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Page Industries Ltd
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Ladies and gentlemen, good day, and welcome to the Page Industries Q3 FY '21 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 Mr. Akhil Parekh from Elara Securities. Thank you, and over to you, sir.
Thanks, Suresh. On behalf of Elara Securities, I would like to welcome you all for 3Q FY '21 Conference Call for Page Industries. From management side, we have Mr. Vedji Ticku, CEO, ED; and Mr. Chandrasekar, Chief Financial Officer. I would like to congratulate the entire team of Page Industries for showing a strong set of numbers. And I'm not taking much time. I'll hand over the call to Mr. Vedji Ticku. Over to you, sir, for opening remarks, post which we'll open the call for a Q&A session.
Yes. Thanks, Akhil. Welcome. Welcome to the Q3 business update. Our revenues for the Q3 financial year '21 grew by 17% year-on-year and 25% sequentially quarter-on-quarter, aided by a very strong festive demand and, of course, the gradual lifting of the lockdown. The lockdown also helped, which helped us to increase the footfall in our stores. Business has recovered well, and we are -- obviously, have grown over the previous year. Our volume in the same period grew by 10% year-on-year and 22% sequentially.Retail stores on the retail store front -- more than 95% of our MBOs, multi-brand outlets, are all functional now. All our EBOs, 100% of them are open, and more than 93% of our large-format stores have also reopened. E-commerce continues to be robust during this time.Our manufacturing and warehousing facilities have returned to complete normalcy. Our outlook for the market, the sales trends, which have been on an increasing trend since August continues into quarter 3 as well. So we have seen a growth trend through month on month starting the month of August to the December end, and it continues.Our branding efforts continue through multiple channels, including online media and continued focus on our point of sale, which we have done extremely well on that side during the financial year because we felt that focus on the point of sale was very important during this year.Our kids wear business continues to be the focus, as you are all aware. And it has shown a very encouraging customer acceptance and feedback. We now have 28 EBOs, which are exclusive brand outlets, that are exclusive for our junior business. We now also have 192 Jockey Juniors specific channel partners across 124 cities, managed by a strong sales team of 150 people.We continue to expand our depth within the existing market geographies as well as strengthening distribution in markets, which are witnessing expansion of mature retail formats. Jockey [indiscernible] throughout India in 2,890-plus cities and towns. We see a great potential in the rural, Tier 3 and 4 cities as well. We are strengthening our distribution network in a sales manner in these markets, which have a good potential and opportunity going forward.We will continue our focused approach on our core businesses, which is the men's underwear, women's underwear [indiscernible] socks and -- and we are quite confident of maintaining growth going forward. So now with that, I would request Mr. Chandrasekar to update you with the financials.
Good evening, everyone, and welcome to the Q3 FY '21 Earnings Call for Page Industries. As you have seen [indiscernible] the volume growth by about 10% in Q3, and the revenues are INR 971 million. And revenues have grown by about 17% compared to the same period last year. The 9-month revenues are INR 19,522 million. This is down by about 90%, as you know, due to the impact of a weak Q1. The EBITDA margins have been [indiscernible] at 24%. It compares with 22% in the Q2 of this year and 17.5% in Q3 of the previous year.We have brought in a number of OpEx controls, and we await approval now in this year, starting with Q1 on the engagement of labor on some of the discretionary spend in OpEx and in advertisement and so on. And that is the main reason, apart from the very well healthy top line for the EBITDA margins of this quarter. The Q3 PAT is up by 39% quarter-on-quarter and by 77% year-on-year, which means compared with Q3 of last year. So we have achieved an all-time high revenue this quarter in history of INR 9,271 million and a PAT of INR 1,537 million. The PAT margin is at 17%. The 9-month PAT is [indiscernible] INR 2,250 million, which is about 28% below that of last year.We have put in place a number of controls on working capital, budget controls and so on. So the cash and cash equivalent has further increased this quarter by about 23% to INR 4,941 million. And this has come about of a better management of inventories and so on. The net working capital, though, has increased to INR 5,518 million. It was INR 4,579 million in March 2020. The inventory has reduced, but then the cash equivalent is up by almost INR 3,770 million. There is also an increase in payables because of increasing volumes of business. So it has been a pretty good quarter and reaffirmation of all that we have, the processes and practices that we have put in place over the past several years, including this year.So thank you very much. We can get on to the Q&A, please.
[Operator Instructions] The first question is from the line of Bhargav Buddhadev from Kotak Mutual Fund.
Yes. Team, congrats for a very strong performance.
Yes, thank you very much, Bhargav.
My first question is on the raw material inflation that we are seeing [indiscernible] prices sort of going up. So in terms of the pricing, have you taken any pricing actions to sort of pass on those prices?
So Bhargav, if you remember, even in the last meeting, I had -- I'd emphasize on this. So there is a tendency of the yarn price going up towards the end of the calendar year because that's the end of the crop season. And then by the time the new crop comes somewhere in around Feb, the prices start to come down again.Having said that, yes, this year has been a slightly -- the price increases have been slightly more than the average of what we have witnessed in the previous years. But we are -- it's completely in our control, and we have baked in this increase in our overall budgets.
Okay. So we have taken price hikes to sort of pass on this inflation. Is that understanding correct?
We had taken some correction in last year, August, if you remember. And that's the -- we have taken the consideration of this increase as well. And on -- and need we -- once we have go to the next financial year, we generally take 1 price increase every year. So we'll be looking at all these prices probably in the next couple of months and have taken appropriate call with the price increase.
Understood. Secondly, sir, our understanding is that in [indiscernible] we've already crossed about INR 2-odd crores. Is that understanding correct? And essentially, is it fair to say that we are trying to place our kids even with [indiscernible] given that typically women customers are the ones who buy kids clothes as well?
Yes, you're right. That is the -- because we also noticed that, as you rightly mentioned, it's generally the mother who buys for the kids. So it made a lot of sense for us to have Jockey Junior selling also from those stores. We also have many stores which are Jockey Junior stores by themselves that sell only for kids. As I also said in my opening remarks, we also have 28 EBOs, and we have another 20 in the pipeline, which we are working on.So -- and we also have pushed ourselves, and we have these 2,000 [indiscernible] 124 cities already [indiscernible] in Junior business. So yes, it's a formidable business going forward. And we are giving it all it requires during these formative years because we know this is going to be a very large business in very full year -- in the next few years.
Okay. Sir, lastly, in terms of the rural penetration, our understanding is that Jockey has come up with a rural bouquet of 5, 6 products, which they have designed for the rural areas. Is that understanding correct in order to make inroads in the rural market and these products would be sort of in budget, considering the per capita income over there is lower as compared to the urban areas?
Yes, you're right. So basically, we are getting into the Tier 4 and the rural side. We have made a bucket, but it's close around 30-odd products. So we were doing some pilots during the last 6 months. And so as I said, in fact, it has been -- it was also so we had done some early basic small pilot in the south earlier, and now we actually get the north and a few places west. And the results have been extremely encouraging. And we are taking it very seriously this year. And we will soon, like what we did for the kids business, we'll be soon having a separate setup for the rural business. That is our endeavor going forward.
[Operator Instructions] The next question is from the line of Nihal Jham from Edelweiss.
Yes. Congratulations.
Sorry to interrupt, Nihal, but your voice is very feeble. May I request you to speak a bit louder?
Apologies. Is this clear enough?
Yes, much better. Please proceed.
Congratulations to the management. Two questions from my side. Sir, if I look at the history of our performance, ideally there has been very limited seasonality in our business, even if I compare Q2 or Q3 as a performance. So specifically, for the performance that we've done this quarter, could you highlight if it's specific to any product segment or any incremental category? Or even there was an issue with not enough inventory in the channel that has led to the strong spot? I'll come to my second question after.
So Nihal, it's -- a lot of things were done in the last 6 months. Because when the markets opened up, the demand pattern has changed. There was a lot of requirements for at-home wear. So in our earlier plan of this year, we didn't have the contribution of our business was obviously lower than what we have today at this point of time. So there were a lot of things done both at front end and back end. I remember in the Q1 a meeting I had said that while, even when markets were closed, our team was in contact with all the retailers through phones. And we reached out to them, and we were not talking business, but we were saying if there is some support and help. So that was the kind of -- created even while the markets were closed. Eventually when the markets opened up, there was, of course, requirement and demand was there. So there was a lot of work required to actually manage the supply chain. I think we did exceedingly well both the supply chain across the raw material and then actually producing new products and reaching them to all these outlets across the countries through our channel partners.Having said that, coming back to your question, the quarter 3, as you know, generally because of the thermal wear, there's also a surge of requirement for the thermal wear. That definitely helps the business in those 3 months. So that was -- that was even there last year. But I won't say that there was something which was specifically different than last year. I think it was a clear focus. We also, during this time, open close around 4,000 outlets. We have opened 7,000 to date in this year, financial year. And these were the people who were not selling Jockey earlier.So all these things put together, I think it was a joint effort from across the teams back end, product management team, the supply chain team, distribution, which helped us to actually do these numbers in the quarter 3.
That's helpful, sir. Your second question, specific to Mr. Chandrasekar, now the kind of bifurcation you give in terms of how your margin is split between contribution gross and EBITDA. I'm not sure if it's available for earlier quarters. But could you specifically highlight what has led to improvement in each of these 3 segments as you look at it? I would assume the price hike you've taken in August would be one of the components. But just the fact that it is across contribution or gross margin, there has been an improvement. So if you could just give a little more detail on that, and I'll be done from my side.
Thanks, Nihal. As far as specifically the concern is, the price increase is one of the factors. The material cost has been strong, meaning that it is not a reason for any of the higher contribution. But then we have the labor cost absorption has been better, particularly because of the high sales. Similarly, we look at the other -- if you're talking gross margin, then the other manufacturing costs, which include power and other variable costs and manufacturing units as a percentage of sales has been better. So these primarily accounts for the better gross margins. And so also the contribution.
But I see that the increase is less than commensurate with the increase in the top line. So is it efficiency primarily? Or...
It is -- a big factor is efficiency. For example, the labor cost is now 7.8% of revenues in Q3 as it is about 8.5% in the same period last year. The manufacturing overheads are about 3.6% as against the 4.5% in the same period last year. So the one better absorption and, of course, better efficiency from the shop floor led to the strong margins.
The next question is from the line of Arnab Mitra from Crédit Suisse.
Congratulations on a very strong performance. My first question was on the overall growth. Have you seen any difference in the EBO growth that you're clocking in on EBOs versus overall growth? And why I'm asking the question is, again, because you opened a lot of new outlets. Was there some extra primary restocking in the revenue growth? The [indiscernible] the overall growth?
So now, as I explained to Nihal earlier, so this is a very sort of a collective effort from a lot of sites which has led to these numbers. We increased the number of stores, which I said, the [indiscernible] has increased in like in the first 9 months. So we have [indiscernible] to 7,000 outlets on the side, which were buying Jockey for the first time. We have added EBOs, which is like we have closed around 18 new EBOs have opened during this time. So they have added to the sales. And of course, the up-sell of the active wear business, which also has helped in higher revenues because, obviously, the ASPs of our active wear is almost 2 to 3.0x our innerwear. So all these things put together has helped us to arrive at this number.
And just the like-for-like growth in the EBOs, is that also keeping strong levels? Just wanted to take that from a retail offtake point of view.
Yes, it is. We have a positive growth on like-to-like as well.
Sir. And my last question was to -- on the margin, your historical margin rate has been more in that 21% rate. This quarter is obviously much higher at 24%. And expenses have dropped a lot Y-o-Y, other operating expenses. I just wanted a sense of how much of this savings is sustainable. How much do you think are expenses which will come back? Would you want to reinvest this additional margin for growth? And therefore, we should see it more going ahead, your historical range of 21%, 22%, rather than 24%?
Yes. Thanks for that question. The 22% is around the norm that we price/cost inflation and OpEx and all that. But of course, this quarter has been special due to when the OpEx controls are already in place, the volumes have taken off. But then some of the -- a lot of the discretionary spend has been cut down. But going forward, we will see some of the advertisement returning, and we are going to invest again in digital transformation and all that. So all that will be for fueling the growth of this business. This year, we are particularly tight on the OpEx.
The next question is from the line of Bharat Shah from ASK Investment Managers.
No, I didn't have any question to ask. I just wanted to make a point that, finally, all the many efforts either in supply chain, product portfolio, distribution team, technology cost factors and increased hire in the baby, finally, we are seeing a culmination into performance that I've come to associate with Page over revenues that I've been seeing. So very happy to note that. I hope this is not kind of a glorious exception, but hopefully, a glimpse of that will remain is kind of an ongoing thing.
Absolutely, Mr. Bharat. I think all the points you raised, that's what we were continuously doing, even when we had very strong headwinds. So all these efforts, we did get some tailwinds for the first time in last, I would say, almost 36 months now. And all these efforts which you very nicely put across, yes, they are there. The efforts, I'm sure, are going to stay. All we need is some support from the market, which we can see now. And we are more than sure that this is sustainable, and we will be taking this forward for many quarters and many years going forward.
Terrific. Delighted and congratulations to everyone.
Thank you very much.
The next question is from the line of Aditya Soman from Goldman Sachs.
So just 2 questions. Firstly, I mean, while it's a very strong performance, how can we be sure how much of this is pent-up demand, given that, I mean, if you look at the 9-month performance, we're still down 19%? And I'm assuming that for a category like innerwear, the demand is not entirely destroyed. So how much of this is just -- any way for us to figure out how much of this is just consumers who missed out in 1Q coming back to shop?
So Aditya, obviously, if we had grown by 50% quarter-to-quarter this year -- sorry, year-on-year this year, but probably, I would have -- there was some [indiscernible] what you were saying about the pent-up demand.We have active grow at 16%, 17%, which we very strongly believe with the kind of headroom we have in this market and the penetration levels of below 20% in that market, which is -- which you already treated, which I've explained many times in these meetings. So we don't see that because -- this is the regular demand, which is coming back for sure. And this is something which we are more than sure is a genuine demand, which will continue for many, many years to come because we still have the [indiscernible] levels which are suboptimal. And we are just at 20% in the men's underwear, and we talked about 6%, 7% on women's underwear. And we're talking of around 7% to 8% on the active wear business. So definitely [indiscernible] some demand. This is something that the demand has come back. The markets have opened. We have done a lot of efforts in the market by opening new stores through MBOs, EBOs. We have opened the EBOs or even junior business. That is helping us. The socks business has come back, which was not there earlier in the first quarter. But obviously, because of -- even in second quarter, it was quite down. It's come back very nicely in the third quarter.So all these things put together, we are quite confident that this is something which is sustainable and will go a long way.
Yes. No, my question was in the context that, I mean, until about 2017, used to do sort of more growth than this literally on every quarter. And then since then, we have this growth [indiscernible] But then this quarter, we've seen an aspiration. But it comes from the context that, I mean, obviously, 1Q had -- was a complete write-off, so some consumers from [indiscernible] then would have come in once the markets open up. But anyway, I mean, the other point, the other question being, how much -- could you give us a sense of how the athleisure mix has changed, say, 3Q this year versus 3Q last year?
We don't share the contribution, but there has been a significant change from -- on our active wear business. We have a double-digit growth in -- at a very high level on the asset growth -- on the volume business because I think that's something which has been the -- which will go a long way for Page because I think that's been the silver lining, I would say, in this -- of the whole year, that there'll be a huge trial of athleisure, and all these people who tried athleisure for the first time have found the product which is a quality per [indiscernible] to value for money. And for sure, they're going to stick to this and cut back. And we have seen in the past that the stickiness of our brand is very, very high. Once the consumers have used our products, they definitely come back. So we see this as a -- this will be very advantageous to us in the coming financial year and year after that because the active wear business is something which is a very, very large contributor. It's almost coming close to our men's business. So that is the kind of contribution in the business, what the active business is issuing. So I hope that answers your question.
Okay, it does. I mean the reason again, I asked this was, I mean, just to understand how much the growth would be in men's underwear or women's underwear for the quarter.
Yes, we will not be only sharing that for reasons because the [indiscernible] we have been sort of not sharing it at segment level.
But most would be in growth, right?
Yes, yes.
Okay.
Sorry. You mean the athleisure business?
No, no. Men's and women's underwear, they would have seen growth, right, year-over-year?
So okay. So women's underwear and athleisure are in high double-digit growth. Our men's innerwear is still slightly lower. It's not grown.
The next question is from the line of Avi Mehta from Macquarie.
Just 2 questions for me. One, I want to understand the reason for the increase in commissions this year, have we increased dealer-level commission? Or is it more to do with mix? And so the other bookkeeping question was, that you typically take a price decrease in Jan. So is that something that you're not going to do this time? I'm sorry I missed from your earlier comments, I thought that you're not -- you don't feel the need for a price increase. So I just wanted to clarify that part.
Yes. Sorry, I mean what commission are you talking about? Have you get that third quarter?
Sir, the rebate information that we gave out, has that increased this year?
No, absolutely not. They are the same.
So probably I picked that up, so I thought maybe...
Yes, no, our distribution margins, our partner margins, they continue to be the same in innerwear, and that...
Okay. And sir, the price increase split, I just wanted to kind of revisit.
So we generally take price season depending on the input costs. So currently, we are towered. We don't have any plans to do it immediately. But what this financial is done, we'll be decide looking into -- although we have already budgeted what kind of percentage is required if it's required. So [indiscernible] will be taken towards the end of the financial year, which should sustain us probably next financial year. [indiscernible] what we did in last year August, it's good to have for us.
Okay. So what we did in August is enough, so we would not -- we take a typical price increase starting Jan, right, sir? Or no, there is nothing like that, sir?
No, you're right. We used to -- many years back, it used to be like we do it in the last quarter every year. But since things changed, this was a different year, so we had taken some increase in the month of August, which is good enough for us to sustain this financial year. We'll be looking for if it's required. The call will be taken towards the end of this financial year or next fiscal year.
Okay. And sir, if I may, what's the volume growth number? I missed that if you had said that number.
That's -- it's the 10% volume growth for the quarter.
Next question is from the line of Swagato Ghosh from Franklin Templeton.
As you mentioned, this year, you have added...
may we request you to speak slightly louder? Your voice is a bit low.
Yes. Am I audible now?
Yes, better.
Yes. So sir, you said you add 7,000 outlets for this financial year. Can you just share some more color on the nature of these? Like where these are mainly situated, like Tier 4 cities or like somewhere else? And also, the reason why we could not reach these outlets earlier and whether the economics of doing business with these outlets are slightly unattractive for the distributors. And hence, in that case, we, as a company, do we provide them some support in terms of working capital?
So first of all, the 7,000 stores are across the 2,900 cities where we are catering. So if you do math, it's not a very big number in that sense. We're talking about probably 6, 7, 8 stores or probably 10 stores that match 5 distribution point. So it's not something which is -- and they are out of the city or out of the town. So they were around. So there were many reasons [indiscernible] does not taking there. I think would be working with the competition. Probably there was a lot of the size earlier. And they have, over a period of time, grown. And the third reason was that this year. Supply-wise, Page was one of the companies, which was into a good position to have the suppliers reach the retailers. So all these factors have us to open these stores.And it's a normal thing. We add this number of stores almost every year, anything between 5,000 to 7,000. This year, yes, we are looking forward to open at least 10,000 stores by the time we closed this year. That was the target we set ourselves. And we already have done 7,000. So I'm confident that we will be hooking those around 10,000 new stores by the end of this year. And there is no cost -- additional cost for the distributors, which we need to support in it.
Okay, okay. [indiscernible] Okay, okay. Fair enough. And sir, I'm also trying to just reconcile 2 comments that you made. One is on the EV like-for-like growth, you said we had a positive growth. But on the men's innerwear, we have not grown. So I'm just trying to reconcile these 2 comments.
So men's innerwear is a large chunk of our business. So the active wear business, as I said, is a very high digit -- high double-digit growth. And as the mix of both. So keeping that in mind, we will have grown -- the like-for-like growth has been there in the 8 years. And so when I said we've not grown, we are almost there like last year. So it's not that we are negative there. So it's mildly there. And it's largely short of last year on the 9 year -- on the 9 months, keeping in mind that we had a washout for a quarter, right? So -- but like-for-like growth on the growth is positive.
Okay. And just for a typical review, what is the mix right now at [indiscernible] versus, say, men's innerwear?
They sell -- you mean within the stores?
Yes.
EBO is close to around 40-odd percent. Sorry, the active wear is close to around 45% in the EBOs.
Next question is from the line of Tejash Shah from Spark Capital.
Congrats on a good set of numbers. Sir, if -- you spoke about the demand recovery and all. But if you can give some indicative breakup of growth in the quarter between MBO channel versus retail channels like [indiscernible]
We refrain from giving those minor macro details.
Even the India number, sir, the way you gave about a men innerwear and women innerwear, just indicative number also will help versus what we reported at company level with channels actually outperformed and which were below it.
Sorry. All I can tell you is that we have grown in each of these channels this year in terms of value business.
Okay, okay, okay. So second, sir, associated question was that a large part of our network was not available for business for [indiscernible] and if we just have to dissect the pent-up demand part from the actual recovery. So the network which was available throughout [indiscernible] are we seeing healthy growth in that channel as well or that network as well?
So see, we -- all our networks were open from quarter 2 itself. It was only the extent there, for example, are EBOs. We're almost 80% by the time we were in the mid-August had opened already opened. It was the MBOs, which was slightly on the lower side. Obviously, because there was lockdowns and a lot of areas which had not opened up. We are almost 95% opened now as of quarter 3 closing. So there was a lot of a specific segment, which had not opened and which has gone now. So they had opened across. It was only the -- it had opened the cross-section has opened, but it was a number of stores within each of these verticals, which was the question earlier, which is no more less. So everything is almost 100% open now.
And sir, lastly, if you can give -- aim to spend growth Y-o-Y for the quarter and 9 months or...
Sorry. Can you please speak loudly, please?
A&P spend growth Y-o-Y and for the quarter and 9 months?
The advertising and marketing is what you're saying?
Yes, sir.
Yes. So we have taken a obvious cut during this year as compared to the previous years. And so we -- whatever was budgeted for this year, we have spent that amount for the year. And so generally, our expense is to be somewhere between 4% to 5%, 4% to 4.5%, so -- which was year-on-year for all these years, which we had obviously cut to almost half this year.And going back to '21, I think that should be back to whatever we require for our [indiscernible]
Next question is from the line of Jaykumar Doshi from Kotak.
You did talk a little bit about the benefit you saw in athleisure space due to new trials and increasing penetration. How frequent is repeat sales? At what point of time will you get a better understanding of how much of that trials or new customers have been -- are sticky, permanent? And any quantitative data that you can give in terms of -- which can help us appreciate the success or how you've benefited better?
So generally, it is between 4 to 6 months, where you're able to see the repeat sales of any product in our category. And so yes, if we look at quarter 2 to -- by the end of quarter 3. So we are talking about that 4 to 6 months' time. And we have seen repeat sales, and there were some of the product lines where we actually were pushing ourselves to keep the supply chain going because the demand was so high. As I said earlier -- in the earlier part of my discussion here, we had not, as a contribution, we had -- when we did the budgeting at last year for the year 2021, so the budgets were obviously much lower in terms of contribution. And it took up the surprise. So we were working over time to actually have our supplies working for this, which is a very clear indication that there are repeat purchases for our core products, which we have been there for many years. But because of these new trials, there is repeat purchase.
Can you give us some color in the 9-month period what would have been the growth for this, at least your portfolio? Just as a onetime testing. I know that you don't break it up on a regular basis, but just...
So as I said earlier, it's a very high digit -- high double-digit growth.
For 9 months also?
For 9 months also, yes.
The next question is from the line of Akhil Parekh from Elara Securities.
Sir, I have 2 questions. One is have you registered any market share gains in our core business that is main similar there for the first 9 months of this year? Or has the market in general expected?
See, unfortunately, there is no dedicated study on the market size. So as we have been discussing it in the past also, so we have -- we have a whole method of understanding the market and what our penetration levels are. So we have taken 2 studies, which were done at various levels. And one of them was the BCG report, which helped us to understand the Indian market. And keeping in mind the number of people which are available out there to buy a product like Jockey, so our assumption is very INR 150 million or INR 15 crore [indiscernible] So obviously, 50%, 50%, INR 7.5 crores men and INR 7.5 crores women our target audience. So that's what we look at our audience. And our understanding is that we have new headrooms. On the men's side, we still have 19% to 20% penetration level and 5% to 6% on the women's side. But that has not changed. It still continues to be the same, given at these numbers, these values. Also from the fact that the market itself is ballooning and growing year-on-year. So that's what is the best estimate we have.
The question I ask you because we are seeing in other categories, where the market shares have moved from smaller, unorganized player to a bigger player. Has that happened in [indiscernible] that's what I'm saying.
It's difficult to say that because there is -- there is no market study as such on the market share for the category of business of our industry. So it's more of an estimate, which we make on our own through some other studies which have been done in the past. And then we are able to collect these numbers. Unfortunately, there is no syndicated study on the market share in innerwear industry.
Sir, and just one more from my side, the CapEx guidance for next year?
Sorry. What was that?
What is the CapEx guidance for next year, FY '22?
Yes. K., do you want to like to take that?
Yes. Thanks. We have some [indiscernible] coming on plan next year, so we will be in the range of around INR 3,000 million.
Okay. So INR 300 crores for the entire year?
Yes.
The next question is from the line of Arpit Shah from Stallion Asset.
Yes. I just wanted to understand, we have a lot of storages in the area. So was it -- do you [indiscernible]
Line is not clear.
Yes. We just heard a lot of shortages in the urban areas, in the main and the [indiscernible] Was it due to the growth of athleisure?
No, there are 2 different lines. And they are manufactured at separate places. So it's nothing to do with the growth of athleisure there. Yes, as I said, the demand was slightly higher than what we had decided to start with. But by the time we are talking now in the month of January, we are almost there. Our stock base are improving. And it's on the -- basically, it's a matter of another 1 month and we will be at normal levels in terms of our supply chain for innerwear there. That has been issued for the last 2 to 3 months.
And sir, you are correct, the athleisure revenue contribution and then another contribution was the same for this quarter?
No, I didn't say the same. It's almost [indiscernible] up to the mandate in terms of revenue.
And most of the offices and everything is opening up currently, would you be able to maintain the base for the next year quarter for athleisure?
I very strongly believe -- I have been asked this question from probably 15 quarters, and I have repeated since we have all the time to make it right, so I hope right in the coming quarters as well.
And what would be the sustainability of this EBITDA margin going forward around 24%?
At 24%, but we peaked for around 22% meaningfully quarter-on-quarter. Sometimes, all the quarters, volumes are not equal. There is a variation of [indiscernible] on the margin, mainly due to the labor adoption and overall absorption. At the same time, the raw material prices do fluctuate as we earning towards the balance on the price and prices look up and then they gradually come down.On a whole annual basis, as always being 20% EBITDA margins or better.
And can you throw some light on the rural area product that you are planning to?
Yes. So there was 6, yes, as I was explained earlier, we did some pilots in last almost, I would say, 18 months now. So we lost that 1 quarter in between, which was the first quarter of this year. This part was done in the rural side across the zones now Southwest and even 1 part of East. And the results are very encouraging. So we have chosen a bouquet of products from our large portfolio, which is -- which we feel is the right product mix to start with for these small markets. And so we are currently planning to have a strategy, which will be headed by one of our seasoned managers, and we have a plan that in the year '21, '22 we will be pushing the rural side. And so I would not be able to share the complete details, but we have some big plans to full a foothold into the rural markets now.
And just a follow-up on that one.
Maybe I'm sorry to interrupt, but maybe please I request you to return to the queue for your follow-up questions as we have several participants waiting in the queue.Next question is from the line of Ankit Kedia from Phillip Capital.
Sir, my first question is on the men's innerwear. Did I hear correctly that there was a slight decline in men's innerwear volumes for the quarter? Or was it for 9 months?
9 months.
And for the quarter, we would have still posted growth?
I -- we -- as I said, we can refrain from answer these questions, but I gave the details because there was some understanding that has to be done. So I would as it to the 9 months. So obviously, there has to be growth in the first quarter because we had a washout in quarter 1. This would be almost at par for the year or quarter 9 -- for the first 9 months year-on-year. So yes, there is -- we are -- also the tax back, this is the largest volume, what we sell. [indiscernible] in mind.There's a lot of disturbance. I can't hear you.
[indiscernible] Sure. Sir, I think I heard in the past that for 9 months, obviously, we would have seen a decline within at the company level, we have seen a 19% decline. So the number which you said was for quarter 3 because athleisure would have grown by high double digits?
Yes.
And sir, going forward next year, do you think this growth in athleisure is sustainable? Or you might see some correction and demand slowdown, wherein your innerwear business takes our growth trajectory?
So innerwear and active wear are 2 different products, and they have 2 different usages. So there is no way that innerwear can [indiscernible] to the active wear or vice versa. The requirement of both is very different. So I don't see that, that could have an impact on each -- either of them.Coming back to your other question of sustainability of the growth of active wear, I would say, definitely, yes. Because the kind of trials which have been due for this year will only help the call there.
Sure. That's helpful, sir.
Next question is from the line of Sameer Gupta from IIFL.
Congrats on a very good set of numbers. Most of the questions have been answered. So I'll probably ask a more strategic kind of a question, sir. So in this e-commerce, we have also seen the routes of consumers adopting more of this channel in the COVID times, and this is across categories. But what's your take? Like at least in your core urban markets, where the salience of e-commerce is growing, and there are so many premium and foreign players now which can enter and access this market, probably they don't build -- need to build the kind of distribution that you have built because of the flexibilities offered by this channel. So do you think of this as a threat, this is more like a thought sharing exercise, sir?
No. No, I appreciate your thought. It's not that we don't think about this or we don't discuss this internally. See, we also have a very strong e-commerce win, right, where we have our own shop, which is [indiscernible] And then we have the -- we sell outright to all the bigs of the e-commerce world. We also sell through marketplace through all these guys. So it's not that we are not available on that side. So if somebody is going to go to the Internet to buy a pair of innerwear or any active wear products, it's not that we are not available there. We are there. And when it comes to value for money and the pricing of the products, the cult of the products, we are up there. So it's not that somebody else can come from nowhere and produce a product which is much more scaler than us at half the price of us and then take over the market. I don't believe it will work like that. It takes many, many years. It took us 2.5 decades to arrive at this value proposition, to create this kind of quality product and the [indiscernible] and the marketing around the brand of so many years. It just doesn't vanish overnight.Then the kind of presence we have off-line, which in turn helps the online business as well, because we are talking of attaining 1,000 EBOs very shortly in probably another 6 to 8 months, we should be having 1,000 EBOs, which is just second to -- and the entire parallel footwear world for a single brand. So that's the kind of reach this brand has. While we can look at the e-commerce business, as I said, but we see that as an opportunity because we are available there, and we have all the products which we sell off-line available online. And as I explained, we sell through all these players who are selling the other brands from their totals.
Next question is from the line of Ashish Kanodia from AMBIT Capital.
Sir, in your opening remarks, you made a comment that there was a month-on-month growth trend since October till December. And if I heard it correctly, the trend has continued during the January. So can you confirm that?And second thing is, when I look at your men's innerwear not recovering back to 100%, we have already added almost 10% to 12% stores. So that could have also given you some growth, right? So what kind of delay in your recovery in the main [indiscernible] given it's more essential in nature?
So question one, yes, I confirm what I said. We had a sequential growth from August month onwards till the end of Q3, but that's been continuously happening. We have grown more than the previous month as a percentage from other numbers.The second part of your question -- sorry, sorry, I missed out -- the second part of the question was?
Sir, the second part was that we have already also had a 10% to 12% footprint in terms of retail outlets, and yet we have not been able to recover. So what kind is driving demand recovery?
No. The only thing is that we have to understand here, the base of our men's innerwear is the largest in terms of volume, right? So it -- obviously, because then we lost 1 full quarter of a very large base, it's not really easy to come out sort of come out of it in just 6 months. But by the time we close this year, I'm sure that we should be in a much, much better position on demand overall.
Sure. And second question. So sir, on the first question, I think I missed your comment. Has the growth continued in January as well?
I should not be commenting on January. Yes, it is -- until December, it has been consistently growing.
Due to time constraints, that was our last question for today. I now hand the conference over to Mr. Akhil Parekh for closing remarks. Over to you.
Thanks, Suresh. On behalf of Elara Securities, I would like to thank everyone and especially the management of Page Industries [indiscernible] I'll hand over the call to -- in case of any closing rate.
Thank you very much, everyone. It's a well-participated conference as usual. And also, we learn a lot from you equally as we share about Page Industries. Q3 has been good, and we hope the good times will continue. But thank you very much. Have a good day.
Thanks, everyone.
Thank you very much, members of management. Ladies and gentlemen, on behalf of Elara securities, that concludes today's conference call. Thank you all for joining us, and you may now disconnect your lines.