Ladies and gentlemen, good day and welcome to Vishal Mega Mart Limited Q1 FY 2027 earnings conference call. As a reminder, all participant lines will be in the listen only mode, there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal an operator by pressing star then zero on your touch tone phone. Please note that this conference is being recorded. I now hand the conference over to Ms. Shikha Puri from SGA. Thank you, over to you, Ms. Puri.
Thank you. Good afternoon, everyone, thank you for joining us on Vishal Mega Mart Limited's Q1 FY 2027 earnings conference call. We have with us Mr. Gunender Kapur, MD and CEO, Mr. Amit Gupta, CFO. I hope everyone got an opportunity to go through our financial results, investor presentation uploaded on the company's website and the stock exchanges. We will begin the call with opening remarks from the management, following which we will have the forum open for question-and-answer session. Before we start, I would like to point out that some statements made in today's call may be forward-looking in nature, the disclaimer to this effect has been included in the earnings presentation shared with you earlier. I would now like to invite Mr. Gunender Kapur, MD and CEO, to give his opening remarks. Thank you, over to you, sir.
Well, thank you very much, a very good evening, ladies and gentlemen. A very warm welcome to this call. I'll briefly take you through the Q1 FY 2027 results, some of the key highlights, then we will open the call for questions. Well, we've had a good start to FY 2027. In this quarter, we did a revenue from operations of INR 3,727 crores. This was a growth of 18.7% over last year, this was backed by a strong same-store sales growth of 10%, a clear proof of the resilience of our business model in this very dynamic and uncertain operating environment. Operating EBITDA was INR 387 crores, which was a growth of 19.3% over last year, our operating margin improved from 10.3% last year to 10.4% this year.
Profit after tax was INR 259 crores, which is a 25.6% growth over last year, the PAT margin improved from 6.6% last year to 6.9% this year. Our superior merchandise, operational excellence, and customer-first approach helped us deliver consistent results even when the broader environment remained very challenging. Our total store opening momentum remains strong with the addition of 27 new stores in the quarter. This takes the total store count to 819 as of June 26th end, our presence in 559 cities. Of the new stores opened, 10 were opened in South India, a market where we continue to see strong momentum. Now we have further 16 small stores, and three were opened this quarter. The small store format agenda is making good progress. Our total trading area stands at 13.8 million square feet.
Our private brands continue to see strong customer traction, contributing 75.2% to revenue growth, or rather our revenue in quarter one, FY 2027. Our Quick Commerce expanded to 767 stores across 520 cities in the country. The total number of registered consumers on Quick Commerce crossed 1.4 crore people. With elevated inflation, weighed on demand environment in quarter one, we expect the impact to taper down in the subsequent quarters. We remain confident and excited about the journey ahead, underpinned by strong fundamentals of our business and continued excellent execution of our growth strategy. With these very brief comments, I would request the moderator to open the floor for questions. Thank you very much.
Thank you. We will now begin the question-and-answer session. Anyone who wishes to ask a question may press star and one on your touch tone telephone. If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use handsets while asking a question. As a reminder to all the participants, please restrict yourself to two questions. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question comes on the line of Videesha Sheth with Ambit Capital. Please go ahead.
Yes. Hi. Thank you. Small store format, what is the kind of store addition that we can anticipate under this format beyond the 8,200 store guidance that you all have given?
Your question is regarding the small format?
The small store format. Yes, that's right.
Okay. Let me explain our opinion on the small format. The fact is that the small format is half the size of a regular format. In terms of absolute revenue and absolute margin is again exactly the half of a normal format. Our approach to the small format would be as follows. In any particular state, once we are in a situation where we have almost exhausted the entire opportunity for the larger format, we would start expanding into the small format stores, quite obviously because the larger formats give double the revenue and double the margin in absolute sense. At this moment, U.P. and Haryana are the two states where we have stores, I wouldn't quite say exhausted, but we have quite a significant number of stores in almost the entire state.
We are doing the small format at this moment only in these two states, and we will continue to grow in these two states. In the fullness of time, as more and more states reach this situation, we will explore them for the smaller formats. At this moment, the small format is focused in U.P. and Haryana, where we have, to a large extent, exhausted the opportunity for the larger format. Does that answer your question?
Yes, it does. Thank you for that. Second question.
Sorry for interrupting. Your voice is breaking. Can you come in the range and talk? No, your voice is still breaking. We cannot hear you. All right. Please come back in the queue. Thank you. We'll take the next participant, that is Jignesh Kamani with Nippon Mutual Fund. Please go ahead.
Yeah. Hope I'm audible.
Yes, please go on.
Yeah. Just coming to this what Videesha asked on the small format. There was two kinds of strategy. One was to penetrate in the existing market, where we have high number of store, and also in the smaller city or town where population is less than one lakh or less than 50,000, smaller store may be viable, which large store may not be viable. And now as you say, you have much more confidence of the revenue per square foot and everything. Why the expansion is still slightly slow? Like if you take our third quarter, we opened two stores, fourth quarter also we opened three stores, and the first quarter also we opened three stores only. Because smaller town can take up 50 sq ft- 70 sq ft per store in one and a half year also. Any reason you are going slow on that?
Firstly, I must say that to begin with, we were experimenting with a small format, and we wanted to ensure that the results are exactly in line with our expectations. Our target was twofold. Firstly, to ensure that the relevance of the small format is established in smaller towns, and we have pretty much established that with a revenue per square foot, not the absolute revenue, the revenue per square foot in line with that of the larger format. The second was to establish that the financial outcomes are the same and as attractive as the larger format. Again, we've been able to establish that the return on capital employed in the small format stores is pretty much the same as the larger format. Now we are at a stage in two states where we can start expanding more rapidly in the small format.
I must say that while we are opening the small format stores in these towns, we equally are opening large format stores also. Because while the opportunity is largely exploited in these places, it is not completely finished. For example, this quarter while we are looking at small format Uttar Pradesh, we opened five large format stores also. Similarly, while we've opened new stores in small formats in Haryana, we've opened two large format stores also, and this will continue in the future also. We will further accelerate the opening of small format stores, and I totally align with the spirit of your question. We can see an opportunity of almost 3,000 small format stores in the country. As we progress forward, you will see increased momentum of the small format.
Understood. Second question on the supply chain side initiative which we are started on the RFID side in class one, one and a half year, we started experimenting. At what stage right now, how many store we have rolled out or planning to roll out? When you see that entire store and back end will be implemented with RFID and some initially result in some of the store where you deployed, how is the productivity improvement or throughput improvement or any reduction in the manpower or employee? Any softer aspect you want to highlight?
At this moment, I think I'd mentioned the last time that we were experimenting with two stores in Delhi NCR. At this moment, we are rolling out RFID into all the stores in Delhi NCR. That is the current status. We will go one state at a time because the way we are rolling out is that we have to first put RFID tags on all the existing stocks in the stores. Then we will need to maintain a separate supply chain for the RFID tagged stores, because those stocks will go to the stores with RFID tags, whereas the rest of the network will continue to get stock without the RFID tags. At this moment, we are doing Delhi NCR. Again, we want to be 100% sure that it's working very well, and we keep rolling it out.
I think the entire rollout will slightly exceed one-year time frame. The benefits we've been able to establish quite clearly for the RFID tags, the first and the obvious benefit is better inventory management. Earlier, for example, counting the entire store stock in clothing would be an overnight exercise. With the RFID tags, we can count the entire store and the clothing stock in four to five hours, and therefore we can do a stock count almost every week. Secondly, with the stock count, we can also get all the details of what the merchandise is, its aging, and so on and so forth. The quality of information available would be of a significantly higher order. Thirdly, quite obviously, we expect the shrink to come down in the RFID tagged stores.
For example, the RFID tags that we are using after a lot of development is a tag which cannot be removed unless the merchandise has been checked out. As you can appreciate, once the merchandise is checked out, it can be assumed that it has been paid for, and it is not stolen merchandise, and only then can the RFID tags be removed. Otherwise, they cannot be removed, and so on and so forth. There is lot of analytics that we can generate from the RFID tagged stores. We have quite clearly established all these benefits in our pilot and experimentation. We are progressing with RFID at maximum possible speed.
One has to appreciate that to launch RFID in a store, the first step is to put RFID tags in all the existing stock in that store, and then set up a supply chain from the distribution center, which is separate for these stores, because the stock from the distribution center to the store will be moved only after putting the RFID tags. Yeah, it'll take us slightly over one year to complete the network.
Okay. Thanks a lot for all, GK.
[inaudible].
Thank you. Next question comes from the line of Nihal Mahesh Jham with HSBC. Please go ahead.
Three questions. The first is, last quarter, we had this discussion around the potential cost inflation. We noticed that despite that, both on a yearly and a sequential
Sorry for interrupting. Mr. Jham, your voice is breaking. Can you come in the range and talk? It's still breaking, Mr. Jham.
Try it correctly again the gross margin.
Mr. Jham?
Yeah.
We have lost the line of Mr. Jham. We'll promote the next. That is Mr. Vivek. Please go ahead.
Hi, good evening, GK. Am I audible?
Yeah, Vivek, you're audible. Good evening.
Hi, good evening, sir. Couple of questions. First on the, I think that's what Nihal was probably asking.
Vivek, your voice is not coming through.
We have lost the line of Mr. Vivek. We'll promote the next. That is Nihal Mahesh Jham. Please go ahead.
Yes. Hi, moderator. Am I audible?
Yeah. Now you are.
Yes.
Sure, Mr. GK. Three questions. First was gross margin. We've seen an improvement despite your discussion on cost pressure starting from May. If you could just highlight on that.
Mr. Jham, sorry for interrupting. Your voice is breaking. Can you come in the range and talk?
I am actually trying to. If I'm audible, Can you hear me now?
Yes, please go ahead.
Nihal, we can hear you. We got your first question. Can you go to the next one, please?
Sure. Second was, we've seen an organization structure change where obviously Mr. Manoj moved on. I think Mr. Sashi Gumma has obviously moved in as a Chief Operating Officer. Just if you could highlight the current organization structure and how, say, the responsibilities are going to be incrementally distributed between the COO. The third question, in your release today, you mentioned about a foreign capping of 49%. Is it just to do with the FEMA regulations or anything more related to that?
Okay, good. I will take the first two, and I will request Amit to come in for the third. On the gross margin, the improvement that you have seen this quarter from 28.4% to 28.7% is largely because of the fact that our promotional expenditure has been lower than the previous year. Our focus this quarter has been to ensure that we maintain prices. To ensure that all the numbers add up, et cetera, the impact of maintaining prices has been pretty good on our same-store sales growth, as you can see from the numbers, and therefore, we have had to promote less as compared to the last year's same quarter. That is on the first question. Secondly, yes, Shashi has replaced Manoj. Manoj is moving on from the company.
As you know, Manoj has been with us for more than 10 years and has played an excellent role in the evolution of our business. Now he is moving on. As a consequence of that, there has been no change in the org structure. It is just that Shashi is going to replace Manoj in the same role. I will request Amit to take on the third question quickly.
This is in line with our disclosures in DRHP, and the idea is to ensure that the company remains Indian owned and controlled.
Mr. Jham, your voice is breaking. Mr. Jham, sorry for interrupting. Your voice is breaking. We cannot hear you. Mr. Jham, I request you to please fall back in the queue. Thank you. We will promote the next, that is Vivek M. from Jefferies. Please go ahead.
Am I audible now?
Yeah, Vivek, go ahead please.
Perfect. Hi. Good afternoon, GK.
Good afternoon.
My first question is continuing with the earlier participant. This foreign ownership which you have mentioned, Amit, less than 50%, your disclosure says that it is because of one of the subsidiary. Apologies if it is a wrong understanding, but I thought even as a multi-brand retail, because of the holding company is into that business, you still need to restrict it to 50%. Is it not because of the holding company that you need to do this?
Vivek, just to clarify, we were Indian owned and controlled even before the IPO and as we speak today also. Our foreign holding is close to 20%. However, we want to make sure that we remain as Indian owned and controlled entity. That is the reason why we are proactively putting this cap to 49.99%.
I understand that part, Amit, and that is clear that you are Indian owned today. My only question is, you have mentioned in the release that the existing business of one of the wholly owned subsidiaries require you to do that, but shouldn't it be applicable for the HoldCo also?
That's true. That's true. We are doing multi-brand retailing in our wholly owned subsidiary, which is Airplaza. Obviously that entity is into the multi-brand retailing and that would require approvals. Keeping that in mind, we have passed this resolution.
Understood. Okay, that's the first question. Second is, GK, given how the inflation deck is, what are the kind of price hikes you would have taken in your own labels in both apparel as well as FMCG?
Vivek, our endeavor has been to ensure that the price hikes, two things. Firstly, they are totally minimized, as I mentioned in my response to the earlier question. The second thing which we have ensured without any exception at all is that the price increase has not been affected in any of the opening price points or mid price points. The price increases, if any, have been affected only in the higher price points. This has not been done across the board. It has been done only in selected merchandise categories where again two things, the price increase to the minimum possible extent had become absolutely critical. Again, in merchandise categories which are extremely price sensitive, the price increases have either not been implemented or they've been implemented to the minimum possible extent.
As we had mentioned earlier also, our effort this entire quarter has been to ensure that we become more cost efficient in every which way across the board as far as the gross margin is concerned, and also to rationalize our promotion expenses, as I mentioned in the earlier answer. Yeah. That's the way we've gone about it. We are very aware that our customers need to be protected from price inflation, and wherever necessary, it has to be done in a very thoughtful and sensitive manner.
Got it. Just a follow-up, GK, in the current context where you have mentioned about the macro and whole host of issues, do you think on the FMCG side your endeavor will be to take up prices which will trail the leading brands, the FMCG brands in a bid to gain market share? Do you think-- Or rather the share of your own labels. Is that something that will happen or you will still maintain a price parity or the differential with the leader brands?
Vivek, our firm view is that our price discount to the market leaders has to be, almost in every case, actually slightly higher than earlier, or at the very least, the same. Under no circumstances would we allow our price discount to the market leader become lesser than before. I can assure you that our private brand is to be either as attractive as earlier or even more attractive than earlier for our customers. In several there are FMC merchandise categories in FMCG where almost the entire market has taken price increases, but we have chosen not to take a price increase. Our private brands will continue to be either as attractive as before or even more attractive.
Got it. Thank you and wish you all the best.
Thank you very much, Vivek.
Thank you. Next question comes from the line of Manoj Menon with ICICI Securities. Please go ahead. Mr. Menon, your voice is breaking. Can you come in the range and talk? Mr. Menon, we cannot hear you. Mr. Menon, I request you to fall back in the queue. We'll promote the next in line. The next question comes from the line of Prerna Jhunjhunwala with Elara Securities. Please go ahead.
Thank you for the opportunity. My first question is on inflation only. You've mentioned that you won't take much price hike as a response to earlier participant. I just wanted to understand how do the consumer behave, in various categories like apparel, GM, and FMCG. Can there be a mix change as per your past experience, which could impact your margins? What could be the minimal price hike that you would eventually have to take if inflation continues at current levels? That is my first question.
Firstly, I must clarify that, as I mentioned, wherever it became critical, we have taken price increases, but we have not taken any price increase in the opening price points in any of our categories. Opening price points are the lowest price points, and they are typically bought by the least affluent people in our consumption group. All the price increases have been largely around the highest price points, which are purchased by the most affluent lot of our consumption target group. Those have been affected, and at this moment, we do not feel the need to take any further price increases beyond what we have already done. This is, of course, based on the assumption that the situation will continue as is and will not get any worse. As we mentioned in the commentary, in the subsequent quarters, we expect the situation to actually become slightly better.
Secondly, we know which of our categories are more price sensitive than others, and categories which are extremely price sensitive. I can give you examples like children's clothing is very price sensitive, or some of the staple foods are very price sensitive. We have actually chosen not to take any price increases to protect our customers. Last but not the least, it's important for me to highlight to you that despite these price changes, A, our total growth continues to be double-digit. Secondly, the growth of our highest price points is the fastest. For example, while our total business has grown 10% same-store sales growth, in apparel, our highest priced fashion merchandise has grown at 13.9% same-store sales growth. To summarize, I would say that, at this moment, no further price increases.
I can't say anything about the future because it's difficult to predict as to how will that pan out. Secondly, despite the challenging environment, we continue to maintain double-digit same-store sales growth. Lastly, our highest priced merchandise, which is the fashion price points in clothing, continues to grow the fastest at 13.9% same-store sales growth.
Understood. Sir, will it be possible for you to share SSG breakup between volume and price? That would help us understand how things are moving.
I actually have no problem with that, but it's difficult to add the volume of apparel with FMCG and GM. That becomes a somewhat meaningless number. I can share with you the constituents of our Same-store price sales. Our total number of customer acquisitions in the quarter has gone up by 8%. We have served 8% new customers in our store, and our existing customers have bought 3% more, approximately, in this quarter. That's how we have achieved approximately 10% same-store sales growth. My apologies, it's impossible to add the volumes of the general merchandise products and apparel and FMCG.
Understood, sir. Sir, any color that you can provide on how the transaction values have gone up, so that would also be helpful, like number of bills or transaction value.
The transaction value for our existing customers has gone up at 3% this quarter versus same quarter last year. As I mentioned, we have acquired 7% new customers, probably through market share gain in this quarter.
Understood. This is my last question. In apparel, do you see increase in competition as a threat to growth on a longer term basis, as many value retail players are actually looking forward to expand very aggressively in the category, though our brands are also very aggressive. The first-mover advantage that we enjoy in many cities, that gets compromised as and when they tap on our cities. Any color on that and your thoughts on that would be helpful. Thank you.
Sure. Firstly, I was telling you that there is no new competitor in the market. All the players who are competing in clothing market, they've been around for a while. Of course, different players have different ambitions. There has been no increase in the expansion pace significantly from any of the players. Of course, they're all expanding, but they've been expanding for a while, like we've been expanding for a while. There is no new either competitor or new aggression in terms of expansion that we witnessed in this quarter. Of course, the spirit of your question is absolutely correct, that this is a very competitive market with lots of very good quality competitors. We've been around in this market for a while, and we've been growing at double-digit rates as we've been reporting same-store sales growth.
Sure, sir. Thank you and all the best in this challenging environment.
Thank you very much indeed.
Thank you. A reminder to all the participants, please restrict yourself to two questions. Next question comes from the line of Rehan Saiyyed with Trinetra Asset Managers. Please go ahead.
Yeah. Good evening, [inaudible] . Sir, I have only one question about your loyalty ecosystem. The loyalty ecosystem now covers around 17.5 crore customers and contributes nearly 95% of the revenue. How much measurable improvement have you seen in customer lifetime value and merchandising decisions because of this data advantage? Could you please help me understand regarding this?
I'm sorry I could not hear all your question. I could gather that it was about loyalty customers.
Do you want me to repeat it again?
I'll try and answer, but if I fail to completely answer, please point it out to me because it was a bit patchy for me. We have INR 17.5 crore loyalty customers.
Right.
These customers are contributing 95% to our revenue.
Correct.
They continue to grow as we acquire more and more new customers through market share gain. Our loyalty customers provide to us extremely valuable analytics, which is used every day of the year for us to sell more to our existing customers. If I missed any part of your question because I couldn't hear it, you could please ask me.
Yeah, sure. You have answered my first part. Just wanted to clarify on the second part, how much measurable improvement have you seen in customer lifetime value, I'm asking, in merchandising decisions because of this data advantage?
I think if we understood your query correctly, the 10% same-store sales growth is testimony of the fact that we are getting a lot of value from our existing customers. Yeah, it's working for us.
Okay. I got it. Fair enough. Just one last question from my side, and then jump back in the queue. Sir, with 75% of your sales coming from your own brands, can you please share any internal KPIs comparing repeat purchase rate, basket size and profitability versus third party brands breakup, if you want?
Maybe your query was not very clear, what we could gather is that you spoke about 75% revenue coming from our own brands.
Yeah.
What exactly you are looking for in that?
Like I'm asking, can you share any internal KPIs comparing repeat purchase rates, either basket size and profitability versus third-party brands that you are tracking?
The 75% market share that we have in private brands, the constituents of that are as follows. That will help clarify if I got your question right.
Yeah.
100% of our clothing business is private brands. Right?
Yeah.
100%.
Yeah.
Obviously the penetration is 100%. Repeat buying rates are upwards of 30% of any new option that we introduce. In general merchandise, 75% of our business is private brands. Only category where we have significant share of third-party brands. In fact, the only two categories, one is kitchen appliances, where we have a brand called Tandem, which has almost 50% market share. The balance, 50%, is with third-party brands such as Bajaj, Prestige and so on. Again, on the products that are present in Tandem, they've been around for a while, so it's quite stable. There isn't any significant new revenue which may have come to us through early product trials and is likely to disappear because of repeat buying rates. It's been around for a while. The third category is FMCG, where 60% by volume of the share in our FMCG is of our private brands.
These brands have been around for several years now, and they're quite stable. The idea of penetration, trial, and repeat buying is relevant for new things that are introduced. These are all quite stable businesses, but when we had introduced our new brands, again, we had experienced repeat buying rates, as I mentioned, upwards of 30%, but that was quite some time back. These are all stable, steady private brands, which have stood the test of time and are preferred by our customers 60% by volume over the third-party brands which are available in our stores.
Okay, sir. Thank you for this clarification and good luck for your coming quarter. I'll jump back in the queue.
Thank you very much, indeed. Thank you.
Thank you. A reminder to all the participants that you may press star and one to ask a question. Next question comes from the line of Videesha Sheth, Ambit Capital. Please go ahead.
Yes. Hi. Just continuing with the questions. Sometime in the third quarter, you all had mentioned that there is another format in but hadn't reached the pilot stage yet. Just wanted to check if there's any update or if you can appraise us of the state.
You're absolutely right, Videesha. We have mentioned that we are working on a new format, but, I must point out to you that we will be first going in with pilot store. Based on the response that we receive in the pilot stores, and we will not have only one pilot store, we'll have more than one pilot stores. Based on the response, we will either need to fine-tune the mix or roll it out. I may not be able to share with you the exact date, but I will take the liberty of telling you that we are very close to the launch of our first pilot store, which will be followed by either one or two other pilot stores, and then we will read the response and decide on the further course of action. We are quite close to the first launch.
Noted. Thanks. Amit, just one question for you, if you can help me with the inventory as of the quarter end.
Sorry, inventory?
Yes, inventory as on the end of the quarter. Inventory levels.
Got you.
You're looking for exact inventory numbers?
Yes
or the discounts? Our closing inventory for quarter one is INR 1,900 crore.
Got it. Thank you. That's all from my side.
Thank you. Next question comes from the line of Harish Advani with Axis Capital. Please go ahead.
Hi. Thank you for the opportunity. My first question was on the Quick Com side. You did mention that we are now at 767 stores and 1.4 crore users. Can you quantify its contribution to sales and the profitability of this channel? And sub-part to this, is the Quick Com customer demonstrating a higher purchase frequency or any incremental basket creation versus the traditional in-store customer?
Quick Commerce, the different stores are getting added at different points in time. I can tell you the range. They are currently contributing to anywhere from 2% to 9% to the store revenue. In majority of the places, the contribution is at least 5% to our store revenue now, which has been very encouraging for us, because when we had started this journey, we had said that our goal would be 5% of store revenue. In most places we are achieving the 5% level, but in our best places we are going up to 9%-10%. That is, I understand your first question. On the second question, in terms of average bill value, Quick Commerce customers are buying slightly more, but not significantly more than our offline customers. Average bill value Quick Commerce customers is about INR 800.
The third fact that I can share about Quick Commerce is that the share of our private brands. I mentioned that for our offline stores, it is 75% revenue. In Quick Commerce, it is even higher than 75%. More number of customers are trying our private brands on Quick Commerce and sticking with our private brands. Last but not the least, and terribly exciting for us, is that 20% of our Quick Commerce customers have never shopped at a Vishal store, and therefore they are net incremental for the entire Vishal franchise.
Thank you, sir, for the detailed answer. Sir, my next and final question is on the employee cost. If you look at it on a per square foot basis, it is up about 13% YOY. We do understand that there has been an element of the increased minimum wage coming into this. Is this then now the steady state number that one can assume as the rate for the staff cost?
Yeah, Harish, this quarter we have seen a significant increase in minimum wages across multiple states like Haryana, U.P., Telangana, Karnataka, and so on so forth. Obviously, the base has gone up. We will continue to look for opportunities and try and optimize as much as possible. Obviously, this is a structural change, and we will see how much we can mitigate that.
Got it, sir. Thank you. All the best.
Thank you.
Thank you. Next question comes from the line of Sunny Bhadra with Emkay Global. Please go ahead.
Yeah. Hi, sir. Thanks for the opportunity. Sir, just on the gross margin front, you mentioned that the expansion is on the back of lower promotional intensity in this quarter. Just wanted to clarify, is there a component of price hike also in this?
Not to any significant extent.
sir, this gross margin should be sustainable for the coming quarters as well, this level of gross margin?
If the current assumptions and the current cost structure continues, we are quite confident there is absolutely no challenge. I'm not saying that I can see the future any better than any of us on the West Asia crisis and so on. That piece is entirely speculative. If the current circumstances continue and do not even improve, we do not see any significant issue.
Sure, sir. That was helpful. Thank you so much, and wish you the best for the coming quarters. Yeah.
Thank you.
Thank you. Ladies and gentlemen, that was the last question for today. We have reached the end of question-and-answer session. I now hand the conference over to the management for closing comments.
Well, thank you very much for your time. I must thank you also for joining in and taking out time from your busy schedule for our conference call. We've always been very encouraged and enthused with your consistent support, and we deeply appreciate that. Once again, thank you, all the very best, and look forward to seeing you again on the next quarter call. Bye. Take care.
Thank you. On behalf of Vishal Mega Mart Limited, that concludes this conference. Thank you for joining us. You may now disconnect your line.