analyst call - nov 2010
TRANSCRIPT
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Jubilant FoodWorks Limited
Q2&H1FY2011Investors/AnalystsConferenceCallThursday,November04,2010at04:00pm.
UrvashiButani:Thankyou,goodevening ladiesandgentlemen.Welcome to JubilantFoodWorks conference call for investors and analysts. The call has been hosted to
discussthefinancialperformanceandshareoperatinghighlightsforthequarterended
September30,2010.IhavewithmeonthecalltodayMr.HariBhartia,CoChairmanof
JubilantFoodWorks,Mr.AjayKaul,CEOandMr.RaviS.Gupta,CFO.Wewillcommence
thecallwithcomments fromMrHariBhartiaandMr.AjayKaul followedbyMr.Ravi
Gupta.Aftertheopeningremarks,weshallopenthecallfortheQ&Asessionwherethe
managementwillbeverygladtorespondtoanyqueriesyoumayhave.Iwouldliketo
mention that certain statements that aremade on this call today may be forward
looking in nature and the results may actually differ from the forwardlooking
statementsmadeand thecompanydoesnotoffer toupdate thempublicly to reflect
changes in performance. A detailed statement in this regard is available in the
companys Q2 FY2011 release, which is available on the companys website
www.dominos.co.in under the investors' section. Iwould now like to inviteMr.Hari
BhartiatocommencebysharinghisviewsonJubilantFoodWorksperformanceforQ2&
H1FY11.Overtoyou,Sir.
HariBhartia:This isHariBhartia, Iam theCoChairmanof JubilantFoodWorks.Goodeveningandthankyouforbeingpresentwithusonthiscalltoday.This,asyouknow,hasbeenaremarkablequarterforJubilantFoodWorks.
Our strong quarterly results reflect our ability to outperform some of our previous
milestonesandcreatevalueforallourstakeholders.Ourresultsarepartofapowerful
continuing trend, which can be explained by the Companys longstanding strategic
direction in combination with prudent efforts of our management. It is really our
continuousendeavour todirectoureffortsondesigningand implementingstrategies,
which helpus accomplish goals benchmarks and surpass the benchmarkswe set for
ourselves.
Wehavebeenabletoexpandournetworkto79newcities,madeinnovativeadditions
to our product portfolio and have taken initiatives to improve our operational
efficiencies.ThesewillofcoursebeexplainedindetailbyAjayandRaviintheirremarks.
AsalwaysIwouldliketospeciallythankallourstakeholderswhohaveplacedimmense
trust and confidence in us. I would also like to take this opportunity to really
congratulateourmanagementteam ledbyAjayandhisentiregroupofseniorpeople
whohavedoneanoutstandingworkwhich isvisible inthisquartersresults..Before I
Chamber no. 1517, 15th floor, Devika Towers, 6 Nehru Place, New Delhi -110 019
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close, letmewishallofyouaveryHappyDiwali. Iwouldnow liketorequestMr.Ajay
Kaultotakethecallforward.
AjayKaul:Thank youMr.Bhartia.A very goodevening and thank you forjoiningustodaytodiscussJubilantFoodWorksoperatingandfinancialperformanceforthesecond
quarterendedSeptember30,2010.BeforeImoveanyforwardIwanttowishallofyou
averyHappyDiwali,averyprosperous andagreatyearahead. JubilantFoodWorks,
maintainingitspastrecordcontinuestodeliverarobustsetofnumbersforthisquarter
aswell.
Letmetakeafewminutestodiscussthehighlightsforthisquartersperformance.Our
total incomeforQ2FY2011stoodatRs.1633.85millionwithagrowthof67%yearon
year.
Our
Net
Profit
for
the
quarter
was
Rs.
184.35
million
up
by
137%
as
compared
to
Rs.77.65million in the secondquarterof lastyear.For the firsthalf in thisyearour
Companywitnesseda significantgrowth inTotal Income,which stoodatRs.2989.35
million.ThecorrespondingNetProfitsstoodatRs.337.15millionupby201.2%overthe
sameperiodlastyear.
Ourstrongnumbersreiterateourleadingoperatingandfinancialpositionasaleaderin
the food service industry. Our growth during the quarter can be attributed to the
additionofnewstores,increaseinsamestoresalesandnewintroductionstoDomino's
productportfolio.Duringthequarter,wecontinuedtofocusourattentiononexpanding
ournetworkintonewercitiesandtownsacrossthecountrythatenabledustoincrease
ourgeographicalgrowthcoverage.Reachisthecornerstoneofourstrategy.Thereisa
strongaffinityfortheDomino'sbrandinthecitieswherewehavenotyetentered.The
latentandthereadypotential issimplytoohardtoignore.Oureffortswillcontinueto
improve coverage at existing locationswhile at the same time spread Khusiyon Ki
Deliverynationwide.
Thefundamentalsofourbusinessandourbasicbusinessmodelhavenotchanged.Our
strongresultsreflectsuccessfulexecutionofafocusedbusinessapproachthatwehave
aggressivelypursuedsincewefoundedtheCompany.Wehaveconstantlydelightedthe
customerwithnewproductconcepts.Feedbackavailabletoussuggeststhatwehave
got
good
responses
thus
far.
This
consumer
salience
is
an
important
part
of
our
model.
Ourhealthyanddelicious innovationthewheatthincrustpizza isanabsolutehitwith
ourcustomersandthelatestadditionofPastaItalianoandMexicanwraphavereceived
astupendousresponse.Oursuccessfulattemptsfurtherencourageustostriveharder
to innovate and satisfy our existing customers aswell as entice new customers into
tryingourirresistiblerangeofMexicanandItalianofferingsandbyextensiontheentire
rangeonoffer.
Akeyfocusareaforusthisquarterhasbeenthescalingupofourstoresnetworkand
todaywehaveawellentrenchednetworkof339storespanIndiain79cities.WeatJFL
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wish to create a distinctive element of easy accessibility around Domino's. Besides
onlineorderingwehavealso initiated the conceptofmobilemarketingwherebyour
customerscanavailpersonalizedtargetcouponsatamobileplatform.This isanother
exampleofDomino'sleveraginginnovationinmarketingtodeliverfocusedresults.Both
initiativesareprogressingwell.
We believe that the food service industry has tremendous potential for growth
especially inacountry like Indiahavingadiversepopulationwithdifferent tastesand
preferences.Wearegeareduptocapitalizeonalltheopportunitiesthatthebusiness
environmentoffersusandareextremelyexcitedabout taking theDomino'sbrand to
thenextlevel.
Looking
ahead,
we
are
very
optimistic
about
the
future
of
our
company
considering
our
commitment to leverageourstrengths that leadus to thepathofsustainablegrowth
andat the same time focuson creatingan implemented strategy thatwillenableus
createwealthforourstakeholders.Thatbringsmetotheendofmyremarks. Iwould
now like tohandover toRaviGuptaourCFOwhowill takeyou throughour financial
performance.
RaviGupta:ThankyouAjayandwelcomeyouallonceagain.Ishallbrieflyprovideyouwith an overview of our Company's performance for the quarter and the halfyear
ended September 30, 2010. It is with immense pleasure that I am speaking about
anothergreatquarterwithavery strong setofnumbers. InQ2FY2011Total Income
stoodatRs.1633.85milliontranslatingto67%growthascomparedtoRs.977.54million
inQ2FY2010,suchgrowth isbroadlydrivenbyexpansionofDomino'snetworkofpan
Indiawiththe launchof18newstoresthisquarter,which includesonesubfranchised
store.
Moreoverwe also reported a healthy same store sales growth of 43.8% during this
quarter.GoingforwardwithrespecttoprofitabilityduringthisquarterourEBITDAwas
reportedatRs.297.25millioncompared toRs.152.23million in thesameperiod last
yearwhileEBITDAmarginsstoodat18.2%ascomparedto15.6%inQ2FY2010.
During
the
second
quarter
of
FY2011
we
continued
to
execute
our
business
strategy
and
made progress in a number of important areas. As we expand our network and
operationsweremaincommittedtorightsizingourcoststructureacrosseachareaand
levelofbusiness todrivecontinuedpositive financial results.Wehaveover theyears
developed an operational system, which gives us the ability to sustain a lean cost
structureand continue to invest inour growthpriorities. Iam confidentwith further
extensionofourbusinesswewill continue toalignourexpenditureprudently toour
operations.
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With respect to interest expenses during the quarter, interest expenseswitnessed a
decline inQ2FY2011andstoodatRs.0.93milliononaccountofrepaymentofallthe
term loans. InQ2 FY2011we reportedPATatRs.184.35millionas compared toRs.
77.69million inthecorrespondingperiodlastyearregistering137.3%growth,whichis
largelyattributabletoourhealthyoperatingperformance.
MovingaheadtotheH1FY2011results,TotalIncomewasRs.2989.35millionregistering
63.6% growth overRs. 1827.46million inH1 FY2010. This is primarily driven by our
expansionacross the country intoexistingaswellasnew cities coupledwithhealthy
samestoresalesgrowth.OurEBITDAforthehalfyearendedSeptember30,2010was
Rs.548.67million comparedwithRs. 275.66million in the correspondingperiod last
year.TheEBITDAmarginsstoodat18.4%ascomparedto15.1%inH1FY2010.
LastlyPATforH1FY2010wasrecordedatRs.67.15millionwitnessinggrowthof201.2%
when compared toaPATofRs.111.94million inH1FY2010.ThecorrespondingPAT
marginswereat11.3%and6.1%respectively.
Inconclusion Iwould liketoaddthatwithveryencouragingH1resultswehavemade
significantstridesinourbusinessoperations.Wehadstartedtheyearoffwithatarget
ofopening70new storesandhaving successfully launched33 stores tilldate,which
includestwosubfranchisestores.
Simply put, our business overall has been progressingwell andwe are confident of
growingatahealthyrategoingforward.BeforeIconcludemyremarks,letmewishall
ofourparticipantsaHappyandprosperousDiwaliandwiththisIwouldliketoconclude
myopeningremarksandwouldliketorequestthemoderatortoopenthecallforQ&A.
AjayandIwillbehappytoaddressqueriesatyourend.Thankyou.
Moderator: Thank you. Ladies and gentlemen,wewill now beginwith the question
andanswer session.The firstquestion is from the lineofPriteshChedda fromEmkay
Global.Pleasegoahead.
PriteshChedda:Firstifyoucouldtellusthesamestoresalesgrowthinthequarterandthereafterbreakitupaspriceleadandvolumelead.RaviS.Gupta:Samestoreforthisquarteris43.8%.Thisquarterwedidnotincreaseourpricesbutperiodicallyeverysixmonthsorsoweincreasethepricesbyabout22.5%,so
onanannualbasiswecansaythegrowth isabout5% intermsofprice,sotherest is
volumeledgrowth.
PriteshChedda:Inthisquarter45%ispriceledonaccountofthepricehikestakeninthepreviousquarter.
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RaviS.Gupta:No,Pritesh,whathappensisthepriceincreaseisdoneeverysixmonthand so. In thisquarter there is no specific price increase butwhenwe compare it
betweentheQ2 FY2010 to Q2 FY2011 therearetwopriceincreasesof22.5%each,so
inanutshellbothpriceincreasestogetherwillgiveyouabout5%priceincreasein the
samestoresalesnumbers.
Pritesh Chedda: Considering the first half same store sales growth being extremelyrobust and deviation from the past trend of about 16% andjust your take on the
marketcondition, is itnowpossible that thesamestoresalesgrowthofsimilar level
willalsobetherein H2 FY2011?
AjayKaul:Seewewon'tbeabletoreflectonhowthesamestoregrowth isgoingtoevolve
in
future.
If
we
for
a
moment
look
at
how
has
the
first
half
gone,
I
think
based
on some goodadvertising campaign some goodproduct launches likePasta Italiano
MexicanWrap,whichwe had launched inQ2 and also things like Chocolava Cake
comingoutof lastyear,whichcontinuedtodoverywell, theway theconsumerhas
responded to these products andpromotional features and added to thatwhatwe
havebeen trying to innovate with themobilemedium,wehavebeenoffering lotof
promotionalofferstoourcustomers,on the operationsfrontwecontinuetoberankedas
thebestoperationsrun intheworldamongstalltheDomino'scountries,wearealso
oneofthebestemployers,soifweputallofthemtogetherandthefactthatwehave
overtheyearsbeenkindofreinforcingatthestorelevel,allourphilosophyofserving
customersand soonwebelieve that theconsumers sentiment isgoing to continue
andtheyaregoingtostronglysupportDomino'sinfuturealso..
PriteshChedda:Havingtheexperienceforthelastfiveyearsandspecificallyforthelastthreequarters,haspizzamarketgrowthdeviated from thehistoricnumbers thatyou
have,doyouthinkat this stage ithasdeviatedontheupsidebasedonthenumbersthat
youhave?
Ajay Kaul: As far as our numbers are concerned, clearly the last three quarters arebetterthanwhatwehavedoneoverthelastsixyears.Toputthingsinperspective,our
CAGRsystemlevelgrowthinthelastfiveyears,whichistill2010wasaround44%andin
this
year
so
far
our
system
level
growth
is
around
67%.
If
I
talk
of
same
store
growth
averageoffiveyearshasbeenaround18%,thisyearsofarit isataround40%.Ithink
speciallycomingoutofyearbeforelastwheretherewasabitofadip,whichthewhole
marketplacehadtaken,becauseofglobalfactors Ithinkclearlythemarket is looking
upbeatandtheconsumersarecomingoutofabitof,callitrecessionaryspaceifImay
say that, and they are showing that much more response to an impulse purchase
productlikeDomino'spizza.
PriteshChedda:Soisitfairtothenconcludethatattherecouldbeadeviationfromthehistorictrend.
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AjayKaul:Wedefinitelybelievethatthere isupbeatnessattheconsumer level inthemarket.
Pritesh Chedda: We have introduced two franchisees now. We have an extremelyrobustcashflow.Whatistherationalebehindsubfranchiseeandwhydon'tweutilize
ourcashonlyforfasterrampup?
AjayKaul:Asapartofourthinkingwhichhasbeenconsistentoverthelast15yearswebelieve thatwe should run thesestoresourselvesbecause then thewholeoperation,
thewholetrainingmachinery,thequalityoftheproduct,thesanitationhygieneallthat
iswithinourcontrolandgivenourcountryIthinktheseareofparamountimportance,
weattach lotof importancetothis,beingacornerstoneforoursuccess in India.Now
these
two
particular
stores
which
are
franchisees
are
more
out
of
design
than
choice
because foranybodytooperateatairports,thesearetwoairportstores,one inDelhi
andone inMumbaiyouhave tonecessarilygo throughwhatwecalla foodoperator
andtheway itoperates in Indiaaswellasworldwide isthatyouhavetobecomeour
franchiseeof thatparticular foodoperator. So letmeanswer this in short, ifgivena
choicewewouldhaveopened this storealsoonourown,butstructurallyhow these
contractsaredoneweareforcedtobeafranchiseeofafoodoperator.
PriteshChedda:Howare these contracts structuredandwhatwouldbe the revenuebooking?
RaviS.Gupta:Therearetwokindsofrevenuebookingthathappensforthis,oneiswechargea franchise fee to franchisedstoresandsecondkindofrevenuebooking iswe
sellfoodtothem,alltheingredientsaresuppliedbyustothesetwofranchisedstores,
sowehaverevenuefromthesaleoftheingredients.
PriteshChedda:Okayandisthefeeincomeasapercentageofrevenues?AjayKaul:Yeahitisapercentageofrevenues.PriteshChedda:Whatisthepercentage?RaviS.Gupta:Wewillnotbeabletosharetheexactnumberwithyou.PriteshChedda:EachnewSKUthatyouhavelaunchedChocolava,MexicanWrap,PastaItaliano,ifonathreetofouryearperspectivewhatcouldbetherevenuesizethatthese
SKUscanbecome,soitiseasierforustoextrapolateforincrementalSKUsizes.
AjayKaul:Itishardtopredict,butwecansaythreetofourthings Onebylaunchofthese products we have been able to make our menu more holistic from the
customersperspective.Becausewhenwedidourresearchthecustomerwouldsaywe
loveyou,butgivemealsoacoupleofmoresideoptionsandalsoadessert,whichwas
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previouslymissingfromourmenu.Sosince Iwouldsay lastyear, inAugustwhenwe
launchedpastaforthefirsttime,thenwedidChocoLavainDecemberandthisyearwe
launchedtheWrap,webelievenowtheseareproducts,whichhavebecomeapartof
ourmenumix.Nowgoingforwardweareattheendofthedayapizzacompany,soour
focusonpizzawillneverchange.Youwillseelotofourinnovationactuallyhappening
around pizza rather than the side orders but the side order and the dessert will
continue finding their place. So arewe expecting these dessert and side orders to
becomeso large that thepizzapercentagewillgodown, Idonot think so.Theywill
coexistandtheywillallformapartofthestomachshareoftheconsumer.
PriteshChedda:AnyballparkfigureorideaonthesizeofeachSKUthatitcanbecomeoverthenextfiveyearsmaybenotasapercentageofrevenuebutabsolutesize,aRs
.30
crore
palette
or
a
Rs.
50
crore
palette.
AjayKaul:Withoutgivinganumbertoit,theyarefairlysizableandinpercentagetermspizzawillalwaystendtobethemotherofallofthem.
PriteshChedda:Lasttwoquestionstheadandpromotionexpensesasapercentageofthesaleswhat it isandwhat itshouldbeandwhat istheemployee inflationthatwe
arefacingatthisstage?
AjayKaul:Wecan'tactuallysharewithyouwhatouradvertisingspendasapercentageis,butitisconsistentlygrowingyearafteryearandwebelievethatwhilewehavebeen
doingsomecutthroughadvertising,whichhasreachedthefarendandcornersofthe
countryandwhichhasreverberatedbythe factthatwhenweenter lotofnewcities
like this year so farwehave gone into10new citiesand if thepentupdemandby
virtueoftheproductalreadyhavingreachedthereatleastatthemindlevelandthen
gettingexecutedwhenwephysicallyenterthecitydemonstratesthatadvertisinghas
already reached there.Butwe stillbelieve thatwehave to growour advertising to
continuously communicate with our customers so that is going to grow, without
sharing the numberswith you. The second questionwaswith respect to employee
inflation.AsyouareprobablyawarewearetheninthbestemployerinIndiabyHewitt
EmployerSurvey;asagreatplacetoworkwearealsoamongstthetop25inIndia.We
believe
in
constantly
getting
back
to
our
employees
because
we
have
more
than
10,500
of our own employees todaywho are the happiness ambassadors aswe call them.
Recently inSeptemberwehavedoneasalary increaseofourteammembers,people
whoworkinthestoresandwecanproudlytodaysaythatweare leadingthepack in
termsofsalariesatthatlevel,thisobviouslybringsinthatmuchmoremotivationand
soonforthemtofurthersatisfycustomers.Similarlywealsoincreasedsalariesofour
associateandstoremanagersinthestoreinSeptemberthatisagaingoingtogoalong
wayinmotivatingthemtosatisfyourcustomers.Soweareverymuchinlineinterms
ofgivingincrementsmuchmorethanwhattheinflationistoouremployees.
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PriteshChedda:Ontheadandpromotionexpense,hasthatdirectionasapercentageofsalesimprovedoverthelast23yearsatleastifyoucouldgiveonthedirectionside?
RaviS.Gupta:Wecansaythat it is improvedmarginallyandconsistently ithasbeenimprovingyearbyyear.Moderator:ThenextquestionisfromthelineofNaveenKulkarnifromMFGlobalSifySecuritiesPvt.Ltd.Pleasegoahead.
NaveenKulkarni: Iwould liketounderstandthe44%samestoregrowthrateforthisquarter,couldyoutelluswhatisthegrowthrateformaturestores,whicharethreeor
morethanthreeyearsold?
RaviS.Gupta:Actuallythereisnosignificantdifferencebetweenstores,whicharelessthan three years and storeswhich are older than three years. They aremarginally
different.Thereasonwhytheyaremarginallydifferentisthatbiggerstores,needtobe
split periodically, whenever stores grow to a certain size and above, to serve the
consumersbetter,weopen another store also in the vicinitybecause the customer
servicestartssufferingatthefringes.
NaveenKulkarni:Soalso if Iwere to lookat thesequarternumbers thequarteronquartergrowthrateisintherangeofaround20.5%,whichprobablywouldbequitea
highnumber,so isthereanykindofseasonalitythatyouseeoverthefourquarters I
wouldprobablyimagineQ3wouldbethestrongestquarter.Isthatarightassessment
tomake?
AjayKaul: Ifyou lookat lastyear, I thinkyouprobablywillhaveaccess to lastyearnumbers,whathappensisastheyearprogressesournewstoreskeepaddingalongso
theyprobablycoloralittlebit,theconceptofseasonality.Ifweweretheoreticallynot
adding any stores during the year then youwould probably get a true indicator of
seasonality.Buthavingsaidthatyouareright,Decemberasanexceptionandmaybe
to some extent halfof January aremonthswhere seasonality is demonstrated very
well,consumersareinaveryjoyousandapompousmood,corporatesactuallyatthe
timeof theyeararealso inagoodmood to reward theiremployeesandholdpizza
parties.SoasaresultDecembertendstobeabigmonth,Januaryhalfofifalsotendsto
be a goodmonth.Other than that I think there is a steady business,which comes
almostthroughouttheyearbutthereareoccasions forexamplewhenthere isDurga
PujainKolkatathesalewillpickupwhenthereisaGaneshChathurthiinBombaythe
saledoespickup,duringtheDurgaPujaDusshera,etc. So there are pockets where on a
few days sales are high or low,butbyandlargeseasonalityisnotthere,itismissing.
NaveenKulkarni:Okayandalso in termsofgrowthratecoming frommetro'sversusnonmetrocitiesaretheydifferentorhowdowelookatthosenumbers?
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Ravi S. Gupta: They are not significantly different actually. All cities practically aregrowingbyagoodsetofnumbersandthereisnomajordifferenceinmetroversusnon
metro.
Moderator: The next question is from the line ofManish Jain from Axis Holdings.
Pleasegoahead.
ManishJain: IhaveaquestiononwhatisthesustainableEBITDAmargingoingaheadoverthenext12yearsandsamefortaxrateandlastoneiswhatistheaverageticket
sizerightnowversuslastyear?
AjayKaul:Okayletusstartinthereversedirection.Ticketsizeissomethingwhichwewillnotbeabletosharewithyou.AsfarasEBITDAmarginsareconcernedforthefirst
twoquarters it isaround18.3%,which isasignificant2.6to2.7% improvementover
last year.Webelieve that given the first twoquarters,wherewehavemanaged to
growoursalesbyaveryhandsome67%atthesystemic levelandaround40%atthe
samestore level.Wehavebeenable togrow thesemarginsandouroutlook forthe
futureisthatwithcustomerresponsecominginthewayithasbeeninthepastwewill
beabletodeliverhopefullygoodresults.
ManishJain: Youexpectthemtosustainandimprovefurther.AjayKaul: Itisdifficulttocommentatthisjunctureandtolookatthefuture.Wewillobviouslystrivetoimprove.
ManishJain: Thanksandlastonewasisonthetaxrate.RaviS.Gupta:Tax rate for thisyearwillbearound20%; this is inview thatwehadcarryforwardtax lossesaswellasbook lossesandfromthenextyear.Wewillcome
backtoyoubytheendofthisyearonwhatwillbethetaxrate,butasofnowitseems
liketobeafulltaxrate.
Moderator:Thenextquestion is from the lineofHirenDasani fromGoldmanSachs
AssetManagement.Pleasegoahead.
HirenDasani:OnthesamestoresalesgrowthifIlookatthecommentaryasperthelastearningscall,theactualnumbershaveclearlysurpassedmuchmoreontheupside.SoI
am just wondering that within a threemonth span how can we be so materially
differentfromwhatwewereexpectingaboutthreemonthsago.
AjayKaul: Ifyou lookatourfiveyearsamestoregrowthonaveragebasis it isaround18%andifyoulookatour lasttwoquartersinparticularthishasjumpedtoashighas
44%,so theseareunprecedentednumbers.Soat theendofthepreviousquarteralso
when we had discussion we knew that there was upbeatness in the market. The
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consumer is respondingverywell,44%youknowhasclearlybeatenourexpectations
alsoandweareveryhappytoreportthesenumbers.
HirenDasani: Again for the full year you are still saying that the same store salesgrowthwillbeintherangeof1820%only?
AjayKaul:Wewillnotbeabletocommentaboutthefuture.Howeverwhatwewillsayisthattheconsumerseemstobereactingverywelltothevariousstimulithatwethrow
in themarketbywayofourpromotions,bywayofproducts,bywayof the various
schemes thatwehavewhether it isamobilecouponor through the Internet,online
ordering.Amixofallthese,asafunctionseemedtohaverespondedprettywellsofar
duringthecourseofthisyear.Thatisallwecansay.
HirenDasani: Okay,Imeanbasicallyyouhavestoppedgivinganyguidanceasfarasthesamestoregrowthisconcerned?
AjayKaul:Probably.HirenDasani:Whataboutstoreopeningsforthecurrentyear?AjayKaul:Tillfirsthalfthisyear,wehaveopened33storesandweareupbeataboutourfullyearguidancewhichwehadgiven thatwewillopen70storesbytheendof
March2011.Andweareontrackforthatandwewilldefinitelyopenaround70stores
byMarch2011.
HirenDasani: Sureandmaybeoneshouldexpectsimilarnumbersforthenextyearaswell.
AjayKaul:Asandwhenwedecideourbudgetsandourtargetsandobjectivesfornextyearwewillbeveryhappytosharethemwithyou.
HirenDasani: CanyoutellmewhatwastheCapexforthequarteraswellasforthehalfyear?
RaviS.Gupta:CapexforthishalfyearisaboutRs.28crore.HirenDasani: Largelyonthestoresonly?RaviS.Gupta:That is largelyattributabletostores.Asignificantportionofthisrelatesto the stores opening because of 31 company owned stores thatwe have opened.
Although we require some balancing equipment for the commissary that happens
periodically,wealsoneedtoaddonequipmentswithinexistingstoresalsobutthat is
smallerportion.
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HirenDasani: Sure,ifIlookattheemployeenumberjustdividingsimplythenumberofemployeesbythenumberofstores,itlookslikethenumberofemployeeshasgoneup
quiteabitduringthisquarter,anyexplanation?
AjayKaul:Yes,itisverysimple.Whenyoulookatthesamestorebasis,wehavegrownataround44%atasamestorelevelyouneedtobeefupthesamestoreemployeebase
byatleast1520%,soifyoulookatourexistingsamestoreemployeebaseforgettinga
44%samestoregrowthyou require thosemanymoremotorcycles,thosemanymore
peoplewhocangoanddeliverpizzas,sothatisonepartoftheemployeesbasegrowth.
Theother isthateverystorenormallyrequiresaround25oddpeopleandthe33odd
storesthatwehaveopenedthisyearsofar,wehavehadsomefantasticperformance
by these storesand theyhaveopenedmuchhigher sales than the stores in thepast
have
and
as
a
result
they
have
required
not
20
25
but
maybe
30
people
on
an
average.
So ifyouaddallof them together so there isa fairlyhigh increase in thenumberof
employees.Buttrustmeifyoulookathowtheyhavegrownagainsttheactualgrowth
thatwehavehadtheyareallcontributingtothetremendousgrowthandsuccessthat
wehavehad.
HirenDasani: Definitely that isprettymuchevident from thenumbersand lastlyanyupdatesonanypotentialjointventures,franchiseeagreementsbeyondDominos.
AjayKaul:Notyet,aswehad said last timealso thatdiscussionsareon,and Imustadmitthatdiscussionsarestillon.Thesearethingswhichdonothappenovernightand
obviouslyapart from the commercialand the strategic sensewhich thebrand should
maketoeachother,thephilosophyandculturealsooftheorganizationshouldmeet,so
itisgoingthroughduediligencefromallsides,frombothsidesandasandwhenthere
willbeanythingmaterialtoreportandobviouslyweareboundbynondisclosureclauses
sowecannotevengiveyouahint,soasandwhensomethingmaterialhappenswewill
bemorethanhappyandgladtocomebacktoyou.
Moderator: Thank you. The next question is from the line of Manav Vijay from
Edelweiss.Pleasegoahead.
ManavVijay:
Good
evening
gentlemen.
Could
you
please
tell
us
what
was
the
sale
from
the twonew products thatwehad launchedduring thequarter,MexicanWrap and
Pasta?
AjayKaul: Itwillbedifficultforustosingleoutwhatexactlywasthesalecontributionbut Imust tellyou thatqualitatively theyhavedoneexceedinglywell.Whatwehave
realizedisthattheshareofthestomachasfarasDomino'sPizzaisconcernedhasonly
grownup.Apartfrompizzas,theconsumershavealsogivenusashareofthestomach
as far as side orders are concerned. So bothMexicanWrap and Pasta Italiano have
foundtheirplaceinthemindsofthecustomeraswellashisorherstomach.
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ManavVijay: SirthebasicreasonwhyactuallyIwasaskingforthatnumberisbecause43.8%samestoresalesgrowth,Iunderstandthatsomepartofithasactuallycomefrom
the introductionofnewproducts.Soasandwhen letussay theCompany introduces
newproducts inthefuturewewillhaveabasesamestoresalesgrowthforourbread
andbutterbusinessofpizzaandsowewillbe inabetterpositiontoputanumberfor
newproductsaswell,soifyoucansharethat,itwouldbereallyhelpful?
AjayKaul:Idefinitelywillnotbeabletosharethosenumberswithyou.ManavVijay: Okaygreat,howmanynewcitiesweaddedinthisquarter.RaviS.Gupta:Inthisyearsofarwehaveadded10citiesand5 cities in this quarter.ManavVijay:Fiveinthisquarterandfiveinlastquarter.RaviS.Gupta:Yesthatsright.ManavVijay: We have done close to 40% kind of same store sales growth. Nowconsideringthefactthatthethirdquarterincludesapartfromlotsoffestiveseasonand
periodsanddays,woulditbepossibletoactuallybeatthisnumberinQ3.Wouldyoube
inapositiontocommentanything?
AjayKaul:WewillnotbeabletocommentonhowQ3willunfold,allwecansayisthatgoingby the last twoquarterswhere theconsumerhas respondedverynicely to the
variousstimulithatwehavethrownatthemintermsofnewproductsaswellasexisting
products,ourvariouspromotions,andallotherthingsthatwehavedone for them in
terms of operation, customer services, that is really encouraging for us that the
customerisrespondingtothestimuliandtheyarereallyfindingthevaluepropositionof
Domino'smeetingtheirstandardsandrequirements.
Moderator:Thankyou.Thenextquestion is from the lineofMadhuchandaDey from
Kotak.Pleasegoahead.
MadhuchandaDey:Myquestionpertainstothesamestoresalesgrowth,whichiskindofdeviated fromyourerstwhile trajectorygiven that thishashappened forwhatever
measuresthatyouhavetaken,theremustbeakindof physicalcapacityutilizationalso
ofyourstoreswhichwouldatsomepointintimegetexhausted,soIjustwantedsome
senseonthatastowhatkindofgrowthcanbesustainedwithoutcreatinganewstore
in the vicinity or adding physical storesjust by addingmanpower as you have been
doinginthelasttwoquarters?
AjayKaul:Evenaswespeak,wehaveletussaya44%samestoregrowthinaquarter,ifIweretopickupalloursamestores,youknowthereisafairlysizable200plusstores
sitting they are spread inacontinuum,therearethesereallyhighvolumestores,tothe
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mediumsizedstoresandtothesmallerstoresandallofthemaregrowingaswesaid
earlieratanequallystupendousrate,44%beingtheaverage. Soas farascapacity is
concerned that isalreadygetting testedas faras the largestoresareconcerned.And
clearlythe largestoresaredoingwellandtherearenosuchbigvisibleconstraintsfor
us;howeverhavingsaidthatweonourownrealizedthatasastorestartsbecomingbig
intermsofvolumehandledwhenyou lookatthecustomerservice indicators interms
ofhowfastwereachtothecustomersdoorstepwehaveacommitmentofreachingin
30minutesor less,but the internalnorm is far lower than that sohowoftenarewe
delivering late inthosekindofstoresorattheperipheryofthedeliveryareaofthose
storesourcustomerservicesmaystartfallingordroppingandwhichsometimeshasa
clearbearingontherepeatpurchaseorderofpeople,sogivenallthatisthetimewhen
they realize that someof thesebig storesneed tobe split. So it isnot asmuch the
capacity,
the
capacities
do
not
come
up
as
a
constraint,
it
is
our
own
indicators
in
terms
ofcustomerservice,customerexperienceandtherebyrepeatpurchase,whichdriveus
tosplitstoresandcreatenewstoresoutofthem.
MadhuchandaDey:Sohowmanyofyourstoresareabouttoreachthatstage,Imean,ifyoucouldjustgiveusasenseofthat?
AjayKaul: It is a smallminisculenumber aswe speak rightnow, sinceourbasehasbecome fairly large,wehavenow339stores, thisnumber is fairlysmallcompared to
thewholebase.
MadhuchandaDey:Butthatnumberwouldcontributetowhatpercentageofyourtotalsales?
AjayKaul:Iwon'tabletoreflectonthat,butwhatthesenumbersdo,Iwouldsaytheydoforexample,the44%samestoregrowthincludesthesplitstores,whichmeansifyou
were to takeaway thesplitstoresoutand lookat the restof theuniverse, thesame
storegrowth isprobablyevenhigherthanthisnumber.Sothis44% includesthesales
shareofthesesplitstoresalso.
MadhuchandaDey:Iamjusthypotheticallyaskingyouthisquestion,shouldyourFY'11same
store
sale
growth
turn
out
to
be
similar
to
H1,
would
you
have
to
rework
on
your
capacityadditionplans?
AjayKaul: Justcannot comment, it isahypotheticalquestion,wewillnotbeable toanswerthisquestionatall.
MadhuchandaDey:Butinyourassessmentifthistrajectoryofsamestoresalegrowthcontinues,youhavetocontinueaddingemployeeintherateyouhavebeendoinginthe
lasttwoquarters?
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AjayKaul: In fact ifoursamestoregrowth is44%,ouremployeegrowth in thesamestoreincreasesatafarlowerbaseandtherebyyouareabletoleverageandimprove on
our marginssotheoreticallyifoursamestoregrowthweretocontinueatthesamepace
our employee growthwill only be a subset of them, itwill be far lesser than that
number.
MadhuchandaDey:Attheendoftheday,youwillbeabletoimproveuponthis18.5%kindofamargin?
Ajay Kaul: That is something which we will not talk about right now because it isdependent on several other factors. Lot of things can be leveraged to look at your
margins or have a bearing on your margins. This is one of the levers which cancontribute
to
that
EBITDA
margin.
MadhuchandaDey: Somyunderstanding iswhat you suggested is you stillhave theleverwith youof addingproportionateamountof employee andmaintain the same
storesalegrowthtrajectory,right.
RaviS.Gupta:No, I thinkwe need to rephrase that completely, if the sales growthrequires thenwe can add employees; employee addition cannot bring a same store
growth.Wecanaddemployeesthatwillbetherightphrasingactually.
AjayKaul:OnethingwhichwehavedoneandIwanttosayhereisthatinthemonthofSeptemberwe tooka salary increase forall thekey setofemployeesworking in the
store for us. To startwith the teammemberswe increased their salary significantly
becausewe realized thatwehad toattract lotof thistalentandalloverthecountry.
Similarlyat themanager levelwithin the storeagainwe increased their salaries.The
ideawastoimproveretentionratesthereandmakesurethatalltheseemployeesare
readyforthebigmonthslikeDecemberandanyothersuchgrowththatmayhappenin
thefuture.
MadhuchandaDey:YouhavealreadycreatedthebufferinyoursysteminQ2.AjayKaul: Iwouldnotcall itabufferbutwehavedoneourpreparations for thebigmonthslikeDecemberandwearehavingarecruitmentstrategyaccordingly.
Moderator: The next question is from the line of Jaibir Sethi from CLSA. Please goahead.
JaibirSethi:Ijustwantedtogetasenseofthemovementseeninyourworkingcapital,particularly the liability figure seems to have goneup a lot aswell as the loans and
advancesfigure,couldyougiveussomecoloronwhatisgoingonthere?
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RaviS.Gupta:Loansandadvancesbasically reflect the securitydepositwhichwegivefor thenew siteandwheneverwe relocateasite.Soall thosesecuritydeposits form
partoftheloansandadvancessothatisthereasonyouwillthatthiskeepsonmoving.
SoinSeptember2009,thisnumberwasaboutRs.27crore,byMarchitwasRs.36crore
andnowRs.48crore.Intermsofliability,liabilitypertainstoallkindofexpenseswhich
alsoperiodicallykeepongoingup.Althoughwearenotdelayinganybodyspayment,
sincewebuyoncreditandselloncash,asmorethesalesaccrued,the liabilitygrows
andthat ishowwegeta leverage inourworkingcapitalcontinuously. Inpastalsowe
haveindicatedthatwewillcontinueto leverageourworkingcapital,this isoneofthe
strengthsofourmodelthatwebuyoncreditandsellonthecash.
JaibirSethi:Wewillseethisnegativeworkingcapitalnumberkeepexpanding.onthestore
basis
as
the
number
grows?
RaviS.Gupta:As thenumberofstoreskeepsongrowing thiswillkeeponexpanding.Althoughitwillmoveslightlyhereandtherebetweenquartertoquarterorsomething
butoveralltrendwillbepositive.
Moderator:Thenextquestion isfromthe lineofAmnishAgarwalfromMotilalOswal.Pleasegoahead.
Amnish Agarwal: My first question is regarding the employee cost, where you areindicatingthatyouhaveraisedthesalariesofthekeypeople invariousstores.Socan
weassumethatthesekeypeoplearetheusualdeliveryboysandallthose involved in
thestoreoronlyafewselectsetofpeople.
AjayKaul:Nothis iseverybody insidethestore;wehavedonetwodifferenttypesofsalaryincreases.Onefortheteammembers,whichincludeseverybodywhoisinvolved
inoperationsother than the supervisorswhichmeans the frontendpeople,delivery
boys,peoplewhomakepizza,whotakeordersandeverythingandthisisafairlysizable
numberofpeoplethisis likearound70008000employees.Thenwehavealsodonea
salary increase for our associate assistant managers, store managers and store
managers sowe have also done some sort of a correction there, so there are two
different
sets
of
people
but
all
pertaining
to
the
store.
AmnishAgarwal:Canyouquantifythathowmuchcouldbethequantumofincrease?AjayKaul: Iamafraidwewillnotbeabletotellyouthequantumof increase,butwecansafelysaythatweareattheteammemberleveloneofthebestpayingcompanyin
linewithourphilosophythatwewanttobecomeoneofthebestemployers.Weasitis
aretheninthbestemployerbyHewittSurvey;weareoneofthegreatplacestoworkas
pertheGreatPlaceToWorkSurvey,sokeepinginlinewiththatwehavetakensomeof
thesesteps.
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AmnishAgarwal:Mysecondquestionregardingthesameis,canyousharewithusthenumberofemployeeswehaveparticularlyatthestorelevel?
AjayKaul:Atthestorelevel,Ireckonwewillbehavingaround9800employees.AmnishAgarwal:Mysecondquestion isregardingthesamestoresalesgrowthwhichhas been accelerating from past 34 quarters. And we actually were operating in
quarterswherethebasewasvery low, forexample, lastyearfirstandsecondquarter
wewereroughlyatsay1314%kindoflevel,whichhasincreasedsignificantlyduringthe
thirdandfourthquarterandsubsequentlythefirstquarterofthisyear,sonowwiththe
same store sales growth at 43%during thisquarter, as earlier themanagementwas
sayingthatsomethinglikeyourmidteensorhighteenskindofagrowthwouldbethe
one
they
would
be
comfortable
with
but
looking
at
the
situation
now
do
you
think
that
despitehighbaseeffectthethirdandfourthquartercangiveussomemoresurprise?
AjayKaul:Wewillnotbeabletoreflectonthe futurequartersbuthavingsaidthat Imust admit that 44% same store growth, 40% for the first half of the year are
unprecedented,theyareverygoodnumbers,evenbyourownstandards.Ifyoulookat
ouraveragesamestoregrowthforfiveyearsbeforethisitwasaround18%.Ithinkthe
first half performance is reflective of the response of the consumers to the various
stimuli thatwe provide them in terms of the products, promotions, advertising, our
customerservice,ourtrainingwhichreflectsinthewaywehandlecustomersandsoon
andweareverypleasedthatthecustomersarerespondingverywelltoallthestimuli
thatwearethrowing.
Amnish Agarwal:My final question is regarding our entry in Bihar,wherewe havelaunchedastore inPatnarecently,sowhat isyourexpectationandhowhasbeenthe
initialresponsetothestoreinPatnaandhowdoyouthinkyourexpansionstrategywill
now be particularly in Eastern India, where we have been relatively weaker in
comparisontootherpartsofthecountry?
AjayKaul:Patnaasacitywithpotentialwasalwaysknown tous Ourentry toPatnawasdelayed for someother reasons;however,Patnahas respondedverywell in the
first
20
odd
days.
It
is
only
20,
25
days
old,
the
consumers
have
responded
very
well,
it
is
veryvisiblethatspeciallyamongtheyouth,theyoungexecutivesandIwouldsayeven
the children and so on. The pentup demand by virtue of having seen Domino's
advertisements,knowingwhatDomino'swasalwaysthere,thereisalsothataspiration,
whichweoftentalkabout.Soallthosefactorshave ledtoaverygoodPatnaopening
andIcannotshareanynumberswithyoubecauseithasopenednotinQ2butinQ3.So
technicallyitbelongstothisquarterandnotthequarterwearetalkingaboutrightnow.
TalkingaboutEasternIndia,Patnadefinitely,kindofmakesusupbeataboutBiharbutas
farasEastern India isconcernedoverthe lastoneyear,oneandahalfyearswehave
consistentlygone intoEasternIndiainvariousdirectionsweareinGangtok,wearein
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vendor requests for by leveraging our volume. That is the reason youwill see that
consistentlyourrawmaterialcostisundercheckandwebelievethatconsideringthat
ourvolumeswillcontinue togrow in futurewewillbeable tokeep the rawmaterial
costundercheckinthefutureaswell.
AmritaBasu:MyotherquestionaboutSriLankaoperation?RaviS.Gupta:AsfarasSriLankaoperationisconcerneda100%subsidiarycompanyhasbeenformed.Wewillbeopeningabout2 3storesthisfinancialyearitself.Theteamis
gettingsetupandwewillbeworkingonsettingupthecommissaryandstores.
AmritaBasu:Thesewillbeownedstores?RaviS.Gupta:Thesewillbeownedstores,throughthesubsidiary.Sothestoresalsowillbeownedbythesubsidiary,wearenotfranchisingorsubfranchisinginSriLanka.
Moderator: ThenextquestionisfromthelineofAakashManghanifromGirikCapital.Pleasegoahead.
AakashManghani: Iwanted to knowwhat is theCapexper storeand secondly yourguidanceonthenumbersofstoresyouplantoaddin34yearsalsothirdlyIwouldlike
to knowwhat is thebreakeven time foraparticular storeandwhendoes the store
achievethelevelthataregularstorehas?
RaviS.Gupta:Thenumberof storeswehaveopened,60 stores, twoyearsback, lastyearweopened65storesandthisyearweplantoopenabout70stores.Wehavenot
workedoutourplansforopeningfornextyearandprobablywillcomebacktoyoufor
thatmaybeearlynextyear. In termsofCapexperstore, it isaboutRs.7millionper
storeandasforbreakevenisconcernedmostofourstoreshaveabreakevenonday
one,theystartgeneratingpositivecashfromthedayoneoftheoperations,exceptfor
thepreoperatingexpenseswecharge,ifwe leaveoutthat,fromthecleanoperations
theyareprofitablefromdayone,soyoucansaythebreakevenisondayone.
AakashManghani:Whendoesthatachievethesametypeofsalesthataregularstorewouldhave?
RaviS.Gupta:Typicallyittakestimetogrowthesalessodifferentstorestakedifferentamountoftime,typicallytheyopenbetween7580%ofthesamestoresalesbutthey
growprettyfast.
AakashManghani:CapexfigureforthisquarterwasitisRs.28croreRaviS.Gupta:Yes,Rs.28croreforthishalfyear.
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AakashManghani:Andthatwillbeattributedmainlytotheopeningofthenewstores?RaviS.Gupta:Yes,itmainlypertainstoopeningofthenewstores.Moderator: Thenextquestion is from the line ofRajMohan, an Individual Investor.Pleasegoahead.
RajMohan:Mostlymyquestionshavebeenansweredbutagain trying todwellabitdeeperonthesamestorestryingtocomprehendthe longerterm implicationsofyour
strategiesonsamestores,don'tyouthinktherearesomeinternalfactors,whicharein
yourcontrollikeintroductionofnewproductsatperiodicintervals,betterbangforthe
buckkindofmarketingthatyouhaveincreasinglyresortedto,shouldn'tthosetakeyour
same store sales growth range significantly higher than what you have indicated
previouslyof1618%,Iamtalkingaboutgenerallymediumterm,overthemediumterm
theimplicationsofyourstrategyonsamestores.
AjayKaul: Ifyou lookat inthepast,ouraverageseemstohavegrownfornearly fiveyears,before thisyearconcluded itwasaround18%.Other thanoneyear,where the
downturnhappenedalittlebitithasbeenclockingaround20oddpercent,Thisyearso
farithasbeenclearlyhigherthanthatcomingoutofQ4oflastyearwherewedidin30s
and thisyearwhatwehavedone inthe firsthalfhasbeenaround40%. I think ithas
beenacumulativeresponse toourvariousstimulithatwethrowasaconsumer from
ourproductstoourhistoricalsuiteofproductstothevariouspromotionsthatweare
doingandsoonandsoforthandtheresultsareverymuchencouraging.Goingintothe
futurehowthecustomerisgoingtorespondtothestimuliit ishardtopredictbutwe
believethecustomersarefairlyupbeataboutoursuiteofproductsandservicesthatwe
areofferingthem.
RajMohan:Soyouarealsosayingthatyouhaveattributedthe improvement insamestorestoimprovedordersalesandincreaseinnumberoforderswhichobviouslywould
beassociatedwith the generalwellbeingof theeconomy you see that sustainingat
leastintheforeseeablefuture?
AjayKaul:Withoutgivinganynumbersouttheordergrowth isasexciting inthe firsthalf,astherevenuegrowth,which isreflectiveofnewcustomerscoming inaswellas
existingcustomers increasing their frequency.And that is the response to thevarious
initiativesthatwearedoingmarketingandoperational initiativesandthatresponse is
fairlyencouraging.
RajMohan:Siressentiallyyour19%20%growththatyoutrackedtothelast34yearsthat is seriouslyat riskbecause that isobviouslypositive for thecompanybut that is
seriouslyatriskofovershooting?
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AjayKaul:Nocomments.RajMohan:Next on theprofitability though youhave refrained talking about futureprofitabilityinthecallyouhavementionedenhancingprofitabilityasyourkeyfocusin
thecomingquarters inyourpresentation.Asyouare intoyourbusyseasonDecember
quartershouldnotwebe inapositiontocapitalizeonthevolumedynamicsmix,cost
efficienciesbecausethesalary increaseshavealreadyhappened inSeptemberandthe
general robustnessof the Indian economy to sortof improveon your EBITDA in the
secondhalf?
AjayKaul:WewillnotbeabletocommentonhowourEBITDAwilltakeshapeinQ3andQ4,butthevolumesinQ3andQ4areobviouslyhigherthantheywereinthefirsttwo
quarters,
there
is
more
volume
in
these
particular
quarters
so
that
sometimes
helps
in
leveraging but having said that we have also taken as recent as first September
substantialsalaryincreaseswhicharealsogoingtoplaytheirroleintermsofaffecting
themargin.Soasasumtotalofallthishowitisgoingtomanifestitisverydifficultto
say.
RajMohan:But then sinceyouhave takenalreadyyoursalary increase inSeptemberwhichshouldhavebeenreflected,okay,sothatwillbereflectinginthenextquarteris
whatyouaresaying?
AjayKaul: Yesfullquarterinfactwillbethenextquarter.RajMohan:Iamaskingsinceyoumentionedyouwouldnotbeabletospecificallytalkabout talkswithglobalF&Bmajorsgenerallywanted toknowareweanycloser than
whenwewereatthebeginningofthisfinancialyear?AjayKaul:Mostdefinitelywehavemovedforward.Moderator:Thankyou.Thenextquestion isafollowupfromthe lineofHirenDasanifromGoldmanSachsAssetManagement.Pleasegoahead.
HirenDasani:Justontheemployeenumberperstore,asyousaidrightlythesamestoresame sales growth of 43% needs to be supported by may be 15%20% higher
employees,someofthemareoncontractbasis.Socanyoureducetheemployeebaseif
thesalesarenothappeninginthesamefashion?
Ajay Kaul: Most of these employees are actually full time on our roll employeeshowevertheirmixcanbeintermsoffulltimeandparttimers,butthatdoesnotmean
wecanreducethemjustasyouwoulddowiththecontractpeople.Thesearepeople
takenwithastrategyinmind,withaplaninmindasfulltimeemployeeswhoaregoing
tobealignedtothegrowththatweexpectandwhatwearegoingtoachievenowand
alsointhecomingmonths.
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HirenDasani:Would itbe fair toassume that initially to takecareofthegrowth, therecruitmentswouldbeontheparttimebasisandthenmaybetheycanbeabsorbedin
thefulltimefashion?
AjayKaul:There isnothing likethatbecause in Indiaparttiming isaconceptstill it isvery,veryprimitive,itisnotlikewhatitisthereinthewesternworldorwhereversoitis
noteasytogetparttimersbutwehaveafairmixofbothparttimersandfulltimersbut
thereareallonourpayrolls,sotheyareouremployees.
RaviS.Gupta:Toadd towhatAjay issayingactually there isneveraneed to reducebecausewearegrowing,weareopening70stores.Eachofthestoresmeans25to30
peopleandwearepresent in79cities,sowheneveryouopenastore inthecitieswe
can
relocate
the
people
also
if
need
be,
so
we
need
the
same
people
all
the
time,
so
this
helpsustorelocatethesamepeopleprettyfast,sopracticallythereisneveraneedto
reducethemanpowerstrength.
HirenDasani:Sureaslongasyouareopeningmorestoresinthesamecity,okaythatisitthankyou.
Moderator:Thankyou.AswehavenofurtherquestionsIwould liketohandthefloorbacktoMr.AjayKaulforclosingcomments.PleasegoaheadSir.
AjayKaul:Ladiesandgentlemenitwasgreattalkingtoallofyou.Youhavebeenpatientlistenersandsomereallyexcitingquestionscameourway,whichweweremorethan
happy toanswer.Wehavehadanencouraginghalfyearand remainoptimisticabout
the remainderof the year.Shouldyouhaveanymorequeriesathand,pleaseget in
touchwithusandwewouldbehappytoaddressthem.OnbehalfofJubilantFoodworks
Ravi,HariandmyselfwewishyouallaveryhappyDiwaliandagreatsuccessfulyear
ahead.Thankyouverymuch.
Moderator:Thankyougentlemenofthemanagement.Ladiesandgentlemenonbehalf
ofJubilantFoodworksLimitedthatconcludesthisconferencecall.Thankyouforjoining
usandyoumaynowdisconnectyourlines.
_____________________________________________________________________Thisisatranscriptionandmaycontaintranscriptionerrors.TheCompanyorsendertakesnoresponsibilityforsucherrors,althoughanefforthasbeenmadetoensurehighlevelofaccuracy.