Refused to commit on pecking order user growth.

The 100% guidance no longer holds for FY27 given competition. When you give 60% CAGR medium-term guidance, what margin of safety is built in? If competition stays as-is or worsens, what is the range of outcomes? What are the building blocks to get to 60% CAGR?

We've addressed that in question three of the letter with the building blocks - it's a function of assortment expansion, geographical expansion, demand densification in existing cities, and potentially newer cities. Intensifying competitive activity isn't going to last beyond the three-year period. We are fairly comfortable and confident that over three years we can deliver this CAGR of growth.

On the building blocks - can you give a pecking order among user growth, frequency, and average order value in terms of what drives the most growth?

We can't project with that accuracy at this point. We are learning as we're building this market and these things might change - we don't want to put out numbers that we then have to defend on the next call.

Contribution per order dipped slightly this quarter - is this largely an AOV function or is there more to read into it? Also, any plans to match Swiggy's Toing model with a different price structure, or is Bistro the affordability option? Any updates on Bistro?

On contribution, AOV is one factor but not called out as the key driver. Last mile delivery is also seasonal; delivery partner supply changes by month; supply chain costs can have efficiencies being banked. Net-net, the movement in contribution doesn't change the trajectory. Longer term, nothing to call out. On Bistro and Toing - no plans to do what Swiggy is doing with Toing; not clear what problem it solves for consumers or restaurants. Bistro is still a small experiment with early signs of a business model evolving, but very small and early. We're watching the space and if we see a thesis that makes sense, we'll follow suit.

As AOV goes up and seasonality changes, should contribution direction be upwards at least for now? And does the NCR margin of 5-6% imply contribution of 8-9% or higher?

As we move to 5-6% margin at some point, contribution margin will go up and on a year-on-year basis we'll see that trend consistently. On the specific NCR contribution data point, not sharing it. But broadly it'll be somewhere in that range.

Over the last two to three years there's been significant linearity between store additions and growth. Is there anything to suggest that will change over the next three years?

It's not a straightforward comparison. In some parts of the network we're still in a store build-out phase. In other parts we just have to create supply in different ways to serve customers as assortment expands. Our job is to make sure supply is there whether in smaller or bigger stores. That number becomes very complicated to do math on in such a simplistic way.

You talked about 17 million of warehousing capacity across dark stores and supply chain hubs. What was the number a quarter back or a year back to understand the potential uplift from utilizing existing capacity?

We don't disclose that. If you won't find it in our letter, it's not a miss.

Orders per day per store has been broadly flat for a long period. When can we see some uplift in that number given operating leverage benefits?

The contours of the business might keep changing. We're not hung up on certain metrics going in a certain direction for the business to work. There could be arguments that the number doesn't go up and still the business might deliver 5-6% margin. That's also possible. We're not constraining ourselves in a certain way of thinking about it. That's why we give guidance for overall growth rather than this metric - because these variables might evolve as we go along. It's a good number to track. That's why we disclose it. But we don't know how it will trend.

Advertising and promotion cost in absolute terms was flat sequentially. What proportion goes to Blinkit? Philosophically, are you okay to let go of near-term market share to focus on profitability, or will you react to competition given the 60%+ growth guidance?

Consolidated ad promotions include multiple things - promotional spend in food delivery channeled to value-conscious customers, customer acquisition for quick commerce, and marketing for food delivery. Each business has its own nuances and dynamics. We can't strip that apart. The commentary given for each business reflects our strategy.

Can you give quantitative understanding of how non-metro cities are doing in terms of business size per store - revenue or orders per day - relative to metro versus tier 1 or tier 2? Also, inventory days seem to have gone up over the last few quarters after the transition to 1P. What is driving this and what would be a comfortable level from a risk perspective?

We don't disclose the breakup of our business in larger cities versus emerging cities intentionally. On inventory days, before giving more color - inventory days is not related in any way to the tier 1 vs tier 2/3 split. Q3 to Q4 there hasn't been any meaningful increase apart from growth in the scale of the business. Inventory days are fairly steady; we're not seeing that increase unlike what was suggested.

Competition hasn't changed much but you still expect 60%+ CAGR. What is the North Star metric - MTC addition, order growth, NOV growth, or market share - that tells you when you need to change your stance and react to competition?

We keep reacting according to what we feel is right and it depends on micro markets. Our stance is around the principles we have for building a healthy business. There are places where our MOV is also lower and where we offer free delivery. These are not unidimensional calls. We look at customer retention and frequency in our own business - as long as we don't see that being impacted meaningfully, the choice to stick to our principles is still there. Over the last few months we haven't seen customers turn away too much and hence no need to react more than what we've already done.

Food delivery is close to 20% growth at 5.5% margin. The mid-quarter platform fee hike should flow through in Q1. How do you think about incremental operating leverage and monetization flowing through the food delivery P&L? Will you reinvest in growth, or is there upside risk to the NOV margin guidance?

We have always been more leaning towards growth. If we can find ways to effectively reinvest incremental margin, we would do that because the objective is to optimize for growth of absolute profit, not the profit margin percentage. That's always been the principle. What we're seeing in the last two to three quarters in food delivery is good ROI on investments for growth. Net-net, this should ensure absolute profit continues to grow at the fastest pace possible. But in future, if that stops happening, we could see incremental revenue flowing down to profitability and that's also fine. Outcome could be either percentage margin increasing or growth going up - both optimize for absolute dollar EBITDA.

Within the 60%+ CAGR guidance for quick commerce, would the top 20 cities still be about 40%? Also, on ad monetization in QC, is it mostly SKUs you stock that are surfaced to customers, or do ad loads at checkout and top of funnel ads also contribute meaningfully? Third, on supply chain automation - are you looking at more automation capex over the next two to three years and any guidance on capex beyond store additions?

On the first question, we don't give that breakup and won't give that color. On ad monetization - non-paid ads by brands or platforms which don't sell on the Blinkit platform are insignificant for us. On capex and automation - we keep testing for that. The framework is that capex should have ROCE that we can track and is visible. Directionally, yes, automation is increasing in all our warehouses and will continue over the next few years. But how much is automated is a function of the cost and efficiency uplift we get.

On dark store additions mix, is it still 80% urban and 20% tier 2/3 or has that changed?

That's changing. We're not giving specific guidance but increasingly a large part of our growth will come from geographic diversification so we will see that mix change over time.

On assortment expansion - does that mean you're looking to upgrade some dark stores to bigger size or add more dark stores in the vicinity?

It means we're going to expand our assortment by whichever way we can. Store size is a function of many factors including availability, specific neighborhood and urban infrastructure. It's a very hyperlocal call. Size is also going up as a function of availability of real estate and how we want the store design to be. There is no single answer that applies to every city and every locality.

Multiple platforms globally are seeing the ceiling on ad revenue as a percentage of GMV moving up due to AI. Does this mean at some point the room for your steady-state margins could also move up in both food delivery and quick commerce?

Generally, we don't operate with a cap in mind. We don't know what the cap is honestly. We'll respond to the realities of the situation around us and if that means an opportunity for higher ad income, so be it. The same framework applies - if we have higher margins, can we invest in growth? Can that growth drive more profit? That's the mental model. We don't operate with a set of metrics with ceilings or target goals in mind.

When talking about QC steady-state margin of 5-6%, is there an implied assumption of how much ads contribute to that 5-6%?

No, as I said, we don't know - we're discovering that. Quick commerce is a much younger business than food delivery. It's already doing more in terms of ad as a percentage of NOV. We don't necessarily have a number in mind on where it finally lands.