 So, thank you. Hello and welcome everyone to Entrepreneur India's Resilience webinar series and today we are going to talk about the dairy industry. I'm Saurav Kumar, editor special projects, Entrepreneur India, the moderator for the session. Today, amid these unprecedented circumstances going to the novel coronavirus outbreak, we're going to try and find answers to some of the questions that may have cropped up within the business community and the changes required, of course, especially for the dairy players. So, I'll start by laying the ground rules for our attendees. The discussion will go on for 45 minutes. This will be followed by a Q&A session for another 15 minutes. If you have any questions during the course of discussion, you can post them through the Q&A option at the bottom of your screen. If you're logged into Zoom or if you're on Facebook live, you can put your questions in the comment section. We'll take them up. Mention in your question if it is directed at any specific panelists. We'll take up the questions for the panel discussion. So, let me now first introduce our panelists for the session. We have with us Mr. Chakradar Gray, co-founder, Country Delight. Mr. Ranjit Mukundan, CEO and co-founder, TELAPS. Mr. Ishtik Singh Gandhi, founder and managing partner, Stride Venture. Welcome, everyone. So, you know, I'll start with a very basic question and then I'll come to everyone of you that, you know, this pandemic has really affected, you know, businesses across board. And we've been discussing it with a lot of players, mobility players, co-leaving players and everyone's affected in somehow, some way or the other. And they're finding ways to, you know, cope with it. So, you know, the first question that I would want to know from you, Chakradar and Ranjit is that, what were the hurdles that you, of course, milk is an essential service. So, the consumption, I do not think would have been affected so much, but logistically and other ways there would have been challenges that you would have seen. So, if you can just let us know and then we can take it from there. Ranjit, if I can start with you. Yeah, so for us, the lot of, as I said, in the digitization stack that we either deploy, there's a lot of hardware that we have to deploy across the, you know, supply chain. These are in the form of, you know, sensors in the field, you know, sensors in the collection center, chilling center, correct data to drive productivity, quality and traceability. And for people to get on the field during COVID, at least the first few weeks, despite the fact that we had our, you know, E-passes and all that, you know, from the government and in authorities. By the time the people on the ground realize, you know, which are the people they can let to cross the district boundary or which are the people that can be allowed to go into a village and fix the issues. It would take time. I mean, the cops think differently versus the authorities think differently. So by the time the authorities, you know, their dictates get down to the cops, it takes a while. So the cops thinks that they can, you know, probably wield a lot here to everyone who's here on the road, irrespective of whether they have a pass or not. Right. But for us, you know, we are going to fix an issue in the field. Right. So we are people need to get, get to the field because since hardware is not there are going to be issues with calibration. There are going to be issues with, you know, disconnection. There are going to be issues with the cables coming off. Right. So we need people on the field to fix the problem. In the initial first few days, we found that our teams couldn't get to these places, even though the authorities were supportive, even though we had the passes because the enforcement folks like the cops on the ground, it wouldn't know the difference, right. There would be more enthusiastic in stopping anyone who's out on the street. So, but then over time it settled down over time, with a lot more push coming from the authorities, they started letting our people to support the issues. Initially, initial few days we had issues where our people were stopped in the middle of the road, asked them to go back, their bikes get seized and all of that. The field personnel had a tough time, because the folks enforcement folks on the ground wouldn't know how exactly to deal with the situation. That was one issue, you know, that, you know, that we faced and the, the other issue was the fact that these are very remote scenarios. These are not urban-centric scenarios. These are remote and, you know, village-centric scenarios. And inside the village, you know, folks in some of the villages, they would barricade the roads and say, look, you guys can't enter the place because we think you might be carrying COVID. Thank you. So how do you, I mean, you need to become one of them to then, you know, support them and, you know, solve the issues. But I think as things stabilized, you know, people start realizing that tech companies like ours who support the remote systems need to be seen as one amongst the folks living there. So they can't be stopped. Otherwise, the milk supply would be affected. Over time, we were able to resolve. So it was mostly to do with some friction on the ground that we saw when we were trying to operationalize some of our systems, attend the support calls, attend, you know, calls with respect to, you know, recalibration and all of that. So there are some issues that we encountered. So sort of I'll just take a minute here and add because, you know, we are a little more brick and mortar and tech business. So we are sort of a digital business. So there is a lot of perspective that I can give which help does which can help a lot of people. So when the lockdown happened, there were two things. So again, from a crisis point of view, we were one of the very few businesses who had 100% fulfillment rates throughout the crisis, including the 94% fulfillment rate on the worst day of the lockdown as well. This was basically because of two things. One, we are a full stack business model with absolute control over our entire supply chain, which really helped us navigate well through the situation. Second is that, you know, we've been milk is an industry that government takes very seriously, because it's a perishable product with a four hour shelf life. And there are hundreds of millions of farmers who are dependent on this for their entire livelihood, and a loss of product effects them very significantly even on a day to day basis. So even if you take back from the 90s, government has always taken adequate precautions and measures to let the back end supply chain, especially from a sourcing point of view, and the production point of being as unhampered as possible compared to other products and commodity. That said, you know, the two things that really have helped country light in the, in the first few days of the lockdown. The first aspect was basically over communication. So what we did here is when there was complete chaos and things were not clear in the initial days of the business. We went, the entire team went on and went overboard on communication communicating with every stakeholder on the ground. So whether it's a farmer, whether it's an employee at our sourcing location, whether it's the production locations or whether it's the field executors at the last mile delivery location. And finally, the customer. So, you know, when you communicate, you understand what are the broad concerns for each of these stakeholders. And then once you get that data in like six to eight hour time frame by speaking to 10 or 15 stakeholders in each of these categories, you sort of get to the nitty gritty of the problem. From a farmer point of view, the fear was whether they should be able to give their milk or not. From a collection center point of view, the fear was whether we will be allowed to operate or not. From a production point of view, the fear was what if a COVID case comes in our production facility. From a last minute point of view, we have nearly 3000 delivery partners. So the idea was to understand with how to contain how to bring social distancing very quickly and ensure that delivery is done from a consumer point of view. The fear was that, you know, what can, can, can, can COVID come through milk? Can, you know, can I get in contact with a delivery partner who can have COVID? So the idea was to be very nimble and very over communicative. For example, we moved our deliveries from a three hour delivery slot to an eight hour delivery slot. We started our deliveries from two a.m. in the morning. We communicated that to our customers and customers were very understanding. We were one of the first businesses to give body temperature of the delivery personnel to the customer. That brought a lot of assurance. We were one of the first businesses to quickly move to a 100% contactless delivery. In our production locations, we have built a huge amount of backup. We quickly tied up with other sourcing locations, other production locations where we said that let's say if our production facility gets filled, we have to have a backup production facility. Within our production facility, we sort of, you know, gave accommodation, food, and all other living amenities for the people. And we sort of did an internal lockdown within the production facility to minimize flow of people. At our sourcing locations and at our delivery locations, we got in touch with all the SHOs, local police stations and SHOs, informed them that, you know, milk is an essential commodity on the right touch points and sort of, you know, engage with them constructively and proactively. So this was all done within the first like 24 to 48 hours. And once this was done, there was a big positive confidence that, you know, that came through the entire organization. And at least the big problems were taken care of from people. So there was adequate social distancing since we expanded our time slots at our delivery locations. Since people were locked down within production facilities, people felt safer. At a farmer level, we told them that we can take milk with adequate social distancing. At our sourcing locations, we went and talked to the relevant police station. So we went very micro, very over communicative. That's one thing that really helped. Then over the next one month period, we sort of started going the takeaway. So, you know, implementing like the body temperature check. Second thing we double double down on our distribution centers. We split our distribution centers further. Then we started building a Bluetooth tracking of distance between people at each of the distribution centers and you know, we used to get real time data on, you know, how many people are moving within six feet of each other at our, at each of our locations. So, and so that really helped us over the course of months. We started following our very seriously from the day one. So if there was a code, then we started thinking it slowly wall towards the situation where it moved that what it is not if COVID happens to a person, it is when COVID happens to a person. Then you start thinking about what is the adequate protocol that needs to be followed. So who are the people who are in, who you're in touch with. Again, the Bluetooth data started helping us in understanding where the frequency of communication of people can be measured and who are the immediate threat of people who need to be tackled with. So it was a mixture of these things, but some of the things that really helped us as a business was to be extremely nimble, to be extremely micro not macro, to be extremely over communicative and to slowly to once the daily problems were resolved to go the take away in scaling up monitoring from a COVID point of. So if I'll come to you, so you know as an investor and a lender of this space so during this period, did you, did you encounter people coming to you with, you know, telling you about opportunities that they see, which, which, which this situation has thrown up and just give you one of my observations is that at least, you know, this is of course on the downside is that there was a couple of ice cream vendors we used to stand outside my apartment and since this lockdown happened, I've seen them all vanish. I don't know where they have gone, I've gone back home where they might be, but these sales would have got affected, but I'm sure that there are upsides to everything. So what has been your observation during this period. Thanks. Thanks for inviting sort of basically what you're talking about are the value added products which are. Yeah, I think if you if you go to the genesis of understanding the milk in terms of the essential things with energy than Chakri brought up. I think that defines the space that the entire aspect of being an essential product and the way it's getting governed right now and the way they have ultimately conquered this in terms of giving a seamless deliveries. Basically defines the opportunities for any investor or lender in this space. There are two aspects to it. One is naturally a very, very large addressable market. And till now, until recently, there have not been too many players trying to disrupt it. So on a factual terms, there is 4 to 5% of GDP, even on the cattle which would constitutes more and this GDP is not impacted GDP which might see over from this financial year. India is the largest consumer of milk products. India is the largest producer of milk products. So if you have so much of scale to basically deploy and such a big market to serve, it actually attracts various permutations from an investor perspective to look at this space. So once any kind of companies operating in this domain in in current times or in any which ways who are trying to disrupt in many, many angles, this domain really, really gets attraction towards various points. Then it really dwells upon the fact that what you're trying to serve, whether you are on the technology space where you're trying to improve the livelihoods of a farmer and primarily augmenting their income through various technology measures, what Stelapse is trying to do and improve the value chain throughout or you are trying at the consumption end, which is again at the fear of consuming a branded product or what they're consuming. They're trying to just decipher and people are very conscious these days about the consumption of milk as well, the quality of the milk. So what country is trying to serve there in terms of ensuring that you get a premium quality milk serve at your doorstep. So they cross the value chain from an investor and end up with so many various requirements for the business, it's a capital intensive business in itself. There are a lot of use cases of dead products because from the kind of devices which you have to procure or which you have to implement. Though from a consumption perspective, it might be cash and carry business, but there's a lot of value chain behind it, which requires a larger infrastructure. So I think that the way this business can be built is through an extensive use of various forms of capital and that's where actually we've encouraged these businesses. I think any business which is overall working in a daily tech sector within the broader agri-tech spectrum, we've really liked and we've been supporting. And yeah, I don't think there are too many very good businesses out there. That's unfortunate, but yeah, whatever the businesses are there. I think we've been quite active with them and I'm talking largely about the community. It attracts because of the fact of a very large addressable market to serve. And in fact, India can be a pioneer in terms of deriving some of the technology solutions here because you're catering to such a large infrastructure as Chakri mentioned. And as Ranjeet mentioned, there's so many state-to-state hurdles which you have to go through and ultimately serve a product at the consumer. And if you are able to conquer this solution within India and serve the market, you can definitely replicate a lot of these solutions internationally as well. So I think this is not a domestic opportunity. Domestic opportunity itself is very large. I think if done well in a very judicious and a very meticulous manner, this has a very large role to play. Thank you so much. So you talked about the scale of the business, which is not very good businesses are there. So Ranjeet, I'll come to you and I'll just for the benefit of our audience. Can you put in perspective in terms of numbers that how big the industry is? What is the tap potential? What is the tap capacity right now? And what is the potential that can be tapped going ahead? Yes, sorry. So I'll just say the overall industry is about 572 million liters of milk on a daily basis. This includes the organized and the unorganized. So it's a fairly big number. And this 572 million liters of milk comes from about 300 million cattle cows and buffaloes put together. So that the milk value alone, if you just take 572 million liters of milk per day into 365 days into let's say 40 or an average comes to about 4.1% of the GDP as we speak also. The cattle values will come to about another 3.5% because the cattle is the key asset that produces the milk. Out of this 572 million liters about 25% is in the organized sector roughly about 143 million liters of milk per day is in the organized sector. And in the remaining about 42% is locally consumed by the households producing this milk, and about 33% is sold into the local mom and pop shops, wheat shops and all of them. So the rough split is 42%, 33%, 25%, 40% of 572 consumed locally, 33% sold to the local mom and pop shops and 25% is what gets finally into the organized grid of, you know, country delight and Amul and all of that, right? And this organized sector is growing at 20% year on year because there is still room to grow and the overall sector is growing at anywhere between 4% to 8% depending on which source you look at. If you look at medium of about 6% year on year, right? So huge growth that is, you know, possible because if you look at developed markets, you have zero unorganized sector. Everything is organized and we are still 75% unorganized and 25% organized. So there's a huge growth possible on the organized side and 20% year on year growth is a big number, right? And I think even in these COVID times, it will continue to grow, give or give or take one quarter this way, that way because of the ORECA segment, you know, closing down. But that's sort of the perspective of how big the landscape is, what kind of growth, you know, sort of happens. And to give a sense of how it compares with fruits and vegetable market with some of you might be out of in fruits and vegetables, only about 5% is organized, 95% is unorganized, right? So thanks to all the super work done by Amul and Dr. Kurian and that team, at least you have 25% in the organized sector, right? So that's a pioneering work that they've done. And we believe that the quantity problem is more or less solved in the Indian context, right? A per capita consumption which is over 400 grams per capita, right? And so I think the next way would be the quality part, that how do I give quality products to the consumer? The quantity problem is relatively well solved, right? When we started in way back in 2010, our per capita consumption was about 280 to 300 grams, right? But now it has gone up to about 410 grams per capita. That's a good increase so that it can be better compared to Western economies where it can be up to 2 to 3 kgs, you know, it can be better. It's not because Westerners, you know, drink more milk, but they get more value added products, right? They eat more milk than drink. Whereas in India, we sort of drink more milk than eat. To give you a sense of the magnitude, they still drink about 65% of the milk, only 35% is eaten, right? Which means in terms of value added products and all that. Whereas in the European economy, it's the reverse. About 81% is eaten in terms of cheese and, you know, the value of products. Only about 19% is hired as liquid milk. So you can see there's a huge, and as the economy improves, the per capita consumption improves, as the urbanization increases, a lot of eat will, a lot of drink milk will shift to the eating milk part, right? You will see the consumption of the value added product goes up. You will see the consumption of, you know, paneer and the cheese and yogurt and the flavored milk and all of them, you know, continue to, you know, sort of, you know, go up. And it will follow the path that some of the Western economies have taken, mainly because it's still an important source of protein, you know, for us, right? The meat is still not that big, relatively speaking. So the value added products will continue to grow at a, you know, quite a rapid pace. My sense is that, based on the report that I read, the emerging value added products like, like, you know, vey proteins and cheese and yogurt and that will grow at 25% year on year, right? The not so emerging value added products like let's say curd and, you know, others that will grow at about 16% year on year. So it's a huge growth opportunities in terms of value added products growth as well as the overall segment. So that sort of gives you overall feel for how the numbers look like in this landscape. So that I'll come to you. So then it said that, you know, there is a huge opportunity and of course value added product is something that, you know, there's a lot of scope for it. But what are the hurdles, you know, to reach to maybe to attain that maybe in terms of infrastructure, maybe, or maybe, you know, maybe, maybe, you know, monetary wise or otherwise, you know, you think are the other requirements that that India would need to reach that stage where, you know, maybe not exactly the kind of 81 90 90% but, you know, maybe a 50 50% maybe or maybe you know where people start even more value added products. So absolutely sort of see the thing is like most of the value added products that are here today in India are not truly Indian, I think and that's a very big problem so there are two components to this entire problem. One is quality of the of the milk or of the product that consumers have and two is is does it fit in the lifestyle of consumers. So the first aspect is quality in quality what you know, Amol and Mother Dairy and these companies have done over the last 30 40 years is they've solved for the sourcing and the production problem and give like consumable milk to consumers, but there is still a, you know, a big fresh milk market even today, even in the cities where you know everything is supposedly organized where consumers want freshness and freshness does communicate a certain amount of quality where consumers want because it's a perishable product and it has a very short shelf life. You know, the difference is between over processing a product and ensuring that it comes to a customer or recombining a product and ensuring it comes to a customer versus giving it in as natural format as it is possible. So that itself leads to a good amount of value addition which is the first building block or the product market fit which continue like figured out that you know, if there is a milkman existing today, why is he existing what is the need of this customer and we figured that customers love the taste of pure and fresh milk and nothing added to the milk. And that's where we came in and we've solved a big small part of the problem and we are continuing to build our business around it. The second was it was always attractive for us as a business to move into value added products and we kept seeing what people are doing in the market. What we've noticed over time that, you know, replicating a western product in India won't do the job. And the best examples of that are, you know, the UHD milk which you have seen it's not been a big success story in India. Or even if you take most of these yogurt brands or or or these shake brands which have come, which get adopted but by a very small three to 5% of the market, the bulk of the market loves, you know, products like misty do a products like he products like rubby, and you know, and and variants of that so you have to as a business think that you know where is the consumption going from an in the unorganized market and if you see that you'll see that people will use milk for tea, coffee, sweets, the he paneer key, that is the broad cross section of the segment and this is where the value of taste of a customer is. So when you're developing new products, it's your responsibility to understand and do some consumer research around what are the products that suit this kind of customers and very successful products come out of it. Some of the products which, you know, if you take if you take milkshakes, historically, you know, people launched strawberry milkshake, and all these kind of milkshakes which didn't, which did well but didn't do that well. But you know, when people consume at home, they put healthy in the milk, they put ginger in the milk, they put Badam in the milk, which gives a health and health quotient and a health property. There is some amount of consumer R&D and research, which needs to go when you're building these products out. And what really helps and gives a brand like country light and advantages are direct customer connect. We do everything that a consumer tells us to if a consumer if and when I say consumer, it is like 70-80% of our consumers, it is not like 45% of our consumers and that's where over the next four, five years, we'll see truly Indian value added products emerge. And, and, and with this entire COVID crisis, there is a lot of emphasis of customers on quality, and, and, and brands, brands will emerge, the whole space will get more organized and it will be a much better environment in the medium term than it looks today. That's that's what we think. So, you know, chocolate, chocolate talked about, you know, understanding what the customer's pilot is and then creating products like that. So if we can come to you that how important is that and when you when you when you look at a company to put in money, do you believe that, okay, these are the standard products and these are the products that they're going to going to get consumed is that or you see where the brand is going to position itself, you know, in terms of, you know, a household like you said that Badam or Haldi, I mean, of course, I've not seen a Haldi milk movie, I've seen a like a milk movie, but not a Badam Haldi milk. So, is that something very important that, you know, dairy, dairy tech players should should understand and look at? Yes. So, are we right? I think overall as I touched upon the larger pieces of the aspect is how big is the addressable market. So, ultimately, we're talking about dairy and you want to be specific here. But what Jeffrey mentioned actually takes that box, because you're talking about large milk consumption in a brand, which is even if not a direct milk consumption brand, which country delight is tomorrow they start doing value added milk products would have its own niche, because you from the consumption perspective, you have to just define that even if somebody is doing a quality or a premium right now it has a demand. And India has varied kind of population right and this is very this product is very close to the heart. So from an investor perspective, it's majorly about understanding naturally that how that niche is getting built because it can backfire also the consumer brand piece has that negative connotation as well that because it gets attractive and jittery from the perspective of investors interest and the consumption pattern can be associated in terms of an upswing any any hiccup there can also backfire big time. So, yeah, definitely, overall the way it has been positioned the what kind of product you have created out of that, what kind of that that's why I think the way they're building a business is also very strong in itself because they're just focusing on the milk and they know the extension will happen later. I think there is overall demand of all kind of products in Indian market, when you talk about, especially go towards cheese and the ice creams of the world, because there is an inherent belief that some of them are artificially linked products as well. So, when we look at any kind of a segment and sector specifically we do see that how the team is what kind of pain factor they have associated with the consumer, how their position that uniqueness within their model, how much ultimately the margins comes out of that, because naturally ultimately returns from an investor perspective is also equally important, and naturally should not have any impediments in terms of a growth from a quality perspective, they've got their supply chain sorted. And at least the necessary approval, especially being a consumer brand the necessary approvals and the possible hiccups it can have is a lot too large extent sorted. These are the major factors and how the team is building around it what kind of synergies they've got within the market. Is it more of a tech enabled which can see that high consumption growth path, because ultimately the cost of acquisition that the capital employed in this business and cost of acquisition is the most important lifetime value of a consumer can be really high. And probably in the daily kind of a business it can be obnoxious as high as five to six X. So if you've got the customer acquisition going, the retention value is so strong that that the unity promise really works out very positively for any business. Okay, I'll stay with you before that I'll just request my attendees the you know to keep your questions coming. We'll take them up in a bit as we finish our discussion. So you know, we have seen that even in this scenario some of the funding for the daily tech has not stopped. So what's the rationale there I mean, why I mean, certainly there is some value which people are looking at if you can tell our audience that what is the value that this sector still holds despite, you know, you know, many other businesses getting affected and that they're trying really hard to get back, get back on track. So if you can explain that to us. Three or four factors behind it first is naturally as we said that this year with the new numbers and we're seeing a GDP contraction rate. And this industry is practically and being an essential, in essence, essential space has not got affected to that it might rather overbrew as per Chakri. Some of the products would actually get more stick in today's time and can have a better value. Milk has an underlying commodity has not seen too much of disruption into this time. So that's that's one factor which actually excites from a perspective of supporting the companies if even if they have limited runways, can you just work capital debt products around it and give that extension to them in order to make sure that naturally the product the demand is not a problem. The disruption might be at the supply end. So the cycle of getting milk from the from the production till the consumption might be a disruption area. If at all that would have been then to a large extent as both of them said is getting sorted on ground. So I think that's that's first factor. The non COVID impact in today's world in today's time is some sectors are seeing naturally is in inclination and attraction second is, as we said that they're limited disruption sort of in this space, right. It's a very, very big sector, you have few players who are trying to disrupt it in all the manner that's at the consumption and angle or the way still absolutely for us that the largest very tech behind what's happening in the consumption pattern. So there are very, very few companies who are really trying to disrupt this phase and it offers much of opportunities that the players who have really made it and really now trying to scale up, you would see would see investors in trust in all the manner. So that's that's the second element. And then third, as we said that people as Chakri highlighted that people have got more conscious in terms of consumption right that for a for a milk product they're willing to pay a premium. They're getting those kind of services at their door for the milk products. This really excites from the consumption pattern and which that kind of addressable market and population consuming milk and milk added products. It can possibly go up once you have on board with a customer. All these three factors put together combined together really offers a great opportunity. So definitely it's a good time to scale business. Is it also a good time to start a daily tech business? Yes, if some good investors, the good founders have come together with prior experience and you need to have at least the basic capital to skate. I think if you got that sorted, you definitely see an interest. Thank you. Benjith, I'll come to you. You know, we'll take up the question in a bit from our audience before that, but I want to understand from you that during this period, have you seen a change in the consumer piece? You know, consumer behavior basically in terms of preference of any kind of product or, you know, because I was reading somewhere that, you know, people are still were maybe apprehensive that, you know, this value added product like yogurt, I don't know, maybe flavored milk, may kind of, you know, may not be very safe or something. So have you also noticed that in the consumption space? No, on the contrary, we have actually seen and noticed that the consumption of, you know, some of the value added products like paneer actually going up, right. So in fact, Amulet reported that they've actually got 70% more intense for their paneer than before COVID. I mean, that's probably because the homemakers are sitting at home and, you know, trying new fancy dishes with paneer and paneer is still an important, you know, source of protein, you know, it's a protein intense product and not a fat intense product. So on the contrary, I think consumption has gone up on that record. And second, not just in India, if you look at China, no less than four Chinese organizations, Chinese Food Association, Chinese Nutrition Association, and a couple more that I don't recall, came up and said that, you know, all China should drink a one glass of milk a day because it's an important source of, you know, immunity. Yeah, it's an important, yeah, absolutely. So it's an important source of lactoferrin. It's an important source of immunoglobin, right. So it's as good as a pharma product in fact, right. So look at it as a, you know, pharma concept and it's a Chinese Association telling all of its citizens to do it post COVID. Right. So it's our, so it's seen as an immunity in a booster and we also noticed the immunity part being played up very strongly with folks like Amul. If you look at their advertisements, right, they pitch hard for the healthy flavored, you know, milk, right. And even during the peak of the lockdown when, you know, Rama and Mahabharat was being at Amul was the only one who bought maximum airtime at that time. Right. It was not the mobility companies. It was not the markets of the world. It was a milk company buying airtime. Of course, one was cheaper, but the second was the fact that they saw that it's no better time than now to actually pitch for the positive aspects, you know, of the milk. So the net net of all of this is even though the Horeka segment of the QSR segment has gone down to literally zero, right, 30-35% gone down. The last I looked up the math about a week ago. The net sales has only gone down by about, you know, 5 to 8% in India. Right. So the 30-35% dip is more than made up by the increase in the, you know, consumer, direct consumer consumption. And it's not like people have stopped eating or drinking milk. It's just a place of drinking has changed, right. So what tea and coffee you would sit at office and drink or in a cafe or at a tie point. I mean, the equivalent amount is being, you know, being consumed by sitting at home. So we are not seeing the meat and fish probably was a little more badly hurt because a lot of bad publicity from China saying all of these issues copped up from the wet market to do with meat. So I think the meat and fish probably was a little badly hit, but perhaps not the milk market. On the contrary, I saw that the consumption rates were actually going up in the day to consumer segment. So, you know, one final question before we move to our question and answers from our guest. So I've been talking to a lot of, you know, sort of place across verticals as I mentioned getting a chat earlier that, you know, we've seen a lot of collaborations happening to find value for everyone, you know, to make it a win-win situation. So what is that opportunity if at all that exists in the KB sector? Very good question, sort of. So the way we are seeing is that, you know, during the lockdown, all the mainstream media had to go offline or reinvent themselves. So whether you take it as a print or the typical retail more activation or the BTL marketing activities, they had to stop because of the lockdown. So everyone started looking for avenues to acquire customers and also since survival became an important aspect of everyone's thought, everyone wanted to do it at very low cost. And when you're thinking on those lines, certain very innovative thoughts came up. So at country light, what we are looking at is apart from, you know, basic digital marketing, we are seeing a lot of partnerships evolve where your target audience is reasonably similar. So we are looking at, you know, let's say there are customers on this pharma mobile applications and there's one or two good friends where we are looking at a cross partnership where they can sell their essential medical supplies to country light customers and country light can sort of pitch to their customers to subscribe for milk, very high quality milk directly at their doorstep. Similarly, where the edutech is a very big space. So and education is where children are present and that's another great opportunity for new emerging edutech companies to collaborate with country light and country light collaborating with other edutech companies. So in ancillary near about categories where there is a synergy in target market and there is no scope of competition. There's a lot of cross marketing opportunity that we are seeing and we are able to target as a business with other digital businesses and with growing tech, a lot of consumers over the last two months have moved online. I mean, it's phenomenal the amount of video streaming that keeps happening and kind of opportunities that it is giving businesses like us to collaborate on content related to ancillary categories for country light. That's another big opportunity that we are seeing from consumer point of view. So these are few of the emerging trends that we are seeing and I think it's a big shift in consumer thought and preferences and adoption and especially for categories like ours where the ticket size is smaller initially but the frequency is very, very high. It makes customers more friendly to try things out and in the most convenient format and then eventually we are able to deliver on our promise to the customer have more consumers. Definitely there is a scope for everyone. So, you know, we'll continue our discussion we have around 20 minutes left. So we'll pick up some of the questions from which have come to us and, you know, continue this. So, you know, I'll just request the attendees to keep the questions very crisp and to the point and, you know, give and let others also have a chance to ask the question. So to start with, if you can have Rohan Sanija to ask the question, please Rohan. Hello, hi, I'm Aurobill. Yeah, Rohan. Hi. Good afternoon everyone. One question to Mr. Chakradar. What are your views on the A2 mil category which has been like the buzzword in the past few years and all the new internet dairy companies, Provilac, P9 farms, etc. So is it actually beneficial to one's health or is it just a marketing gimmick or what are your views in general are a macro view? On this category? A2 protein is good for customers and we've seen emergence of global brands in this. There is a brand called A2 milk in New Zealand which has emerged only on this promise. But that said, you know, in India the problem is the productivity of animals. And like, you know, Ranjit was mentioning earlier that like 300 million cattle and there are 600 million liters. So the productivity is extremely low. And when you are having such low productivity, having a scalable A2 promise is extremely difficult because, you know, as a business, if you are trying to, you know, give milk to your customers and A2 cattle that are giving A2 milk have typically 4 to 5 liters of milk a day. And assuming a household consumes 1 liter of that for their house, like it should be between like 3.5 to 4 liters a day. That is the level of availability of milk at cattle level. And A2 farms have commercially been unviable. Maybe I've seen at least 10 to 20 businesses try this and fail because of the low productivity of animals. So while it is a great product, at least where we are as a country and what is available today, it is very difficult for a business to give A2 milk unless the price is north of 100 rupees. And even then, you know, unless you have your own farm and you are able to really control everything, it is very, very difficult for you to identify the difference between A2 milk and A1 A2 milk. And so the other milk which is available is A1 A2 where both are there. So at least a country like what we do is we do not claim ourselves to be an A2 brand but 60 to 70% of the produce that we get is A2 milk. So while it's a great product, I really find it very difficult to build a consumer viable business because primarily of the price at which customers will have to purchase this. Another quick addition, there is a misconception that only a desi animal can give A2 milk, whereas even if you have a 0.65 bloodline HF animal which is cross-bred within you, you can still get an A2 A2 sort of milk. So people's visuals that people get when they think of A2 is okay, it's desi milk but in reality you could have a cross-bred animal also given A2 A2 milk. And there are some folks who are trying to sort of maybe take it to a next level by saying I'll give it A2 ghee which looks a little weird because it gives you know almost 100% fat and zero protein. And A2 is a protein, right? So when you say A2 ghee, it becomes a little weird as to what does it mean, right? Is it because the source milk was A2 and hence the ghee is, you know A2 because the ghee is completely fat, right? There is no protein or at least the trace protein. So it doesn't make sense. So there's a little bit of people trying to use it also may not, it might just go beyond the actual facts, the scientific facts that lay beneath it. Okay, all right. Thank you so much. We'll let Aruneshwar ask his question next. If you can have Aruneshwar please. Aruneshwar you'll have to unmute yourself. Would have known, gentlemen. Yeah, go ahead. Sir, I'm Aruneshwar, agriculture-based agriculture student. Sir, my question is what are the areas of great opportunity in dairy industry which a budding entrepreneur can go for? Well, okay, Spith, I think you've already partly answered that but if you can add another bit. On a generic perspective, on the points which I mentioned earlier, I think one important thing which I should have highlighted which motivates some of the other people to come in this sector is sheer impact of this sector, right? Because you actually are so practically giving, as Ranjit mentioned, the cattle to farmer issue is so low in India. And the livelihoods of the people gets increased if more consumption is derived in a proper manner and these people gets better income levels to have more cattle. So it's like a chicken and egg story but overall from sheer investor's perspective, it's an impact sector to be in because naturally whatever you do in the dairy sector impacts the farmer on ground. And that attracts not only commercial investors, that attracts impact investors as well. In fact, Ranjit has very good cap table in terms of impact investors as well. And that's been increasing because what has resulted into is that the surprising fact has come out that impact investors, some of them have generated more IRRs than some of the commercial investors. While being sheer oriented towards a particular sector, that's a surprising element out of it because they have such a long vision in a company, right? In terms of going deeper with 7-10 years investment, that sheer ground daily presence result into that. So just being particular about what he's asked, I think across the chain there are opportunities. And Omnivore piloted this in India very well in 2014-15 when Mark Engines started. And I think across the daily tech spectrum, I would at least see a lot of opportunities getting created along the chain wherever you want to pick it up at. Naturally the most difficult aspect out of that would be creating consumer brands because that requires a lot of presence. And in fact, in terms of a larger infrastructure also requires a lot of capital, what Stellapse has built. So maybe a smaller opportunity to start with if you have deficient in capital, which can be ancillary to these of the ecosystem. And over and slowly and gradually scaling it up towards the spectrum. But I think if Ranjit and Chakri wants to add on particular things which they have missed in now and some of the other entrepreneurs can catch up on. Yeah, and also Ranjit, if you can add upon that, I would also want to know that we have a huge country. So which are the really areas or regions in terms of geography where still you would say that is untapped in terms of, you know, daily tech business. Yeah, and see pan India, it's, it's a big opportunity because as I said, agriculture has not been a very glamorous segment from tech perspective. So it's only recently that tech interventions have started so vis-a-vis a more vis-a-vis the more urban centric scenarios. The rural and agri has never been very glamorous from a tech intervention, right? People who supply, apply IOT or AI, ML to other more glamorous segments. So I think any tech intervention anywhere in India in an agri segment is a good opportunity. Specifically, if you ask regional wise, I mean, if you just go by the, you know, unorganized, organized, you know, kind of an approach. Down south is a little more organized, more than 30, 35% is organized. As you go up to UP and, you know, other places, the amount of organized sector is much lesser. So if you have a business idea, which can catalyze and organize a larger part of these places like the western UP. At the UP produces about eastern UP, sorry, UP produces about 17% of our milk in India comes from UP, right, from an overall sector point of view. So is there some things that we can do to catalyze the movement towards the organized transition in the UP like, you know, segment? Visually, let's say down south in Kerala or Karnataka, a significantly higher percentage is organized because folks like KMF and Nandini have done a really good job and they've been around for many years. Up in UP, it's probably not that great. So that's one. And second, from a cold chain point of view, as I think Chakri also mentioned, there's a lot of innovation that can happen on the cold chain. And how do I do farm-based chilling? How do I do chilling much earlier as the cow gives out milk rather than chilling at the more monolithic chilling centers? Is there some innovations you can do on the chilling center, especially with alternate chilling energy mechanisms? But these are not places where you have easy power, right? So you need alternate powers. Yes. Yeah, alternate power, right? So that's another part. And any interesting ideas that can help improve the quality and traceability part, right? Both from a consumer point of view, milk production point of view, that's going to be another interesting segment, right? Because as all of us, I think, on this panel have spoken, the productivity problem is, production problem is sort of solved for to some extent, right? So if there are folks coming in to help solve the quality and traceability problems, that will be another huge upside. So these are some of the things, I think, where I think they can be entrepreneurial efforts at a significantly higher scale that can be brought forth. So just a caveat to what Ranjeet said, though we're talking about the opportunities, but you have to keep in mind that this sector requires strenuous and intensive efforts, both of the panelists and other businesses which have been built, has been built over past eight, ten years, right? It's not that kind of business that you start today and probably you're chasing money from next year onwards. In very, very extensive efforts, what they've put in in various forms, they've pivoted in the starting of the business, what they started with and what they've achieved. So I think that aspect has to be kept in mind. It's a very difficult business to do. It's not that easy. That's, we've seen there's disruption once. Just to add a little to that, Aishwarya and Arun, this is like what, you know, at least I have learned and I think Ranjeet can resonate from very hard experience, is that you have to give yourself at least four years before, you know, you think otherwise whether this will work or not. And if you, let's say, have 100 rupees today as the capital outlay, even other than your career point of view, you should not even spending more than 20% of that in the year one because in milk you have to go through cycles. It's a very perishable product. And you know, there is like a very famous quote in Haryana which says that, you know, you have to keep this in mind that, you know, it's a long journey and you have to, you know, prepare yourself. And it might be okay that, you know, if you think that there is a better opportunity waiting for you and there is something else where returns can be quicker and better for you. I'm sure. They don't want any competition for the next. No, no, not at all. It's a very big sector. You know, as Ranjeet mentioned that we're just at the tip of the iceberg, maybe the person that we see. So, you know, but you know, I completely resonate with what you guys are saying is because, you know, I know that it takes a lot of on-ground running around and work to really get these kinds of businesses done. So, definitely. So, you know, we'll take the next question that's from Karim. Karim, can you ask a question please? Karim, you'll have to unmute yourself. Oh, yes. Good morning. I have just one question. I mean, for Mr. Mukudan, what Stelaps was able to do by processing all the data coming from the farms? What were the action, I mean, or the advice for, let's say, farmers and maybe the Ministry of Agriculture in order to improve, I mean, the management of the cows and also the production, the milk production over the farms? Yeah. So, you know, what we have tried to do using the, you know, data across the supply chain, right? We're not just farm focused, farm is one key area because that's where the key action happens. That's where your core asset, which is the cow exists. So we sort of use that data using our herd management solution, using the data from the rest of the, you know, supply chain to primarily drive home, you know, productivity, quality and traceability. Right. So that's at a very broad level. Those are the three key pillars. But that said, the data that's coming on also gives us a good idea of as to what kind of an animal nutrition will work in which farms. What kind of a nutrition will work in south versus what nutrition will work in UP. Right. And animal nutrition is a big topic, right? You have, you know, feed, your father, your silage, your additives, your premixes, your in all of that. So what will work in which segment and the data about the animal productivity, animal genetics, animal bloodline, right? And overall animal upkeep is going to help us figure out what kind of nutrition will work in, you know, which parts. So then it helps you assess does much better nutrition management and do remember that 60% of the input cost in milk production is animal nutrition. Right. So you need to get that, that part right. Of course, in the larger farms, it can be better, but I'm talking like in an average Indian Indian farm. That's number one. Number two, the data also helps us in do a lot of these preventive health care, you know, for the animals. Typically in emerging markets, especially in India, the focus has been on sickness management and less on preventive health care. So can we do more and more preventive health care for the animals? Can we do vaccinations on time? Can we do deworming on time? Can we prevent outbreaks of, you know, subclinical, luminal acidosis? Can we prevent, you know, brucellosis from kicking on board? Can we prevent laminates from kicking on board? Can we prevent, so there's a whole bunch of items that, you know, kick in an animal husband scenario. So can the data help us do preventive health care, you know, vis-a-vis sickness management? The third and really important part is breeding, right? The breeding efficiencies in India are not that great. If you look at the intercalving periods, it could be as, you know, longer than 500, 600 days on average. Right. Whereas it should be, you know, 360 days or in that range, because it's a huge PNL impact for the farmer, right? Because he has to feed the animal, even though it's not producing milk. So how do you use data and the interventions to optimize, you know, breeding efficiencies at these farms? And finally, farmers do need to get credit and insurance, right? If they'll go to shift from a backyard hobby level farmer and become a primarily entrepreneur or MSME, if we are to consider a farmer as an MSME, they need access to capital. They need access to insurance and they need access to other mechanization. So can folks like, you know, stride ventures and others can also provide capital directly and directly to these farmers. And can we do data-led risk underwriting for these farmers, right? Because not all farmers are the same. It's not a risky segment. Can we write underwrite risk differently for different farmers? It's like saying, like, if you are a better driver than I am, you should be actually paying less insurance premium for your car, right? Because you're a more safer driver. Similarly, on the farmer's side, can we do more stratified, personalized, contextualized risk underwriting so that they can get access to capital, they can get access to insurance for their livelihood? So these are some of the key items that are many more, but these are some of the top items where I think the data that we get across the supply chain can really help. So we just about to, you know, time, but then we'll try to take a couple of more questions. Gentlemen, I hope you will have no issues so that, you know, attendees who have come get their queries as answered. So can we have Sridham next to ask this question, please? Sridham. Okay. If you don't have Sridham, can we have Arvind Patil next to ask this question? Yeah, Arvind Gohey. Hello. Yes, Arvind Gohey. Yeah, see now this is under pandemic condition. The thing is that infection is coming from the other cities and mainly major cities, metropolitan cities. And our production of milk is from the villages major countryside. Now the fear is that this transmission takes place from the cities and the production at primary production level middle get affected. So how the corporates working out to see that this fear is removed and ensure that the infection doesn't get transmitted through their activities. Okay. I think Chakratha you partly answered the question but if you can again take it, you know, as to what you already mentioned. Okay. See Arvind, first of all, the milk that, you know, typically most businesses give to customers are food is first of all not at COVID doesn't transmit through food. That's number one. The second aspect is when you're giving any of the products that you give, which are related to milk, mostly they're processed products. So in the case of milk, you can say that milk is heated up to 78 degrees and then immediately chilled to four degrees before automatically packing. And then the product goes to the customer. So from a consumer point of view, at the pack product is never at risk of transmission to the consumer and that's why you've seen that most of the milkman based milk has moved to the organized sector, whether it's people like So that is one aspect and second, then it becomes about the second aspect, which is how does the consumer receive the product where contactless delivery becomes a very important component where we ensure that, you know, all the delivery personnel are sanitized every morning before they deliver the milk they wear the protective equipment relevant protective equipment. And as a policy, it is 100% contactless in the sense that they never get in physical contact with the customer, even if it means for collection of money. So we've moved our entire business online and many businesses are taking similar steps in this direction to solve this problem. I hope it answers your question. Fair enough. Next, we have a question from Abhishek Singhal. Abhishek, can you ask his question? Yeah, hi. My question was regarding like particularly to Ishpreet as well and other panelists can also add that are there any opportunities where the farmers can be, you know, empowered with the technology to reach, you know, like Xcelapse is doing, you know, to empower them with technology to have more efficiency to reach directly to consumers because there are now, you know, innovations where brands have been built like milk basket country delight where they are selling the branded milk but are there any opportunities where the milk vendor can directly reach to the consumer through tech. You're talking about farmers, you're talking about probably the milk porers, the farmers, the vendors that are, you know, delivering right now, the people who are still delivering by the bike. Yeah, so I think that's what both of them are trying to do to a large extent as well. They're trying to club actually the supply chain, they're trying to interlink the supply chain. I don't think milk basket is trying to do that as per my understanding, it's more of a end consumer play, which they're trying to do. But if you talk about anything, both this business model, what they're trying to do is to club that gap. If you think that other businesses which can be built around that in a synergistic manner, the answer is absolutely yes. I think as we said that this sector requires this sector throws a lot of opportunities, right? If you just want to build a niche play within that and say you'd only want to create a technology pan India as Anjit mentioned or Chakri mentioned that within the states, right? There's so much of play which can be built up. So within that states because every corporate is also working in a very different manner. It requires synergies to work independently with them. And at the farm level, if you're seeing a synergy directly to a corporate level or to a consumer level, I think it requires a very big technology integration to get it done. You can definitely have partners within that. But yeah, there is a whole huge scope in that. I think we've been observing quite a lot of companies from the agri tech space in general, which does that. That's more of not daily, but the other products, which is more of marketplace linked from farm to folk. There have been recent scheme of the government announcements which really propels that move in all the manner. In fact, I think particularly to daily also there was a scheme launched recently, which I think it was Pashudhan, if I'm correct, which actually is trying to decipher that, that how we can get farmers more engaging towards the direct platforms. So government is building an infrastructure play, which I think the startups are using very well. If you can use that play to derive a business model out of that, I think can can be built up around it. Happy to take happy to probably Ranjith or Chakri wants to add on something. I think I think we'll take this one more question. No, I think ishpreet has covered it. Okay, okay. So we'll take the last question. That's from visual manjila. If you can have to ask the question. Yeah, thank you, gentlemen. My question is whether the veterinary doctors, the veterinary specialists, are there any scope or any ongoing thing that the technology will help them to technology to integrate this, these people to the entire ecosystem of diary and diary products. Yeah, Ranjith would have answered it, but I don't see him here. But yeah, Chakri, if you can take it maybe. Ranjith is here. Is Ranjith here? Yeah, I just got dropped off. Sorry. Can you take that question please or do you want to repeat? I just got logged off when Ishpreet was talking. Yeah, can you repeat it please? Yeah, Mr. Ranjith, my question was whether any, whether the all ongoing techno and other enablements are taking this veterinary specialist doctors into the scheme of things to help production, improving the production or to reduce this production down times. Absolutely. So in fact, you know, one of our key personnel driving the farm side intervention is a PhD in animal science. And we have a whole bunch of veterinary doctors, paravets, AI technicians in on our roles. And I think they become in fact the key to driving our farm side intervention. I mean, be it the nutrition, animal nutrition in animal breeding efficiencies and in all of that we have, you know, folks, so I think a significant portion of our, you know, product features and product intervention. The inputs do come from very significantly from the veterinary specialist, people with the prior BVACMVAC background, you know, folks with nutrition background, deep nutrition background. And folks also who have specialized in animal treatment, as well as folks as specialized in animal genetics. So we have all of that domain inputs coming in to the tech intervention without which things will not work. The domain intensity is a very, very key component of, you know, what we do. So, thank you so much. We've really run out of time. So we'll have to wrap it up here. So, thank you each week. Thank you. Thank you. Thank you. It was really insightful, even for me to understand this sector so well. And, you know, the opportunities that are there, you know, present still there. And we're just to the tip of the iceberg, maybe, and there's a whole gamut of things that can be done across the country as you guys mentioned to me. And thank you. Thank you to our attendees and I'm sure that it was insightful for them as well. Good luck to you. See you again for our next program. Children, thank you so much. Thank you so much. Thank you. Thank you. Thank you. Thank you so much.