Analyzing...
MR. RONAK – KIRIN ADVISORS PRIVATE LIMITED
Ladies and gentlemen, good day and welcome to Patel Retail Limited Q3 and 9 months FY 26 Results Conference Call hosted by Kirin Advisors Private Limited. As a reminder, all participant lines will be in the listen-only mode and there will be an opportunity for you to ask questions after presentation concludes. Should you need assistance during this conference call, please signal an operator by pressing star then zero on your touchtone phone. Please note that this conference is being recorded.
I now hand the conference over to Mr. Ronak from Kirin Advisors Private Limited. Thank you and over to you Mr. Ronak.
Yes, thank you. Good afternoon everyone. On behalf of Kirin Advisors, I welcome you all to the conference call of Patel Retail Limited for Q3 and 9 month FY 26 results. From the management team, we have Mr. Dhanji Patel, Chairman and Managing Director. Mr. Rahul Patel, Chief Executive Officer. Mr. Hitesh Sawlani, Chief Financial Officer. Now I hand over the call to Mr. Rahul for the opening remarks. Over to you, sir.
Thank you Ronak. Good afternoon. On behalf of the entire management team, we extend our heartfelt gratitude to all our shareholders, investors and partners for their continued trust and support in our journey. Patel Retail Limited is a fast-growing value-driven retail and FMCG company with focus on spices, having an integrated model spanning retail, manufacturing and exports.
The company operates stores under the flagship brand Patel's R Mart, owned brands like Indian Chaska, Patel Fresh and Patel Essential under manufacturing. Under manufacturing, the company is focused on private label manufacturing and key brands in this vertical are Indian Chaska, Patel Fresh, Blue Nation and other home care brands.
The company has set priority to increase private label contribution as private label supports higher gross margins, better inventory control and strong brand equity. The company plans to increase private label contribution to 22% from current 17% over the next two years. Under manufacturing and processing, management continues to focus on improving capacity utilization while leveraging a strong base of backward integration.
Strict cost discipline is maintained through extensive in-house processing and testing capabilities enabling better control over quality, efficiency and overall cost structure. Private label contribution continues to increase and is positively impacting margins.
Starting with a single grocery outlet in 1990, we have today evolved into one of the most trusted neighborhood supermarket chains in Mumbai metropolitan region, operating 49 stores across Thane, Raigad with over 2.10 lakh square feet of retail space. Our cluster-based expansion model ensures strong local market dominance, supply chain efficiency and cost control. We serve India's growing lower middle class and aspiring upper middle class consumers with a wide range of groceries, staples and FMCG.
The following performance reflects our Q3 FY 26 results. Our income grew by 35.51% year on year to INR311.12 crores. We significantly improved our profitability with EBITDA climbing 63.59% year on year to INR24.91 crores, bringing our EBITDA margin to 8.01%, an increase of 137 basis points. Our PAT showed exceptional growth surging 95.89% year on year to INR12 crores and our PAT increased by 119 basis points to 3.86%. This excellent quarter resulted in an EPS of INR3.59 reflecting an 44.18% growth.
For the nine months of FY 26, we successfully maintained our growth trajectory. Our total income for nine months reached INR719.75 crores marking an 19.05% year on year increase.
We grew our EBITDA by 33.79% to INR60.34 crores achieving an EBITDA margin of 8.38% which shows an improvement of 104 basis points.
Our PAT for nine months increased by 60.59% year on year to INR29.07 crores with PAT percent improving by 104 basis points to 4.04%. Overall our EPS for the nine month year was INR10.08 representing a solid 36.22% growth. This results underline a steady growth trajectory and the benefits of integrated business model. Hello? Yes, we can take on Q&A now.
Thank you very much. We will now begin the question and answer session. The first question is from the line of Vinod Shah from VS Ventures. Please go ahead.
Yes, good evening. So I have some couple of questions. So how realistic is the target of increasing private label contribution from 17% to 22% plus in the medium term?
Right. Sir, by way, by focusing on the placement of that products, we are also trying to enter into the suburban markets of the exterior of other states when it comes to brand Indian Chaska.
We are trying to introduce new SKUs that we have found essential in the current years and is catching on the trend to be made under our own brand. Overall, it's just about giving the better quality at the right price and eventually we'll see the growth from 17% to 22%.
Okay, okay. And which private label like categories like spices, staples and FMCG apparel are driving the highest growth?
For now, it is Indian Chaska which we had launched around a year back. We did an exceptional revenue of around INR8 crores this year and we plan to grow on 15% to 20% month on month.
The overall percentage at the year-end should give you an overall impact of 2%-3% by just Indian Chaska.
And when it comes to other brand Patel Essentials, Blue Nation and our Indian Chaska but not the powder spices, but the other segments where we do snacks which we sell in our own stores, that should contribute the rest of it, right?
Okay. And one last question, how does Patel Retail manage quality control and brand trust as private label volumes scale up?
Yes. So sir, we have our own manufacturing unit, one is in Mumbai, the other two are in Kutch.
So we have different products being processed in different facilities. That's how we maintain the contamination and the allergen control. And when it comes to the quality control sir, we have
our own in-house lab which is very well equipped with very advanced machinery which help us control the what we must say as the parameters in certain products.
Like for example I'll give you of chilli powder. We have a machinery called HPLC which calculates our the heat value as well as the color value of the product. It also helps us calculate the curcumin of the turmeric. So all of these instruments help us in giving the consistent quality to our consumers which they are used to, right?
And plus our in-process quality control is where it helps us to control our rejection and eventually helps us in maintaining the cost for the same as well, right? Yes sir, so these are the facilities that we have and these are the practices that we follow which help us giving the same quality to the consumers which has been accepted from time to time.
The next question is from the line of Priyansh Miri from Family Office . Please go ahead.
Yes, thank you Rahul for giving me this opportunity. Sir, very great set of numbers, congratulations. I have few questions. What is our current year utilization sir on manufacturing side of things?
So from manufacturing side of things, our current utilization when we talk in the season it's close to 80% to 85%. Since the utilization of those machineries are calculated on the yearly basis, you would see a significant not significant but a drop to 20%-30% less because some of the products that we do process are seasonal in nature.
But to tackle that problem and to get a consistent utilization of our assets, what we have done is to increase the bandwidth of the product within our private labels as I said earlier, right? So let's say a cumin, when it comes to the domestic market or the export market, the main season is from February start and goes on till July end.
The supply is adequate throughout the year but the actual volume comes within this month. But to tackle that particular problem, we have introduced our own brand, we have introduced a product line of whole spices under our brand Indian Chaska which helps us create that efficiency in the asset utilization.
And similarly with other units as well. For powder spices we have introduced Indian Chaska, for our atta unit plant we have introduced Patel Fresh. We also are doing private labels so that also helps us in utilization of our assets.
We are also approaching our export clients who have for with the service of one-stop where if say a client is growing and want to introduce all kind of SKUs, we have in regards to the food industry precisely spices, whole spices, atta and sesame and peanut. So we are offering them the service of private label as well.
So that's another way that we are using our machineries. And when it comes to peanut, we have a plan of so we do deshelling of peanut but we also do the removal of the skin of the peanut which is eventually turned into a snack that we eat these days as well as it is used in peanut butter as well, right?
So eventually we plan on introducing our brand in peanut butter as well with our distribution channel which has been set by Indian Chaska, right? So it is one step at a time, right? So we have introduced Indian Chaska right now in multiple states and moving forward with that similar line we are going to introduce other products in regards to that same units as well.
So that's our plan to increase our utilization and right now the utilization in season comes to around 90% and when it's not season it is around 45% to 48%.
Okay, thank you sir for this detailed answer. Also sir when it comes to our store sales growth right for our retail sales channel, what sort of number is there for same store sales growth SSSG? Yes, it would be around 8%. Yes, go on, Hitesh. 8%. The same store growth is 8% for year-on-year basis.
Sir, this is a blanket number, right, including our white label and also the other brands product that we have? Blended number, correct.
Blended number. Is there any special tracking, sir, for our white label products, particularly in terms of say volume growth that we are witnessing?
Yes, we are tracking the private label growth on our retail store as well. We are growing almost in the range of 17% to 20% and it is growing year-on-year basis.
Okay. One more question, sir. On our planned capex for next say one or two years, what is our distribution on our say manufacturing or expansion of retail site? Can you throw some light on that? Please repeat your question?
What is our capex plan, sir, on our manufacturing as well as retail side of the business?
So capex for the retail store is almost INR1,500 per square foot and on an average we have a 5,000 square foot store size. And as far as manufacturing and processing capex is concerned, we already have enough capex installed to meet the supply.
Okay. So in manufacturing, we might not require any further capex for next three years, right? Is that understanding correct, sir? Yes, you can say that. From manufacturing side, certainly not. Okay.
So until and unless we expand the retail.
Yes, until and unless we introduce a new product line, right, which would require some kind of modification within the machinery itself which is already been installed. The base of all product has been installed, right. Let's say I have a machinery of mango pulp right now. The same machinery can be used to make a tomato puree as well with very minor modifications. So only in those cases, there will be utilization of capex for manufacturing part. But aside from that, whatever work we are doing right now we have enough capacity to cater for the next two three years.
Sure sir. One question, sir, on product side of things. Like there are -- like, globally, when we see such smaller company like ours right, there are case study when they have actually moved on to from basic processing to more of a specialized product, like chocolate, right? Let's take example of mango puree or peanut-based chocolates, right? So is there any plan, like how we plan our product innovation or do we have any pipeline for getting into such specialized product where margin could be further high? Like two, three level of processing into a product?
Right. So as I explained earlier, right, when we were talking about utilization of our capacity.
So right now, what we have done is we have introduced five plants, five units under one unit.
We eventually plan on turning all of them into a value-driven products such as, let's say, we would from our Unit 3, which is atta unit, right, we will do a line of noodles and fryums as well.
That's a level up. And from there, we might enter into the industry of instant snacks, instant noodles.
From powder spices, we have now introduced Indian Chaska for whole spices. Another level up for more margin driven would be seasoning and to level up to that would be ready to eat. For peanut, right now we are doing deshelling of peanut, we are doing removal of skin peanut, we would do peanut butter eventually and then we would do snacking in snacking of peanuts as well right.
And when it comes to sesame, we do cleaning, sorting, grading of the raw sesame as well and we also remove the skin of the sesame which is hulling which could eventually turn -- which would eventually create a base if we want to make a product line for tahini or specialize into Middle Eastern spices.
As there is an -- as the demand for international flavors is been rising in the country, right, so whatever arrangement or whatever utilities are there available with us is all for the basis of the product that will be introduced in the following years. So I hope that answers your question of how we might expand our manufacturing into more value-driven products and goods.
Sir, any timeline by when we can see such value-driven product contributing to our top line?
Right. So we believe there is no point in introducing something and shutting it down as soon as there is a failure. So we rather do the market research first. Since some of the products are already into developed markets, some of the products that we have identified which are not yet organized, we want to introduce into organized market as well.
So until and unless that research has been completed, we won't force ourselves to just do that product because we are here for a long run. When we introduce something, it's a record that we have never shut it down. Even when it comes to our stores, we have opened 49 stores, none of them has been shut till yet right.
So our vision with any kind of introduction of a new product or let's say a new category is very clear. We first want to understand the market first, get our base right, introduce the distribution channel well, try to see that the product is accepted, are we placing the bet on the right product, are we satisfied with the product? It's a long exercise but we are trying to do it as soon as we can right.
We have enough let's say assets or people for it who are who are running the show behind the doors. But if you are asking me a precise timeline, it's very difficult to say. Very difficult to say.
But every six month, seven months a year, we would introduce a new product line or something like that. That's our goal eventually.
Understood, understood sir. Sir one more question like when we had our November presentation that you published right after that we had one call where I think the management has stated that they have secured around INR20 crores? INR22 crores of export business yes.
Okay. So any progress on that sir or in that order are basically whatever we have produced that is what we are exporting right? Or is there any collaboration work or something?
Yes it is purely all the manufacturing goods that we are doing mainly powder spices. Since we have cracked the code of the consistency as I said right, we have all the necessary things that we need to execute such big orders. Most -- all the products that have been secured in this order are manual are the products that we manufacture our own. Be it atta, be it powder spices, be it peanut right. Okay sir. Does that answer your question?
The next question is from the line of Bhavya Seth from Apex Finance.
Okay. I have couple of operational questions okay so my first question would just wanted to understand the inventory efficiency a bit better. Like how has the inventory turnover moved over the last years and what's really driven that trend?
Hitesh can you take on the inventory numbers?
Sure. So the current level of inventory considering the size of the company is almost INR210 crores and we are targeting to maintain more or less the same inventory ratio.
Okay. And how are pricing and loyalty programs adjusted to retain the customers who may be tempted by quick commerce convenience?
So obviously with the growing competition there is always a pricing strategy that we have right.
So there is a rigorous practice that we do by keeping an check on the ongoing market, be it our offline competitors or be it our online competitors, we always keep a check on them. And when
it comes to loyalty of the customers and trying to retain our consumers, we provide -- apologies the call got disconnected.
As I was speaking about the pricing strategy and retention of our consumers, as I said we keep a keen eye on our offline as well as our online competitors when it comes to pricing strategy.
We try to break deal with all with all the leading FMCG companies for the terms of trade if not to get a better term of trade terms of trade than our competitors. And when it comes to retention of our consumers, we try to give them services like free home delivery.
And offer them 15 plus one which is basically you get one month of free shopping on shopping of 15 months. And that has turned out a really impactful for retention of our consumers. So we understand the business of retail as purely a service-based industry, right? So we try to give them every service that we possibly can. So we have also introduced our omnichannel presence where their consumers for their ease of shopping, we offer them shopping via WhatsApp, our apps as well. I hope that answers your question right?
Yes sir. So as you scale up the store network, what are the main operational bottlenecks that you are seeing today and how are you thinking about fixing them over for the next few quarters?
Sorry can you please repeat the question?
Like as you scale up the store network, what are the main operational bottlenecks you are seeing today and how are you thinking about fixing them over the next few quarters?
See whenever we open a store and carry on the operation, the biggest challenge that we face or that general in retail is to try to fill up our shelves as soon as we can right. We never want it to be empty right now to solve that problem we have a hub-and-spoke model where all the distribution is done through a central warehouse which is situated in within 60 kilometers of all our stores. So that helps us in efficiently keeping our racks in stock by supplying them in the shortest time possible like 2-3 hours in stock.
Okay and the last question is Patel Retail evaluating the dark store model and quick delivery services to compete with e-commerce like quick commerce players? And if yes what would be the expected impact on margins and capex?
Right so we never say never and when it comes to the capex and the actual margins, all of those things. We have not introduced -- we are just planning on building an efficient supply chain model to first execute those things right? And whenever you start something which is to create the value for the consumers -- capex is something that can be foreseen with keeping a future with a future vision. So right now commenting on capex or any kind of margin, I can't really do that. Okay sir thank you.
Thank you. The next question is from the line of Sakshi Shinde from Shah Consultancy. Please go ahead.
So sir, I'm new to the company and I was going through the history financial, I can see this time we have good numbers in 9 months, also this kind of 20% up in top line? So I was going looking after the history financial, so we did around INR1.000 crores revenue in '23 and then this down and it was around INR800 crores. What was the reason for that down sir?
Right. So in the year where we -- where you saw there was a spike in the revenue, that was mainly on the account of the sugar trade that we were taking on at that time. Now due to the government circumstances in regards to the trade of sugar, it was banned for the next 2 years right so the dip that you saw was account of that.
And in that year we did around something INR300 crores worth of sugar exports. I would say we were still in growth year on year, definitely it is not seen on the paper since there is no one particular trade that has been shown but -- that was the reason was for the decline in the following years.
Okay fair enough. So and any guidelines for FY '27, as we are like I think growing at a good speed?
Yes I mean we'll be doing our best, try to give as much value to our shareholders try to stand on the point that -- stand on the commitments that we gave our shareholders before the IPO right we will try to give 100% and try to give the best result that we can it's been reflected in our past three results as well and we plan on following the same trajectory as well.
Sir, also I was, going through the website and I was going through the store locations why we are not very much, I think I can't find any store in Navi Mumbai any specific reason why we are not present in Navi Mumbai?
You would soon find a store in Navi Mumbai region. It's just that it -- it wasn't following in our business model yet, but a few stores in suburbs of Navi Mumbai would be seen soon. Why we didn't right now is because we have a very strict and rigorous model when we choose a store in regards to the fixed cost that's been commenced during opening of any stores and Navi Mumbai being a Tier 1 city it was just not within our range.
But I myself -- I myself from Navi Mumbai and I can see a lot of, like stores are there like not exactly like Patel Retail, but Yes similar to that so? I was just curious to know that why we are not catering that market?
I don't know how they are doing their operations, but I know how we will do our operation so whenever we enter any market we try to make a significant impact in that market. So now that we have chosen to enter the suburbs of the Navi Mumbai, we for sure try to make an impact in Navi Mumbai as well.
Also sir, how do we like positioning ourselves like how -- do you like position your Patel Retail different from DMart and other retail?
We are value driven, we are neighborhood stores, our design of product basket is way different than what DMart does, our packing size is way different than what DMart does, our quality of food is way different than peanut oh than what DMart does right.
We have a keen eye on the quality of the product that we keep in our stores and when it comes to our product design on our basket design it is very much -- in related to the consumers that we are going to cater in that 4 kilometer of the radius that our store is being introduced right. So that's how we try to position ourselves apart aside from DMart.
We are currently at like 49 I think 50 stores and what is the plan like, how much we can expect by the end of '27 FY '27? Any plans to double this numbers?
We plan on opening 10 to 15 stores every year that's just because we don't want to open the store test the waters if it's not working shut it down that's the waste of the capex that goes within it is just a depreciating model. Whenever we try to open a store we try to do it the right way -- so Yes so 10 to 15 stores in the next year. So right now we are at the count of 49 so by FY '27 you can see at the number of around 60 to 65 stores.
Good to hear sir. And one last question where I can see, Patel Retail in next 5 years?
You would see Patel Retail and all the brand of Patel Retail in your house that's what we aim for. Yes, I hope you come to Navi Mumbai.
We want to be we want to be a crucial part of that 3 to 4 hours that you spend every month shopping right? We want to create that kind of experience for all our consumers. We want to give all the right brands at the all right prices with non-negotiable quality to our consumers, with our brand that -- with our food category that's upcoming within our brands itself. So that's where we want to make impact amongst our consumers.
Good that's really nice and good to hear sir I'm actually looking forward to the updates. Thank you that's it from my side and all the best.
Thank you. The next follow-up question is from Priyansh Miri from Family Office. Please go ahead.
Yes. Hi sir just quick question sir. Last con call on November I think you mentioned that the sales that we contribute from our mobile app is around 3%, do we see any positive trend like is it increasing decreasing or how does it currently stand? Can you just give us a second? Yes sure.
It is pretty much on the same line right now, but with our new changes in the application and trying to build a new user interface and as we are working on our quick commerce model, we certainly see a surge in revenue that's been generated from online application, but as of now it's
pretty much the same. It's around 3%. Now we are trying to introduce the revenue contribution from our online channels.
Okay. So sir is this the new mobile app that you're working like any key changes like more partnership with any other e-commerce player or any other feature that which will be willing to this new feature?
When we talk about online business, our priority has always been to give value to our consumers and try to build a sustainable model. We truly believe on making the things not changing the things which are not broken. We are definitely going to try to introduce the thing that has been successful by using the benchmark strategy of the market and we have already have a mobile application. We are just going to change the user interface and add two-three more shopping convenience feature for our consumers. That's about it for our application model yet for now.
Sure sir. Another side of the same question sir like that that is with mobile app, but in our retail store I think in last call you also mentioned that our stores are doubling up as a dark stores right for many of this player, right?
We are talking with them. So basically what we said is whenever we introduce our quick commerce feature in our application we would use our stores as dark stores. Apart from that we are also talking with the key players in the quick commerce market to take up as our store as the dark store and that's still in the talks we are trying to negotiate with them. So we just chose efficiency and why we would have a more efficient model than them because we would have a multiple source of revenue from the same store if we do that.
For now I don’t think there's no any material progress as of yet in terms of partnership or something? No, not yet.
Sir also like in present quarter, there is a huge significant bump in our revenue numbers right?
Is there any one-off in terms of export order being executed or something or like it is a sustained number that we can see for coming few more quarters or years?
See as I told you we'll try to do our best and we are hoping to see the same trajectory growth.
I'm not sure about the number, but the growth that we are seeing would be on the similar lines that we have showcased right now. Also we have not reached a cap right. We are still growing and we still want to grow for that.
So I wouldn't be able to give you a precise number on what the revenue that could be -- that we would be doing in the following years, but we'll try to do as much as we can put 100% of our efforts and try to justify every possible commitment that we have given to our shareholders and withstand with our word to our shareholders.
Okay, sure sir. Sir one last question on our capital cycle days. So before last year right before from 2022 to 2023 for four year it was roughly around 50 days to 60 days right. In last two years we have seen it to jump from 84 to now almost 100 now. So what contribute to that sir like is it
like are we extending more credit days to our partner channel partners or what is the key thing?
Are we focusing more on expansion or what is the reason behind this jump?
Okay. So we are trying to – so definitely not credit days. What we were doing in the past 22 in the past year was major of our export trade was in the nearby ports. Now we are now – now majority of our export operation is in U.S, U.K, European countries, Australia, Canada where the transit is more than 45 days, 50 days, 60 days depending on the vessel and depending on the geopolitical situation what route is open, what route is not open because we see consistency in this market rather than the Middle Eastern market where the prices fluctuation and the quality is negotiable for them. And we truly want to work in the field where quality is the main concern.
Obviously the -- obviously every consumer needs value with the quality, but such ports US, Canada, UK is very quality driven market. All our machineries are such that we can make that kind of quality, right. So we thought, we want to utilize this specialty or this USP to cater much higher class of people with much higher margins and on account of that you would have seen increase in the credit days for now.
Understood, sir. So just a follow-up question on the export part only sir. US contribute what percent of our export sir and the recent trade deal right? How do you see it impacting our export business, particularly to US?
Yes, so UK is around 15. US is around 10%, UK is somewhere around 15% to 20%. Canada is around 10% to 11%. Hello? Yes, sir. You are audible. Yes.
Yes, sir. You are audible. Rest sir, is Middle East majority of our part then?
In Middle East we only do few selective countries like Saudi and Oman which also regulates on a European standards, those countries. Saudi is one of our big buyers. And besides from that Australia is there. Australia contributes 10%, US does 11%, Canada does 15%, UK does 20%.
There's Sri Lanka as well who does around 10% to 12%, there's Saudi Arabia who contributes around 10% to 12%, there's Oman who contributes around 5% to 6%.
Okay. So sir, as you see it is a diverse across geography, right? So, we are not going to, like, we are currently focusing on a diverse strategy, right. Not focusing on say increasing US more or any particular market more. Is that fair enough to say?
See, what our approach in the export business is to try to work with the top brands within that country, let's say. So, in UK we are working with the top three brands that are in the market, right. We are doing different products for them, we are trying to introduce our new products to them, we are trying to bandwidth their portfolio all the products that they are working on we are trying to gain that, that is going to come to us eventually, right.
No consumer is going to give us everything at once. So we introduce few product to them. Once they see that Patel Retail is a reliable source they know how quality works, they understand the market more, and then they give us three more products, and then they give us 15 more products.
So that's how you see the increase in the export revenue as well.
It's not on the account of just spreading anywhere. It's on the -- we want to increase the bandwidth of the product portfolio within the consumers that we have right now. Because we have already chosen the right consumers that we really want to work with in that particular market.
Okay. Sir, when you say top players of a particular market like this logos are the retail businesses or any FMCG dedicated FMCG brand? Like I'm talking about say, US and we have Costco, right, big retailer. Is that a correct understanding?
Yes. So, basically what we -- when I say about top players, I mean about the players who have their own private label well-established in those countries, which caters the local crowd within that country, right. So, for example, I can give you in UK there is a brand called Heera which is the leader in UK when it comes to Indian commodities, Indian spices, be it atta or be it whole spices, be it peanut, be it pulses.
So we do that work for them, right. So, there is a very high chance when you go to UK, Canada US, that you would although the goods are been made under their brand name but it would have been manufactured within our factory.
Okay understood sir so our primary customer will be more of a FMCG company right not the actual retailer right? Like Aldi, Lidl and all those… FMCG company -- because that's where the volume comes right I mean if I try to cater one, one retailers it is high in operation cost plus it is difficult to manage those containers as well because there would be a lot of mix and match products in one particular product. So it is not very viable in terms of operations but if you work with those companies who actually provide to these retailers that's just a better operational way.
And helps secure the margin better plus our product portfolio increases. There is no conflict of interest as well because again they are the leaders, right? I mean supplying directly to retailers is only me destroying my limit of supply.
The next question is from the line of Abhinav Shetty from Auckland Capital.
Sir I just had one question I just wanted to know the implication with respect to you know, change in commodity prices volatility in commodity price and currency fluctuations?
See the volatility and the change in the commodity price is something that we cannot control right all we can do is keep a keen eye on the demand and the supply that is been seen in the market right. So just before there is a crop harvesting, we try to do all the research that we can right from studying the weather right from going to the farms, trying to understand the health of the crops trying to trying to speak with the farmers, trying to understand what is the growth rate of the crop.
And thus on basis of the that and plus with the historical data before the harvest we well sure know what would be the price range of that commodity in the following year. But again there can be circumstances where there's a sudden spike in the prices of the commodity as well. But that sudden price of commodity spike is for everyone right. So it is not just us, so the entire commodity prices going to increase. And so our competitors prices are going to increase so that doesn't hurt us that much or I would say it doesn't hurt us at all.
And besides that when it comes to our own brand and securing the raw material. We try to do it in season where the price of the commodity is lower than the following months in which the harvesting has not been done so that's how we secure. And that's how we try to maintain the margin within our private label. And when it comes to our export orders and the volatility in those commodities for our export orders it is going to be the same for everyone.
We can predict prices there's there are multiple things that we can do so that's pretty -- that's how we encounter the volatility of the market. Moderator Sir do we close now or should I announce for more questions?
I think we can close. And I'll hand over to Dhanji sir for the closing remarks. Moderator Ladies and gentlemen, we take that as the last question of the day and now I would like to hand the conference over to Mr. Ronak.
So before I make the concluding remarks, I would like to hand over the call to Mr. Dhanji Patel. Over to you sir.
Dhanji Patel, Chairman and Managing Director, Patel Retail Limited.
I thank all the investors from the bottom of my heart for showing trust in Patel Retail. We started from a small grocery store and today we have reached here with hard work and honesty. I and my entire team will continue to work with full honesty and commitment to maintain your trust. Thank you.
Thank you. On behalf of Kirin Advisors Private Limited, that concludes this conference. Thank you for joining us. And you may now disconnect your lines.