Mrs. Bectors Food Specialities Ltd

NSE:BECTORFOOD

Q4-2025 Earnings Call

[Operator]

Ladies and gentlemen, good day, and welcome to the Mrs. Bectors Food Specialities Limited Q4 FY '25 Earnings Conference Call. [Operator Instructions] Please note that this conference is being recorded.

I would now like to hand over the call to Mr. Anoop Bector, Managing Director, for his opening remarks. Thank you, and over to you, sir.

[Anoop Bector, executive]

Thank you. Good evening, everyone. On behalf of Mrs. Bectors Food Specialities Limited, I extend a warm welcome to all participants joining us for Q4 '25 and FY '25 financial results discussion call. Joining us today are Mr. Manu Talwar, our Chief Executive Officer; Mr. Suvir Bector, Whole-Time Director; and Mr. Parveen Kumar Goel, Whole-Time Director. We are also pleased to have MUFG Intime, our Investor Relations adviser with us on the call.

I trust you have had the opportunity to review our investor presentation and press release, which have been uploaded to the stock exchanges as well as our company website. The company registered a 15.4% year-on-year increase in revenue for FY '24-'25 compared to FY '23-'24. Revenue for Q4 FY '25 grew by 9.8% over Q4 FY '24 amidst continued urban slowdown, further exaggerated by higher end prices to consumers due to sharp input costs being passed on has impacted the growth momentum. However, with the easing of interest rates and taxation relief provided by the Honorable Finance Minister in the budget, we are optimistic of gaining that momentum.

Despite a challenging environment, both our core businesses, Biscuits and Bakery recorded steady and resilient growth. Rising input material costs exerted significant pressure on margins. We remain confident that the calibrated price actions that were initiated in November 2024, which shall get over in Q1 '26, will enable us in mitigating the impact of inflation in this financial year.

In parallel, we continue to drive cost optimization through a focus on operational efficiencies in manufacturing and supply chain areas. On the demand side, we are encouraged by a steady recovery in rural consumption. We are also witnessing mild uptrading within low MRP packs as consumers increasingly opt for higher-value offering, reflecting an improving value perception.

Additionally, with the revision in the tax slabs announced in the union budget, we anticipate an increase in disposable income, particularly in urban India. This should translate into stronger demand momentum heading into FY '26. We are pleased to share that our recent product innovations continue to gain strong acceptance in the market. Our focus remains on driving premiumization through differentiated offerings that deliver great value addition and align with evolving consumer preferences.

In line with this strategy, under Biscuits, our new shortbread cookies made with 25% butter and no palm oil cater to the premium indulgence segment. In kids snacking category, we introduced animal-shaped crackers under the brand Teddies, with no cholesterol and no trans fat. The initial response has been encouraging, and we are actively planning product extension under this platform.

Under English Oven, we are piloting under ready-to-eat segments with the launch of muffins, brownie, Choco Lava, with the intent of making indulgence easy, a space we believe holds strong potential for growth.

Launched to meet rising demand for healthier options, we launched Zero Maida Pav, appealing to wellness-focused consumer and strengthening our health-centric portfolio. Further on building a premium health-focused portfolio, we launched [ Nature Baked ], a clean label, health-forward range in Q1 '26. With the positioning, it is honest, it is clean, it is [ Nature Baked ].

Additionally, brand innovation initiatives are underway for select legacy products to align with contemporary taste and packaging trends. Looking ahead, we have a robust innovation pipeline with several exciting launches planned that reinforce our commitment to quality, health and consumer delight.

Performance of our export portfolios continued to be strong, further reinforcing our position as a trusted partner to leading international chains. However, towards the end of Q4, the announcement of potential tariff changes introduced a degree of uncertainty in the external environment. Despite this, we remain confident in the strength of our global partnerships and our ability to navigate market dynamics while maintaining growth momentum.

Q-commerce continues to perform well, especially with newer product formats, gaining traction. To capitalize on Q-commerce momentum, we are partnering with major brands, focusing on rapid innovation, launching impulse-friendly SKUs and ensuring agile supply chains with city-level inventory planning. On the traditional trade front, we remain focused on expanding our distribution footprint, ensuring calibrated manpower deployment for sustainable growth.

On the technology and digitization front, we have made a significant progress across functions. We are undertaking a complete revamp of our IT infrastructure, with a key focus on upgrading our core ERP system supported by AI and ML integration to drive smarter, faster and more connected operations.

In sales and distribution, we have further strengthened the option of our distribution management system, driving greater visibility and control. We are also focusing on digitizing our manufacturing and supply chain operations, which will strengthen our process and improve our delivery, the result of which we expect to see and reap in the coming financial years.

We remain firmly committed to our CapEx road map. In May 2025, we commenced operations at our Indore facility. This enhances our manufacturing capability, especially for differentiated products, and plays a pivotal role in our growth strategy. For exports, the location offers proximity to ports, enabling smoother outbound logistics. On the domestic front, it strengthens our supply chain by improving regional serviceability, enabling faster route to market, reducing logistic costs, all contributing to our ambition of building a strong pan-India presence.

On the Bakery side, we are equally focused on expanding our footprint. We are progressing well with 2 key projects, the new bakery facilities in Calcutta and Maharashtra. These developments are strategically aligned with our vision to make English Oven a truly pan-India brand. They will also enable us to serve QSRs and business partners that are currently beyond our reach due to supply constraints. These additions increase our nationwide servicing capabilities and enhance our competitiveness.

Before we move on to our financial performance for the quarter, I am pleased to share that the Board has recommended a final dividend of INR 3 per equity share subject to approval of the shareholders at the upcoming AGM of the company.

Financial performance. Starting with Biscuit. Our Biscuit segment revenue stood at INR 257 crores against INR 240 crores in Q4 FY '24, registering a growth of 7% compared to Q4 FY '24, including domestic and export biscuit segment. The Biscuit segment has grown by 26% compared to Q4 FY '23.

Bakery segment revenue stood at INR 179 crores against INR 151 crores in Q4 FY '24, registering a growth of 19% compared to Q4 FY '24 including retail bakery and institutional segment. The Bakery segment has grown by 40% compared to Q4 FY '23.

The consolidated revenues for the current quarter stood at INR 446.1 crores versus INR 406.4 crores in Q4 FY '24, thus registering a growth of 9.8% on a year-on-year basis. EBITDA stood at INR 55.6 crores. The EBITDA margin for the quarter stood at 12.5%. PAT stood at INR 34.3 crores for the quarter, registering a growth of 2% on a year-on-year basis. PAT margins for Q4 FY '25 stood at 7.7%.

Moving to FY '25 financial performance, the consolidated revenues for FY '25 stood at INR 1,873.9 crores versus INR 1,623.9 crores in FY '24, thus registering a growth of 15.4%. EBITDA for FY '25 stood at INR 251.5 crores versus INR 242.4 crores in FY '24, thus registering a growth of 3.7%, with an EBITDA margin of 13.4%. PAT for FY '25 stood at INR 143.2 crores as compared to INR 140.4 crores, with a PAT margin of 7.6%.

With this, I request you to open the floor for questions and answers. Thank you so much.

[Operator]

[Operator Instructions] The first question comes from the line of Abneesh Roy from Nuvama Wealth Management Limited.

[Abneesh Roy, analyst]

My first question is on the raw material side. Wheat crop is at a multiyear high. And even palm oil today, we have seen from May 31 duty cut of 10%. And USD terms also, palm oil has corrected. So my specific question is in Biscuits B2C, do you see good margin expansion starting Q2? And any chance of any price cut or grammage increase, which can partly take away this benefit?

[Anoop Bector, executive]

So currently, we are under the process of taking down the price rises, what we had initiated in the last price rise, which will -- which is getting completed in this quarter. And going forward, on the raw material side, we definitely see -- we believe in long contracts. And on the wheat side, our company faced a very less inflation in the last year. So in this year also, our contracts have been long contracts, and -- but however, the government of India keeps increasing prices. There has been a price increase in the wheat side by INR 150 and that is the corresponding price increase, which we shall be facing in the market.

On the palm oil side, we -- you're absolutely right. The prices have also subdued. And along with that, there is a 10% duty cut, which has just come in, so which will start hitting us, giving us the benefit completely by -- partially in the quarter 2 and then on the quarter 3 basis.

So considerably considering, we should be more positive than what we are today. And the margin expansion is not going to be that large that it enables the companies to start passing down discounts at the moment, what we feel, what it looks like because there has been some inflation in the sugar side, but these costs are now well covered under the -- whatever price rises had happened, I think we shall get into a more comfortable position.

[Abneesh Roy, analyst]

Sir, 2 follow-ups there. One is palm oil in the B2C Biscuits, will it be, say, around 20% of the RM basket? And second follow-up is on wheat. Is most of the wheat for you, the buying price is locked in already? You did say long-term contracts. And is it a multi-month buying? Or most of the buying contract at least is frozen? So that way...

[Anoop Bector, executive]

We end up -- this has been a practice with Mrs. Bectors. We end up doing long contracts, which are -- where we would cover around 75% to 80% of the material, depending on the quality of the flour we need because for a particular variety, especially on the Bakery side, we need very particular quality.

So what we are doing is when the contracts are happening, they are happening at the best prices. That's what our bigger competitors would also be doing because that's the time when the contracts are entered, there is a time when wheat is at its lowest. So what we like is more planned purchase than getting -- facing any erratic decisions, right, coming in. So in any case, because the buying has happened in the month of April and May when the crop comes in, so it's best buying.

So on the palm oil, I'll really not be able because biscuits have different consumption of palm oil. But averagely, yes, 17% to 20% is consumed in the Biscuit side, and there will be some benefits coming in over there.

[Abneesh Roy, analyst]

Very useful. Last question on FY '26 outlook, almost all [ staples ] companies have been positive versus FY '25 demand. In your markets, in again, B2C biscuits, how do you see the demand side? And any comment on market share?

[Manu Talwar, executive]

So just to brief you on the -- especially on the biscuit side demand. So from the quarter 4, we have started seeing a positive trend. And so we are building on that positive trend of growth. So the growth are greater than what it was in the first 3 quarters of financial year '25. So the growth trajectory is there. I mean it's kind of started building it up. So that's on the kind of a growth side of the biscuit -- domestic biscuits.

[Abneesh Roy, analyst]

Any guidance you want to give for the B2C part of the business, revenue growth?

[Manu Talwar, executive]

On the B2C side, the business of Biscuit and Bakery together, we have a guidance that for this year, what it looks like B2C business, we will be growing kind of mid- to -- low to mid-teens kind of stuff. That's what is visible now on an annualized basis.

[Abneesh Roy, analyst]

More back-ended? First half will be a bit slower?

[Manu Talwar, executive]

No -- yes, it will be more back ended, yes. First half, it will be. Yes.

[Operator]

The next question comes from the line of [ Raj Patel from AK Securities ].

[Unknown Analyst]

Am I audible?

[Manu Talwar, executive]

Yes, yes. You are.

[Unknown Analyst]

Okay. So what does the innovation pipeline for FY '26 look like? And can we expect more health forward or indulgent-based launches?

[Manu Talwar, executive]

Yes. So if you would have heard speech by the Managing Director, he referred to some of the differentiated product launch, right, which we have done. And so whether it is for the kids or whether it's a shortbread. And there are a few more lined up. So probably in the next 3 to 6 months' time, on a Biscuit side, you will see further differentiated product launches.

On the English Oven side, again, as it was highlighted in the speech that we have launched a health brand. It's a new brand called [ Nature Baked ] and we want to build up that brand and different products under the brand. Alongside that, as in the last 2, 3 years, we built up of frozen product business, and we were doing -- we are doing that business and we have built up that business well with B2B, where we enhance on B2B. So as a pilot, we have launched a few products under the frozen category in English Oven on a B2C side. And the objective will be to also start building that up as we see the results on that side.

So there is a fairly strong pipeline this year both for Biscuit and Bakery and also primarily on a differentiated product side. They are -- especially, we have clearly decided that we will stay away by our innovation bucket over the next few years. We will stay more on a differentiated product rather than me-too product. Rather, our new Indore Biscuit plant, which got commissioned in the May, last month. So that is further strengthening our differentiated product portfolio, both for domestic market as well as international market. So a lot of focus over the next 18 to 24 months to build a variety of new products, which are differentiated.

[Unknown Analyst]

Okay. And last question from my side. So what is the expected contribution of the new Indore facility to domestic and export operations in FY '26?

[Manu Talwar, executive]

See domestic, Indore facility, which we -- the plant got commissioned, has a capacity of annually of 21,000 tonnes, right? And it brings us closer to the port as well as it helps us servicing the geography of West India from there and Central India in a much more efficient manner. So we will be using this capacity close to full. So it will gradually build up because it's a new plant. But objective is to maximize the use of this capacity.

[Operator]

[Operator Instructions] The next question comes from the line of Amit Purohit from Elara Capital.

[Amit Purohit, analyst]

Just on the growth rates, if you could provide some insights on the export, either on a full year basis for the quarter, how it would have been for the Biscuit business during the quarter and full year?

[Manu Talwar, executive]

So on the exports side, first, Amit, as all of us are aware that over the last 3 years or 4 years, export has been growing exceptionally exponentially, right? And yes, so there are some tailwinds, which came in quarter 4 and quarter 1, right, which are there. But on an annualized basis, very confident that in exports, we should be able to grow mid-teens kind of growth in this financial year.

As far as domestic biscuits are concerned, I would say that growth quarter 4 of the financial year '25 and quarter -- it has -- growth started building up. And on an annualized -- and I see as inflation has come under very good control, interest rates have started coming down. So what we were expecting in Diwali last year, we should definitely expect now that this change of growth should clearly build up much better as we start hitting the festive season from August onwards, right?

And on a full year basis, again, I expect mid to -- low to mid-teen kind of growth on a domestic side. And that's what we're endeavoring. Yes, first half, as I replied in the previous question to Raj that it will be a slow buildup. But yes, there will be more weight on the H2 of this financial year.

[Amit Purohit, analyst]

So you're saying H2 probably would see a good double-digit kind of a growth in the domestic biscuit business, and that is how one should read? Or you're saying...

[Manu Talwar, executive]

Yes, domestic as well as on the export side, yes.

[Amit Purohit, analyst]

So just to clarify, sir, sorry, but you're saying the double-digit growth would be visible in the H2 part of it? Or you said for the full year FY '25?

[Manu Talwar, executive]

No, no, no. It's full year basis. What I said in the full year basis, we can expect domestic biscuits to be low teens kind of growth, and export to be somewhere around mid-teens kind of growth on annualized basis.

[Amit Purohit, analyst]

Sure. And for the full year FY '25, is it fair to assume that domestic would have been a mid-single-digit growth in value terms?

[Manu Talwar, executive]

Yes, yes.

[Amit Purohit, analyst]

Okay. Okay. Okay. And sir, just on this Indore facility, which we have started. When do you think that the utilization levels may be in Q3, Q4, how does this ramp it up to like 50%, 70% utilization?

[Manu Talwar, executive]

We will be hitting 50% to 70% range of utilization in just about next 50 to 60 days' time, not later than that.

[Amit Purohit, analyst]

Okay. And this clearly would have a benefit on two accounts. One, you would be able to better service this West region and Central part of the region. And the second is obviously on the cost side, the freight cost would be lower, right?

[Manu Talwar, executive]

Yes.

[Anoop Bector, executive]

Yes. On the other side, it is also a line which can produce very different types of biscuits. So the premiumization will also start playing in. But the premiumization, what we are doing, we've already developed the products. We are going to be introducing these products into the market initially in the export market.

And so there are three benefits. One is the transportation, logistics. Then we do have NPD possibility, which is now getting exponential, right? I mean, because every biscuit plant cannot produce the required NPD, what we are aspiring. So the Indore line does have that capability to give us a lot of new biscuits for the market. But it is going to be -- it really will come in time. So it can't come in immediately. So there would be a time of 3 to -- 3 months or a quarter or 1.5 quarters, where things will actually start flowing in very fast.

[Amit Purohit, analyst]

Okay. And the health foray, it is largely on the Biscuit side? Sorry, I could not understand that part that you talked about.

[Anoop Bector, executive]

No, the health foray is overall. I mean we -- whatever we produce, a fraction of our production is going to be health, where we are talking on the Biscuit side, on atta -- replacing maida with atta and certain products. In the Bakery side, like we said, we are bringing in a lot of atta products where customer feels more comfortable eating it.

And then we've launched the clean label product, which is without chemicals. It's absolutely clean. The clean label brand is called [ Nature Baked ] so it is showing positive results. And with this, [ Nature Baked ] has just come in, I think, probably a month back. So it's very, very initial, but it is doing well. And that's the need of the hour that we produce products which are absolutely clean. It avoids palm oil. It avoids chemicals. So it's like eating a homemade food.

[Amit Purohit, analyst]

Bakery side, right? Sorry.

[Manu Talwar, executive]

Amit, no, no, both sides. So [ Sourdough ] which is a very new innovative product, which we launched on the e-com channel. It comes with no palm oil, right? And similarly, we launched the atta pav as well as we launched Kulcha, which is 100% atta.

So this health journey will continue to build on both sides. Yes, we have done much faster actions on the Bakery side, where the adoption by the consumer is much fast paced as compared to Biscuits, but Biscuits also, we have started doing, and there are a few more things lined up over the next 90 days.

[Amit Purohit, analyst]

Sure. And anything on the margin outlook, sir, for next year, given the now changes in input duty? What do you think would it be? Now a bit more earlier last quarter, you called out, I mean, probably Q1 -- post Q1 and onwards, you would see normalization of margins. Do you stand the similar guidance?

[Manu Talwar, executive]

So look, Amit, what I see, it may take almost H1 by the time the normalization of kind of margins happen for us, right? It will start getting better. But it will take about 6 to 9 months. It will be almost that kind of period as of now. It will take that time because there are a few reasons for that. The reasons -- yes, the good news on custom duty cut on the palm oil will definitely kind of help us. But you -- we've always been maintaining and as you heard in the speech also, we were taking very calibrated price increase.

We were not taking price increase in a kind of more that we just need to cover all the cost because we also need to keep the consumer in mind, right? So with these calibrated price increases, we knew that we will be able to cover so much on margin because of those prices. And there is something which will come through cost efficiency or any other positive impact on the commodity side. So yes, it would take about 6 to 9 months' time as it looks like now for us to get into the full margin recovery.

[Amit Purohit, analyst]

Sure. So for FY '26, 13% to 14% range is a fair estimate, right?

[Manu Talwar, executive]

Our endeavor is that. Absolutely, our endeavor is that, that we kind of achieve that on a full year basis.

[Operator]

The next question comes from the line of Sonia Keswani from Negen Wealth.

[Sonia Keswani, analyst]

Am I audible?

[Manu Talwar, executive]

Yes, yes.

[Sonia Keswani, analyst]

Sir, I had a couple of questions on the working capital front. If I see the debtor days have largely remained constant year-on-year. But they had increased significantly in FY '24. And the reason for that was the Red Sea issue that happened. So right now, given the debtor levels for FY '25 are largely similar to FY '24 and if I assume export grew much faster than domestic, has that issue normalized? Or has it improved in any sense? Any color on that?

[Manu Talwar, executive]

So firstly on export -- in terms of overall debtor in terms of number of days, we have improved over '24 by 10%, right? And Red Sea issue still persists. It has not gone away. It still persists. So that challenge is still there with us. But yes, it has reduced a little bit, not much. But just to clarify that our debtor days has improved by 10% over financial year '24 in '25.

[Sonia Keswani, analyst]

Okay. So that improvement in debtor days has come on the export front also?

[Manu Talwar, executive]

Marginally, marginally it has come from that side. Yes.

[Sonia Keswani, analyst]

Okay. And can you give me a rough percentage of how much exports would be as a percentage of our total revenue?

[Manu Talwar, executive]

We normally don't share. We share Biscuit segment and Bakery segment, right? So please excuse me from that. As of now, we have started sharing. We share only up to the Biscuit segment and the Bakery segment.

[Sonia Keswani, analyst]

Got it. The other question was on inventory. It has increased by over INR 300 crores year-on-year, and even the inventory days have shot up. What is the reason behind that?

[Anoop Bector, executive]

So inventory -- Manu, would INR 300 crores be right figure?

[Sonia Keswani, analyst]

INR 30 crores.

[Manu Talwar, executive]

Pardon?

[Sonia Keswani, analyst]

INR 30 crores, I suppose, sorry. I think INR 300 million, yes, right.

[Manu Talwar, executive]

Yes. So our debtor days have gone up marginally by 10%, again over last financial year. And it primarily happened on account of some additional FG inventory being built up -- was built up in the month of March, but that's being neutralized in the first quarter. So it should get back to the same level as FY '24 by June end.

[Sonia Keswani, analyst]

Okay, sure. Got it. And my last question was on the Bakery segment. So this 20% growth that came in, in Q4. And if I see -- yes. So -- and it was 18% on a year-on-year perspective in FY '25. So which segment -- if you can help me understand which segment was the key growth driver in terms of Institutional and English Oven [indiscernible]?

[Manu Talwar, executive]

Last financial year, both grew well. So both B2B business and English Oven business, both have grown very, very well. Into B2B segment, I would like to just highlight that, as I was saying earlier that over the last 2, 3 years, we started building up a frozen business, right? And this frozen business, both on the sweet and the savory side, has really shown a good traction over the years. So last year, a large part of very aggressive growth, a very good growth which we saw on a frozen side, right, and which has driven. As we all know, QSR still the growth are there, but still -- they're still to come back to their previous level of good growth, but frozen business has grown extremely well on the last financial year, which was a very high double-digit growth.

[Sonia Keswani, analyst]

Okay. And is the -- apart from the frozen segment, the QSR segment that you said is yet to come back. So is it growing in low single digit? Or how is the number like?

[Manu Talwar, executive]

No, no. So yes, they are just about low double digit for the last financial year on the revenue side, yes.

[Operator]

[Operator Instructions] The next question comes from the line of Harit Kapoor from Investec.

[Harit Kapoor, analyst]

So I just wanted to check on this innovation side. If you look at this quarter, this last quarter, which you've seen a bunch of new things that have happened driven partly also by the Quick Commerce proliferation. It seems like '26 will be a year of significantly higher innovation given the number of things you guys are planning. Just wanted to get your sense on do you think this can be a material driver for domestic growth, both for biscuits and breads this year around, especially FY '26? Because it seems like you have bunch of things in pipeline, along with the fact that your CapEx expansion is also happening. Just want to get a bit of color because it seems like it's a bunch of exciting new things. So just your thoughts on this.

[Manu Talwar, executive]

Yes. So very right, Harit. We have pressed the pedal for the new products and differentiated products, both for the Biscuits and the Bakery side. And we have done few launches over the last few months, and we will be building it up very, very aggressively over the next about 9, 12, 15 months to come.

Will they start contributing in the financial year '26 itself substantially because any new product takes time to kind of build up in terms of revenue cycle, so -- but yes, for the future perspective, these are differentiated. These are new products where we are finally taking a route of quick com, e-com and our Cremica preferred outlets on the Biscuit side. And similarly, the same way we are taking a route of quick com and also general trade in the English Oven side. But yes, we are betting a lot.

And as I said earlier that on the Biscuit especially, we're very clear that we won't be launching me-too products. Our all launches will be differentiated products as we have just done with 2, 3 products in the last 90 days, and we will build up that. The buildup will take some time. The buildup resulting in huge revenues in this financial year itself may not happen. But yes, over the next few financial years, they should create a differentiation and revenue growth trajectory for us.

[Harit Kapoor, analyst]

Fantastic. And the second is on distribution, specifically on biscuits and breads domestic distribution. If you could just highlight for this year, is the plan a slower rate of growth in distribution, a number of outlets, both on biscuits and breads or the pace of expansion this year, is the focus more innovation, less distribution? Just a little bit sense of distribution.

[Manu Talwar, executive]

So whenever I'm interacting, I point out one thing. The objective of distribution always has been to increase the customer reach, right? And what has dynamically changed over the last 2, 3 years is that e-com and especially Quick Com has been able to demonstrate a much faster reach to the consumers. And consumers also has -- are enjoying the speed of delivery and ramping up on the Quick Com platforms, right? And we see the Quick Com platforms kind of really kind of taking off.

So from our focus point of view, the first thing is English Oven side, we have done extremely well on the Quick Com side, and we were ahead of the industry curve, and we have created a good market share there, and we continue to maintain the lead there. So on a Quick Com side, we -- our contribution in English Oven is almost -- is over 25%, right? And we continue to build and increase quarter-on-quarter.

Similarly, on the Biscuit side, we -- in our plan, we have put a lot of weight on driving the growth through the e-com, right? And all these differentiated products we just spoke about was to -- will ride on the e-com because e-com are the consumers, which want to try -- they relish the differentiate products. So a lot of it is going to drive our reach through Quick Com. Even on the Biscuit side, we have very aggressive plans to grow almost a few x times on the Quick Com side in the Biscuit. Alongside, we are playing on more weighted approach. What do I mean by weighted approach is that CPO, the Cremica-preferred outlet, has done extremely well for us. If you look at '23, '24, we were around 4,000, 4,500. Last year, we ended around 7,000. And they started contributing a fair amount of contribution to our business. So a lot of focus is going on CPO and further driving them. Again, we have a plan of growing CPO outlets by almost 30% in this financial year. So these are the 2 approaches we are taking to drive the reach -- consumer reach, right, in both Biscuits and Bakery side.

In the Bakery side, I would just add that we will be now entering Calcutta. Another 2, 3 months' time, Calcutta will be ready to expansion. So we will start getting into Eastern side of the market. And similarly, Khopoli plant, half the plant getting ready in September, in the balance half in Jan. We will have the capacity to expand much faster in the territory, which comes within 250, 300 kilometers. So a lot of other parts of Maharashtra, which are urban and strong Maharashtra, we would be expanding there and maybe some other side of the West also.

So that's also I just thought use this opportunity to brief you in terms of driving the reach.

[Operator]

The next question comes from the line of Akhil Parekh from B&K Securities.

[Akhil Parekh, analyst]

Sir, my first question is on the QSR side of the business. Would you be able to highlight what is the salience of QSR segment to us? And are we seeing now any improvement in QSR for first 2 months of FY '26? That's my first question.

[Manu Talwar, executive]

So I think that what we clearly see that all QSR partners remain very committed to investing, opening new stores and are driving the business towards the growth side. And so yes, there are some signs of improvement, but we'll have to look at some more -- look at for some more quarters in terms of trend of growth on the QSR side.

And yes, so the partners are committing. They are opening new stores. They are driving the growth. And I'm sure growth will get back to the earlier levels in a strong double digit. Last year, we have grown our revenues in double digit.

[Akhil Parekh, analyst]

Okay. Okay. And salience of the business, if you can highlight that?

[Manu Talwar, executive]

Pardon?

[Akhil Parekh, analyst]

For the QSR business, how big it is for us, if you can highlight that?

[Manu Talwar, executive]

So our B2B business on the Bakery side is approximately 11% to 12% of our revenue.

[Akhil Parekh, analyst]

Okay. My second question is what are the potential sales possible from the Indore facility at the peak capacity utilization?

[Manu Talwar, executive]

So all the capacities which we have added, including the Khopoli, which will get commissioned in this financial year, and the current Khopoli plant will move to some other place. We should expect, on a full usage -- full utilization basis, revenue on current prices can be close to INR 3,400 crores.

[Akhil Parekh, analyst]

This is for combined 3 facilities, you said? Sorry, I didn't get it. Indore, Khopoli, and Calcutta?

[Manu Talwar, executive]

No, no. Yes. Yes, you're right, with these all 3 facilities coming. Indore has already come in and Khopoli and Calcutta also coming in. And that today current plant, which we have in Khopoli, which will get relocated to some other territory. So taking all that into account.

[Akhil Parekh, analyst]

Sure. And last question on the CapEx side. Is it fair to assume our CapEx cycle is over for at least next 2 years and we'll have only maintenance CapEx starting from, say, second quarter of FY '26?

[Manu Talwar, executive]

So CapEx, because we have a lot of WIP in CapEx, whatever projects we started, Khopoli will complete this year, Indore got commissioned this year, right, in the FY '26. Khopoli will also get commissioned in FY '26, Calcutta, so our CapEx cycle will start coming down considerably from FY '27.

[Operator]

The next question comes from the line of Shirish Pardeshi from Motilal Oswal Financial Services.

[Shirish Pardeshi, analyst]

Just two quick questions. If you can spell out for FY '25, what is the volume contribution for the export business? And what is the total volume growth we have achieved in FY '25?

[Manu Talwar, executive]

So other than our [ co-pack ] business, our volume growth in FY -- just give me a minute. In FY '25, our volume growth was in single digit, right? It was a high single-digit kind of volume growth, both in Biscuit and Bakery.

[Shirish Pardeshi, analyst]

And what is the entire volume contribution from exports for FY '25? I'm talking about the Biscuits. I'm talking the Biscuits.

[Manu Talwar, executive]

So Biscuits revenue growth -- contribution.

[Shirish Pardeshi, analyst]

Volume, volume.

[Manu Talwar, executive]

Volume contribution will be difficult for me to answer because we look at Biscuits in pounds and we look at Bakery in pieces.

[Shirish Pardeshi, analyst]

That's what I'm asking, what is our Biscuit volume?

[Manu Talwar, executive]

Biscuit volume contribution to what?

[Shirish Pardeshi, analyst]

To the overall volume, what we have achieved in FY '25.

[Manu Talwar, executive]

That's why I'm saying both...

[Shirish Pardeshi, analyst]

Biscuits, I'm asking.

[Manu Talwar, executive]

Okay, you were asking what is the contribution of domestic and biscuit, right, you're saying?

[Shirish Pardeshi, analyst]

No, if we have done the volume for biscuits is 100, what is the export contribution to that 100? I'm only talking about Biscuit as a segment.

[Manu Talwar, executive]

Yes. So it's a 50% to 53% kind of range.

[Shirish Pardeshi, analyst]

Okay. And just one follow-up here. What is the gross margin we would have achieved in FY '25 on the export biscuit business?

[Manu Talwar, executive]

We don't share segment-wise gross margin, right? We share overall, which is given on the financials.

[Shirish Pardeshi, analyst]

Okay. The last question on the -- do we have any particular contribution to be achieved in FY '26 from the new product segment?

[Manu Talwar, executive]

Yes. So we are targeting to get close to 5% of our revenue. That's our target. So we want to get close to 5% of our revenue contribution coming out of [ NPS ].

[Shirish Pardeshi, analyst]

And this you will achieve with the existing product, which is already launched?

[Manu Talwar, executive]

Yes. So the products which are launched and they will be launched, right. This is for the financial year '26.

[Operator]

[Operator Instructions] The next question comes from the line of Bharat from Moneycontrol Pro.

[Bharat Gianani, analyst]

Sir, can you provide the growth outlook for the Bakery business for the current year?

[Manu Talwar, executive]

So Bakery business for the current financial year '26, we expect it to grow somewhere mid to high teens.

[Operator]

The next question comes from the line of Amit Agarwal from Kotak Securities.

[Amit Agarwal, analyst]

Sir, my question pertains to raw material prices. Britannia in its latest call mentioned that they are currently experiencing commodity tailwinds, so are we experiencing the same?

[Anoop Bector, executive]

Yes. So commodity prices, there is softening of commodity prices at number of places. But at certain areas, commodity prices are still strong. Milk is not -- milk is higher than last year. And cocoa prices still grew strong. But yes, there has been softening in prices of palm oil, which forms a considerable part of the inflation for our sort of product. And there is a softening in that. And also just 2 days back, we have seen some price reductions, which will come in the form of custom duty reduction. So I mean, if you look at it in that prospect, yes, there is a softening of prices.

[Amit Agarwal, analyst]

So can we expect our margins to improve only because of softening of raw material prices going forward?

[Anoop Bector, executive]

So there would be some impact. It is too soon to really call for it because I mean the reduction in import duty has just happened 2 days back. So we are also seeing what is going to be the impact, but there will be some positive impact on this.

[Amit Agarwal, analyst]

And sir, Q3 call, we had mentioned that we may see improvement in operating margin trajectory from Q1 of FY '26 onwards. So are we on track to achieve that?

[Manu Talwar, executive]

Pardon? Come again, sorry, Amit?

[Amit Agarwal, analyst]

Q3, we had mentioned that Q1 FY '26, we will see margins improving for the company. Currently, we are at around 12.5%. So we did a margin of around 14.5%, 15% in the past. So are we on track to get back to that old level?

[Manu Talwar, executive]

So not in Q1. I just answered before also when Amit from Elara asked that as of now, the visibility is that it will take about almost up to end of the quarter 3, we should be able to neutralize our margin and get back to the earlier margins.

[Amit Agarwal, analyst]

Okay. And sir, any guidance on the volume front, like since we are an expanding company, we were primarily present in [ NCR ] earlier. Now we are expanding to West, East. So our volumes have grown at around high single digits. So can we see this to grow double-digit going forward?

[Manu Talwar, executive]

As of now, our volume projection is also same what in line to grow high single digit and get close to double-digit volume growth, right? And that's the plan.

[Amit Agarwal, analyst]

No, sir, because West will start contributing because of the Khopoli plant contributing and even you mentioned that Q2, we will see even East, Calcutta starting to -- isn't that adding up to volumes?

[Manu Talwar, executive]

So Calcutta will start adding from Q2 to the volumes, but Calcutta is absolutely a new market for us for English Oven, right? And so that market will take some time to kind of build up. We will be introducing the English Oven brand to the eastern side of markets, especially Calcutta to start with. And the ramp-up will take a few quarters to do that.

[Amit Agarwal, analyst]

Volumes more or less will remain same what we experienced in FY '25?

[Manu Talwar, executive]

I'm talking in terms of growth, yes, we are aiming to grow double-digit volume growth in this financial year. So that's endeavor.

[Operator]

We take the next question from the line of [ Gaurav Gandhi ] from Glorytail Capital Management.

[Unknown Analyst]

Just one question. As of now, we don't see much presence of Cremica brand biscuits on the shelves of modern retail chains or Quick Commerce platform, at least in Maharashtra. So as the new biscuit facility are Dhar has commissioned, what's the plan to improve the presence in these areas?

[Manu Talwar, executive]

Yes. So with Dhar facility coming, certainly, our reach into the West region, Maharashtra, Gujarat gets stronger. And the objective is to drive our presence both in [ MP ] channel as well as the e-com, quick com channel in a much faster pace and Central India also.

[Operator]

Ladies and gentlemen, in the interest of time, that was the last question. I now hand the conference over to the management for their closing comments.

[Anoop Bector, executive]

Thank you, everyone, for joining us. I hope we have been able to answer all your queries. In case you have any further details, you may please contact us or MUFG Intime, our Investor Relations partner. Thank you so much.

[Operator]

Thank you. On behalf of Mrs. Bectors Food Specialities Limited, that concludes this conference. Thank you for joining us, and you may now disconnect your lines.