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Dollar Industries Ltd
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Ladies and gentlemen, good day, and welcome to the Dollar Industries Limited Q1 FY '22 Earnings Conference Call hosted by Elara Securities Private Limited. [Operator Instructions] Please note that this conference is being recorded. I now hand the conference over to Akhil Parekh from Elara Securities. Thank you, and over to you, sir.
Thanks, [ Padma ]. Good afternoon, everyone. On behalf of Elara Securities, I welcome you all to the earnings conference call of Dollar Industries First -- 1Q FY '22. From the company we have with us, Mr. Vinod Kumar Gupta, MD Chairman; Mr. Ankit Gupta, President in Marketing; Shashi Agarwal, Senior VP, Corporate Strategy IR; and Mr. Ajay Patodia, CFO. Without taking much time, I will hand over the call to Mr. Vinod Kumar Gupta for the opening remarks. Over to you, sir.
Good evening, ladies and gentlemen. On behalf of the entire management team at Dollar Industries, I welcome you all at the Q1 FY '22 First Quarter conference call. I'll hope that you and all your loved ones are safe and healthy. We pray for the speedy recovery of those whose families have been battling at the virus and request all to take utmost precautions and always wear a mask when going in public places. As a responsible company, Dollar Industries organized a vaccination plan in Q1 FY '22 for the safety of its employees and its family members. Around 1,500 people were given first and they'll get second dose in vaccination drive in Calcutta. Dollar as a company has always prioritized its role in give it to all the society and as I said actively for food and shelter for 'migrant labors, workers in Tiruppur and we also distributed masks and food supply during the lockdowns. I would like to share with you that today we have with us Mr. Ajay Patodia, Chief Financial Officer, whose appointment has been approved by the Board of Directors in the Board meeting conducted on 7th of August. Ajay comes from a strong background being a Charted Accountant and has been worked as a CFO in the similar industry. He has been handling the finance and accounts [indiscernible] prior organization since more than 2 decades. He take charge as CFO with effect from 10th of August. We are happy to welcome Mr. Ajay on board with us. Year 2021 saw the lockdown in phased manner, which varies at different state level. In spite of the second wave challenges, our revenue has grown at 28.74% on a year-on-year basis, while our EBITDA shows a growth of [ 25.74% ] on early year on a year ago. As an organization, we continue to focus on building on our growth pillars from brand distribution and digitization to create maximum value for our shareholders. At the Dollar Industry, we always try to grow and maximize our stakeholders' value. Our thirst for growth that lead us to make a move on expansion plans. The company has planned the CapEX of around INR 90 crores will be invested for expansion of our spinning division, stocks manufacturing unit and increase the production capacity both at Kolkata and Tiruppur. Adding with this, the company is in the process to set up an integrated plant of 3.2 lakh square feet in West Bengal, which will be fully automated, digitized plant. This will cater us to grow our logistics facility and increase our opportunities. The company is also planning to [indiscernible] for its employees. The company will continue with its effort to bring down its working capital cycle by 15 days. The company has put down stricter policies around its trade policies which has been accepted by the channel partners. We are very much positive that this joint effort will help in reducing working capital cycle. As you all are aware that the company went under the rebranding exercise, because of which around INR 79 crores were incurring FY 2021. But this year in FY '21, '22, we have capped our increasing expenditure to the tune of INR 55 crores to INR 60 crores. We have kept the limit because all the necessary actions have already been taken by the company to make it a retail network and consumers will averse on the change in the brand architecture. I shall now invite Mr. Ankit Gupta, who is our President Marketing, to talk a bit more about our performance during this quarter. Thank you.
Good evening, everyone, and a warm welcome to the Q1 FY '22 Earnings Call. In quarter 1, fiscal '22, was an equally challenging quarter as the second wave of COVID-19 impacted major parts of the country causing greater havoc and loss of life, leading to individual state wise lockdown and disrupt in the economy. In spite of all these challenges, we're glad that Dollar Industries reported good numbers in Q1. Our sales [indiscernible] quarter showed a growth of around 98%, if you compare it with Q1 FY '21. As expected, people and companies at large have accepted the culture of work-from-home. Updating you on our project Lakshya. Under project Lakshya, we have 61 number of distributors who have been brought under the project and where the distributor management system, DMS has been implemented. This is in line with our efforts to move from the push-based model to a replenishment-based model. We all expected second wave of COVID-19 slowdown our Lakshya project. Overall, we expect to achieve greater market penetrations from the primary and the secondary sale, faster increase in number of [indiscernible] at distributor level while faster recovery of dues in the retail channel. We have prioritized the implementation of Lakshya project in the northeastern region of the country. And we are also planning to implement the project in Tamil Nadu, state of south India, and we have already started the mapping process in Andhra Pradesh. We are also planning to implement our traditional system at our supply chain level, which -- the purpose of which we have already started. Apart from that, we have started the process of moving over to SAP-based ERP from the Oracle ERP system. As we are aware of what we have been since last year because of the pandemic, now in terms of our own work, the employees have the flexibility of working from home majorly during the lockdown situation. This also brings us to focus on consumers who are clearly shifting to the online platform. A new section of the youth is always hooked on to the screen for their socialization -- socializing. To care take of that, we are also trying to reach out to them through our digital platform. So we have diverted a lot of our marketing expenditure to the digital marketing. So that brings me towards the end of the initial opening remark. I shall now hand over the call to Mr. Ajay Patodia to discuss about the financial performance of the company during the quarter. Thank you.
Thank you, Ankit Ji. Good evening, everyone. Welcome to first quarter earnings call of Dollar Industries Limited for FY '22. Quickly updating you on our financial performance. The company's total revenue for Q1 FY '22 issued at roughly INR 205.49 crores as compared to INR 159.62 crores for Q1 FY '21, a growth of 28.74% for the quarter. The EBITDA for company for Q1 FY '22 stood at INR 36.25 crores as compared to INR 28.82 crores for Q1 FY '21, a growth of 25.74% for this quarter. The profit before tax of the company for Q1 FY '22 stood at INR 31.05 crore that is 15.11% as compared to INR 22.04 crore, that is 13.81% for Q1 FY '21, a growth of 40.86% for the quarter. The profit after tax of the company for Q1 FY '22 stood at INR 23.16 crores, that is 11.27% as compared to INR 16.30 crore that is 10.21% for Q1 FY '21, a growth of 42.13% for the quarter. Now moving on the brand wise contribution for Q1 FY '22, that is Big Boss stood for 47%; Champion for 1%, Dollar Socks at 1%, Force Go Wear at 1%, Force NXT at 2%; [indiscernible] stood at 8% and Regular at 40% of the total turnover. Now a small update on the joint venture with Pepe Jeans, the total revenue for Q1 FY '22 stood at INR 1.29 crore as compared to INR 1.39 crores for Q1 FY '21. The loss from the joint venture for Q1 FY '22 stood at INR 1.14 crore as against to bill 51 lakhs for Q1 FY '21, with our share of loss being INR 57 lakhs and INR 0.25 lakhs, respectively. We now open the forum for question and answer.
[Operator Instructions] The first question is from the line of [indiscernible] Capital.
My question is pertaining to the project Lakshya progress. So what is the total number of retailer which you have added newly in the system. And also from the existing dealer and retail expand, what is the shift under the project Lakshya?
Your voice is breaking. Not audible.
Yes, am I audible now?
It's still not clear.
Am I audible?
Yes.
Sir, my question is pertinent to the project Lakshya progress, which is [indiscernible] . So what is the total number of retailers that you have added under the project Lakshya and also from the existing dealer and retailer, what is the shift under the project Lakshya?
So in project Lakshya, we have started with -- we started the project with Karnataka. Then moved on to Rajasthan, started Gujrat, Maharashtra, now Telangana. We are planning to move to Northeast, Tamil Nadu as well as Andhra Pradesh. So till we have not completed any of the states 100%. But in terms of retail points, we have mapped around 1.25 lakh retailers we have already mapped, out of which around -- all of which around 30,000 retailers have already been enrolled in our system under project Lakshya.
Okay. Okay. And sir, any year-end targets that you're working for?
Yes. So actually from past 2 years, we have been facing lockdown in our major season time. So quarter 1 is a good season time for the [ leather ]. But like last year also, there was lockdown and this year also, there was the lockdown. And project Lakshya demand a lot of field work. For this, seem to go to the market, map the retail outlet as well as to enroll them and find a new distributor in that area. So it takes a lot of field work. But due to the COVID situation, the process has been slowed out. Nevertheless, we have already brought in 61 distributors into this particular project. And by the end of the year, we have a target of having 150 to 200 distributors under this project.
Okay. And then secondly, what is the volume growth and the [ real value ] growth in this quarter?
Volume growth was around 7%, and the value growth was 21%.
So have you taken any price hike in the current quarter also?
Yes. In the month of April, we took a price hike of around 5%.
So rest is on the product mix improvement, right?
Yes. But actually, if you see the growth from Q1 last year to Q1 this year, so from October onwards, right? October 2020 onwards, there has been a lot of price hikes in a staggered manner. So from October till April, we have increased our prices like 5 to 6x. And overall, we have increased around 20% price. So that's way, we've seen a lot of value growth instead of a volume growth.
Okay. Okay. And sir, third, what is our strategy for the Force brand? Because when we are in the Force Go Wear category, there has been a sharp decline in Force year after year. But our Force NXT brand sales is also not picking up that fast. So what is the strategy for that brand, particularly?
Are you asking regarding the process?
I'm asking about the strategy for the Force brand category, sir.
You're not clear. I'm unable to understand your question.
So my question is pertaining to the strategy for our Force NXT brand. We are not seeing the growth in the category, sir.
Okay. So regarding Force NXT, like last year, the contribution from Force NXT was 1%, which has increased to 2% this year -- this quarter, you see -- if you see on a year-on-year basis, quarter 1 FY '21 and quarter 1 FY '22. So there has been an increase in the Force NXT sale. And the category, this has been really good in Force NXT as athleisure category over there. So around 76% of our total sales comes from -- in Force NXT comes from athleisure range. So in athleisure, we have a whole lot of products like joggers, track pants, shorts, T-shirts, polos, tank tops, gym wear. So we have a lot of products in Force NXT, which is doing really good. And now the market has also started picking up on Force NXT. With regards to Pepe Jeans, I know the sales has been slow for the quarter 1. But overall, if you see, we are still -- like last year, we did a sale of around INR 17 crores. And this year also, we are in line to have a sale of around INR 24 crores, INR 25 crores. This fiscal.
Okay. And sir, lastly, on the A&P side, so do you feel like capping our A&P spend around INR 55 crores to INR 60 crores, do still have any impact on our revenue growth, as ours is the industry where brand spending is the only key differentiator factor?
Hello? Sir, you're still not clear in your question like your voice is muted, I suppose.
Am I audible?
Sir, you're audible, but not clear. I think you have to keep your speaker a bit away from your mouth.
Okay. So my question is pertaining to the A&P spend. So by capping the advertisement spend around INR 55 crores to INR 60 crores, do you feel this hamper our revenue growth as brand recall and brand spending is the only key differentiator factor for our kind of an industry?
No. Actually, no, it's not like that. We have made a very conscious decision of capping that advertisement expenditure to INR 55 crores to INR 60 crores. As because last year, we have already made a very high expenditure in advertisement with regards to retailing shop branding, or dealer boards, hoarding and TV advertisement. And this year, we are very hopeful that we can do with INR 55 crores to INR 60 crores of advertisement expenditure. And yet we'll -- the guidance that we have given for the revenue growth around 14% to 15%, we'll be able to achieve that with this particular number of advertisement in the future. There won't be any degrowth as we see due to the advertisement expenditure.
The next question is from the line of Richard Maheshwari from Arihant Capital.
Am I audible?
Yes, yes.
Sir, just wanted to know, the gross margin, how should we estimate the movement of gross margin going forward? Because in Q1 FY '22, your gross margin was 62.1%, whereas in Q4 FY '21, it was 57.2%, or in Q1 FY '21, it was 64.7%. So going forward, what's your outlook on cotton prices plus how should we estimate your gross margin?
Ruchi, myself, Ajay Patodia. I'm newly joined. So regarding gross margin, our gross margin is stable quarter-to-quarter. We have a target of around 34%.
You are targeting 34% gross margin?
Yes.
But your gross margin in Q1 FY '22, it's 62.1%.
So Ruchitaa, there's a thing. So if you see the subcontracting expenses or the jobbing expenses, that is a part of our production, right? So if you see we -- generally, we are in the lines of 63% to 63.5% of our -- that is a cost for COGS.
So your sub-contract expenses should be included in the raw material? That's what you're guiding at?
Yes, yes, yes.
Okay. So 34% is kind of your running gross margin we should estimate going forward?
So the current regarding our gross margin is around 36%, 37% that we see because around 63% -- hello?
Yes, I'm listening.
So the cost is around 63%. If you see year-on-year, on a yearly basis, the average comes to 63% of its sales, so 37% is the gross margin.
Okay. Fair enough. And what's your outlook on cotton prices going forward?
Going forward, like for next 3 to 4 months, we don't see any hike in the prices of cotton and the yarn market is also -- it seems to be stable right now. So we are not planning any price hike also in the near future.
Okay. And what about this [indiscernible] issue, which is happening and that's keeping the cotton prices elevated level plus new cotton profits still away, it will come in October kind of thing. So still, are we comfortable at the current prices? Or we are not estimating any price increase in the cotton front?
So it -- suppose there is a small hike in the cotton prices also, we are not seeing any substantial increase in the yarn price, ultimately. And that's the -- and that's why we are not taking or change any future price hike in our products also. As far as our spinning unit is concerned, we have enough stock of cotton right now. So it will clearly matter our operation also. It won't really disrupt our operation also.
Okay. That sounds great. And can you just give me the bifurcation of your premium contribution and your value contribution this quarter, plus how we should foresee for FY '22 as a whole?
So for this quarter, in our premium, we have Force NXT, which is around 2%. Then we have Missy, which is mid-premium to premium, somewhere between that. So that's around 8%. Big Boss which [indiscernible] around 47%. Champion is at 1%. And the Regular, the economy range of products that we have is around 40%.
Okay. And this rate will continue going forward or the margin -- or the premium contribution will increase or if this should be the going forward run rate?
Ruchitaa, the thing is we also want our premium range to increase, and that's where our focus is also. And we are hoping for the best. And the Force NXT is doing really good right now. It has started picking up the momentum. With the athleisure range, we are seeing a good traction in the market as well. So initially that we launched Force NXT, it was 100% innerwear but now around 70% of our athleisure in Force NXT is giving a very good value. In fact, if you see the ASP also, the ASP has increased from INR 118 to INR 150. So this has increased just because of the increase in the contribution of the athleisure.
Okay. And as you guided that for FY '22, your revenue growth will be somewhere around 14% to 15%, what kind of EBITDA margin you will close in the FY '22 level?
So we are very hopeful that we'll be able to close between 14.5% to 15%.
Sonal Minhas from Prescient Capital.
This is Sonal Minhas. Can you hear me, sir?
Yes.
I wanted to know regarding your working capital. Maybe if you have numbers to share quarter-on-quarter between Q4 last year and Q1 this year, how have your debtors moved between the 2 quarters in the better way specifically?Or secondly, if you could alternatively share, what debtors are you working with in the dealers and distributors who are in Lakshya? And those who are not in Lakshya? Alternatively, basically, if you could answer that. That's the first question.
Sir, regarding the working capital cycle, in Q4, like as on 31st March 2021 our working capital cycle was around 178 days, wherein the receivables was 121, inventory was 112, and [ payable ] days was around 55 days. So the total working capital cycle was 178 days just because due to the lockdown situation happening in different stages -- different -- with different rules and regulations, like every state has different rules and regulations. So our first quarter sales was really down, like what we've budgeted and what we got. So if you see the working capital cycle for the quarter 1, it would be very skewed because the sales was very low. So it would be best if we compare it from Q1 to Q1. So last year Q1, the total working capital prices went up to 268 days, just because the other there is a group 45 days of working. And we have to extrapolate based on the 90-days given data. And this year, Q1 was 215 days, but at the end of the year, what -- we think or what we are hopeful about is this 178 days of working capital cycle, which was as on 31st March 2021 will reduce it by around 15 days, this fiscal.
Okay. Got it. Okay. Sir, second question I had was on what percentage of your sale gets done through the wholesale network right now? And if you could share, let's say, year-on-year has also come down significantly. Any numbers around that, that is helpful?
So our traditional -- see, our business is based on the traditional channel itself. So we are distributors who thereafter [indiscernible] to the retailers. So in a distributor, the sale is around -- sales is around [indiscernible] through the distributor model itself. Export is around 9% and e-commerce on the audit retail is around 2% to 2.5%. So majorly, our business is based on the distributed channel basis. We have around 1,000 distributors. All of these 61 distributors are in our project Lakshya where we are seeing very good results in terms of secondary, primary and reduced debtor days as well. But as a percentage of total sales or as a percentage of total distributor, it is really very small number to extrapolate, so that's why we're not sharing a lot of numbers about Lakshya project. maybe after this 15th, we'll be to give a very good number -- we'll be in a position to share the numbers with you guys. So that -- then that numbers would be comparable or we can extrapolate to some of the regions. We can see zonal improvements or region wise data.
Got it. Okay, sir. So just a follow-on the first question. Your sales between June last year and now is up by INR 40 crores, roughly, if I'm -- just INR 45 crores roughly. Last year, June, we were at 160 and this year June, we're at 204. So what is the -- have the debtors come down? Or have they come -- have they gone up between this period? Just wanted absolute number. So if the delta sale is up at INR 45 crores, what is the delta debtors in crores?
So our debtors as on 30th June, 2020, versus 30th June '21, we have reduced our total debtors by around INR 45 crores, INR 47 crores.
The next question is from the line o Ankit Babel from Subhkam.
A couple of questions. Firstly, sir, in the presentation, you have mentioned about your target of INR 2,000 crores revenues by 2024. So just a clarification you're targeting by FY '24 or calendar year '24?
So it would be '23, '24.
FY '24, right?
Yes.
Okay. And sir, at that level of revenue, what kind of EBITDA margins you are targeting?
Around 17%?
Okay. Good. And sir, my next question is, will we be debt free by the end of this fiscal?
No, not really. We are not planning for that. Although our debt will remain at a very low level like before, but we are not seeing it to be debt free.
So by next year, you might be debt free.
Currently, we are not planning to, actually. Some amount of leverage should be there with the company. If you see our only debt is the short-term borrowing, which is [ WC or cash credit at EBIT ]. And a long-term investment is just, I think, a few lakhs, and that is also -- that will be also payable within a year's time.
So basically, since your margins will be improving going forward and your working capital is also reducing, plus there will be growth in the company. So the cash flows would be utilized for higher dividend instead of paying the debt?
So we have our CapEx planned. So we have planned for some INR 90 crore CapEx, which includes increasing the capacity of trading unit almost double. This will be doubling our production of spinning. Then we have spent -- we'll be spending for our [indiscernible] that is based out of Delhi. And also like a quarter or 2 before, we announced that we'll be making an integrated plant of around 3 lakh, 3.5 lakh square feet in Kolkata. That is integrated warehouse that we are based in. So that is also -- that will also have an impact of around INR 50 crores to INR 60 crores and all will be through internal accruals.
Why investing in the spinning unit where we have so much of capacity already there in India? I mean none of the branded players spend in backward integration. I mean, we have Jockey, as an example, that -- which only focuses on cutting, packaging and distribution and focusing on branding rather than the commoditized work of spinning and all those. So why we are investing in that?
So like for past 1.5 years, you might have seen that a lot of yarns, a lot fabric is in -- a lot of yarn is being exported from India. The exports have increased the demand. The demand and supply gap has increased in India, due to which a lot of shortage has been seen by the company, which led to the price growth as well. Right? And with this particular increase and the increase in demand and to reach the goal of INR 2,000 crores in 2024, we have made a very conscious decision of increasing our yarn manufacturing like spinning the cotton into yarn. And apart from that, if we are talking about [indiscernible] has everything in home, starting -- so it procures the fabric and apart from that, elastic, cutting, stitching, packing, everything is in home. They employ around 20,000 22,000 employees in the payroll. And that's -- if you see that subcontracting expenses is 0 and everything goes into the employee benefit expenses. So we are also doing a lot of work in house and it's very labor intensive as well. So we have made a very cautious decision and to achieve the goal of 2024, we have to make certain CapEx, so that we are able to increase our production whenever needed. So increasing the job workers for the stitching is no problem. But the major thing is that procurement of yarn and tie, the availability of yarn and tie that is very important.
So you are planning the total investment around INR 150 crores in the next 2, 3 years?
So around 90 plus 50 -- around, yes, around INR 140 crores, INR 150 crores in a timeframe of 1.5, 2 years maximum.
So wouldn't it impact your return ratio, sir? I mean once you reach your INR 2,000 crore revenue with 17% margin, what kind of ROE you are targeting with this kind of investment? Hello?
Yes. So around -- so you're asking about ROE or ROCE?
Both, sir.
So we have to work it out a little. That would be somewhere around -- like ROCE would be around 25%, 27%.
25%, 27% ROCE. Okay. And this working capital, what are your ultimate targets in the next 2, 3 years to bring it down to?
So ultimately, in next 2 to 3 years, we are very hopeful that Lakshya project will also be completed in like 3, 3.5 years' time. So the debtor days should decrease a lot. So overall, like 100 days of inventory around 130 days, 135, 140. That would be a fair estimate to make.
[Operator Instructions] We move to the next question from the line of [indiscernible] Trinity Securities.
Congratulations, Ankit Ji for the elevation and really welcome to Patodia Ji from a key competitor of the company. Can you just -- a question on the volume growth side. Last year, we have been able to grow almost 17% on the volume. And this year, you've already indicated that the price hike is there to the tune of almost 20%. So when we are guiding 14%, 15% kind of revenue growth, that will be predominantly driven by the price hike that has been taken by the company in the last 6 months. So can we get some sense that what sort of volume growth that we are looking for this year because Lakshya and all other things are already doing wrong for the company. So if you could ride on that, it will be really helpful?
So like for FY '22, if we are guided for a growth of 13% to 15%, the volume growth that we are looking forward to is around 7% to 8%.
Okay. Even if you assume 7% to 8% volume growth and the first quarter itself the value is -- the price hikes to the tune of 20%. So will genuinely surpass the guidance that we are giving. So because of this steep price hike that has happened and still there is no sign that this yarn prices will cool down, won't you see it feasible to increase the revenue guidance?
So the thing is since we are measuring this price hike -- the price growth -- the value growth and the volume growth on a year-on-year basis. So last year Q1, the prices were very low. And the prices of the products and the cost of the product also started rising from the month of September onwards, right? So from September till month of April, the company has hiked the price by 20% on a staggered manner, when we took a price hike for around 5 to 6x. So that is why you have seen a very high value growth and volume growth. But this year, we are not seeing any more further price hikes like for next 3 to 4 months, at least. So that's why we are keeping this, like, around 8% volume growth. And the rest of it would be the value growth, the other growth that will be brought about from the change in the category also like [ CCR ESP ] year-on-year, it has increased from 51 to 58. And the athleisure segment has contributed around 40% to our Q1 sales. So there has been a decrease in the sale of athleisure segment as well.
Yes. And my second question is, Ankit Ji, on the joint venture side. We're seeing a lot of traction which is happening on the e-commerce points and a lot of movement across the globe is happening on this side. So are -- this venture has not yielded the way -- probably at least [ 3 ] investors have dropped out in the last year. Do you have guided something, but can we see some more action on this front where more collaboration can happen. And probably this platform, our sales could pick up faster in terms of overall percentage of our. So if you could write down on that front, it will be really helpful?
So the thing is we are very focused about the Pep Jeans joint venture as well, and working really hard to turn it around. Actually, the big problem is from last 2 years, we are not getting the main season sale. Like Q1 is the highest for any innerwear sales. For this, the supply has to be there in the month of February or March. So -- but during last Q1 also, there was lockdown and this Q1 also, state-wise lockdown was happening with different rules and regulations. The market was not opening for the -- for a lot of time, or let's say, somewhere the market was open from morning 7 to 12. Somewhere the whole -- entire market was closed by 2:00. And at some places the market is not opening at all, the retail stores, the MBO. So that's why we are lagging a bit behind in terms of the sale of this given products. Apart from that, if you talk about online sales, the online sales have grown around 3 years for Pep Jeans joint venture. And we have collaborated with all the major platforms. And this year, we are focusing a lot on e-commerce as well for this Pepe Jeans. And overall, also as a company's strategy, we are focusing on e-commerce sales, because it's a huge opportunity that lies in front of us.
The next question is from the line of Shanti Patel from Shanti Patel Investment Advisors.
Sir, my question is, what is the capacity utilization today? And what do you think about total turnover approximately for the current year?
Sorry? Capacity utilization of what?
Our installed capacity, how much we have? What is the capacity utilization?
We have a blend of both, so majorly our production is based out of job work basis. Where is -- each of our intermediary processes are outsourced, given to the job worker for -- with the particular process. And it's scalable also. And if you -- If you don't want it, you said not do so also. So installed capacity like the backward integration that we have is north of to be 100% of our total production requirement. It is meeting only 25% to 30% of our total result. So currently, we are at 100% utilization, let's say. And going further, regarding the revenue guidance, it would be around 13% to 15%, as I told before.
Okay. And what is our market share in the respective of our product in the organized sector?
Sorry?
Market share. What is our market share in respect of the product?
Sir, there have not been any...
Data?
No data is available for the particular sector or no market research and formal market research has been done for this particular sector, right? So there are a lot of unorganized players, there are a lot of regional organized players or small players that n number of players in each and every state. So like in Chhattisgarh, you have [indiscernible]. In south [indiscernible]. There are a lot of small, small players. So an estimation would be around like a total hosiery industry would be worth around -- it would be 120 crore people in India, and everyone needs their innerwear so it's basic necessity, right? So at least 3 to 4 Force wear a year. So it very well imagine, how big is the market and how big is the opportunity that lies in front of us.Targeting market share would be the really very difficult because you don't have an exact number of how big the market is, how big the organized players or all the [indiscernible] players out there. So we could estimate that in men's range, it would be around 50%, 50%, organized versus unorganized, there would be 66% to 70% unorganized; and 30%, 35% organized. Kids is 90% is unorganized. You don't see a pan-India brand selling kids wear. There are a lot of small, small players or regional players who will be in our [indiscernible] segment, but you won't find the pan-India, national level brand [indiscernible] very efficiently.
But after GST came into picture, the unorganized sector is not going down and down?
Everyone thought in a similar manner. In fact, we also thought in a similar manner that after GST would come in and after demonetization, the unorganized players will vanish from the market and the market share will go to the organized players, the big players. But that didn't happen. They are still there. They're still working. And they change themselves with time, I would say. So there [indiscernible]
The next question is from the line of Apurva Mehta from A M Investment.
Yes, sir, about your vision INR 2,000 crores by FY '23, '24, that will have a CAGR growth of close to 24%, 25%. So if you are guiding for 13% to 15% this year, then next 2 years, you should be doing like more than 25% growth. So are you visualizing close to this next year, you will have a better growth story?
See, Apurva, the thing is that the company is a transformational phase. A lot of things happened this year. So last year, we -- last year, we changed our brand logo, the brand architecture and we are still working with projects like the TOC, the vector program. And this year, the main season was lost due to some lockdown problems. So that's why we are giving the guidance of 40% to 50% this year. And yes, our aspiration is to reach 2,000 by FY '24. And we are hopeful that we'll be able to meet our aspiration, meet our goals, and we are working backward also. So that our production, our supply chain also supports the sales. So we are -- everyone is working in a similar direction, same direction. And we are the only very hopeful. And the reason why we are giving 30% to 50% growth this year is just because our first quarter was not that good due to the lockdown happening in each and every state, and the timelines were also very different for every state. The rules, the regulation, the market opening times, some of the districts where markets opened only [indiscernible] and then lockdown. So the markets are not [indiscernible]. So keeping everything in mind, and given the sales of first quarter, so they are keeping the growth at 40% to 50% only for this particular fiscal.
And your export front, you have written that there is a threefold growth in Q1. And so what will be our target for this year on the export growth side? Is it could be much, much higher than -- and why so the threefold growth?
So if we compare Q1 FY '20 with Q1 FY '21, we saw that our exports was 3x what it was last year quarter 1. So overall, our exports would be around 8% to 9% of our sales. And the increase in exports would be -- last year, it was around INR 65 crores, INR 67 crores of our exports. So this way, it would be around 8% to 9% of our total sales.
And sir, one more thing was that when we were listening to Vinod Ji on Zee News, Zee TV, he has guided 16% to 17% EBITDA, PBT of 15% and PAT of 11%. So there is some contra in when you are guiding 13,000 to 15,000 kind of EBITDA. And just now when I was listening about half an hour back, the interview in Zee News. So why such contradictory? Or are we conservative in giving the guidance to the analyst community? Is it that or...
We have always been conservative about giving the guidance to everyone. But I think we had mistaken something over here. In the Zee Business today when the interview was happening, the levels that you spoke about like 13%, 13.5% of EBITDA or 11% of PAT. That was the Q1 number that he was calling out and not the guidance that we were giving on the News channel.
But it was specifically asked, he told that we will maintain such kind of 16% to 17%...
The guidance that he was given on the interview, that was just a Q1 numbers he was repeating on the interview. So I'll just hear the interview words again. If I see there's a discrepancy, I'll clarify that with the channel itself.
The next question is from the line of Sonal Minhas from Prescient Capital.
This is Sonal Minhas. Can you hear me, sir?
Yes.
2 questions. Ankit, what is lost sale due to COVID, the second wave in Q1? And basically linked to the number of days you were working this quarter. And how are things looking like for July onwards basically? What is -- how do you see things now?
So we have lost around [ 100 crores ] of business in Q1 due to the lockdown. And we are trying to meet this up in the Q2 and Q3 itself.
The next question is from the line of Pushkar Jain from Sequent Investment.
So my question is answered.
The next question is from the line of Ankit Babel from Shubhkam.
My questions also have been answered.
We take the last question from the line of [indiscernible] Securities.
Ankit, just one question. If we talk about our investments in the spinning unit that did really -- I would account this move forward because I'm very closely checking the sector and the dynamics of textile sector in India has gone for the structural change from the next couple of years, forget the days when the spinning units were making 5%, 7% margin. That -- it has moved to much higher levels. And that's really a conscious decision to go for the spinning investments because that will go a long way for managing the margins in the near to medium term. And I hope that the analyst community will learn this soon -- with this new reality, which is emerging in the sector. But going by these investments since we are going to be fully integrated player vis-a-vis the competition, which is not fully integrated in the sense from yarn to the end product. So still, we are having not the sector-leading margins that is there for us. We are still guiding 15% or maybe potential margins of 17%. But whereas these players have already moved to 20% kind of margins. So when you talk about 24 when all this things will be more or less done for us. Can't we see this broader trajectory of margins will be industry-leading. So that's the thing that if you could guide on that will be really helpful?
So the thing is that, as I said, the company is in a transformational phase, a lot of things going on in the company like from brand architecture change, the logo change, then project Lakshya was going. A lot of cost -- expenditure has been spent on the project Lakshya as well. The team size is now around 125 people working with project Lakshya itself. Apart from that, we are migrating to a ERP system, which is also a good amount of expenditure and a good amount of time taking process. So a lot of time will be consumed in all these projects and a lot of cost will be incurred in that. That's the reason we are keeping the -- like giving the guidance in a conservative basis, whether it be the EBITDA level or the same level. After we have completed our transformation or -- we have reached to a certain level where a proper efficiency has been seen with this -- all these projects that are ongoing right now. So that we see a very good change in our -- whether it be the sales level or the margin level. But yet, it would be 1, 1.5, 2 years after, not currently or not immediately.
Okay. Probably, this is -- I believe that total mention of [indiscernible] not talk about those margins. [indiscernible] to be completed first and hopefully you can get better what sort of trajectory that probably [indiscernible]
We are very hopeful for that.
Ladies and gentlemen, this was the last question for today. I now hand the conference over to Akhil Parekh for his closing comments of Elara Securities. Over to you, sir.
On behalf of Elara Securities, I would like to thank everyone and the management team of Dollar Industries Limited. I'll hand over the call to the management for any closing remarks.
Thank you, everyone, for joining this call. I hope we have been able to address all the queries. For any further information or any further question, kindly get in touch with us. And thank you once again. Stay safe, stay healthy.
Thank you very much members of the management. Ladies and gentlemen, on behalf of Elara Securities, that concludes this conference call. Thank you for joining us, and you may now disconnect your lines.