Sastasundar Ventures Ltd (NSE: SASTASUNDR) Q3 2026 Earnings Call dated Feb. 09, 2026
Corporate Participants:
Banwari Lal Mittal — Managing Director & Chief Executive Officer
Lokesh Agarwal — Chief Financial Officer
Analysts:
Unidentified Participant
Soumya Chhajed — Analyst
Jatin Jadhav — Analyst
Deepesh J. Sancheti — Analyst
Abhishek Singhal — Analyst
Athar Syed — Analyst
Presentation:
operator
Ladies and gentlemen, good day and welcome to the Q3 and 9 month FY26 earnings con call for Sasta Sundar Ventures Limited hosted by GoIndia Advisors LLP. 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 the 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 Ms. Soumya Chajit from Grow India Advisors LLP. Thank you and over to you Ma’. Am.
Soumya Chhajed — Analyst
Good day everyone and welcome to QT and nine month FY26 conference. Concur of Sustas in the Ventures Limited we have on call with us Mr. B.S. mittal, the Chairman and Executive Director Mr. Lokesh Agarwal, the Chief Financial Officer. We must remind you that the discussion on today’s call may include certain forward looking statements and be therefore viewed in conjunction with the risk pertaining to the business.
I now request the management to take us through the recent business update. For that we’ll open the floor for Q and A. Thank you. And over to you sir.
Banwari Lal Mittal — Managing Director & Chief Executive Officer
Thank you. Good evening everyone and thank you for joining Sassa Sundar Ventures Limited Earning call. We sincerely appreciate your continued interest and support as we progress through an important phase of our growth journey. Our philosophy has always been detailed in combining medical science, technology and professional growth to make healthcare affordable and accessible. The core commitment continues to shape our strategy and execution during the year weeks after a steady revenue from last 34 quarters due to automation or growth came back and therefore from Q2Q our revenue have risen from by 20 to 11% Q2Q and by YOY 22%.
There is an expansion in gross margin also from last quarter 7.4% to this quarter 7.6% and from December 24 6.1 6.1% to 7.6%. During Q3 app 26 our business continued to demonstrate steady operation traction across both B2B and B2C verticals reflecting disciplined execution and sustained customer engagement. For the nine months period ended F26 over performance remained resilient despite traditional challenges witnessed earlier in the year. Growth momentum was supported by improved vendor sourcing, optimization and procurement processes and automation across fulfillment and supply chain operations. Both our key platforms, Retailer Sakti and Saskrans and B2C continue to remain central to our growth strategy.
Retailer Sakti maintained stock order volume supported by deeper retail penetration and enhanced supply chain efficiency. Meanwhile Sastra Sundar B2C delivered robust growth supported by improved customer engagement, stronger repeat order behavior and expanding product categories. Our performance continue to reflect the strength of our capital efficient model. Over 9 months FY FY 26 we maintain stable revenue growth and improved profitability metrics supported by better product mix, improved vendor terms and disciplined cost control. My dear friends, we have posted a very extensive presentation this time in Stock Exchange. I would request all of you to read very carefully each and everything about the business model how we are the most capital efficient company in the country both in terms of capital efficiency, both in terms of working capital efficiency and a highly growth oriented platform we have been able to build.
I am pleased to share that we remain firmly on track to achieve our stated guidance. Retailer sector is progressing towards ebitda breakeven by Q4FY26 and expected to deliver sustainable EBITDA positive performance in FY27. The sustainable bit 2C is progressing towards contribution margin positive in FY27 with offsetting leverage, improved edge order density and customer acquisition efficiency still trends and as you have seen in the balance sheet that how we are funding our growth which is required in a tech oriented business that our total investment for futuristic technology less than our treasury income and thereby the cash flow is remained positive by virtue of a treasury income for the future.
Our focus remains anchored on three key strategic priorities. One is technology and growth infrastructure. We continue to invest in building high tech AI enabled platforms that enhance customer experience, improve supply chain efficiency and strengthen personalized capabilities. These technology investments are expected to deliver measurable operating leverage benefit bringing FY27 edge adoption scales. Expansion across categories and geographies. We are actively expanding product categories, strengthening vendor partnership, an increasing penetration across underserved geographies. These initiatives are expected to support sustained growth momentum over the next two to three years. I’m very happy to announce that we already launched our JITO brand.
This JITO is a very progressive strategy to distribute generic generic offering under our own brand and I am happy to announce that we are the only distributor or we are only the healthcare platform which has the relationship with around 65,000 retail pharmacies. So quickly we will integrate all our pharmacy retailers to our JITO distribution network. Overall, our vision remains to build a leading healthcare platform that combines innovation, empathy and technology to deliver affordable and accessible healthcare solutions across India. With strong platform engines, tailored satin B2B and cisandar B2C, we believe we are uniquely positioned to create a scalable and sustainable healthcare ecosystem.
With this, I will now request our CFO, Mr. Lokesh Agarwal to take you through the financial performance for Q3FY26.
Lokesh Agarwal — Chief Financial Officer
Lokesh thank you Mitaji Good afternoon everyone. This side. Lokesh Agarwal so I take you through the financial performance of the company for this quarter. During this quarter that is quarter three financial year 26 we marked a strong operating quarter for the company reflecting a healthy top line growth, meaningful improvement in profitability. So you will notice that our revenue from operation has increased to 341cr for this quarter registering a growth of 22% as compared to year on year growth of last compared which is driven by sustained traction across both B2C and B2B. Business gross profit for this quarter has increased by 55% year on year as compared to last quarter while the gross margin has increased to 7.6% as compared to 6% reflecting an improved product mix and operating efficiency while employee benefit expenses increased year online year on year in line which is in line with our strategic investment for talent acquisition and investment in technology while other expenses are moderate and remains in line with our revenue.
EBITDA losses have significantly narrowed down to negative 14cr which has improved year on year by 41% while the EBITDA margin has improved by 4% in the corresponding quarter of last year supported by higher other income. The Company reported a sharp turnaround at the operating level wherein the ebit turned positive at 1cr compared to loss of negative 37cr of quarter three of last year. Further, you would notice nine month financial performance has also improved drastically. The company reported a revenue of 928cr approx reflecting a 15% year on year growth driven by steady perform across steady performance across core segments.
Gross profit has increased 30% year on year to INR 70cr while gross margin has improved by 80 basis point. We ended up with 7.5% gross margin for nine month period as compared to 6.7% of corresponding period last year. Improvement in our operating efficiency and higher other income supported a turnaround in our profitability with the company reporting PAT of positive 11cr as compared to loss of negative 151cr in 9 months FY25. Overall, the performance reflects the Company’s focus on scaling revenue while improving operating efficiency. We are continuously investing in technology, talent and in our platform capabilities to translate into stronger Margin, profitability and positioning the business for sustainable growth ahead.
Thank you. With this I leave the floor open for your queries.
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 touch tone 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 Amit from Robo Capital. Please go ahead.
Unidentified Participant
Thank you. Thanks for the opportunity. So my first question is on HealthBuddy. So what is the count currently and what do we expect the count to be next year for HealthBuddy like next two years or so. And secondly on HealthBuddy, what is the now currently, what is the quarter, what is the burn rate currently and also what are the top two three items where you know there is a burn? Because I think on unit economics level we may not be bleeding for help buddy.
Banwari Lal Mittal
Yes, you are very right. So the health buddy model itself is a positive edge contribution level. We are no we don’t burn even a single penny out of the delivery. So now there are 293 health bodies at Sandhya platform and this will we will grow around 50 to 60% year by year. So by 31 March F27 we should be around 400 health buddies and then we grow continuously and the top item of case burning or case investment is our salaries. So and advertisement. So the salary part is around 15 crores for B2C platform building and around 11 crore is or revenue advertisement.
So these two things are basically case investing items from transition level. We are case positive and we will continue to be case positive. So there is no case burn in transition.
Unidentified Participant
And these salaries, these are essentially for the IT team or for the building the platform, is that right? Or these are. These also include the delivery salaries for those who deliver the product.
Banwari Lal Mittal
No, we don’t deliver the product because the products are delivered by health buddies. So there is no delivery cost attached to this. These are purely tech oriented people who are building the futuristic tech capabilities. So these we don’t factor into our futuristic investment. We have a separate ecosystem building course. So B2C retail platform. We are building a unique platform to provide a the personalized services by artificial intelligence using say counseling based upon our data and B is the Cuke health delivery model which we are launching and three is the GITO generic module by which we can provide the clear insight how the generic, generic medicines may be cheaper for customers.
And fourth are the health records. These are the futuristic plants office or team is building platforms. So these are not related to current infrastructure or current offerings. These are purely futuristic offerings upon which we are very, very positive and these are very measured investments by us.
Unidentified Participant
Right. So thank you. And secondly on the retailer shift how do you see growth going forward like say a couple of years from now?
Banwari Lal Mittal
So we internally we have planned that we shall grow by 30% plus year by year for next 10 years. So five years, that is how we plan the growth. But I mean these are subject to so many variations upon Q2Q or even one year. So there may be some quarter where we we grow slowly, there may be some quarter we grow fast and rapidly. But if you ask me next 5 years to 10 years then we target to grow by 30% plus CAGR for 510 years.
Unidentified Participant
Thank you sir. And the last question if I may is on the corporate action. There is a, I think a merger planned if I. If I. So maybe you can throw some light on the corporate action on or what is the plan now?
Banwari Lal Mittal
So this is very important agenda for all of us. So earlier the SEBI agent made a condition that the there is there has to be QIV to hold 25 equity post issue to maintain the public shareholding. So we are working on that part. And after closing of this account for this financial year to 26 we will approach to our board of directors to grant the merger approval. And subject to that merger approval we must be completing the merger and demerger process in the next financial year.
Unidentified Participant
Okay sir, that’s it from end. Thank you and all the best.
Banwari Lal Mittal
Thank you.
operator
Thank you. Before we take the next question a reminder to all the participants that you may press star N1 to ask a question. The next question is from the line of Avnish Tiwari from Vaykorea Fund. Please go ahead.
Unidentified Participant
Hi, first question I had was this GST change which happened last year. So all inventory you had at a higher rate of gst how did you consume that? Like how did the marketing companies compensated you for that?
Banwari Lal Mittal
The marketing companies, I mean pharmaceutical companies have not compensated. They have given one month extra credit as to all the participants in the industry. So we have in our books the GST credit which we were into the inventory and we hope to cover up in next 2, 3 years period of time.
Unidentified Participant
Did it impact your gross margin for the third quarter because you had to consume this higher cost inventory?
Banwari Lal Mittal
Gross margin is right now is not enough to consume. So we are not paying any gst. But going forward, our gross margin will enhance and our revenue will also enhance. So I think in next three, four years and then we have, we are working very sincerely to increase our offering in terms of beauty care and personalized care where the GST rate is high so that we should compensate so that we don’t have any other option other than to wait for adjustment through our revenue.
Unidentified Participant
Okay, okay, okay. So you’re saying the GST we have already paid to recover, that you need to sell higher gst. Like in future you. You plan to recover that through selling items which carry gst so you can claim that input tax credit.
Banwari Lal Mittal
Right. So out of this sitting, one thing it can be that, you know, we, we sell other items and we increase our revenues. So I mean that is not a very big amount. It’s a very moderate amount. So we don’t find any difficulty. I mean, this is a change. And change is for good for country, good for the society, good for us. Also, the GST rate is decreased from 12% to 5%. But here some side effects are there. So we have to bear that kind of pressure on working capital. But there is not that much.
Unidentified Participant
Okay, so the only impact you have on working capital, not on the gross profit or margin. Because revenue and cost of goods both are excluding the gst, right?
Banwari Lal Mittal
Yes. So there is no effect on that except that, you know, working capital is plugged for some, some three, four years time.
Unidentified Participant
Yeah. Working capital is slightly limited. And to compensate for that, the marketing companies give you one month extra payable. Like what was that?
Banwari Lal Mittal
They gave us one month extra credit. But that has gone past. So that we have availed. But right now the GST remain as it is.
Unidentified Participant
Got it, got it, got it. Now second question I had was that let’s say your gross margins are about 7 and half, 7.6%. And in this industry of distribution, what are the typical gross margins? I mean some of your competitors have like reporting around 10%. Some of these other kind of distributors, smaller ones, have that vicinity 8 to 10%. So is this business. Can you help us understand your gross margin versus what we see at a larger company’s gross margin who are in the pharma distribution business?
Banwari Lal Mittal
Yes, you are absolutely right. But you have to compare one after discounting the credit part. So we don’t give credit. So we started our model without giving any credit. So over margin of 7.6%. If you adjust with credit that is coming 1.5%. If you see the larger distribution company, their credit is as high as 60 days. So 60 days credit means 2%. So our credit is zero. So 2% extra. I mean 7.6 to 2%, 9.6. That is in line with the industry. So as we grow more, I think this credit data will be replaced by the digital data.
We have started taking charges for our data management from pharmaceutical companies. We have launched Sasa Sunder digital platform SAS podcast on YouTube that has started monetizing. So we firmly believe that this credit delta will be compensated by delta by data and platform revenue and then again the platform fees that we charge from the retailers. So taking together without even the credit delta, we should be able to reach around 9.5 to 10% gross margin. And then there will be substantial improvement by virtue of the Jito or brand or own level brand. So we hope that it will enhance as we grow.
Unidentified Participant
Can you explain what do you do in data management for which your retailers will pay you about 2%, not 2%.
Banwari Lal Mittal
The data plus podcast plus the test three ability we are giving to the pharmaceutical companies data means we have the data because we our entire distribution is through digital. So we have the PIN code by data that in which PIN code which retailer is buying, in which area, which retailer is not buying in which area, which retailer has what kind of inventory at their stores and which retailer what kind of inventory they are returning. So all those are digital data. Those are very valuable insight for pharmaceutical companies.
Unidentified Participant
You give it to the marketing company, you mean? Right? This data
Banwari Lal Mittal
as pharmaceutical companies we give without mentioning the name by categorizing the PIN codes.
Unidentified Participant
Got it, Got it. And second thing also you said one is this activity you will do to to get additional revenues. You said second activity also which will help you in a gross margin. What was that now your own Gito brand.
Banwari Lal Mittal
I mean, I must emphasize that we are the only distributor who can integrate the pharmaceutical soaps into Jito private level brand. So this is a very unique model. The ability as of now, we are the only company which is which has a 65,000 retailers on board in digital medium. So we have launched them and we are making them enable to sell the generic generic quality brand Jito. And because now there is sustained demand from customer side, because the new customers are coming to avail the benefits. And this model, we firmly believe that along with the separate channel in success on the platform Jito, this will substantially increase our revenue and this will substantially increase our gross margin also.
Unidentified Participant
Got it. Typically how much margins you make on your JITO gross margin or contribution margin, where there’s some small cost involved. In selling, right. You need to connect with these distributors, retailers. So what is the either gross or contribution margin of jito?
Banwari Lal Mittal
So Jito, as you know the platform we have a variable expenses of around 5%. So the Jito the gross margin will be around 30%. So 5%, 30% will be the gross margin and out of that 5% will be the cost as happen with other medical distribution cost. So in Jitto we will be having gross margin 30% contribution margin around 25%.
Unidentified Participant
Got it? Got it. Okay, great. Thank you.
operator
Thank you. Ladies and gentlemen, anyone who wishes to ask a question may press star and 1. The next question is from the line of Aryaman from Bludent Investment managers. Please go ahead.
Unidentified Participant
Yeah. Hi sir. So basically like you mentioned, we don’t do credit. So. But doesn’t this create a bottleneck during expansion? The expansion that we’re currently doing? Because I’m assuming the distributor here give a decent amount of credit to the pharmacies. So if you’re going with no credit. Doesn’T this create a bottleneck in terms of growth and expansion?
Banwari Lal Mittal
We don’t find any bottleneck. Rather this is a usp. If you see the West Bengal geography where we launched first, we are the market leader including all the credit giver players also. So if this has been the bottleneck, then we should not have been the market leader. And then looking to our second geography is Noida, we are very rapidly expanding. We are the fastest growing distributor there in Noida. And then third geography, we went to the northeast, we opened another fulfillment center, Guwahati. So there again we are the leader. So I mean this is a choice to the retailers that they get a transparent price.
They get the commitment to deliver next year for all the medicines. And against that we give them extra discount. And the discount is as high as 1.5 to 2% more than any other distributor. And the credit if they get from banking channel or they get a credit from other NBFC, that credit cost is less than 1%. So if this disintegrate this credit from that distribution, that will happen in due course of time. Because this credit clubbed with the distribution is very costly affair for retailers as well as for distributors because both are into trouble. So this is a innovation and this is our USP and we got market leadership by virtue of that USP.
And we do not find any bottleneck in the growth.
Unidentified Participant
Sure, sir. Thanks a lot.
operator
Thank you. Ladies and gentlemen, in order to ensure that the management will be able to address questions from all the participants in the conference, kindly Limit your questions to two per participant. Should you have a follow up question, please rejoin the queue. The next question is from the line of Dharyat Revedi from DJT Investments. Please go ahead.
Unidentified Participant
Hi sir, thanks for taking my question. Hello. Am I audible?
Banwari Lal Mittal
Yes. Yeah, yeah you are audible please.
Unidentified Participant
Yeah. Sir, just wanted to get an update from you on the status of the new warehouses in Lucknow and Udaipur and also on the capacity expansion in the existing warehouses. So if you can just, you know, give an update on that please.
Banwari Lal Mittal
Yes. So as you have seen from the last four quarters, we we were growth was very limited and that way by virtue of the automation in Baraipur. So we faced the demand expansion very rapidly and that made our warehouse very small in comparison to the demand. So now we’re looking to the forecasting. We target first the entire Eastern India and then Northern India and then the entire northeast. So from West Bengal we will be serving to Bihar and Odisha and Jharkhand and Chhattisgarh. So we need extra warehouse. So we have started, we have automated the warehouse to make the capacity double and then another additional fulfillment centers of around 80,000 square feet.
That will be in addition to 156 existing. Noida we are again building 1 lakh square feet new warehouse. And from Noida we can go to Rajasthan, Jaipur, Haryana and from this side one part of the Uttar Pradesh. So we have to build in Lucknow to service the cities like Banaras, Kanpur, Ayodhya and then from Rajasthan we can’t reach to Udaipur side. Udaipur, Chittur, Bharatpur, Ahmedabad. Ahmedabad is very near to Udaipur and Indore which is also a eight hour journey. So these are the territorial thoughtful decision to build FCs so that we can cover a substantial part of the Northern India and Eastern India and Northeast India and some part of Ahmedabad from Udaipur before we build a new warehouse in Ahmedabad, Maharashtra and south southern India.
So that we plan the next year. But this year as of now we want to cover the entire distribution tangle in the region in which we operate.
Unidentified Participant
Why is this additional capacity likely to be completed?
Banwari Lal Mittal
The additional capacity in we have started in West Bengal first. So West Bengal will be completed in next six months. Noida, we will start in next quarter. So it will take around one and half year. Guati partially we have built and then we are building a new building there in Guati that will take another two years time. Lucknow it will take two years. So therefore it will take two years. So these are the two years planning in the meantime we will continue to serve from three FCs because we have a very large scale of FC.
Those are automation process. So takes lot of time before we build a new fc.
Unidentified Participant
Okay, Understood sir. And sir, if you can just give you know an update on what was the sales from JITO for this quarter.
Banwari Lal Mittal
No JITO this quarter we have just launched. So sales is not too much in lakhs of the rupees. But we. I can tell you the start is very good and inspiring.
Unidentified Participant
Okay, and what are the projections for the next say 12 to 24 months from Jito.
Banwari Lal Mittal
From 24 months we must be reaching around 5% of the sales by JITO and it will rise. I think next year we will be doing around 2 to 3%. Because initially one and two years takes lot of time for building distribution, for building procurement capabilities, building brand and then it enhanced rapidly. So we expect that next year it should be 2% of the revenue and then 5%. And then for next two, three years 10%. But we are targeting in next three, four years around 10% of our revenue from Jito.
Unidentified Participant
Sure, sir. And we are integrating this with our existing network of pharmacies, right?
Banwari Lal Mittal
Yes, that is what the beauty is. We will build the JITO brand and JITO network. Absolutely new phenomena without any cost. So there is no cost at age. We have the fc, we have the distribution, we have the technology, nothing. So I mean this is the what the beauty of any digital ecosystem is that we enhance capabilities. We enhance offering without any additional cost.
Unidentified Participant
Sure sir. Understood. Thank you. Thank you sir. And all the best.
operator
Thank you. A reminder to all the participants that you may press Star and one to ask a question. The next question is from the line of Pulavarthi Saikiran from Pulavarti Advisors. Please go ahead.
Unidentified Participant
Hi sir. Thanks a lot for taking my question. So just quickly understanding the working capital days. Looks like especially on the payable days there is a lot of volatility. If you can just help us understand how to think about working capital ass percentage of revenue and working capital day.
Banwari Lal Mittal
So the working capital volatility remains because of the nature of the business and because of this GST environment also. So some quarter have up and down. But as a business model say for next three, four years the working capital in our business should be Almost negative or 10 days working capital you can say because we are building a model whereby through a technology our inventory will be around 21 to 20 days. 22 days. And that will be funded by your receivable. So so fundamentally the business Will not need any capital. But yes, as of now we we need a capital.
Until we achieve that kind of cycle and the work, the Jito brand will be needing some working capital. And that is a working capital intensity. Because we depend upon contact manufacturing. We don’t have our own plant to manufacture. So that will require another 60 days working as far as the Jito brand is concerned. So yes, quarter to quarter as I said earlier also there will be some volatility. But fundamentally this is a efficient working capital model.
Unidentified Participant
Got it, sir. And as of now, as of December 2025 what is the cash on looks.
Banwari Lal Mittal
There are two parts of our company. One is the Sassan Ventures Limited so one is the financial part. There is one NBFC called Microsec Resources. And one is the Sassa Sundar Health Buddy Limited. So around 30% by Sassan. The Health Buddy Limited is around 408.3crores of treasury. And Sasa Sunder Ventures other NBFC business has around 100 crores treasury. So the total treasury in the company level is around 500 crores. And Susan the Health Limited is 400 crores.
Unidentified Participant
Got it. And one last question from Sif. So if you remember you also mentioned that Sasa Sundar which was like her chip card health business has dropped from 110 crores to 135 crores. And then currently this quarter we have seen at 44 crores. How do you see this growing probably in the next 18 to 24 months.
Banwari Lal Mittal
So Sasha, in the business I think for next year, from this year to next year we must be growing around 100% and the growth is coming very nicely. We are very happy. And I believe in next 12 months time we shall reach at the level where we handed over to Flipkart. So in two years time we will be happy to see that we are fully capitalized as a company. And we got the capital from that capital from treasury income. We are building business and whatever we have lost we gained again at the same level. So in next one year I am completely hopeful will reach at the level where we have we handed over into Flipkart.
Unidentified Participant
Perfect, sir. And just to confirm sir, in your opening remarks you mentioned that retail shifty will be EBITDA positive starting from next year. And at this point of time is fall toward the contribution margin level. Is my understanding right?
Banwari Lal Mittal
Yes, absolutely right. And I am very happy to say that in January if you see the January month then January month retailer sector is already beta positive. And Sundar is already a contribution margin positive. So I am firmly Hopeful that the next quarter in retailer we should be EBITDA positive. And next. I mean EBITDA means there will not be loss 0.1% EBITDA. But next year Italy SRC we are hoping to have 1% EBITDA EBITDA and Sasha Sundar we are already contribution margin positive company in the month of January. And next year certainly we will be contribution margin positive company.
And Sasandra also. This, this. You know this cost of cost we are. We are increasing with a purpose. If you know I just tell you the example of how the retailers are and why the success in there. So I tell you that the case margin case generation capability in retailer Shakti is 4% of the revenue for say after five years when it developed say it turnovers at that point of time is 5000 crores. Say for just for an example the retailer Sati business model will generate 4% of the case. So that is around 200 crores.
But the Sasa Sundar case generating capacity will be 8%. That is 4% more. So say Sasa Hunter’s revenue is 2000 crores. So we will generate case 160 crores. So the against that 160 crore for next three, four years. If you are investing 125 crore that’s a wise decision. And this is a basically purely a trading profit loss. And then the type of evolvement which is coming into artificial intelligence and type of a composite logistic model. I mean you. You can compare any other company in India and I would be happy to gain my knowledge. I mean I.
We have given in the presentation on page number 14 that our total capital rage is 350 crore. And I have posted a 9% post tax cost of capital raise 431 crores. The total capital deployed is 786 crores. Out of that 100 crores we repaid to the Mitsubishi. Net capital out of buyback is 683 and T403 net asset is 197. So the IPR business the capital deployed is only 86 crores. This 83 crores. If I composite say for next 5 years with cost of capital become double 200 crores. This 200 crore I realized in one year in Sasa Sundar zone and Sasa Sundar when we partner with Flipkart we realize out of 75% stock 800 crores rupees.
So any one AIP. I mean the Sasandar Health and happiness podcast itself a YouTube channel can generate this kind of profits in next 3, 4 years time frame. So this is the business you know. Only 83 crore rupees we have invested in building the entire company I feed including retailer Satya and Saxa Sundar. And you can compare any other digital company in India which can demonstrate this kind of capital efficiency and working capital efficiency. I will be happy to learn.
Unidentified Participant
Significant achievement. Thanks a lot for detailed explanation. And all the best.
Banwari Lal Mittal
Even. Even a small startup which raised 83 crore 100 crore rupees burn that money in three months time.
Unidentified Participant
That’s true sir. That’s true. All the best. Thank you very much.
Banwari Lal Mittal
Thanks.
operator
Thank you. A reminder to all the participants. Please restrict yourselves to two questions at a time. The next question is from the line of Jatin Jadhav from Shahsrar Capital. Please go ahead.
Jatin Jadhav
Hello. Am I audible?
Banwari Lal Mittal
Yes please.
Jatin Jadhav
Yeah, I had two questions. The first one is how should we. Think about the capital management between retail. Shakti and Saspas on the B2C over the next two, three years.
Banwari Lal Mittal
So both business have won for us. So large part of the capital goes into the fulfillment center building or technology building where you know the the capital goes on. And retailer Sakti as I already said is almost break even at a corporate level including its corporate cost. So retailers actually we don’t find any any major capital outlay for next two, three years. It is self sustainable level. And as I have already said that we earmark 150 crores to spend for building new technology. Out of that around 50, 60 crores you already spent so another 100 crores that will be funded through the treasury income for next to three years time please.
So the company’s capital and treasury will be intact and out of the treasury income will be investing for building futuristic success on the platform including Jeeto. So if you find there are some companies which are building their own brand brand specific retail distribution channel and. And you see their capital investment and that kind of company in the company itself will be able to build without any investment. So that kind of efficiency we bring on table that Absolutely. Distribution of generic generic brand is being launched is being scaled up without any capital outlay.
Jatin Jadhav
Got it. Got it. Thank you so much. My next question is what advantages does. Retailer Shakti have versus its peers like Entoro or any regional distributor. Especially if competition starts increasing.
Banwari Lal Mittal
Very good questions. I would request to please repay 5 of my presentation on the stock exchange where we have clearly demonstrated that you know how value additions we give to retail pharmacies. So there are four factors which are main. One is the reliable fulfillment of all medicine needs so any retail pharmacy say wants to procure out of 50,000 sqs. They have to depend upon 1520 distributors. There is no one distributor and that is very inefficient. The distributor take around 10 to 15 days time to fulfillment. There is no certainty as a retailer Sakti Today any retailer gives order online next day there is a guarantee delivery.
Thereby they ensure that guarantee delivery is there. They are able to reduce their inventory level by ensuring that it then we are only company which give them clear discount scheme absolute transparently on screen without any discrimination. Our margins are certainly better that we give initiative credit. But again the credit course also that becomes more superior for them. And there is a absolute easy to return policy that they just need to put into screen next day good materials from them. So these are the five clear cut benefits. One is reliable fulfillment of all medicine needs, better margin, initiative of credit help reducing inventory level.
Clear discount schemes, transparent pricing and simple return process for unsold high inventory. So these are the clear things. And then I am very happy to inform all of you that soon we will be launching a retail air that will be the AI driven SaaS platform that will be given to all the retailers free of cost. From there they can manage the inventory, they can manage their billings and they can automate put order into retailer Sakti. So this we will be launching in another 34 months time. And we have invested around 10 crore rupees into this retailer.
And this will be available without any cost to all the retailers who are attached with retailer Sakti platform.
Jatin Jadhav
Those are the two questions. Thank you so much and all the way.
Banwari Lal Mittal
Yes please.
operator
Thank you. A reminder to all the participants that you may press star N1 to ask a question. The next question is on the line of Dipesh J. Sancheti from Manya Finance. Please go ahead.
Deepesh J. Sancheti
Hi. Am I audible?
Banwari Lal Mittal
Yes please.
Deepesh J. Sancheti
Yeah. Guided for PAT positive next year supported by treasury income. How should investors think about core operating PAT excluding Treasury?
Banwari Lal Mittal
Let me disclose every presentation. Every quarter to quarter presentation we show separately how the treasury income is and how is the operating profit. And as per Indian accounting standard also the balance sheet profit and loss account quarterly regions we also give separately. So if you see the presentation which has been posted on the stock exchange. Given separately
Deepesh J. Sancheti
talking about when will we get positive pat positive without treasury income.
Banwari Lal Mittal
Okay. So paid for YouTube. There are two components. One part is the retailer so and one part is so retailer the the next year we will be paid positive. This is our our working is for which we are working and success in that. We aim to Be paid positive sometimes in year 28, 27 or 2930.
Deepesh J. Sancheti
Okay. And this JITO which you have launched, is it connected to the Jain International Trade Organization? Is it similar to this and are we leveraging that, you know that JITO also.
Banwari Lal Mittal
No, I mean we, we don’t find any connection with the Jain International. Jito is our register trademark and it’s for, for medical and medicines. This is register trademark. Okay. Okay.
Deepesh J. Sancheti
And what specific strategies in your inventory management or receivable collections are optimizing this working capital cycle? Because those are the two key variables. For us to get a positive cash flow.
Banwari Lal Mittal
Yes. So we are the best company in terms of the capital efficiency, so we don’t give any credit. So there is no headache for managing the receivables for inventory. We have clear cut, demonstrated and developed a AI driven algorithm whereby we can predict our demand very nicely, very happily. And we have built direct relationship with almost all the pharmaceutical companies in India. And going forward next five years, we think that we will be a negative working capital company because our inventory will be at 20 to 23 days time which will be funded by pharmaceutical companies by giving similar kind of credit.
So we are working towards that and this company will be running without any working capital need.
Deepesh J. Sancheti
Great, great. Thank you so much. All the very best.
operator
Thank you. The next question is from the line of Abhishek Singhal from Perpetuity. Please go ahead sir.
Abhishek Singhal
Thank you for taking my question. I just wanted to understand because I was hearing from you the fact that the model you’re building is very capital efficient and you know, we might either have a negative working capital at best, say you know, 10 days or with some investment in Jito a bit more, which essentially means not more than 5% of sales is your net working capital requirement. Now in that scenario when you start hitting 5,000, 7,000 crores, kind of a top line, you know, the total deployment. Required will still be significantly less than. The cash that you have in hand. And plus in our journey towards that 5,000 7,000 crores, we actually start generating cash. So technically the cash that is lying in our books at this point of time, a part of that might not be required for growth. Just thinking aloud sir. And given there is some change now with the government proposing for buybacks and the way our stock is today valued at around 0.5 times EV to sales and staff. So is there a thought process inside. That there could be some distribution of. Cash through the driver route?
Banwari Lal Mittal
Yes, why not? Abhishek, as you have demonstrated the current year we Bought back capital of Mitsubishi from the same thought. So 100 crores we paid to Mitsubishi. And because this is a step down subsidiary. So first action we have to complete merger in the holding company for which we are working. So post merger. And yes this will help that there is a government initiatives to make the buyback free. So we. We don’t intend to hold case unnecessarily which belongs to shareholders. So. And by that time I think from two years now onwards our merger will be completed or capital investment in Sasa Hunter will be almost over.
We can see that whether we can. We can do the buyback. And I can recommend to our board of directors. And yes there’s a very thought upon which we can work upon
Abhishek Singhal
that’s quite helpful. And sir, just on the retail Shakti. Side you talked about.
operator
Sorry to interrupt. Mr. Singhal please rejoind the queue for more questions.
Abhishek Singhal
Sure, I’ll do that.
operator
Yeah. Thank you. The next question is from the line of Saket Kapoor from Kapoor and company. Please go ahead.
Unidentified Participant
And thank you for the firstly. If you could just explain the merger process and where are we Sir. And post the merger how will the entity look like? Sir, I’m new to the company. So pardon me this.
Banwari Lal Mittal
So the post merger the. This. The Sustainable Ventures Ltd. First thing is that we are changing the name. So next 10 days the name will be changed from Sustainable Ventures Limited to Healthex Platform Limited. So in Healthex Platform Limited this healthcare company session the Health buddy will be merged. So Health X Platform Limited will when will have all the business options on the Health Party Limited which is a digital healthcare platform business. And then there is a NBFC company which is called MicroSec resources that will be be demulched and will be listed separately. That will be NBFC company and that will be listed separately.
So every shareholder who are right now is the shareholder of Sustain Ventures Limited will have shares of SAS Healthy Limited the 80% holding of Sand Ventures into Healthy Limited will be distributed among the shareholders ventures and SAS Ventures Limited shareholder will get another share of NBFC company Microsecond Resources. That is how it will look like.
Unidentified Participant
Okay. So there will be two two different entities for the nature of different activities that that we do. That is how frequency
Banwari Lal Mittal
two focus entities.
Unidentified Participant
And when we look at our peer comparison NTO would be the only organization where we can look at a like to like comparison or depending upon the on the business model. Since it is it is mentioned here that we procure medicines in bulk from the manufacturer. So if you could just give Us some more understanding on our peer comparison.
Banwari Lal Mittal
So the peer comparison I would request you definitely we also see their balance sheet and performance. So at the business level we are similar to say keymates of Apollo Group or Intero. Of this nature, the business business buying medicine, storing and selling to the retailers business by same. But the key differentiator you must factor into that what are the key differentiator? One is the credit driven busines
s. One is the business by building a a case company. And second factor once you build the case you must also see that building business like Intero how much capital they have to put to buy the rights of pharmaceutical company.
That is called the distribution rights. And I must be and you must recognize the fact that company like retailer Satisunder we have not spent a single penny to acquire any right and 95% medicine across geographies we buy directly from pharmaceutical companies. That is how the there is a strong differentiation in the businesses. You must also see that how much capital Intero is deployed how much capital the business model like us can deploy the capital versus the cash generating capacity in next four, five years you must build into two businesses. Then you will find very effectively the differentiation.
So business wise you can definitely track as far as the gross margin is concerned, as far as the growth is concerned. And then growth again organic growth or bought out growth. So bought out growth needs capital. And then the shareholders hard earned money goes into that. And then where will you accreditation is difficult. So that is how you can factor into. So definitely you can follow those companies. But I would sincerely request you to study my presentation in this time I have given a very comprehensive presentation on the stock exchange. And you factor into capital efficiency, growth efficiency into that model.
And then you factor into how much roe roce we are giving how much roc this model can give. Then the comparison will be right.
Unidentified Participant
I’ll definitely go through and then come back again. But my second question was on the post merger what would be the promoter’s take in both the entities?
Banwari Lal Mittal
So as of now, the success in the microsecond resources NBFC promoters will be the same thing. And In Health Buddy Limited promoter security will be around 58 to 60% depending upon the ratio.
Unidentified Participant
And for the for microsex. I miss his comments, madam. No question.
Banwari Lal Mittal
Microseconds will be 75 promoters and HealthX it will be 58%.
Unidentified Participant
Okay sir, I’ll join the queue. Sir, who will be the remaining shareholders for 40%? That that would have been my question if you could answer that. I joined the queue.
Banwari Lal Mittal
Yes, definitely. So the One will be the Roto pharmaceutical company which hold around 16% insertion. The SBD limited. This is Japanese one of the largest eye care company in the world that will be holding and then some fi, some UIB and the balance public.
Unidentified Participant
Right sir. Thank you sir. I will do my due diligence.
operator
Thank you. The next question is from the line of Athar Syed from Smart Sync Services. Please go ahead.
Athar Syed
Hello sir. Thank you for the opportunity.
Banwari Lal Mittal
Thank you.
Athar Syed
From Smart Sync Services. So I wanted to understand like I’m little new to this company. First time attending your con call. So just wanted to know like what is the differentiator between us and our competitor in terms of like how we operate. Because if. If you see we like we are just like a distributor. So anyone can enter into this segment also or and also the old player like pharmacy and one MG and other people also started these businesses. So what is the key differentiator between us? If you could explain it would be great.
Banwari Lal Mittal
A very good question. Sincerely request you to please download my presentation into BSE NSC website and see that we have given our X factor key differentiator. So our core operating capabilities One is key differentiator is our efficiency. So we are the most efficient in terms of putting capital. We build the entire IPR business day by just putting 86 crores. We have given the detail on page number 14.
Athar Syed
Actually if you don’t mind, I actually heard these things. But apart from this I wanted to understand like in Mumbai government also started. There is something called as Jan Shakti Ayushman Kendra. Like it is a government backed by government backed medical store. Basically So I also met some pharma companies also two years back. They also said that the biggest margin also to take by distributors like companies who distribute. Like companies who distribute pharma products. So government started this program where they directly cut off these distributors and directly taking this pharma product from the companies and selling it through the medical.
So it is not like. What we. Can say very tough for us to maintain our business and change this industry.
Banwari Lal Mittal
No, I mean the government cannot deploy the technology into any type of business and cannot build the distribution network. That is not the government job. So the whatever government does government does for making excess and affordable health care to retail public to general public. Not for distribution network. And even if the government does, I mean they will do. Definitely they will do. Because there is a very very large market. So we will also do and the government is doing in West Bengal also. But we are the market leader so that you see the competition Builds more business and the business where there is no competition, there is no growth also.
So this will keep on going
Athar Syed
but. It will flash our margin as well.
operator
Please.
Athar Syed
It is my only one question which I am.
operator
Please rejoin the gift for more questions. Thank you. The next question is from the line of Parinit an individual investor. Please go ahead.
Unidentified Participant
Yeah, thank you for the opportunity. So I was wondering in terms of in the presentation the company has laid out the fact that for Health Party the contribution mark is going to be 0.5 to 1% whatever is left over. So I was wondering for Saskatchewan there what is the split between let’s say online was the Health Buddy distribution channel first question and regard and overall how was the margin different from both channels? That’s a Health Buddy versus on the app and how was it planning on scaling? I understand that you want to scale it up to or it will be pat positive by the end of 30.
Could you just give some what are the milestones that we need to keep tracking and how is it going to go there?
Banwari Lal Mittal
So I must explain you that success on the app and Health Buddy is the same kind of model and they are not two differentiated model HealthBuddies are the local partners on pin code wise who handle the prescription checking, compliance and last mile delivery. So the system as a company we receive all the 100% orders through digital medium substantial. More than 50% orders come directly through app. Some orders come from the dashboard which we install in the HealthBuddy Service Center. So these are only one model and the contribution margin which we are talking about HealthBody is the integrated margin of Satisf App and HealthBuddy.
Unidentified Participant
So we’ll only have 1% March 1% contribution margin from this particular business, right? That’s the idea.
Banwari Lal Mittal
As of now. As of now, yes. And from next two, three years this 1% we expect to rise around 8%.
Unidentified Participant
Understood. And one more question regarding you mentioned the fact that the previous participant that a lot of distributed companies spend a lot of money in acquiring the pharmaceutical rights. Could you explain why does Sastasunda doesn’t need to spend it and how exactly how much are we saying? Because we don’t need to spend and why don’t we need to spend.
Banwari Lal Mittal
So we have not spent any single penny of acquiring any rights. Whatever money we are spending and we building our technology and building our brand so that are paying off to us and will continue to pay in future.
Unidentified Participant
But why don’t we need to acquire those rights? Because we’re just taking it from the pharmaceutical companies. Because if I’m as you need to get the code from the pharmaceutical companies to distribute in a particular area. So do we need to pay for it or how does that work?
Banwari Lal Mittal
That much? I am telling you that we acquire those rights basis on our efficiency, basis on our capabilities, basis on our fulfillment centers quality. So they work with us initially through distributors. Then they have seen us, they have seen our terms of payment, they have seen our goodwill, they have seen our working capital and they are happy to work with us without any payment of distribution rights.
Unidentified Participant
So basically your goodwill is your payment to them. Basically. Is that right? Understand?
Banwari Lal Mittal
I mean I must tell you that we never in our history of the company we have not delayed a single day payment to any pharmaceutical companies or taxi code is absolutely 100% tight. We have not not dispute of any kind of any single pesa with any pharmaceutical company.
Unidentified Participant
Understood. But if you were to spend that money how much do you think you’re saved by having such a strong marketing, strong brand presence in the market. So over the geographies we already are in right now.
Lokesh Agarwal
We didn’t get your point.
Unidentified Participant
So basically I understand that goodwill is saving a lot of cost. By having the goodwill you’re getting a pharmaceutical company’s distribution without any paying any rights. I was just wondering for us to understand as shareholders how much did the company save by having that goodwill versus let’s say another. Another distributor coming into the market newly for the existing geographies like what percentages did.
Banwari Lal Mittal
Because that you can compare say penny benchmark of the market. The other markets are right purchasing around 30% of the revenue for rights. So say our revenue of retailer is 1000 crores. So 30% of that is coming around 300 crores. So we are going to buy the distribution rights from a offline distributor. You have to pay 300 crore rupees.
Unidentified Participant
Understood. This payment you’re talking about just acquiring the receipt.
operator
Sorry to interrupt. Mr. Paneer, please rejoin the G for more questions. Thank you. The next question is from the line of Avnish Tiwari from Vikaria fund. Please go ahead.
Unidentified Participant
Hi, I two questions. One question is this when you are supplying your own trade generic jito to pharmacies wouldn’t that be a conflict with your pharmaceutical or marketing companies who are supplying medicines to you because it will undercut them. That first question. Second combined because you have a tight schedule here. Second was that when you’re talking about somebody else your computer growing through acquiring distribution rights. Why like is it just that you are able to grow organically at a high rate or if you were to also grow at high rate. You also will need to do some operation like a 30% growth aspiration which you have.
Can you do that organically or without acquiring these rights? That’s the second part.
Banwari Lal Mittal
Yes. So second question. We are fully confident that we can grow 30% plus year by year for next 10 years without any acquiring any distribution rights. That is number one and number two we don’t find any conflict between Gito, generic gendic and branded medicine. Both these are two segments. There are two separate kind of customers. The people who will buy the branded generic, they will continue to buy the branded generic. The people who will buy the gitogenic generic they will buy the gitogenic genetic. And this conflict between branded genetic and githogenic or any other genetic genetics we don’t find any merit.
From the perspective that 100 crore new Indians are coming to buy the medicine hitherto but not having any access. So there are hundred crore people. Out of that around 20 crore people are suffering from either one of the chronic disease, diabetic blood pressure, heart disease. They don’t take medicine because they don’t have access to medicine. Now the India is rising, is a fourth largest economy is going to be developed country by 2047 and thereby a whole bunch of 100 crore people will come in the medicine bracket. They will need medicine and because they have the limited capacity of paying this generic generic will grow very rapidly.
And we want to capture that state in a very calculated move. And both markets are different markets, both are different customer base market. And there is already generic generic medicine which are selling into the market. Something not new from initial, from last 50 years there is a market but that is growing very rapidly nowadays because of the new customers who are coming. So I hope these address your questions.
Unidentified Participant
Yes, yes, you are going to sell to same retailer or will be two different kind of retailers in which you will market valid generic versus G2.
Banwari Lal Mittal
So all four formats we will go aggressively. I mentioned in the presentation about all. Four for i1
Unidentified Participant
Pharmacy Retailer is there. You will be selling both JITO and the the branded generic which you have purchased.
Banwari Lal Mittal
Yes, both are available at at the digital platform. They can buy both. So this is another medicine like any other medicine.
Unidentified Participant
Got it.
Banwari Lal Mittal
We don’t go to retail pharmacy to sell. They make order online.
Unidentified Participant
They purchase online only. Okay, great. Thank you.
operator
Thank you. The next question is from the line of Saket Kapoor from Kapoor and company. Please go ahead.
Unidentified Participant
Thank you for the opportunity. Sir. Slide number 20. When we have mentioned about warehousing and the expansion that we are doing sir is cost involvement. Requirement. How do we work out how much will we be needing to invest in the technology? And second question was regarding at what valuations did the the investors which you mentioned, I think to the Japanese and. The biggest retailer from. I think so from Japan. At what valuation they invested in in the company which will be demerged visually merged with Satya and then. Then get getting demerged.
Banwari Lal Mittal
The Rotha pharmaceutical invested around 225 crores valuation. The Mitsubishi invested around 700 crores valuation. And second question is about building your new warehouse. Additional investments. So the additional investment in building new warehouses. We are still working that what kind of facility we require. But I can tell you the West Bengal where you know we have placed the order. So West Bengal we will be investing around 10 crore rupees for additional capacity of 80,000 square feet warehouse and Noida we are working. So I am not able to give you the exact figures. So these are the things and the AI automation.
Yes, this will be a good part because. But any automation cost we recover in 18 months of time. But we believe that going forward because of the substantially improvement in the AI technology. So this picking process, the raking process, the dispatch process. All are. You know will be run by the AI. The robot route channeling the delivery part. So payment receipt part. All will AI will play the major role. And we have a complete team. As I have said that we already marked 25 crore per year budget on the artificial intelligence studio team that will be building both for Sundar and retailer Sakti.
And we don’t find any additional expenses on any part of it.
Unidentified Participant
Okay, so you mentioned 10 crore investment. Okay. Right. Sir, I joined the Q. So if. If I may add only one. One part. When you were mentioning about the differentiating aspect in the aspect of the legal aspect. Are there any big intervals that our model cannot be replicated by other people? Since everything is in the public domain and we had we are giving more insights on how we work. What would be the key enabler or the key entry barrier that makes us a differentiator. And it will take more. It will take a trouble for the other people or to replicate our model. Because as you mentioned that the volumes will grow substantially over a period of time.
Banwari Lal Mittal
First, anti barrier is building the relationship with all pharmaceutical companies. So either you have to buy the distribution rights from the existing distributor. There is a very cascading effect will take 10 years time frame. And you have to spend say 2000 crore rupees to buy those rights. Second is the building technology. So building technology anybody has to spend five years time frame. And third is bringing the warehouse in efficiency. There is again a five year job. So it’s not an easy task. It is not only tech company where I build the technology and start. It’s a technology plus fulfillment capacity plus relationship with pharmaceutical companies which works in a very tight zone.
And then the bringing all all sort of retailers, all sort of consumers. So I. I must say that like you know Geomato like Blinkit, these are open mode everybody knows But I mean it’s not meaning that everybody can still start company like Blinket or company like Swiggy. So I mean these are the things the every every business. I mean there is nothing to hide upon. So it’s an execution idea is not new.
Unidentified Participant
Yes. Yes. You mentioned about the. The. The ally.
operator
Sorry to interrupt. Mr. Kapoor, please rejoin question correct Chick. Thank you. A reminder to all the participants. Please restrict yourselves to one question. The next question is from the line of athar Syed from SmartThing Services. Please go ahead.
Athar Syed
Hello sir. Thank you for the follow up. I just wanted to know two part aspects of your business. One is working capital like how the like. I mean credit to our medical store and all detailers basically. And second is what is the average EBITDA margin in this business like in terms of Intro it is 4% but our EBITDA margin is very much fluctuating component is 3%. Sometimes it is 1%. So what is the on and average with the margin in businesses now first.
Banwari Lal Mittal
You know if you compare with the Entero you must compare that how much capital they’ve deployed 9% post tax return on equity and then calculate their EBITDA margin then you will find that they are EBITDA negative. If you deploy your Excel sheet from the day one how much capital they have taken from the shareholders put 8% 9% CAGR on that and then bring how much money is coming. So EBITDA itself showing is a. It may be a misleading factor if there is no return on equity and if there is no economic valuation. So our company you must see that from economic value addition perspective.
We have given the detail working how capital has been efficient and we have given the detail IRR on the capital also so that you must see and the EBITDA positive will be the case generating capabilities and EBITDA itself is we do not see. I personally see the cash flow there come from the paid. So say my company is making 4% EBITDA positive. So what 2, 3% you will find is the depreciation 2% is the interest and the net cash flow will be less than 10% of the return on equity. So by building a company whereby the return on equity after depreciation and after tax and everything is 10%.
What is fun of making that business? We are building a business which we can generate return on capital employed by more than 50% year by year which can generate the cash flow and which can really build a great company without much of the capital. So there are these are the two differentiating point. And I must request you that you must analyze in your deep research and then we can make another debate.
Athar Syed
Okay sir, got it. Thank you.
operator
Thank you. We’ll take a last question from Saket Kapoor from Kapoor and company. Please go ahead.
Unidentified Participant
Yes sir. Only a concluding point about our relation with the pharma companies and we getting an edge other on other companies. So how had we were able to model it out in a way that we did not have to pay those registration fees? And as you were mentioning about when comparing with other players in the same space, what correct steps have we taken that we have been able to do so, sir.
Banwari Lal Mittal
So I think the first part is the hygiene of the warehouse and hygiene of the fulfillment center. So if you see in India the most of the distributors warehouse, if you visit those are in old kind of structure with tin on the roof and you know, not very clean, not very hygiene, not very cold storage. The fulfillment centers are all international standards. All are absolutely modernized, absolutely air conditioned and with a good hygiene practices. All employees are fully paid employees. And then one if you see the very prominent figure is a purchase return. So you must be aware that all pharmaceutical companies except the return of expiry drugs the industry average of those return is more than 2% while Sasa Sundar’s return is less than 1%.
So that is how they save. In Sasa Sundars history we never delayed any payment to any pharmaceutical company by even for a one day. So absolutely timely payment and absolutely predictive demand and absolutely cooperation as far as the distribution is concerned. And then the second factor we give them reach to tier 2 cities, even villages where they were not able to reach. So if you see if you map the West Bengal area in 30% of the area they don’t have any distributor but they have the retailer through which they can reach to anyone anywhere in 24 hours.
So that kind of the reach to pharmaceutical companies and with a efficiency model with a goodness in terms of inventory this is a strong value addition we add to them. And for that they they Are happy.
Unidentified Participant
Right? Enter for warehouses in West Bengal.
operator
Sorry to interrupt, Mr. Kapoor. We have other participants waiting for that. Fine, thank you. The next question is from the line of Amit from Robo Capital. Please go ahead.
Unidentified Participant
Thank you for the follow up. So my question is on retailer Shakti. I was looking at some numbers. I think last year we did about 950 crores of revenue. And this year if I calculate I seem to have missed the number if it is in PPD. But the number could be in the range of 1100 or 1200 crores or so. So we haven’t grown much this year compared to last three, four years earlier. We’re growing, you know, above 100% CAGR. I understand the CAGR can come down. But this looks fairly, you know, lower growth this year.
Banwari Lal Mittal
I fully understand. I am aware about as I mentioned in my opening remark also that this year due to the automation issue in our Baripur area though our growth was not that much as happened in the past year. But that we have sorted out. And if you see in this quarter that growth has come back. So we grew by 10 to around 10%. Q2Q. And I am happy that January, February, March. Maybe the one of the best quarter in the company. And looking to the January trend. So that growth has come back.
Unidentified Participant
Yeah. So we are confident. I mean you think that.
operator
Sorry to interrupt. Sorry to interrupt.
Unidentified Participant
Question. I’m not asking a question, I’m just.
Banwari Lal Mittal
No, we are comfortable by growing 30% year year CAGR for next 10 years. In between some quarter there may be some issues.
Unidentified Participant
Okay, Perfect, sir. Thank you. Thanks for the opportunity.
operator
Thank you. The next question is from the line of Avnish Tewari from Vikarya Fund. Please go ahead.
Unidentified Participant
Hi. If you were to compare your reach in terms of number of retailers you are reaching out to the revenues you generate compared to let’s say Intero. How would you compare that matrix? I understand capital efficiency and all other things you described are really, really good at your end.
Banwari Lal Mittal
So the availability is the key issue. So any retailer who is opening or running the shop they have to deal with 20 distributors. So instead of 20 distributor he can deal with one. So that is the most part. And on an average any retailer has to keep 40 days inventory because of the uncertainties in terms of the fill rate by retailer Sakti that can come down from 40 days to 10 days because there is guaranteed next day delivery. So its inventory level is substantially low. So these are the critical things which we hold the competitive advantage.
Unidentified Participant
No, I meant to ask you that your revenue from Retailer Shakti and number of retailers you are reaching out to compared to Antero’s revenue which is much higher. And number of retailers they are reaching out to. So do you is it right to find that they are generating more revenue from a similar number of per retailer they are reaching out to compared to you? Or there’s other way to analyze this? This.
Banwari Lal Mittal
No, no. There is no other way. Because they. They are a credit oriented company. So their. Their relationship with few retailers will be very very deep. Because they give the credit. So per retailer wise margin. Because of the credit orientation the retailer is a superior. This interior is a superior model.
Unidentified Participant
Not only margin per retailer revenue also you can deliver higher because they’re giving credit.
Banwari Lal Mittal
Ah so the revenue higher. But at the end of the day by making revenue higher by giving more retail retailers credit. What I am making that is very important. So you see that whether that model will give you 15% ROE for next 2, 3 years. If the 15% ROE any company cannot make then what is the purpose of the business?
Unidentified Participant
Thank you.
operator
Thank you ladies and gentlemen. We’ll take that as the last question for today. I now hand the conference over to the management for closing comments.
Banwari Lal Mittal
So my dear friends, I thank you very much. I would again request you to go through the my presentation which you have posted in the stock exchange that we made a very detailed presentation giving our business model as well as our futuristic plans. And please bear with me any sort of quarterly fluctuation. Because we are a start up company. We are still building the great company for India. Thank you.
operator
Thank you very much on behalf of Go India Advisors llp. That concludes this conference. Thank you all for joining us today. And you may now disconnect your lines.