mr. Mr. Rohit Totla, full-time director and Mr. Rajiv Ja,

company secretary and compliance officer. Now I hand over the call to the management for their initial comments on

the quarterly performance and then we will open the floor for question and answer session. Thanks and over to you

Raju sir. >> Okay. So good [clears throat] afternoon everyone and uh we welcome you all uh to

this Q2 financial year 2526 uh investor call. uh as for our process, let me start with a safe harbor statement and

I'm just reading out to you. This presentation contains statements which address such key issues as Elen Noel's

growth strategy, future financial results, market positions, product development, products in the pipeline

and product approvals apart from potential signages from partnering with GSWs.

Such statements should be carefully considered and it should be understood that many factors could cause uh these

forecasts and actual results or outcomes to differ from these statements. These factors include but are not limited to

price fluctuations, currency fluctuations, developments in raw material and personal costs, pensions,

physical and environmental risks, legal issues and legislative fiscal and other regulatory measures and approvals as

well as significant market disruptions. Stated competitive positions are based on management estimates supported by

information provided by specialized external agencies. For a more comprehensive discussion of the risk

factors affecting our business, please see our latest annual report of 2425. Also the company has been releasing the

required disclosure or clarification/ updates from time to time as the case may be to PS and NSE pertaining to

portfolio review by above NB and the latest updates there on and the management would not be responding to

any general and or or specific query in this regard. However, the investors/ public at large would be kept informed

of any updates in this as per the listing regulations. So uh I would be handing uh the floor over to uh Rajiv

sir. [clears throat] Good afternoon. I hope all of you can

hear me. >> Yes sir. >> Yeah. Thank you. Yeah. So firstly good

afternoon to all of and delighted to be back. I think one of the things we've always done uh over the last many years

is to make sure that we stand in front of you respectful of the performance of the company and give you all an update

of your company. uh firstly the quarter that's gone by u you know I realize that it it's not easy we had a board meeting

which yesterday we had to explain to our board members uh because obviously there are parts of the when you look at the

P&L that one needs to understand certain intricacies otherwise wrong you know deductions will be taken particularly

with the cow out of the businesses and also because of a one-time gain so I'll what we'll do is we'll spend some time

there and Krishna will walk you through it the numbers etc we've already loaded the presentation onto the website and

for those of you who want you could go through it. What I will do quickly is to run you through the business um and I'm

joined by Krishna and Rohit along with Rajiv Ja and you know when when we come to Q&A the three of us Krishna me and

Rohit will participate but I'll give you a high level of how the performance has been uh what are we looking at and where

are we right now. So firstly I think what the the the strong news of the quarter is volume has come back on

growth as an entity. So you know if you really combine both on the decorative side and on the uh coaching side

industrial side we've registered 3% volume growth. That's the first good news and in this the even better news is

if you look at we've not really grown in categories like party and all that we've just played and we are just about

slightly below the base because we decided in this quarter we we had a lot of others challenges we didn't want to

accentuate that because those are businesses where if you get just play the price you'll get the volumes and the

revenue and that you know we want to do really reset up so that's the first thing so the first thing is volume

growth across both the business even a decorative volume growth with you know challenges in some of the low margin

products. The second is premium in decorative paints grew you know it grew uh close to uh you know closer to mids

single digit. I think that's the great part. Yeah. And even in automotive and specialty coings in our industrial

business we've registered a premium growth. That's the that is the second not just a good it's a great news for

us. We believe that in our both in our towns in in our large cities premium is back and that's the power of the brands

like velvet touch weather shield and brands like sikin and lean all so that's the greating news

>> next decorative we where were we challenged we were challenged for two three reasons

all our peers who've sort of the numbers so far have talked about including weather disruptions and competitive

intention But an area where we have re redesigned [clears throat] to re-examine given the journey that we are going to

get ahead is the mass market. And in that journey obviously uh did not do well. There was a as a result the

decorative paints while grew marginally right the overall revenue was a little one and a half% uh overall entity

decline right on quotings we had registered both a volume and a revenue group but the issue was the mix our

industrial coatings grew much faster followed by marine and protective and we had a bit of a challenge in our

automotive and specialty coatings which high margin business and in marine and protective it was largely because in

marine we had a huge base last year remember that we quoted some of the best Indian vessels which are now in the sea

are three of them and that was a one-time order that came our order book is very strong our order book is

phenomenal actually for the next few months so it's a delay uh and with a bit of a lag effect and we should see that

between this quarter and more in the quarter ahead we should see a complete recovery and back to you know high uh

singledigit double digit growth that we've been seeing so So that's as far as the you know the the the the performance

is concerned. Now if you break our numbers into volume, price and mix volume has gone up. So where did we have

an issue? We had a higher issue on price and why we closed that journey because as all of you know we are now going to

be a part of the JSW group in a few weeks time and the brief from Mr. part general has been very clear to us as a

team the guys go let's get after revenue and get back to high growth and get back to market share gain and so our endeavor

starting from September has been to look at you know very uh using the you know a lot of scientific analysis to say that

look where are we significant premiums so you know we are in certain premium categories and in certain categories we

were operating at premium of 7 to 9% and one of the things is we used a conjooint analysis uh you know done through a

third party expert to reaffirm uh that and that's where we've been taking some price corrections in the month of

September and October to make sure we are far more competitive because we believe that we've got the right to win

in the some of these segments. So that is the second. The third is uh many of you may remember some of you have

already commented uh we were the first to launch what's called the warranty or assurance program in 2021 right uh of

course uh you know given our spend being still a part of the absolutely put it but obviously when the larger you

know player the market leader and the the challenger really put it obviously we looked off so we came with a new

campaign where we are questioning whether it's quality or warranty and many of you seen that campaign been

committed. Thank you for that. It's called the L Shandar Chal Shandar campaign where we believe that quality

is as important as warranty and you've seen that campaign. What have we been working on? We've been working on an

entire digitization of road map because we believe in the journey ahead productivity can be driven through

digitization and maybe in some of the Q&A Rohit will answer that. uh so we've worked with one of India's leading

consultant the Boston Consulting Group to develop a state-of-art leading lead management system and maybe Rohit can

cover that later and also on distribution. [clears throat] So we've achieved as I told a very strong growth

in premium which is unlike the rest of past perhaps you know the industry uh with the sort of solid brands and we've

seen that that's something that we continue to grow in uh we've enhanced our portfolio we've la relaunched

propositions in the mass particularly on promise and on exterior emulsions and relishians and we've come in with

certain new ranges which we believe in the months ahead we'll do on decorative paints I see that there is a bit of a

potent demand like largely because of the fact that the months of September and October we had rainfall insistent

rainfall across the country are now getting back into good growth. On the quoting side, it was largely industrial

coatings led as I told you with strong uh you know orders coming in our coil business. Uh and uh also on AS, as I

mentioned, we grew in premium. We had new wins, exclusive partnerships and we've also made some terrific gains in

the autom in MPY. We've the power and mining businesses registered strong growth and we are now seeing a pickup in

the marine docking business in uh October. So hopefully we will start correcting that and moving forward.

Yeah, we've had some specialized uh offerings like interdure which is specialized solutions across industries

which is anti-corrosive coatings for applications across industries such as infrastructure, oil, gas and general

industries. As I mentioned earlier, the order book is strong and really for us uh I think very important for us to

explain to you the construct of the P&L and you know the entire thing. So without much ado let me hand it over to

Krishna. Krishna. >> Okay. Thanks uh Rajie. Before we get into the details of Q2 performance, it's

worth spending some time on the business reorganization is the slum sale that took effect during the quarter. In as

you are all aware in February 25, we accepted the binding offer from Actionable NB for the purchase of our

orderings business and international research center. After that we have gone to the postal ballot and got secured the

shareholders approval. Both these slum share transactions were undertaken through separate business transfer

agreements and were concluded in on uh 1st of July 2022 25. Therefore, our results for the Q2 FY26

do not include powder coatings or service income from the service income and the corresponding expenses from the

international research research center. Given that these are material contributors to the business as a

comparison with our last year reported numbers will not be the right indicator uh of our performance. Accordingly, we

have restated the last year numbers and transparent transparently shared as a part of the investor uh deck which

excludes the powder quotings and the I international research center numbers. These numbers are provisional unodudited

and based on our internal estimates. So moving to the moving to the quarter performance as

Rajiv alluded uh in terms of the revenue development what was reported uh reported number on a on a comparable

basis is 1.5% lower than the last year and which stood at 834.9 uh crores. Gross margins our gross

margin percentage is 41.3% was impacted by the vertical product mix as some of the midter businesses reported the fast

fastest growth in the B2B segments. There was there was a there was also some raw material inflation experienced

in our quoting businesses. However, partly offsetting these factors was the improved product mix in retail uh retail

business. Thus the dilution was limited to the [clears throat] 1.6%. a bit.

Uh we did continue to uh control the opex and uh while we provided the support to the marketing push to offset

the seasonal volatility. The stability at uh the stability init percentage at 11.1 reflects the discipline cost

management which helped to offset the top line and the margin pressures. And uh we also had a significant amount of

uh uh improvements in the working capital management and which stood which resulted in the cash generation of

around 274 277 crores and and which stood as of 30th September. With that I hand it over

back to uh SSB uh so that we can go through the question answers. >> Yeah.

Over to you all the questions now. >> Yes sir. Ladies and gentlemen, we will now begin the question and answer

session. To ask a question, please click on the raise and icon tab available on [clears throat] your toolbar or on the

QA tab available on your screen. Kindly turn on your mic when the operator announces your name. You may post text

questions as well. We will wait for a moment while the question Q assembles. We'll take our first question from the

line of Mihir Sha from Namora. Please go ahead. >> Give me a moment please.

>> Hi M. Good afternoon >> Mr. Mi Sha. Please go ahead. >> Hi sir. Thank you for taking my

question. Good afternoon sir. Uh good afternoon and congrats on a good good performance on the volume front and the

premium end segment. Uh so just to understand a bit deeper on the price correction that you've taken. uh any

initial feedback that you can share from the dealers or from the consumers on how they are accepting the price correction

and the you know positive effect that will have on their on your volumes uh and what is the kind of pressure that we

can expect on the margins because of the price corrections that have been put into the market. So that's my first

question. >> Okay. So look I think the price correction uh cumulative so far has been

in in the region of about a one and a half to% to 2%. Remember that we already uh in the market see an aggressive

discounting because of the new entrance which have come in right now in terms of what have we seen it's too early because

really what we put in September because there's always pipeline stock right would really start bearing fruit

actually from this month onwards. So it's more from this month onwards for the September price and from next month

onwards for the November price prediction I'll be able to give you a clear but my understanding to the

qualitative replies when we've spoken to trade people feel we are aggressive. I don't know whether your channel checks

are also showing the same. They genuinely think that look I think uh you know post the uh uh you know acquisition

by the GSW group and the new direction that we've already started work on. They see a little bit of aggression coming in

because that is also you know the the sort of strategy that has been articulated by Mr. Park Jindel has also

been agreed with Mr. Greg Pubio who's the CEO of Axon Nobel. It's in you know it's after taking Axo in confidence that

we are executing these strategies and so far my belief is the real test of the pulling will come when the results of

this quarter come and more I think we'll really see the real it'll pan out in the fourth quarter if I were to put it

hopefully answers your question >> no very clear sir thank you yes and our channel checks were also indicating that

there is new energy that uh is there with exo now uh so that's why I wanted to check on the positive impact Right.

Uh so so in connection with that how should one think about the competitive intensity in the industry now? Uh we

have seen the other larger player probably uh you know uh the intensity has kind of reduced in some way is what

we believe um you know but and there's new aggression from your side. So from overall competitive intensity point of

view over the next uh you know year or couple of years how should one think about it? Where do you think it will you

do you do you subscribe to the view that a disruption in price points or any any other disruption uh can drive uh share

gains or do you think intensity will remain healthy and uh you know the whoever puts their best foot forward in

in terms of efficiency good product good servicing uh will be the you know key winner out of this uh uh uh this entire

thing just wanted to share get your views on the same >> so Mir I'm a I'm from the school that

believes that good product good and and doing all the hygienic stuff in the long term give you better results and when I

say long-term it's one to two years right what does pricing do and you look at industry by industry I've been very

fortunate [clears throat] to work in FMCG uh you know lubricants telecom telecom with the highest intensity and

my learning is simple that if you don't arrive at something which is sustainable then uh it'll work for one two years you

can really show up but then you do not build something which is very strong I you know I'll give you an example when I

handled Airel inel in Tamil Nadu we were the number three brand I mean it was airel vodafone and then us right and

pricing was not the strategy in which we won right similarly I don't think pricing from a long-term perspective is

a is a strategy it is a short-term disruption strategy it is where you can sh up a lot of volumes particularly if

the larger players are listed and uh you know have compulsions because of aid margin delivery margin delivery

you can you can do that up to a point and unless you build something sustainable there it becomes very

difficult to continuously do that that's my answer uh my specifically I I don't want to make any announcements or any

I'm not in the same camp uh where I think that everything is over I think look there is a fight happening in the

market between a market leader and a very strong challenger let's not kid ourselves in saying that it has had

impact on the profitability of the industry and also the market shares of all the players. Maybe lesser on some of

us, more on a few others, right? But the reality is it has had an impact and I would not want to celebrate uh early uh

victory till I'm able to see proof of the pudding and for us we've been over the last few months ourselves uh you

know on a on a new journey and our you know ask is to make sure that we are fighting like soldiers with a laser

focus in the market to make sure that we come out winners right as a mobile India and and really that's really being the

task. So really for me to summarize the question I don't want to celebrate early victories of saying look and something

is over or not. Uh because I think the mark it takes a little bit of time to really do that. Yes it is true that the

you know the larger players including us are seeing a bounce back in many of the markets. Maybe Rohit I'll just invite

Rohit to articulate that a bit more. Right. In what I call what we call the high share geography high state

geographies. Yeah. where our contributions are Rohit if you can quickly give a quick color to the

question Mi asked. So again the same thing which is let me put it uh execution is a key what we ended up

doing on a pricing action is uh matching the prices wherever uh especially in a channel connect category wherever we

were premium right so it's not that we we were really really aggressive on a uh pricing front from uh the market stand

point of view yeah what we are focusing really is on the execution. We have selected set of markets and that is

those are the markets where we have enhanced our execution starting uh addressing all the stakeholders be it

architect, interior designers, be it uh painters, be it retailers, be it contractors or or the large. So this is

where our entire trust is. N hopefully that answers all your questions you asked.

>> Yeah, great. So if I can just push in one more uh if you allow me uh quickly on the demand environment. I know it's a

bit early but uh you know if you can uh you know crystal ball gaze for us a bit and uh you know we the industry has been

seeing uh pressure on the volumes in some time while there are some early shoots green shoots uh that you called

out. Uh should one think that from a uh industry demand overall consumption environment point of view with all the

efforts that the uh government has also put through by you know uh uh income tax cuts, GST cards, lower interest rate

etc. positive effect on the consumption is likely to happen. Uh do you think that we are near the cusp where demand

should start seeing improvement going forward or do you still see some headwinds uh you know for some more time

to continue? Well uh so firstly to your question look the GST uh reductions impacted certain

industries and all of them are reporting better than us right if you look at it uh we've also seen very strong growths

in cement and normally after cement paint follows because remember that large percentage of our business comes

through repainting right so it follows u now what has impacted the industry is also as you will agree me is that the

rains have been completely uh you know uh unexpected this year in terms of not amount only the fact that it's prolonged

and even different parts of the country are here occasionally it's raining so it's impacted [clears throat] the season

my belief is look I think yes it'll improve whether it'll completely improve this quarter again uh you know uh is

something that we need to see but yes there will be an improvement but if you ask me to take a view of a six month to

a one year I see sharp improvement for a simple reason uh the repainting cycles occur in a span of three to four years

or five years Right. The last repainting big blip we got was postco in 2022 to a large extent 21 and 22 right there more

in 22 and and lesson learned in 21 because 21 came off a low base right but 22 so if you look at it technically by

next year early next year which is the fourth quarter of this year to first quarter of next year a lot of stuff

repainting will come in and I think hence you would start seeing the growth come in and the growth will be in line

with the sort of you know activities and like Rohit said the execution excellence and so the brand activation that we do

in the market. >> Y >> got it. So thank you very much. That is

very clear. Uh wishing you all the very best sir. >> Thank you.

>> Thank you. We'll take our next question from the line of Lakshmi Nar and KG from Tunga Investments. Please go ahead.

>> Hi. Hi. Good afternoon Rajiv and team. Uh nice to hear you back. Uh Rajik one question is that um you know if I just

look at a long-term at least like last 18 months or so uh the industry for some reason has been uh having um you know

very very low growth if I just aggregate all the revenues put together right the standalone revenues of all companies now

uh what is that has actually uh because we always thought that there will be some base effect which would come in but

hasn't come in so far so what makes uh is First is is the industry growing right in the last two three years I mean

from um you know September 22 to till now if I just look at the quarters it's been very benign in terms of growth so

um uh so just want to understand is the industry growing uh uh in terms of revenue numbers and second uh what gives

you confidence that uh uh there there will be you know growth will come um you know the next uh best time is ahead of

us I mean Of course you alluded that there'll be repainting cri just that's my first question.

>> Yeah. Okay. So look I think you're looking at of listed entities and if you look at the newer players and the newer

entrance and at the total growth yes there has been growth in the industry. So I don't want to p now you may argue

that look the growth is below GDP uh growth that's possible in a couple of quarters but on an average if you look

at there has been growth just that the growth trajectory shifted to newer players who came with much aggressive

price points. The if you look at 80% of the growth is coming from mass market economy parti texture construction

chemicals and uh these are segments where you know the some of the players who are established players obviously

found it too difficult to react because it would dilute it it would be hugely dilutive to the margin and the

profitability of the business. So that is what has happened. However, obviously there is a point in time in which you

cannot allow other people to have your lunch and that wakeup call you are seeing now amongst the larger players

which is what is now making sure that everybody gets aggressive. So in a way I think what will change is first that the

shape of the the curve will change to where the sources of growth of various players came from and and in terms of

the you know where which player was getting what growth that I see a bit of a change. Second, I think uh the fact is

that there has been a correction as you know M asked in the earlier question and to that the outlay of people with some

of the savings will come in and people will go for home refurbishments and painting uh and I believe that look

within the months ahead uh you know we would see some sharp growth coming in on the both the B2C and the B2B sites right

uh Robert you want to add something yeah >> sorry >> so that's that's what I would

Got it. And uh you know in terms of uh there have been some price increase and corrections are taken right so across

the industry and there has been some resetting I think two three quarters back. Uh so if you just look at it from

a volume growth point of view what is the uh what is the volume growth one can actually expect for the industry uh in

the next one year. >> Look again you know it's a function of the segments which drive the volume

growth. the volume growth for couple of players already touching high single digit mid to high single digit we are

you know getting close to the mid uh single digit it'll get to double digit in the near term but you have to

understand that bulk of the growth is coming from these categories that I just talked about right we've not launched

our construction chemicals [clears throat] I think Roth is planning to launch it next month uh by end of the

year December uh is when we are launching and our products are way superior compared to some of the

offerings in the market so we believe that we've got a right to win and uh on the price increase. Look, the price

increase I'm not even talking because there was barely an increase because it was offset by additional discounts in

the market across some of these segments. So really there's nothing that could really come into the P&L because

that just it lasted for about a month and then you know aggression started back. So I don't think the price

increases at this point of time at this competitive intensity is something that's going to uh uh I just hope that

that the discounting will get rational over a period of time. Uh but coming back to volume I do see that it at least

now we'll start steadying at single digit mid single digit to high single digit eventually double digit growth and

then very soon I mean in in perhaps between next quarter this quarter and next quarter in a few months it'll start

I see next quarter definitely as a double digit growth quarter volume and uh high single digit for revenue. All

right. So Raj and also for the next you know two to three years uh what are the three priorities uh you would actually

have for the company and second uh the Dulux name would be available for us till when?

No, Julux is now owned by Axonobel. It's for perpetuity. It's owned by Axonobel as a part of the Axonobel India as a

part of it. And that moves to the obviously now the new owner is the JS family. In terms of top three

priorities, look, I think we are I think amongst all the paint companies having a massive transformation and you would

agree to that Lakmi right so my first job is to make sure that in when you're when you're in this to steady the ship

and make sure that you're delivering on ground while making sure that the strategic direction is run. So what do

we need to do? Obviously there's a lot of work going to be I think it's not appropriate for me to talk about it. I

would wait. I think the Mr. P Jindel will talk about it at an appropriate time.

>> Got it. Got it. Uh thank you Rajiv. All the best and welcome. >> Thank you. Good luck. Thank you.

>> Thank you. Next question is from the line of Aneruta Zooshi from ICFA Securities.

Please go ahead. >> Yeah. uh sir in uh terms of the entire commodity prices uh we have seen uh most

of the commodity prices are lower even the anti-dumping duty on TIO2 uh is also kind of now rolled back so uh with

correction in commodity prices what can be the maximum potential for price cuts uh for the industry to remain at current

uh uh margins >> I need two things uh see the the the the raw material has been benign for now a

small period of time. So really I think uh and it's equal for everybody on the uh you know the anti-dumping duty uh yes

the order has got favorable but it's not executed. So we are still I think most of the players are still paying it under

protest. So till it's completely called off you know it's not it's not it's not going to come in into our P&L uh because

we have to follow the law and we are following I mean your company is the highest on these things so we do not we

do not we obviously that we do the right thing okay so till it's completely called off in our books it still

reflects now coming to the prize what is the I my belief is look it's very difficult to say what is the top of the

table but I believe that we are not too far from already being there right we can argue in certain categories can you

be a a little more aggressive but my view is what will now do it I think the the pricing pressures have already

started coming into play and I think now the power of the brand distribution those things will start coming in yeah

and that's where you know I'm certain that uh you know the we will be pretty well pleased

>> okay sure sir sure uh so in terms of any uh uh uh growth drivers uh as far as distribution is concerned or uh in a way

some of the new products that we had introduced uh like the value for money imulsion or even waterproofing

[clears throat] or even uh floor paint also. So any update that you can share? >> Yeah, I yeah it's only fair I ask

please. >> Yeah. Okay. Uh so for us what we are doing as far as distribution is

concerned uh we have lot of white spaces and and those are uh the places where we are going and appointing distribution is

adding close to four four and a half% kind of our revenue every uh year to us and this year it will be little higher

uh and that is what what our strategy is as far as product categories are concerned quarter waterproofing products

be it waterproofing or a construction chemical uh products which are getting accepted across uh and and uh that is

where uh the weighted distribution is coming in. Hope that answers. >> Yeah. Yeah. Sure sir. That is uh very

helpful and update on the uh multiple new products that we had enter into.

So uh almost everything is uh doing really well especially the new launches which is to do with uh Uber luxury uh

premium products which is to do with velvet toucha uh both in in the sheen variant and a matte variant especially

the matte variant has been accepted really really well by architects and interior designers uh and and really

very much liked by the consumers. uh second which is to do with the uh entry- levelvel imulsion hygiene for exteriors

uh it's it's uh we had a remarkable success on on the launch of those products

>> thank you >> okay sure sir uh understood uh last one question from my side uh I guess the

royalty reduction is already accounted for in Q2 results >> yes yes

>> yes yes right so yes So uh uh what is the total saving in the royalty uh if you calculate as percent of net sales uh

that is one question and secondly uh we have seen logically the margin should have gone up but I guess there will be

certain uh cost related to so many corporate actions happening. uh so if you can [clears throat] quantify on the

uh overall margin and what should be uh considered as a sustainable margin uh going forward any any indicative

guidance if you can share >> so let me give you the guidance and I'll let Mr. Krishna answer all my guidance

is very clear we should be in the binda margin of 14 to 15% on a sustained basis that's what I've always maintained

remember that still we are a number four player even with uh uh you know uh being a part of the JSW group uh position

doesn't change except that we now become a clear number four and move to number three soon [clears throat] right so

Krishna can I can I ask you to quickly just cover some of the other questions that an asked

>> yeah I think an we have fully [clears throat] faced in the the royalty which we pay for the decorative IP cease

to exist effective 1st of July 2025 and the numbers of Q2 FY26 doesn't include the royalty payout for the decorative

paints however for the performance paints or the industrial quotings the royalty IP lies with actionable envy and

uh we continue to pay the royalty for that products as far as uh royalty utilization is concerned if you see from

the compar comparable results the gross margin decline is 193 million whereas uh when it comes to the

uh EBIT the decline is uh only 22 million so that means uh effectively there is a operational efficiency which

is there in the system we are prudent in terms of the cost management and the moment the revenue trajectory as

explained by Rajie we do see a significant up likely to happen from the Q3 FY26 onwards which will address the

matrices and the guidance bandwidth. Okay. >> Okay. Sure sir. Uh I will just take one

question from uh uh the chat uh box. Uh so is there any change in dividend payment policy with the new uh team

taking over? uh Anerod at this point of time we don't

see any change there and as and when it comes we [clears throat] will inform the shareholders by way of the corporate

disclosure >> any any any changes in policies we will come back to you at an appropriate time

>> okay sure sir uh that's uh uh very helpful >> thank you

>> questions otherwise we Yeah, >> we have a question from Aimea from Mquery. Please go ahead.

>> Hi AI. >> Hi sir, am I audible? >> You have to be a little louder. Yeah,

you're audible but very faint. >> Huh? Sorry, >> we can't hear you. Ai,

>> is this better? No, sorry. I'm just trying. >> Maybe you need to change your uh voice

settings. Can you hear us? >> I can hear you. But uh

>> yeah, your volume is low. That's it. >> Your volume is low. >> Uh can you try speaking now?

>> Can you hear me now? >> Uh very very feeble.

Yeah, I can hear you but I I'm not able to hear. Uh, sorry. Um, >> can you try speaking a little?

>> Yeah. >> All right. Thank you. >> Thank you.

>> Uh, sir, are you able to hear him? Raju, sir. >> I'm very feeble, but let me try. Go

ahead, Abby. >> Go ahead, Abby. I just >> uh a bit of both in the sense that

obviously price checks happened with both you know consumer and with contractor painter right but basically

what has happened is because of the price table in which the industry and certain key brands were operating in our

ability to grow the brands versus what we've done in the prior years had come down and so it's that and we've done a

complete conjoin analysis to really be able to address it to answer the question of it and it's it's largely

it's it's it's across uh a little bit of the portfolio but it's some of our heavy hitting brands where we believe that you

know it was tapering off because perhaps the premium was a bit too high. >> Got it sir so very clear and

>> yeah so when you look at a moving unwill total and you know there it smoons all the curves etc seasonality etc we look

at that and then the conjoint analysis of to put two together. Oh >> fair enough fair enough. very clear and

so does that entail a sharper entry into the market you >> no I don't want to announce strategy on

a call but uh you know I think I think that's not I would not like to answer that question

>> fair enough sir that's okay I I got >> thank you thank you >> thank you very much

>> thank you >> thank you ladies and gentlemen we'll take that as the last question for today

I now hand over the call to management for closing comments over to you sir >> so first and foremost Once again a big

thank you. Uh you know we do realize that perhaps this possibly could be uh you know the last investor call from an

Aonobl India perspective. Of course India and all of us continue but you know very maybe in new shapes, colors,

news as we move forward. We are absolutely delighted and looking forward to being part of the JSW family. We've

had a lot of a few interactions I think four or five Krishna with Mr. inspired general and we are highly energetic

because I think the this is exactly what we've been wanting to to be get the ability to play in the market the way

the you should play in the market you know there's no point of playing in T20 uh in a in a test match style and that's

what you know sometimes when you with some of the constraints that we've had and I'm very glad that even our global

CEO had articulated that very well when he had the when the announcement happened so I think we are really

looking forward to the journey a lot of it lies at our end in terms the superior execution and taking it to market and to

me the future leaders of this company will be in terms of those who are able to demonstrate superior performance.

Right? So, thank you very much. Good luck. All the very best. Bye-bye. Thank you for joining the call.

>> Thank you. >> Thank you. >> Thank you members of the management.

Ladies and gentlemen, on behalf of ICA securities, that concludes today's session. Thank you for your

participation. You may now exit the meeting.