Expect online sales to double in near future: Relaxo

Relaxo Footwears reported a net profit of Rs 27.06 crore for the quarter ended September 2015. Speaking to CNBC-TV18, Ramesh Kumar Dua, MD of the company says premiumisation of products has led to a double digit growth in volumes this quarter.Dua hopes to improve premiumisation and expects a 100 percent growth in online sales going forward. He says capital expenditure will mainly be demand-driven ands that growth in the first half will continue in the next two quarters.Below is the transcript of Ramesh Kumar Dua’s interview with CNBC-TV18's Nigel and Latha Venkatesh..Nigel: On the topline we have seen a growth of close to around 15-16 percent, what brought about this? Was it volumes and how much of it was pricing?A: It is volumes also and premiumisation of the product also.Latha: what was the volume growth you would say?A: It is double digit volume growth for this quarter.Latha: How does business look Mr. Dua are you seeing from quarter to quarter an increase in the volume of sales as well as more expensive products being demanded? Can you expect that even in the second half?A: The products that we are manufacturing now, they are based on our market research and through market research we are finding that the consumer is evolving day by day and his needs are becoming different and now we are producing products based on those evolving needs. So these things are helping us, premiumisation of the product and also the growth in volumes.Latha: To what extent have the margins improved because of premiumisation and to what extent because of lower raw material cost, because your margins have increased by about one and a half percentage points?A: This you cannot say effect which of these two things but both things are contributing.Nigel: Could you tell us what exactly was the percentage of your revenues coming in from your online sales? A: Percentage revenue of online sale is very low, but it is growing. This year we will be growing around 100 percent than what it was last year, so although the base is low but growth is good and we are quite prepared for this online growth.Latha: You were telling us that you are seeing an improvement both in premiumisation as well as volume consumed. You guided for a 20 percent growth; in the first half you have done 18.5, do you want to up your guidance? Will you do better than 20 percent?A: This growth that has been growing on in the last quarter, first half, we are likely to continue that kind of growth.Latha: And what about any Capital Expenditure (CAPEX) plans? Are you going in for CAPEX plans for an FY17 thrust?A: Yeah. Whatever the way the demand is building up, we always plan our CAPEX accordingly, so this year also keeping in view the demand, we have provided for the CAPEX.