Gopal Snacks Ltd (NSE: GOPAL) Q4 2025 Earnings Call dated May. 26, 2025
Corporate Participants:
Naveen Gupta — Chief Business Officer
Rigan Raithatha — Chief Financial Officer
Analysts:
Bhavik Shanklesha — Investor Relations
Abneesh Roy — Analyst
Vishal Gutka — Analyst
Resha Mehta — Analyst
Shrinarayan Mishra — Analyst
Dharmil Shah — Analyst
Ashok Shah — Analyst
Yash Bajaj — Analyst
Presentation:
Operator
Ladies and gentlemen, good day and welcome to Q4FY25 Gopal Snack Limited earnings conference call hosted by NK Global Financial Services 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 the presentation concludes. Should you need assistance during this conference call, please signal an operator by pressing Star then zero on your touchstone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Bhavik Saklesha and from MK Global Global’s Financial Services Ltd. Thank you. And over to you sir.
Bhavik Shanklesha — Investor Relations
Good afternoon everyone. I would like to welcome the management and engine for this opportunity. We have with us Mr. Rajan Gaichaka, Chief Financial Officer and Mr. Naren Gupta, Chief Officer as well. I’ll hand over the call to the management for opening remarks. Over to you gentlemen.
Naveen Gupta — Chief Business Officer
Thank you Bhavik. Good afternoon and thank you for joining us for the earning call. We hope you all got a chance to go through our investor presentation uploaded on the stock exchange. We will share our key operating and financial highlights for the quarter and Full year ended 31st March 25th. FYE 2025 was a year marked by resilience, adaptability and consistent execution for gopal Snack. Despite a challenging external environment and muted demand trends in Q4 FY25 we remained focused on strengthening operations and building a platform for sustainable growth. Talking about statewide performance for full year, FY25, our focus states registered a growth of 17% driven by an expanded distribution footprint while other states recorded 59% growth. Through deeper market penetration and outreach in underserved regions, Core state has degrown by 1% largely due to operational challenges caused by fire. Looking at segment wide performance for full year, the wafer segment delivered a strong growth of 41% supported by strong marketing endeavor. Despite the impact of Rajput facility incidents, categories such as Gatia and Namking continue to remain core contributors to our portfolio. We are committed to further scaling the growth in these categories. Expansion continues to be a key pillar of our strategy. We now have a network of 852 distributors with over 180 plus new distributors added during the year. Strengthening our market presence and supporting revenue growth. Our new manufacturing unit at Gondal has become operational reaffirming our focus on production efficiency and supply chain resilience. Commencement of the Gondol plant enabled the complete phase out of third party manufacturing. The company is actively working on new branding and marketing initiatives which will be rolled out over the coming quarters. These initiatives are designed to enhance brand visibility, deepen consumer engagement and support long term growth as we move forward. Our strategic priorities remain centered on expanding market presence, improving operational efficiency and fostering innovation across product lines. With a strengthened distribution network, rising capacity utilization and a diversified product portfolio, gopalmax is well positioned to capture future opportunities. Our journey forward is supported by a dedicated team and trusted partnership and we aim to deliver consistent growth and strengthen our leadership in the package match segment. I would now like to take this opportunity to introduce our newly appointed CFO Mr. Nrigan Rai Kata. He is qualified chartered accountant with extensive experience in accounts and finance. He will now share the financial performance of Q4 and full year FY25. Thank you.
Rigan Raithatha — Chief Financial Officer
Thank you Navinji. So, good afternoon to everyone. So let me begin with sharing the key financial highlights for the quarter and full year ended 31st March 2025. Let’s take up the key financials for Q4FY25 project. During the quarter we achieved revenue from operations of 318 crore down by 12% from Q4FY24 which was majorly impacted by the operational challenges caused by fire. Our gross profit for the quarter ended stood at 64 crores representing a gross profit margin of 20.2% as compared to 28.1% last year. Our margins during the period were impacted mainly by rising E raw material costs that rendered the pressure on the margin e raw materials such as palm oil, potato, Mega floor Chennai witnessed a sharp increase which has substantially impacted our cost structure. Palm oil increased by 54% from 85 rupees per kg to 132 rupees per pg Potato by 56% from 12 rupees per pg to 19 rupees per pg and Meta 4 by 21% to 28 rupees per kg 34 rupees per queue. In response to that we have undertaken multiple initiatives like downward revision in grammage in our 5 rupees and 10 rupees SKU of Karthi and naming products and upward revision in selling prices in larger pack. Our EBITDA for Q4 stood at 2 crores with an EBITDA margin of 0.6% compared to 10.8% last year. In addition to the effect of GPA above for declining the data margin other is also included due to increase in other expenses further consequent to fire incident. We have booked the total loss of rupees 47 crores under exceptional items covering damages to plant and machinery, factory building and stock which are covered under insurance. Now coming to full year performance for FY25 for 12 months we have reported the revenue from operations of rupees 1468 crores with year on year growth of 5%. Gross profit for full year at 368 crores with gross margin at 25% as compared to 28.5% in FY24. Impacted due to rise in fee from real prices. EBITDA stood at 105 crores with EBITDA margin at 7.2% as compared to 12% last year. In addition to the effect of GP decline is also attributed to increase in employee and other cost advertisement costs. Coming to our balance sheet KPI, our normalized ROCE stands at 16.3% while return on equity stands at 16.4% and our asset turnover ratio is 6.9%. Our cash flow from operations stood at 68 crores and working capital gains 250 days out of which 50 days are at attributable to raw material holdings. Raw materials as per our business practice are purchased in the crop season during Jan to March with gradually declines upon conversion into the finished goods. At last, our focus continues to remain on optimizing operational efficiency, enhancing profitability and delivering value to all of our stakeholders. Over to you Pavit Foreign.
Questions and Answers:
Operator
Thank you very much. We will now begin the question and answer session. Anyone who wishes to ask a question may press Star and one on their touchstone telephone. If you wish to remove yourself from the question queue, you may press STAR and two participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question is from the line of Abneesh Rai from Nuvama. Please go ahead.
Abneesh Roy
Yeah, thanks. My first question is on the overall palm oil scenario. What we have seen is palm oil has corrected sharply. Almost. It is back to where it had started. So, Are you also already seeing this in your buying price? And when do you see your margins fully recovering through pre inflation which we had seen around six months back. Do you see that in Q2? And given overall demand scenario is still a bit weak, can price cuts also happen? That is my first question.
Naveen Gupta
So thank you for the question. So coming to the palm oil prices. So palm oil prices yes it has softened from as compared to Q4 which was around 130 to 132 rupees per kg to currently approximately 120 rupees per kg. And that is just reflecting in our purchase basket also. But it will never come to the earlier level because the duty impact which has been levied on palm oil from 5% which was increased to 25% in mid of half year last year. So that duty impact will remain. But it has yet soft enough. So it will definitely be seen in our gross margin in Q1 as well as in Q2.
Abneesh Roy
Sure. And there was some talk of alternate to palm oil also being used. Given the duty in palm oil never came down in spite of expectations of the industry. Is there any usage of that alternate edible oil?
Naveen Gupta
So the palm oil is an essential factor in dumpkin business. So there cannot be any big alternative to palm oil because other edible oil is its own disadvantages to be used in the napkin business. So palm oil conditions be part of our purchase market.
Abneesh Roy
Okay, final question. Your revenue growth in Q4 seems disappointing. I do understand the capacity constraint which you had, but still it seems lower than expectation. So if you could talk about the market growth in your geographies and the capacity constraint, was there any demand issue which is the main worry now rather than the capacity constraint?
Rigan Raithatha
Hello Amish. As far as Q4 numbers are concerned, those are in line with our previous commentaries. The factory which we lost was contributing 65% of our top line. And we lost 110 man days to be very precise between Q3 and Q4. So our per day revenue loss on weighted average was 1 crore rupees. If we just add back those 100 crore rupees to our delivered revenue, the numbers are aligned. Now as far as lower demand and other sectors are concerned. We have deep penetration in rural India. In rural Gujarat particularly. Right. Rural demands are okay as of now as well. Our current quarters numbers are aligned to our internal projections. Definitely. When we give a statement that we have made our dependence on third party level zero. That is. That is a perfect statement. Having said that we have got product basket of say 95 products. So there are several challenges in our. In our kind of industry which allows us which I mean which is a constraint in fact that when we get a third party manufacturing so there has to be a product basket. So as of now we are manufacturing products which were earlier going to quality.
Operator
Sorry to interrupt sir, but your voice is voice was dropping.
Rigan Raithatha
Yeah. Am I audible now?
Operator
Yes sir. You may proceed.
Rigan Raithatha
Yeah. So if we were manufacturing 95 products in our factory as of now we are manufacturing 90 products. As far as rest of five products are concerned we cannot get it manufactured from third party owing to quality issues, scale issues. So demand is intact and numbers are aligned to our internal calculations.
Abneesh Roy
Final question. When do you see your manufacturing being fully in place third party and on your own, so allied question is when do you see why sales growth happen? I do understand your base becomes quite favorable when that specific quarter will come. But on a two year basis which I think is the right way to look at your business now. When do you see on a two year basis growth coming back?
Rigan Raithatha
The first question is manufacturing. Manufacturing. We will commence commence production in our Modasa plant by mid of July. And Modasa plant will be fully operational for all the products. As far as growths are concerned to our production of you know, 20% growth in the current year over last financial year. Over last financial year. As far as two year base is concerned, we’ll tell you the exact number computed right now.
Abneesh Roy
So your voice is breaking. I could not get.
Operator
So are you there? Are you audible? Yeah.
Abneesh Roy
Can you repeat? I fully lost you
Rigan Raithatha
See, we stick to our guidance of 1800 crores revenue in this current financial year. Right. So it will translate into 20% growth over last financial year. We understand that our Q4 was muted and part of Q3 was also muted. So we have taken that into consideration. As far as two years growth is concerned. It will come to 28% in a base of two years.
Abneesh Roy
Understood. Thanks a lot. That’s all for me. Thank you.
Rigan Raithatha
Thank you.
Operator
Thank you. The next question is from the line of Vishal Gutka from Ask Investment managers. Please go ahead.
Vishal Gutka
Yeah, thanks for giving opportunity. A few questions from my side. For the core market Gujarat for 20%. You highlighted it is for India level. So for Gujarat specifically what I would try what kind of number that we are targeting in terms of sales strategy and what initiatives are we taking to drive that growth. Given the competition factor. Is there another question on the commodity basket? I think some commodities have seen deflation on a sequential basis. Whereas other commodities continue to remain firm. So as a whole, what is the outlook for RM index for F26 and what are we trying to. And what steps are we taking to navigate the same? And the last question on the 5 rupee pack, I think it contributed around 65% of overall sales. The number has come down over a period of time. What steps are we taking further to reduce the dependence on 550 pack?
Naveen Gupta
Thank you. Give me a second. Hello. Yeah, Vishal bhai, thank you for the question. As far as Gujarat is concerned, on annualized basis we are projecting 15% growth. As far as focus states are concerned we are projecting 25% growth. And in other states we are projecting 55%.
Vishal Gutka
Right. Yeah, sorry, go ahead.
Naveen Gupta
Yeah. So your question was that what will Strategy to improve number.
Vishal Gutka
Yeah, yeah. 15 growth is a very good number. So just 100 percent one is definitely the basis favorable. Apart from that what steps are you taking to drive the growth?
Naveen Gupta
Our basic four pillars we already explained in our previous commentary. Now in Gujarat we have laid a platform whereas we are going to double our number of salesmen who are on distributor payroll. So basically from weekly coverage we will start giving bi weekly coverage. Since our product basket have expanded. So it becomes imperative for us that we start giving double service to an outlet. So this is going to be a total game changer. In case of Gujarat cover number two as far as commodity prices and RM index I think Mr. Regan will be able to answer this question.
Rigan Raithatha
Yeah. So in terms of commodity prices. Yes those are started seeing like Farmolin has reduced to 8% Chennai reduced by 5% odd. So this will have a positive impact in terms of our raw material basket as well as gross margin as far as to bring down dependency on five MRP packs. So there are two, three things which are going to help us in terms of reducing our dependency not only on PI rupees MRP pack, rather on palm oil based products as well. One is once we roll out our marketing endeavor that will be a full blown TV advertisement that definitely uplifts brand perception in consumer mind. So we are trying to promote our 10 MRP packs in wafer category. It has a positive cascade effect on, you know, other categories as well. Other categories also start trending in higher MRP categories. Secondly, we introduce our Sandy Southeast which we introduce in all the modern trade chains and all the E commerce as well as general trade. So its full benefit has yet to come. We will definitely whatever the industry average is in terms of larger PAC contribution, we’ll come at par with better off.
Vishal Gutka
Hello.
Rigan Raithatha
Yeah,
Vishal Gutka
Sorry,
Rigan Raithatha
Should I repeat sir?
Vishal Gutka
Yeah, last line. If you can just repeat.
Rigan Raithatha
Yeah, so we We introduced trendy pouches which we. Which we did. Successful placement at big commerce platform and modern trade platforms. Its full benefit has yet to get reflected in numbers. Having said that we are confident that by all the means I mean one by product management and the other by marketing endeavor will be able to uplift the perception in consumers mind. Our contribution of larger path will come either at par with industry average or rather it will become better than industry.
Vishal Gutka
There’s two adjoining questions. One was you told that in Gujarat you’re trying to increase the seat on street although of course the range has gone up. So there will be incremental cost, a meaningful uptick in employee cost for Gujarat market because they’re planning to do service in bim monthly, bi weekly. And second question is on the if you can give guidance on ebitda margin from S26 or gross margin. I mean difficult
Rigan Raithatha
Answering your first question. After this fire incident we put all out efforts through trade marketing rule to retain our market share or how not to lose our market share when we say that deployment of additional ketone streak. So we will be partially subsidizing those salesmen. However the overall cost will not go up by 0.1% even. The reason being that we are slowly withdrawing the trade marketing input. Trade load through the retailer becomes the key so it will not impact. It is well within budgeted numbers.
Vishal Gutka
Second question. Yeah, yeah.
Rigan Raithatha
Pertaining to gross margin. So as our gross margin dependent upon the raw material prices and currently those are softening and currently we have visibility till profit till around H1. So in that terms good positive terms of gross margin.
Vishal Gutka
I think the wall is getting cut in between is getting broken.
Rigan Raithatha
Yeah. So let me repeat again. Yeah let me repeat again. So as currently raw materials has started softening, we have visibility till H1 currently based on future raw material prices. So that is definitely going to have a positive impact on our gross margins and that should be better as compared to full year of F4 2425.
Vishal Gutka
If you can quantify the amount on EBITDA or across whatever reason based upon assuming the situation holds on as on date so quantification is possible on the GROSS MARGIN EBITDA FRONT. 26 what numbers are looking like.
Rigan Raithatha
Yeah, so see, currently would be difficult to quantify because we have just
Operator
Started to interrupt sir, but your voice was breaking
Rigan Raithatha
So. Yes it is. It is difficult to quantify in terms of currently because we have just started the financial year. But yes, it would be definitely better than for fy current year of 2425.
Vishal Gutka
Wishing you all the best for the coming years. Thank you.
Rigan Raithatha
Thank you so much.
Operator
Thank you. Before we take the next question, we would like to remind the participants to press star and one to ask a question. The next question is from the line of Resha Mehta from Green Edge Wealth Services. Please go ahead.
Resha Mehta
Yeah, good afternoon Narendra and thank you for the opportunity. So the first question is basically I think we’ve guided for around 1800 crores of revenue for the current financial year. And if we look at the current quarterly run rate that is close to around 300 crore, right? And so which effectively let’s say we were to assume that in Q1 and Q2, you know, we are able to reach 400 crore kind of a revenue, which means 800 crore revenue for H1 and then the balance 1000 crore revenue that comes in H2 which seems a pretty, it seems like a very tall number, right, to reach in H2. So how confident are we? And you know, why you did outline a lot of efforts to kind of maintain our market share. But you know, still there would have definitely been some channel disturbances, right? Be it in terms of general sales or you know, because the required quantities would have not have reached that. So, so how do we really see this, you know, achieving small number of thousand crore or you know, maybe even more in H2. So just wanted to kind of get your thoughts there.
Rigan Raithatha
Yeah. So Reshaji, thank you for the question. We understand that current quarter’s run rate is definitely around 100 crores per month only. However, there are two factors. One is whichever growth levers we are talking about, those will start delivering numbers in Q3 and Q4. We have clearly stated in our previous commentary as well that H1 is going to be muted. It will be single digit revenue growth, right? Whereas in H2 we have planned a growth of 37 to 40% on H2 H2 versus H2. Now how these numbers are going to come. One, I just mentioned in my previous question, in the previous question that In Gujarat we are doubling our service levels. Our industry has you know lot of dependence on service level. So Gujarat will start firing and other states it is going to be distribution expansion plus marketing endeavor plus product management improvement. So even our current current month numbers are aligned to our internal plan.
Resha Mehta
Got it. So that does translate to a thousand crore kind of revenue for H2 which because of all these things which you seen. Got it. And you know the other was on the some data questions basically for fire We’ve booked some 47 crores of of losses. Is there anyone expected or are we reasonably confident that you know this is the final number?
Rigan Raithatha
Yeah. So fire loss which we have booked for the Q4. It is more or less in line with whatever estimation which we have received based on the surveyors loss and all those things. So we are not expecting any further losses on account of fire. Marginally it might come in Q1 but it would not be BJ.
Resha Mehta
When you say marginal would that be like a 1020 crore now kind of.
Rigan Raithatha
No, no it would be I would say 3 to 4 crore something like of that sort that also we have almost covered I would say 98% of the thing. But some might happen due to the change in estimates which can be in the range of 5% here and there.
Resha Mehta
Right. And Capex is most of the Capex for the Modasa facility you know ramping up. Is that kind of done or in FY26 if you could highlight what is the kind of Capex number that we see.
Rigan Raithatha
So Capex we are planning to have over there in terms of that should get completed by as Naveenji said by July and we should be getting close fledged production coming up from the August. So we have incurred some of the Capexes in restoration of our Rajkot facility which would happen at Modasa and so some of would have incurred in FR 2425 and something would be happening in 2526 also.
Resha Mehta
Yes, I was looking for a number. If you could share the number for the Current financial year 25:26 what would that number be?
Rigan Raithatha
Number. Just a second. So Modasa we have incurred roughly around 9 crore rupees in Current financial year, that is 24, 25. And next year we are expecting to incur another 30 odd crores in 2526. So that would include this restoration of this facility from Rajput to Morasa and certain other new wafer lines also are coming up over there.
Resha Mehta
And any other maintenance capex that would be roughly 51 crores.
Rigan Raithatha
No, no. So maintenance capex would be in line of 3 to 4 crores at Mulasa.
Resha Mehta
Right. So give or take around like 35, 40 odd crores of total capex for the full financial year. That would be a right assumption to make.
Rigan Raithatha
35 crores should be the ideal number which would include maintenance as well as incremental capex.
Resha Mehta
Right. And also now we exited Q4 by completely stopping our outsourced third party production. Is that understanding? Right?
Rigan Raithatha
Yes.
Resha Mehta
Okay. But Q4 as a whole would have had some third party outsourcing, right?
Rigan Raithatha
Yes.
Resha Mehta
Okay, so let’s say, I mean our gross margin for Q4 was 20% if there were no outsourcing to third party. Right. So what you know, would have been our gross margin because we would have incurred additional logistics and manufacturing costs because of outsourcing to third parties. So if this factor was not there.
Rigan Raithatha
Yeah. Expected average impact was one and a half percent.
Resha Mehta
Okay. So the gross margin would have looked something like 21 and a half percent.
Rigan Raithatha
Yes.
Resha Mehta
Okay. Okay, one question. So you know, because unfortunate fire disabilities. Right. And probably our corporate office would also be impacted. Would have got shifted. So have you seen any kind of major churn or you know, disenchantment with, you know, with people because you know, they would have had to move places or you know, work in a makeshift arrangement. And how are we kind of handling that issue? Know that has been an issue.
Rigan Raithatha
Yeah, that’s a very good question. In fact, if you would not have asked then we would have missed this question. Very good achievement, I would say. One is amongst 300 distributors of Gujarat. There was only one casualty, only one distributor left us post fire incident. Now as far as employees are concerned, I would say nobody has left. We have got right now we are functioning from four makeshift offices which are in vicinity of 500 meters of our, you know, corporate office. And today only we have started, you know, exploration of our corporate office work owing to this fire incident We did not lose any talent, any resource or any channel partner.
Resha Mehta
Great. Great. All right, sir. That’s it from me. And all the best. Thank you.
Rigan Raithatha
Thank you, Rishaji.
Operator
Thank you. The next question is on the line of Sri Narayan Mishra from Baroda BNP Paribas. Please go ahead.
Shrinarayan Mishra
Thank you for the opportunity. So my first question is on the margins. Given that we’ll be commencing our operations in the Modasa plan by July and fully we’ll be operationalizing by October. So if you. If we try to build the margin trajectory. Will it be kind of high single digit, mid to high single digit in H1. And then in H2 we expect it to be maybe low double digit to mid teens.
Naveen Gupta
Yeah. So our Modasa plant will become operational by that we are projecting. And in terms of margins, yes, H2 should be better. Because what we are projecting in H2 our majority of sales that is higher up.
Operator
Sir, but your voice dropped. Yeah.
Naveen Gupta
So let me recruit. So. Yeah. So H2 margin should be better than sales growth rate would come easily in H2. So in terms of margin guidance. Yes, H1 should be somewhere in terms of mid to higher single digit. And H2 should be higher than H1.
Shrinarayan Mishra
Okay. Okay.
Rigan Raithatha
In a different perspective, you know our. Our efficiencies and our operational margins are better in Gujarat versus rest of the states. When we talk about better numbers in Gujarat, that definitely gets gross margins as well.
Shrinarayan Mishra
No, agree, agree. But on a full year basis because of the, you know, additional cost to ramp up the plant. The full year margins would be lower than March 24 or in the similar range.
Rigan Raithatha
No. So full year margins would be better than FY 24, 25. And so in terms of ramping up. Yes, our CapEx is. Are fully installed. So that not near.
Shrinarayan Mishra
I’m asking with respect to FY24. So with respect to FY24, will it be better or same vicinity?
Naveen Gupta
Talking about market.
Shrinarayan Mishra
Yes. Yes sir.
Naveen Gupta
Are you asking full year margin?
Shrinarayan Mishra
Yes sir.
Naveen Gupta
Full year means will be better than full year margins of FY5, 26 will be better.
Shrinarayan Mishra
FY24 25 is definitely better. But I am asking with respect to FY24
Rigan Raithatha
And you are asking with respect to FY24.
Shrinarayan Mishra
Yeah.
Naveen Gupta
So it would not be on Same lines at FY20. The reason being that here there is the raw material prices have impacted. So which out of some of which we have passed on to the consumer. And gradually we will be passing on to the market as per the market condition.
Shrinarayan Mishra
Okay, okay. Okay, got it. And so second question on the modern trade side. I mean before this incident happened, fire incident. We were. We had some plans for the modern trade. Now how has that shifted? How is that delayed? And how. How are we progressing there?
Rigan Raithatha
We are progressing well in our. Let me quote name few of the national change. And now our presence is selective stores of Mumbai and outside we are. There are largely two national chains which are operating in modern is Reliant. Another is deep right. We are present in Dema in selective stores in Mumbai right now and present in entire western India Dmart outside Mumbai. As far as Reliance is concerned, we are present in Gujarat. Now coming to the regional chain as we are speaking. We are now present.
Operator
Sorry to interrupt, sir, but may I request you to reconnect. The voice is dropping
Rigan Raithatha
. Am I audible now?
Operator
So you are audible but the voice keeps dropping in the middle. Should I reconnect you to the call, sir?
Rigan Raithatha
Yeah, yeah, please. Okay, sir. Ladies and gentlemen, please hold while we reconnect the management.
Operator
Ladies and gentlemen, we have the management back online with us. So you may proceed.
Rigan Raithatha
Yeah. Am I audible?
Shrinarayan Mishra
Yes.
Rigan Raithatha
Yeah. So there are two national teams, one is Reliance and another so our footprint as well as throughput in both the chains have improved, which is culminating who are revenue growth of 50, 60% within these two chains. As far as regional chains are concerned, we are right now present in six regional chains which we were not present in Q4. At Bansal Superstore, there are 10 stores in Baroda. We are present there now. SG Supermart, which is a Rifur based company, we are present here now. There’s a chain called National Handloom. We are present there now. There called Patel Retail in mmr. We are present there now. There’s a chain called Haiko Supermarket here, present there now. So as far as modern trade are concerned, since we did not have product in our basket earlier now, the product improved product basket is helping us to improving our presence in modern trade.
Shrinarayan Mishra
Okay, okay. So sir, we could achieve it simultaneously despite that fire incident. So I mean, how have we managed the demand between general trade and modern trade then? I mean, did we intentionally shift some of the demand from general to modern trade? Maybe we have lost something there in the general trade.
Rigan Raithatha
No, no. See, Q4 was a very challenging quarter for us because it was not only production loss, the loss was also in terms of market share because production beyond production laws. There’s a whole ecosystem which became challenging. It was supply chain management and it was, you know, few stocks coming from the third party and all. So we do not do anything intentional to shift our revenue from modern trade to general trade. Modern trade. Majority of items which we were serving, those SKUs are different general trade by different SKUs so definitely fill rates was a challenge to general trade as well as modern trade. But it was nothing of that sort that we shifted our demand from general trade to modern trade.
Shrinarayan Mishra
Thank you. Thank you.
Operator
Thank you. The next question is from the line of Dharma from Dalmas Capital Management. Before we move on to the next participant, the participants are requested to use to limit their questions to two per participant.
Dharmil Shah
Hi. Hi Navinji. Thank you for taking my question. Primarily my question was on gross margins. You mentioned that FY26 gross margins would be better than FY25. So the state exit run rate of 21.5 including the third party manufacturing still it’s a very big jump from 21 to 25. So are you considering the only raw material slight decrease in this or are there any other areas which are adding to this gross margin increase?
Naveen Gupta
No. So currently when we say there will be improvement it is primarily on account of increase in sorry decrease in raw material prices that should be gaining benefit to us. And the Q4 which we say normalized was around 21.5. So for full year basis we are at 25% gross margin. So from there we are seeing an improvement from Q code prices.
Dharmil Shah
Understood. And does this include any grammar reduction or price in large effects or this is this was purely based on raw material estimate.
Naveen Gupta
See Dharmesh Bhai. On the weighted average we passed on 4.7% gross margin impact to the consumer already by two ways. One was grammar reduction in the smaller packs and another was MRP hikes in the larger packs. So as of now given the situation we don’t see further damage reduction scope looking into the intensity of the competition. Having said that, we are going to release our marketing endeavor by mid of July. That gives us a lot of confidence in terms of improving our margins by taking some money out of consumer pocket and some money out of channels pocket and some money out of the trade pocket as well. Because you know, in the current quarter as well and as well in the previous quarter we spend heavily to retain our retailer base by spending higher money. So the lower margins were attributed to two three factors. One was of course RM price hike. Another was there was a desperation to retain market share that we should not lose our distributor, we should not lose our retailers. So there were definitely higher spending. Now gradually we are reducing that spending as well. When we release our marketing endeavor. So our dependency on consumer goes up and our dependency on intermediary Goes down. So that will definitely help us to improve gross margins.
Dharmil Shah
And secondly if I come to the non Gujarat revenue or see the distributor count has decreased for focus particularly for Maharashtra and Rajasthan. Maharashtra I would assume was entirely serviced by the Nagpur plant. So why was this the case?
Naveen Gupta
No, Maharashtra was not entirely serviced by Nagpur plant. Western parts of western Maharashtra and Mumbai was catered by Rajput and Madhasa, Rajasthan was completely catered by Gujarat plants only. Parts of Madhya Pradesh like there were nine districts of Madhya Pradesh which were getting catered by Gujarat plants only. So eventually we have not actually grown in terms of number of distributors in Q4. But we have not dropped because whatever numbers we are showing. So at four places, one is Mumbai, another is Bikaner another is badmir and there’s one more place so we can Surat. So there are four places going to, you know, scale challenges. We converted 48 of our existing distributor to the micro distributor model. So we appointed our existing distributor as super stockist come distributor model. So 48 distributors got converted to micro distributor model which are not getting reflected directly in our SAP dealing. We as a company never had a super model. Right. We always used proclaim our ecosystem is so strong that we don’t need super stockist model. Because right now because of supply chain rules and issues challenges we decided that in even in case on some some business we have to incur some additional cost to retain our market share. Let’s incur that cost. So that is a temporary arrangement. We will, we’ll be out of this arrangement once our you know production and supply chain improves.
Dharmil Shah
Understood. And just to recheck these parts we completely manufacture in the modus appliance, right?
Naveen Gupta
Yes.
Dharmil Shah
Revenue growth for wafers have come down in current quarter. Obviously it has grown by 19 yoy. But earlier the run rate was somewhere around 40 or 55%. Model plant was not affected by fire or any supply chain issues. Any facility.
Naveen Gupta
Yeah, that’s a fair question. Actually it went against our previous assumption Typically what happened then after this fire incident when supply chain issues came up. So you know our hero products were not available. So we realized that we were we were able to sell vapors with the help of our hero products when hero products were not available. So throughput per outlet also went down substantially impacting vapor business as well.
Dharmil Shah
And this does not have any impact of some increasing pricing for vapor last quarter or is the pricing also factor is that
Naveen Gupta
That’s little challenging to exactly quantify that it was there any impact into price hike and all. We were always carrying an aspiration that our pricing has to be in line with leaders pricing. So effectively today, whatever price, at whatever price we sell to the retailer is at par with the market leader price. However, we continue to support that pricing through trade marketing group through secondary schemes. But still overall realization in wafers have gone up by 10% in terms of charging from the retailer versus pre previous year. So by end of this year we intend to further narrow down that gap and we intend to bring that gap maximum to the tune of 4 to 5%
Dharmil Shah
And this. And lastly on the raw material side, the 40,000 metrics and capacity for warehouse. How long does it last for us and by when do we have to rely on market sourcing?
Naveen Gupta
It will last up to end November. And typically then every brand has to start procuring fresh potato from the market only by December. From December.
Dharmil Shah
Understood. Thank you so much.
Operator
Thank you. Participants are requested to limit their questions to two per participant. The next question is from the line of Ashok Shah from Eklavya Invesco family office. Please go ahead.
Ashok Shah
Thank you for allowing me to ask question sir. As a Gopal we used to give more garage compared to our competitors. So do we have a now change that strategy and we are giving similar grammage for 5 rupees and 10 rupees and packages.
Rigan Raithatha
As thank you for the question.
Naveen Gupta
So, I cannot give a plain answer to this question. But you know there are certain categories like wafer we are giving grammar at par with the competition. There are certain categories and subcategories like murmura based item. Whereas we are giving either at par drama versus competition or little higher versus competition. So competition also have different measures like Balaji can give more, Aldiram can give less. So we are now maintaining average damage. So somewhere we are giving more grammar. Somewhere we are giving lesser grammar and somewhere we are giving average.
Ashok Shah
So as a brand and goodwill and confidence we have received over last few years do we plan to reduce our grammar compared to our competitors?
Naveen Gupta
See when we roll out our marketing endeavor we will try to improve our margins by 23 ways. In selective products can we take a further reduction in grammar? In selective SKUs can we increase our MRT and as overall brand can we improve our product mix so can we sell more quantities of those products which gives our gives us better margin. So we are just awaiting for our marketing campaign to release Then we will decide future course of action.
Ashok Shah
So second half we are planning for a major growth in ourselves. So what are the plan to increase the number of the outlet where our product is available and number of the distributor we are going to increase. So what will be size of the increase? We are planning
Naveen Gupta
The in core states we will not increase a single number of distributor from here onwards. Rather we will increase our number of Rather we will increase number of their salesman distributor salesmen so that they start giving twice in a week cover. So this is how this will help in terms of increasing number of outlets width as well as depth coming to the known core states. As of now we are saying that we have got 854 distributor including micro distributor we have 900 distributors. We aim to take this number to total 1000. So we will increase 100 effective distributors in non core state in the complete financial year. Because now our focus will shift to make the existing distributor more sustainable and we will try to expand within 300-500km radius of our manufacturing facilities.
Ashok Shah
And so my last question. Do we plan to add any new state in our business?
Naveen Gupta
As of now we do not intend to add any domestic state but in Q3 we intend to expand in our international business. And that too that to through some strategic partnership and not direct.
Ashok Shah
So what is the current sale of international business?
Naveen Gupta
Roughly 10 crores per annum.
Ashok Shah
So which will be my plan to increase to double it at least
Naveen Gupta
If we are able to crack some strategic partnership through some export house or some player who is already doing good amount of exports. We actually intend to take our international business to 40, 50 crores per annum. That may. That number may not translate in the current financial year. But definitely next financial year
Rigan Raithatha
We will start our work in Q3 only because by that time our productions will become stable. There’s no point, you know, attempting international business at this stage. Whereas we don’t have stable production and stable supply chain ecosystem.
Ashok Shah
Thank you. Best wishes for current year. Thank you.
Naveen Gupta
Thank you.
Operator
Thank you. The next question is from the line of Yash Bajaj from Lucky Investment. Please go ahead.
Yash Bajaj
Yes, thanks for the opportunity and good afternoon. So just on the previous comment you mentioned that you are targeting Gujarat region to grow by 15%. Now I mean just trying to understand the growth levers a little more deeper. I mean this, this state would be more of a Gatia led segment and it is a fairly mature category in Gujarat. So I mean what could be the levers for Gujarat as a state growing by 50, 15% considering you know, you considering that is more penetrated and you’re not adding more distributors.
Rigan Raithatha
Yeah. So Yash bhai, thank you for the questions. So in Gujarat there will be four growth levers. One is we will continue to sell more amount of vapors through various trade marketing endeavors as well as distribution efforts. Second is as I stated that our complete focus is in Gujarat is to retain our distributors and not allow to slip a single distributor from our fold. So what typically we are We are going to do, we are going to increase our this increase our coverage frequency at outlet from averagely 1.1 to 2 to 2 in a week. So that is definitely going to help us by improving level third is when we do marketing endeavor. So whenever a brand like our category or our start my marketing endeavor. So the biggest beneficiary state is the core state. Unlike a general perception that it will help us in footprint expansion in non core state. Rather it helps us in terms of better offtake better per capita consumption in the core state. And fourth and last is there will be lot of BTL activation, lot of consumer activation which we intend to roll out in Gujarat. That will also help us increase our number.
Yash Bajaj
Understood sir. And sir, just trying to understand out of the thousand crore of Gujarat business which would be the categories other than Gajya would would be big.
Rigan Raithatha
Which would be the.
Yash Bajaj
Which would be the other product category other than Gatia in Gujarat which would be big for us. If you can just tell us 2, 3. I mean G would be 1, vapor would be another. I believe any other category
Rigan Raithatha
Category is Namkins Yash Bai which has more than 30 products. Then third category is snack pallets and fourth as of now wafer. So we definitely, we definitely will grow in wafers tremendously and namkes will be the immediate beneficiary category besides Gatia.
Yash Bajaj
Okay. Okay. But after Gatia wafers would be big or namkeen would be big in Gujarat
Rigan Raithatha
Namke is big.
Yash Bajaj
Okay. Understood sir. And just last question is that the other category which is other than wafers and Gajiya which is basically western snacks then numkin and other snacks any reason why that we don’t see much growth over there? Is it that we don’t focus on that or is not our focus area any reason for that growth not panning out there?
Rigan Raithatha
Yeah. Yes. By. So we clearly decoded that reason that right now we have more than 95 products in our product basket and you know more than 325SK is in our basket. So, So typically the Gopal brand is known either for Gatia or for the Snack Palace. When our salesman goes to the market, he does not sell. He just books the order. So this is why we are contemplating twice in a week coverage at the outlet. There are different models which work when we speak about split coverage. So that is the key reason the salesman or distributor typically sells only those products which has a higher attraction. The other products may be. May. May be very big in terms of addressable market, in terms of market size and scope. But since those are not our core products, our distributor fraternity and even sales team does not focus on the other products. Now with the double coverage, you know, with the higher coverage frequency, that focus will definitely come.
Yash Bajaj
Okay. Okay. So basically we will. We will see growth in all our categories since we are increasing our service coverage. Okay. Understand?
Rigan Raithatha
Yes. Yes. Yes.
Yash Bajaj
Okay. Understood. Thanks a lot.
Rigan Raithatha
Yeah. Thank you.
Operator
Thank you. The next question is from the line of Vishal Gutka from Ask Investment Managers. Please go ahead.
Vishal Gutka
Yeah, thanks team. A couple of questions on my side. Sir. What was the percentage outsourced managed at F25 and shall this number come down to zero? F26. If yes, if no then please highlight what will be the number for F26 as well. Second question about distribution trend. I think approximately 900 distributors. So what are the plans for expansion in coming 12 years? F26, what are the plans, how we plan to take it forward. And last question on the insurance team. I think you filed a claim with insurance company. So what is the quantum of claim that you’re filing? What, what amount that you’re expecting to receive as and whenever it comes? I think it might come in the medium term, it might not come in the near term. These are the broader questions. Thank you.
Naveen Gupta
I’ll answer your second question first which is on number of distributors in Gujarat. We do not intend to increase our number of distributors because our plate is full in terms of number of. In terms of our footprint in Gujarat, we intend to increase number of retailers and we intend to increase coverage frequency in Gujarat. As far as non core states are concerned, which includes Focus and other states, we have a plan to increase 100 distributors in the current financial year, not beyond that.
Rigan Raithatha
Vishal, to answer your first question about the outsourcing of the product. So in Q4 we had outsourcing of roughly around 8 to 9% of our revenue. So that was the quantum of output in Q4. So that has been completely from mid of the March and we have complete in house production coming on in Q1. So there is no outsourcing in Q1 being happened
Vishal Gutka
For entire year 25. What will be number percent output manufacturing.
Rigan Raithatha
So it was same as Q4 almost because our fire event happened in later end of the December around the 11th of December so number remains same as the percentage of revenue almost.
Vishal Gutka
Got it. Got it. Thanks.
Rigan Raithatha
And regarding question on your claim. So yes our claim amount will come. So we have gone by the restoration of our original assets. So as and when we start restoring the original assets in terms of planting machinery and building the claim will flow to us and we have the enough claim. In terms of total our loss was the tune of around 90 to 95 crores. And considering the positive aspects coming from the insurance company we are quite positive that we will get almost full to near to full value of the claim.
Vishal Gutka
Got it. Got it. Thank you.
Rigan Raithatha
Thank you.
Operator
Thank you ladies and gentlemen. We will take that as the last question. I now would like to hand the conference over to the management for closing comments.
Rigan Raithatha
Yeah, so thank you. So I would like to thank everyone for joining this call. I hope me and Naveenji we are able to respond to all your questions adequately. For any further information we request to please get in touch with us or our investor relationship team. And wishing everyone to be stay safe, stay healthy and thank you everyone for joining us. Thank you.
Operator
Thank you on behalf of MK Global Financial Services limited That concludes this conference. Thank you for joining us and you may now disconnect your lines.