Second Quarter - Dabur India Limited

Sunil Duggal:Dabur India Limited Q2/H1Earnings Conference CallOctober 31 st , 2008See we have been progressively reducing our dependence on Nepal, it was 80% of the mixone year ago, today it is something like 60% and we can bring it down further from 55% to50% in the near term. That is one way to de-risk the business model and we believe thatnow that the long term settlement has been signed ,the whole labour issues have been sortedout, the climate in Nepal would be better as well going forward. we have got bettermanagement/control now of the supply chain in terms of inventories so we can ramp up theIndia operations. We are building a lot of capacities in to the Indian operations to makesure that what happened in September actually does not happen again.Abneesh Roy:That is all from my side. Thanks.Percy Panthaki of HSBC SecuritiesPercy PanthakiHi, good evening sir, congrats on a good set of numbers. Sir just wanted to understand inyour hair oils category what is the split between volume and price growth?Sunil Duggal:In Amla it is approximately 10% volume and 8% price. The hair oils category as a whole infact showed little bit higher price increases as compared to many other categories.Percy PanthakiOkay and secondly again on the foods category I believe this is probably the third or fourthquarter where the growth has been slightly below the expectation, so you have mentioned acouple of solutions to that, one is depending less around Nepal etc., but do you think thatapart from the supply chain issue there is probably an issue in terms of the demand side alsobecause whenever I go to a mall the brand proliferation in the juices segment that I hadwitnessed has been really huge, there are so many brands whose names I am probablyseeing for the first time.Sunil Duggal:Yes, you are right, we have an issue in modern trade, not from the quality competitors likeTropicana but from the lesser brands who are able to offer huge margins, so typically youwill get a juice there for Rs.50 a liter, Rs.100 for 2 liters that is typically the price point thatis operating in modern trade. Over and above, they are lubricating modern trade withenormously high mark ups so there is a issue with modern trade which we can only addressby reinforcing our consumer franchise, so we have significantly upped our strength in termsof A&P, which we will continue to do so and I think the answer lies in telling the peoplethat our product is better, it has got a higher juice content and therefore even if you have topay a little bit higher price so be it, so for the traditional trade which is really the heart andsoul of the business, it is pretty much intact, while there has been a slippage over the last 2years or 3 years in terms of our modern trade share, our traditional trade share has remainedintact and has in fact grown, so we will find a way to address the modern trade issues, butthere is no easy solution to that.