Earnings Call Transcript of discussion between Management and Analysts of Q3FY20 performance
Opening Remarks
So you know, it's a four quadrant chart. The first one is on revenues. You know, it's a 4% revenue growth, 3.8% in fact. Our market share, we haven't seen a larger market share increase than what we are seeing this year. Operating profits are the ever highest and they moved up by 100 basis points. And PAT is plus 24% at 12.7%. So that is results at a glance. Moving on to the next page, all of you are aware of the economic slowdown that we are facing in the country. So, we thought that it might be a good idea to take advantage of it and just make sure that we do not just keep pushing volumes, because there is a limit to how much elasticity the system has at this point in time.
So, we focused our energies, obviously, we are driving top-line as much as we can, but we are not dumping at all, and we focused our energies on making sure that we set up the right systems and processes for the future. So, we worked on a continuous replenishment system for our inventories which is completely pull based, and we are moving in the right direction with that. We have improved our distributor health, that is the lifeline of our company. And as the economy slows down, they also feel their own stresses and strains. So it's important that we focus on improving their health as well.
We have reduced wastages in the system even further. We have tightened our fixed costs. We have looked at every possible method of capacity extraction, so that we can postpone capital investments in capacity, if we can get more from what we have. And we are implementing S/4 HANA with huge process improvements in the system as a result of that. On the innovation, what we are doing is, there were a few projects which were in test market.
So for example, Croissants and Salty Snacks is in test market. So we haven't moved beyond that, because these are not probably the times to take these projects nationally, we are trying to fine tune those. And we have also prioritized some of the future innovation projects, because in times like this when the economy is a little slow, consumers tend to go back to their favorite brand, that gives them more comfort, and they are not as experimentative as they would be in good times.
Our strategic plans you are all aware of, to be a total foods company, continue to be cost leaders in everything that we do, distribution and marketing, basically, expanding our distribution to make sure that we get to the rural areas with the same share that we have in urban areas, and a cutting edge marketing strategy on all our mega brands.
And the fourth is getting to adjacent businesses. Obviously, the underlying in all of these is striving for profitable growth. Moving to the next stage, our journey to be a total foods company has begun. We have got wafers and milk shakes, which are available across the country. We have salted snacks and Croissants which are in test markets, and we continue to fine tune those mixes as we plan to take them across the country.
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