Second Quarter - Dabur India Limited

Vivek Maheshwari:Dabur India Limited Q2/H1Earnings Conference CallOctober 31 st , 2008Just quick questions one on the foods business, we have seen a modest growth and youanswered already the reasons but for the domestic business the margins they have grown by48% and you know the absolute margin percentage have gone up by 630 basis points. So,what has been the reason for this margin improvement and even that is the case forconsolidated business also.Rajan Varma:Apart from A&P spends I think the other thing is we have also seen a major benefit ofintegration flowing into the business since last time and therefore that overall improved themargins from an overall point of view and that I think we have been talking about thisimprovement since we have integrated this into the CCD business, but I think this is a resultof that integration out here.Sunil Duggal:There are two things here. There has been a margin upside on account of A&P and salesand distribution, but there has been an erosion which is consequent to the rupee issue but tosome extent that had been mitigated by lower raw material prices which have prevailedglobally for food products. So it is a very complex margin environment here. We havebeen hurt pretty badly by the rupee. What is fortunately has been mitigated by lower rawmaterial costs in dollar terms at source and lower A&P and lower S&M.Vivek Maheshwari:Sure. Going forward I mean once you are done with your all the launches and newlaunches and stabilize what is the target margin in case of food portfolio that you seebecause you know in the base quarter it was like 15%, now it is at 21%, so what is the longterm maintainable margins in foods.Sunil Duggal:Near term. I won’t talk long term here, but near time we would look at EBIT’s in theregion of 15%, 21% is abnormality. I think, we will need to spend little more on the A&Pto drive the portfolio with new launches coming up. We have got some very interestingnew launch ideas, which will require a fair amount of investment.Vivek Maheshwari:Okay sure and my last question is you mentioned some time back that since the excisewindow will get over by 2010 so you would be spending something like 100 to 120 croresover the next two years, any plan that has been formed up in terms of what product it isgoing to be or.Sunil Duggal:Everything has been planned up the last SKU what will be made, when it will be made,where it will be made, land acquisition is taking place, everything is going like clockworkbecause if we have to commission a very large plant in the next 17 months or so, we need tomove now, so all that is in place.Vivek Maheshwari:Any detail that you can share in terms of what products it would be?