Thank you. Good morning, ladies and gentlemen.

I am Anandan, Executive Chairman of the company. I warmly welcome you all to this earnings call.

As the Indian economy continues to exhibit strong underlying momentum and created a supportive environment for credit growth, including for affordable housing finance. Aptus delivered a good start to the year with assets under management growing by 21% YoY.

Disbursements reached a good level during the quarter, and the growth was broad-based across geographies and distribution channels with continued demand from our targeted customer segment. Profitability remained healthy during the quarter.

Net total income increased supported by business growth, improving operating leverage. Return on assets remained healthy while return on equity stood at little over 20%, ROE.

Spreads remain largely stable, our margins remained resilient during the quarter despite rationalized start pricing of certain lending segments and prudent liability management including reduction in cost of funds. Asset quality remained broadly in line despite continued business growth, credit cost broadly contained at 60 basis points during the quarter reflecting resilience of our underwriting framework and disciplined portfolio monitoring.

Looking ahead, we remain optimistic about the opportunities in the affordable housing finance sector. We are seeing good business momentum across our markets and are confident of delivering 22% to 24% AUM growth as guided as while maintaining our focus on operating efficiency.

With that, I would now like to hand over the call to Mr. P.

Balaji, our Managing Director, to take you through the business focus and key operating and financial parameters. Thank you.

Thank you, sir. Good morning to all.

To begin with, I am happy to convey that we have started FY '27 on a positive note. The strategic initiatives that we outlined during our last earnings call are progressing well and have contributed to the continued improvement in our business momentum.

We remain focused on balancing growth with profitability while maintaining our credit discipline. Overall, the quarter reinforces our belief that the affordable housing segment we operate in remains structurally robust and continues to offer us significant growth opportunity.

As outlined during our last earnings call, we continue to make steady progress on the strategic initiatives aimed at accelerating our growth momentum. First, branch expansion.

We continued to expand our distribution network, and during the quarter, we opened 33 branches, taking our total branch network to 372. Next is strengthening customer acquisition.

We continue to diversify our sourcing channel through the expansion of our connector network and increased focus on digital marketing initiatives. The connector channel contributed 8% of our disbursements during the quarter, and we continue to see encouraging traction from this sourcing channel.

The next one is the increasing average ticket size. Our continued focus on increasing the average ticket size supported partly by inclusion and calibrated customer selection strategy is helping us onboard higher-quality customers while maintaining healthy business momentum.

The next one is the customer quality and pricing. Our calibrated reduction in the lending rates on select loan ticket sizes together with our strategy of increasing the average ticket size continues to support customer acquisition while helping us onboard higher-quality customers.

Going forward, we remain focused on the disciplined execution of these initiatives. During the quarter, the last year's whatever was guided has been achieved in the sense in terms of growth, Q1 disbursements grew 36% year-on-year, providing confidence in achieving the FY '27 AUM growth guidance of 22% to 24%.

Just to give us July '26 disbursements also was good, and it has improved by 25% as compared to July '25 disbursements. Branch expansion, we have added 33 branches during the quarter against the full-year target of 60 to 70 branches.

Spreads, yield moderation remained in line with expectation and was fully offset by a lower cost of borrowings, resulting in stable spreads. Operating expenses to AUM remained at 2.7%, within the guided range of 2.6% to 2.8%.

Credit cost stood at around 0.6%, in line with the guided range of 0.5% plus or minus 10 basis points for FY '27. Profitability, ROE remained above 20%, consistent with our profitability guidance.

Based on the progress made during Q1 FY '27, we remain confident of delivering our FY '27 guidance across growth, spreads, operating cost, credit cost, and profitability. Our growth is anchored on the following strategic pillars: one is diversified mix, geographic expansion, productivity, digital excellence.

One more thing which is important is product expansion. We are also evaluating opportunities to broaden our lending portfolio beyond home loans and SME loans through the introduction of a new lending product.

Together, these pillars continue to strengthen our franchise and position us well to deliver sustainable growth while maintaining our profitability and asset quality. Now moving on to performance, AUM grew by 21% year-on-year to ₹13,648 crore.

Disbursements grew 36% year-on-year to ₹1,053 crore. Branch network stood at 372 branches.

Now coming to asset quality, the collection efficiency stood at 98.52%, primarily impacted to an extent by seasonality and some moderation in collection within the NBFC portfolio. Consequently, our 30+ DPD stood at 6.87% as against 6.21% in Q4 FY '26.

Encouragingly, collection performance has improved in July with the 30+ DPD declining by nearly 20 basis points. We expect this positive trajectory to continue as our collection initiatives gain further traction.

The GNPA stood at 1.7% as against 1.52% in Q4 FY '26, while net NPA stood at 1.29% as against 1.15%. The credit cost for the quarter remained within our guided range of around 0.6%.

The credit cost for housing finance company came in at 0.2%, while the NBFC reported around 1.4%. Aptus is one company with two businesses and two benchmarks.

Our housing finance business should be compared with HFC peers and our NBFC business should be compared with the NBFC peers. Each has a different operating model and risk profile, therefore consolidated asset quality should always be assessed in the context of the portfolio mix.

Now coming to the profitability, during the quarter, net interest margin grew by 19% year-on-year to ₹441 crore. We maintained our spreads significantly to 9%, driven by declining cost of funds to 8%.

Our opex as a percentage of AUM remained at 2.7%. Profit grew 19% year-on-year to ₹261 crore, translating to an ROA of 7.8% and ROE of 20.4%, which is amongst the highest in the industry.

Coming to the funding, during Q1, we raised approximately ₹822 crore on a consolidated basis, primarily through a mix of term loans, securitization, and direct assignment. Our liability profile continued to remain well diversified with 50% from banks, NHB is at 14%, securitization at 18%, and the balance through NHB funding.

We continue to maintain a strong liquidity position with total liquidity of ₹1,933 crore as of June '26, including ₹1,257 crore of unavailed bank sanctions, providing us ample headroom to support growth. Now with these remarks, I open the floor for the question-and-answer session.

Hi, thanks for taking my question. Just a little bit of a guidance on the way this year is playing out.

One is that the disbursement growth is pretty impressive at around 36%. There have been challenges throughout the last four, five quarters.

One is, A, what are the drivers and what does the thought process comfort in terms of how this plays out over maybe the next two, three quarters if you say of some color on July, etc.? I think even on the asset quality front, if you could give some color, I know you mentioned that 30 DPD was down around 20 basis points, but, A, what exactly are the drivers and how do we expect the year to really end?

Those are my two questions. Thank you.

First is on the growth. Like what we have explained earlier, first the growth will come from expansion of new branches in new states and expansion of new branches in the existing states, plus the increase in average ticket size by at least ₹1 lakh as compared to the last year.

That is also will provide momentum for the growth. Next thing is the connector channel which we have developed, that has actually gained traction.

As we told you, during the first quarter, 8% of the disbursements was through connector channel, and this will be augmented in the second, third, and fourth quarter as well. The other one is we have also optimized the lending rates on certain housing loan ticket sizes.

That is also likely to provide momentum for the growth. That's what has actually happened in the sense if you look at our July '25 disbursements, it is July '26 disbursements, it is 25% more than the disbursement as of July '25.

All these things are likely to result in good growth, and that's what we are pursuing. That is on the growth.

Next thing is obviously with this kind of disbursement growth, the AUM growth also will catch up, and that's what is giving us confidence that we'll be able to achieve the guided range of 22% to 24% AUM growth. Now coming to the asset quality, as I told you, the credit cost in the HFC was at 0.24%.

This is in line with any other housing finance company, and the quality of the book is behaving very well there. If you look at the NBFC, there was a small hitch in terms of collections during the fag end of June 2026, and that is what has resulted in the collection efficiency dropping down to 98.5% and 30+ DPD going up to 6.87%.

We have already taken corrective steps in terms of the NBFC collections, and we're very happy to tell that in July 2026, the stage two has almost reduced by 15 to 20 basis points. This will continue, and going forward, this range, the credit cost range of 0.5% plus or minus 10 basis points will be maintained, and this will be there for the next three quarters.

Any specific factors that you may want to call out because of weakness in collections or what happened really in the first quarter in the NBFC?

Repeat your question, sorry, Nischint?

Any specific factors that you may want to call out which were the reasons for weaker collections in the NBFC in the first quarter?

Actually, first of all, let's be very clear. There is no problem with the quality of the customers whom we have funded in the NBFC.

It's basically some commitments which was there at the end of the June. At the end so, June '26, that was a thing.

I think if you look at the credit cost of 1.4%, that compares with other NBFCs in the same line of business. Actually, there is no problem with the quality of the customers.

Only thing is some commitments which was there at the end of the June, they were not able to meet it, and that is where there is a slight deterioration in the portfolio quality. That is getting corrected in the month of July '26, and we will come back strong in this quarter.

Just to add, our data, company-wide, the parent company in HL business, pursuing HL business, the quality of portfolio, overdues, NPA data, credit cost compares favorably with all other comparable housing companies. Equally, our NBFC data also is comparing well with other NBFCs of similar size or comparable NBFCs.

On a combined basis, on a consolidated basis of HL and NBFC, the combined data got increased by this 20 basis points primarily on account of while it compares well with other NBFC business, but still on a combined basis, our data wise, it is higher. That's why we are going to work strongly to reduce it further.

Probably, this is kind of more of a month-end or a seasonal trend is what you are suggesting. That's how I would read it rather than saying that this is...

Yes.

Absolutely, Nischint. Yes.

Got it. Thank you very much, and all the best.

Thank you, Nischint.

Hello. Hi, am I audible?

Yes, Umang.

Good morning and thanks for taking my question. Sir, my question is also related to the asset quality point.

Now we do understand that Q1 is a seasonally weak quarter, but our headline ratios in terms of 30+, 90+ are also higher on a YoY basis. Is there anything lumpy out here which has led to this?

The second question is that while the blended collection efficiency has dropped to 98.5%, if you could just split it out as to how much collection efficiency has dropped in the NBFC business? Yeah.

If you look at the collection efficiency in the housing finance company, it is around 99.5%, and this one is around 97.5%. That's the difference.

Adding up to this on a consolidated basis, it is around 98.52%. Regarding the increase in the NPA, actually we are not seeing that kind of a lumpiness in this quarter or year-on-year basis.

In fact, this is what we have also guided. In the sense, 1.49% was the NPA as of June 2025, that has become 1.7%.

This will definitely be brought down with the kind of efforts that is being done, and this is broadly on account of the NBFC NPA getting increased.

Sure. This is not specific to any particular region or any particular cohort of customers or anything like that?

No,

no. No.

Understood. Sir, just one suggestion, I do appreciate that on the call you are trying to emphasize a lot more about the HFC and the NBFC business where you would want us to sort of compare both the businesses separately, but just a suggestion, if we could also start giving data points for both the businesses separately, it would help us as investors and analysts to kind of compare it in a more meaningful way.

Yes, Umang. We have already discussed from September 2026 onwards, you will get data for both the companies in the investor presentation.

All right. Thank you so much and wish you all the best.

Thank you.

Hello?

Yeah. Amit.

Can you hear me?

Yes, Amit. Yeah.

Hi. No, this is Rajiv here.

Sorry. Just to clear this point on asset quality, you said that towards the end of June, some of the NBFC customer couldn't pay and couldn't honor their commitment, but in July, they have not only cleared the June dues and they've also honored their July commitment as well.

Now they have kind of rolled back their bucket, right? On an ongoing basis, your collection efficiency which was, say, 97.5% in NBFC now should be coming back to normal of what, 98.5%, 99%, in June, July?

Yes. Definitely, definitely.

Got it. Incrementally, you'll not see flow-forwards from the NBFC portfolio in July and August?

Yes.

Okay. On this, from a growth point of view, and again, you said that July disbursements were higher 25% Y-o-Y in your initial remarks, but I think from last July, you also stopped doing, this, below ₹7 lakh loans also.

You stopped doing below ₹7 lakh ticket sizes from last July. On an adjusted basis, see, on a like-to-like basis, then how should we look at your disbursement run rate going ahead?

See, 31 35% in 1Q was also because of a lower base last year, but July is 25%, but you still have a lower base. When the base normalizes, how should we look at your disbursement growth?

This quarter, minimum 25% to 30% increase over the last quarter, year-on-year basis, will be happening this quarter. Impact of less than 7 lakh...

Impact of less than ₹7 lakh is already factored. That's what.

Fully passed.

The disbursement is also now happening on NBFC? On the NBFC side, you've not kind of calibrated on disbursement, right, because everything has come back to normal, right?

Yes. See, that's what we told.

Actually, there is no problem with the quality of the customers. It's just one small hitch that has happened during the fag end of June.

There is no way that we are reducing the business in NBFC.

Just one thing on the funding side, two things. NHB proportion in the funding is at its lowest in many, many quarters, and I don't see any NBFC sanction in the pipeline also.

What is the reason? Second is the unavailed sanction from banks, as we see in the liquidity slide, what will be the cost of these sanctions when you draw?

Yeah. Let me talk about this NHB.

See, what has happened, we have also applied to NHB for a ₹500 crore refinance facility, but the indications from NHB is that the cost of funds that they are going to give will be around 8.2% to 8.3%, whereas we in the housing finance company, we are able to raise money from the banks or from the in terms of securitization or NCDs at 7.8% to 7.9%. It makes more prudent to borrow from these sources rather than going to NHB.

If NHB is able to offer competitive rate of interest, then we will go to NHB, otherwise it will be from the other sources. That is on the NHB borrowing.

Next thing is this ₹1,257 crore of sanctions which is there, in the case of HFC, the sanction rate is around 7.9% to 8.1%. In the case of NBFC, it is around 8.1% to 8.25%.

Got it, sir. Thank you so much.

Best of luck.

Hi, sir. Thank you for taking my question.

A couple of questions. First is you talked about getting into new lending segments.

Now there are merits to being a company focused on a single segment, and the addressable market for affordable housing, LAP is pretty large. What is the rationale for getting into these new segments, and which products are under consideration?

See, this new product segment is in a formative stage. We are in the process of discussing on which product we want to get into.

We will be able to give more color in the next quarter concall because this is the thought process which is there in the company. We'll discuss it internally and then give you more color in the second quarter.

Got it. Can you explain what is the rationale for getting into new segments because our growth opportunity in the single segment is pretty huge, right?

Why now?

That's so. We are looking for to reach our next level stage of growth, let's say from 15,000 to 25,000 or from 25,000 to upwards of 50,000 over a period of time, we felt that there is a strong need apart from strengthening our distribution, digital, online, associates, etc., there is a need to diversify the product range also.

We see opportunity particularly in NBFC business because in the HL will continue to be largely in HL, and after meeting the primary, basic requirement of HL, the gap available in non-HL in HL company is limited. In NBFC-wise, today we are offering to the SME and to some extent LAP.

Now there is a large scope for to look at the add-on products particularly even to our existing customers. We have today over 200,000 customers availing the unsecured or security-based or non-security-based set products, financial products from other vendors.

As we have a very good experience with this sort of customer, and we see an opportunity for us to introduce appropriate products in our NBFC to expand. That to support our growth apart from the distribution, we are looking at very closely the products also.

The income stream we want to augment.

Understood. Does that mean that we'll go slow in geographic expansion and much deeper into our existing geographies with more products?

As I mentioned, the geographical expansion will continue, and the direct sourcing through our branches, through our field staff will continue, online will continue, business associates will continue. That's in terms of largely, as it is around distribution in some form or the other, physical, online, offline, with your own staff.

Then apart from that, the other way in terms of our helping the company to scale up further is really the product expansion. That's where we are looking at an opportunity could be there in our NBFC company to augment the products in the NBFC business particularly to leverage our existing customer base, which is also growing at about almost about 20% per year, our customer base itself is growing.

That we should be able to leverage with our new products as well.

Understood. My second question is on asset quality.

If you could give some color in terms of ticket sizes, how the asset quality varies, say, between you had some book on sub-₹7 lakh and maybe ₹7 to ₹10 lakh and ₹10 lakh plus. Is there a difference in the credit behavior, and how are the NPAs between the different ticket sizes?

No,

we are not seeing that kind of a differential behavior in terms of ticket sizes, except for the bounce rates. As we already communicated, when we less than ₹7 lakh, the bounce rates were 2% to 3% more as compared to the greater than ₹7 lakh.

Other than that, we are not seeing the kind of difference in the asset quality when you look at the ticket sizes.

Got it. Lastly, our opex hasn't gone up a lot while we've added 33 branches this quarter.

Is that because these branches were added towards the end of the quarter?

To a certain extent, yes. Of this 33 branches, 10 branches 10 to 11 10 to 12 branches were opened before May 15th, and the balance were opened in the month of June.

That the rent and all those costs will get reflected in the second quarter. We have a track record even last year we've added about

50,

40 to 50 branches, and that has not really resulted in our opex going up in any significant way. In fact, current year, we are planning around what, 60?

60

to 70 branches. We have already added 33 in the first quarter, plan to add another 20,

25

in the second quarter as well, and the balance will get added subsequently. Some of these branches gets added in the newer states like Maharashtra and Orissa.

Despite this, given our conscious in terms of operating cost, in fact not only the investment in branch network, we are also enhancing our investments in the IT. Despite that, we are very conscious of our cost of our operations both as a percentage of AUM as well as as a percentage of the income.

That way, we have a very clear advantage in the competition today that we will continue to maintain despite these investments in the infra, in branches, and IT.

Got it. Lastly, if I can just ask you, can you give some color on how the attrition in the industry is evolving?

Has it improved or does it continue to remain the same?

If you look at the attrition, at the senior level, absolutely there is nothing, and in the case of middle management also, it is only maybe 5%, 6%, and in the case of branch manager, it is around 10% to 15%. At the field level, it is around 40% to 45%.

Earlier it was around 50% to 60%, it has come down to 45%, but still this is high. We have introduced retention incentive, insurance scheme for these employees, and all those kind of things to retain people, but still if people come and open branches in the states where we are operating, the first thing they do is to poach our field officers.

That's a challenge which we need to recognize, but that is why we are also launching the alternate channels so that there is less dependence on people as well.

Understood. Thank you and all the best.

Hi sir. Thanks for the opportunity.

Sir, just one question on the strategy side. Last year same time, sort of exited the below ₹7 lakh product, and now when we are thinking for another product expansion strategies, naturally, we have to calibrate growth in some of the existing product to meet NHB criteria.

How one should think about the AUM mix shaping up in near term? Is there any impact on NIM, ROA at all, sort of when you start expanding new product lines?

If you look at the product mix, currently in the housing finance company, 57% is housing loan and the balance is the non-housing loan, either in the form of quasi home loans or a top-up or insurance loans. This is likely to continue because we still have to maintain this principal business criteria.

At this level of product mix, we are comfortably meeting the principal business criteria, the mix will remain the same. If at all any other business will be done, it will be done in the NBFC.

That's

right. This is not likely to impact the ROA.

Yeah.

Okay.

Unless the borrowings increase and the leverage increase.

Got it. My point is in this 50% mix which we have currently, when we start adding new products, right, to maintain this mix, naturally the new product lines will grow at a faster pace because of low base, and hence, some of the existing product lines in NBFC should see lower growth, right, at blended basis, otherwise will miss NHB criteria.

Strategically, let us say, which products do you think will go slow in near term or maybe will offset by new product lines?

I think we need to be clear here. See, the mix which I was talking was on the housing finance company, so that mix will continue.

Any new product that will be done will be done in the

NBFC company,

okay? While the consolidated mix might change, but on the housing finance company, this will be the mix.

There will not be any impact on the principal business criteria or on the ROA or on the ROE.

Okay. Nutshell, even if we go for this product expansion, broadly there will be no impact on profitability?

Yes.

Okay.

In fact, it can be more. In fact, it can be more.

Yeah.

Got it, sir. Just this last clarification on again this 30+ DPD movement.

Right? Given we sort of anticipated that ticket size a year back and I'm sure incremental growth would have been towards better customer pool.

Logically, at least the early bucket should have YoY improvement, right? Sequentially, I can understand there is a seasonality, but since we are exiting, let us say, the challenging segment last year and 12-months MOB I'm sure should perform better than vintage book.

In that sense, why 30+ is not coming down on YoY basis?

Correct, Renish. What you're asking is very logical, but the thing is this is not because of the deterioration in the quality of the customers or this thing.

It is just that it was a temporary hitch during the fag end of the June '26 where some commitments was not delivered. That has happened in July.

That's what I'm saying. Whatever commitment didn't happen as on 30th June, that has got honored in the month of July.

Got it. It was just a date mismatch, maybe.

With the result, there is improvement in July.

Got it.

This improvement will continue in the month of August and September as well.

Got it, sir. Got it, sir.

Thank you and best of luck, sir.

Thanks, Renish.

Hi sir, thanks for the opportunity. I have a few questions.

One, your tax rate has been lower for the last two quarters, around 20% versus, I think if we look at the previous trend, that was around 23%. Why is that, and then going ahead, what should be the normalized run rate on the effective tax rate?

I didn't get your question correctly. Voice is not clear, Raghav.

Are you able to hear me now?

Yes, slightly better.

Okay. I am saying that your effective tax rate has been 20% for the last two quarters, Q4 and Q1, versus 23% before that.

Why is that, and then going ahead, what should be the normalized run rate on the effective tax rate?

The tax rate is basically because of the benefits we are getting because of the aggressive write-off policies which we are following, and that's the tax benefit we are getting. That's what has resulted in this, and this will continue.

The credit cost is largely on account of write-off rather than provision, and write-off, as is deductible for the tax allowances.

Understood. You're saying this will continue, is it?

Yeah.

Understood. For July, you said that your disbursements are up 25%.

What is the YoY growth in volume terms for the month, like in terms of number of loans?

These are very specific questions. I will answer when we meet.

I don't want to discuss in this call.

Sure.

Largely, our growth in loan number of customers will be around...

Will be the same.

Yeah. Yes.

Sorry, how much?

No, it will broadly be the same. Specific we will discuss, yeah, in our meeting.

Sure. Last question, the assignment income, that run rate in absolute value term seems to be stabilizing, or if I look at that as percentage of the off-book AUM, the margin is normalizing lower.

Where should this margin settle on a steady-state basis, because when I look at other housing finance companies, the assignment income as percentage of off-book assets seems to be somewhere around 11% to 12%, yours is currently at 23% and it's been coming down from as high as 40%. Should it, say, settle somewhere closer to 12%, 15% mark or maybe lower assuming that you probably have a higher-yield book versus others, higher-yield product?

I just wanted to get some clarity on the margins.

It should come down to around 12% to 15%. It should come down to around 12% to 15%.

Understood. Thanks a lot.

That was all from my side.

Good morning to the team. I have two questions.

My first question to Mr. Manoharan is, beyond the regular outlook, what are the top two to three execution priorities you are focusing on in the next few quarters, and alongside that, what do you see as the biggest risk in borrower demand shift, interest rate movement, or competitive pressure, and how are you preparing to manage them while strengthening Aptus' position in affordable housing finance?

That's my first question. I'll ask my second question after this.

Thank you.

Once again, we didn't understand the question. Can you please repeat it?

Sorry about it.

I'm asking about a concrete plan of action that you may be implementing like expanding branch network, strengthening digital lending, or diversifying borrowing segments, and also the risk you see in borrower demand, interest rate cycles, or competition. I just want to understand both on how you plan to grow and how you are preparing to handle challenges that could slow down the growth process.

Thank you.

The competition, that will be there. That we cannot rule out.

Branch expansion will be happening as guided. We have guided about 60 to 70 branches this financial year, of which already 33 has been opened.

Another 20 or 23 will happen in this quarter, and the rest will happen in Q3. Branch expansion, we do not have any challenges.

The growth will come, whatever branches we are opening, obviously new sales officers will be joining there. To that extent, number of sales officers will go up, and to that extent, business will also go up.

We don't find any challenges in the growth from the new branches, so that it will go as per plan.

Thank you. My second question...

Please go ahead.

No, sorry. Please continue.

No,

regarding the risks we are seeing for the growth, we are not seeing that kind of a risk because we always believe and there is good opportunity for growth in the affordable housing segment and also in the NBFC where we are operating. In the new geographies also in the existing geographies.

Of course, competition is there, but still the market is there and we still believe that we can still grow. To have the sustainable growth, as explained by the Chairman, we are also getting into the new products.

This is what is the thing. Definitely growth is not an issue considering the fact that we are guiding 22% to 24%.

I hope I answered your questions on the risks. Also the competition, again as Manoharan told, there are people, there are companies who are opening branches in the state where we are operating, but what we are doing is we are also when somebody comes and says that people are opening branches, we also say that there is business opportunity available in these existing states.

We are also getting into states where the competition is not very intense, for example, Orissa. Also in Maharashtra, there are the locations where we have opened branches, the competition is not very intense.

This is how the progress will happen, and of course, we'll be following this contiguous branch expansion strategy and going deep into a particular state.

Thank you. Can I ask my second question?

Please.

Yeah. My second question is to Mr.

Mittal. Again along the similar lines, while the business guidance is just now mentioned, I want to understand from a financial point of view, what key risk or challenges you anticipate in the coming quarters and what specific measures are being taken to manage margins, liquidity, and balance sheet strength, especially in areas like borrowing cost, asset quality, and regulatory compliance?

Thank you.

First, coming on the margins front. As we have little bit reduced the rate of interest income, so that we are protecting by effective borrowings.

We expect the gross spreads to remain at 9%, and that since our leverage is also being stable around, we expect the NIMs to be around 13%, 12.9%, 13%. Our NIMs are protected from that perspective.

In terms of operating cost, we are very prudent. We have consistently delivered 2.7%, and in spite of increasing branch, the way we manage the operating cost, I think there might be a 2.7% to 2.8% range, but we are very strongly managing our operating cost and that we are very consistent on managing that.

Regarding the credit cost, that is one little aspect where we are working on. Definitely Balaji sir also emphasized that collections is one of the key things which we are trying to manage, and we expect that to also remain between 50, 60 paisa.

This are the aspects in the financials which we are taking. In terms of liquidity, what we have been doing is we have been keeping enough liquidity for 2, 3 months, and since our leverage is very low, we are able to negotiate with the bank and bring them to our price, what we want, and what rate of interest we want.

We are not in a hurry. We are not leveraged.

That is the most important aspect of our balance sheet. We can wait and bring the lender at our terms and at our rates rather than asking or offering rate what banks are asking.

Yeah.

Thank you, and best wishes.

Just to add to what Sanjay said, you are also asking about the risk that can come in the second quarter or third quarter. The only thing which I'm seeing is if you look at our total borrowings, 66% is variable and 34% is fixed, of which 66%, 35% is linked to repo rate and 31% is linked to MCLR.

Basically, if there is an increase in the repo rate, there can be some impact, but we have also computed the risk. It is just the impact is likely to be 0.06%.

That also will not be a major impact in terms of maintaining the NIMs or the spreads.

Thank you, and best wishes.

Thank you.

Thank you for taking my question. Sir, our quasi home loan LAP has been growing faster than the home loans over last year or so.

Have we optimized lending rates more in that segment or what is the reason for this higher growth rate?

You're talking of the housing loan?

Yeah.

Yes, we have optimized on certain ticket sizes, and that too in HL only, and that too on the incremental housing loans. Yeah.

The question was our LAP is growing faster than housing loans. What would be the reason for that?

If you look at it, last year, our HFC loan book grew by 18% and NBFC loan book grew by 29%.

Okay?

Now in this quarter, HFC loan book has grown by 20% and NBFC loan book has grown by 24%. We would like to concentrate more on the housing finance and grow that book and also concentrate on the NBFC by introducing new products and also the existing product scope.

Sir, my question was on the parent company side only. Within the parent company between the home loans and the quasi home loans or LAP, LAP has been growing faster than the home loan product.

I'm asking for the reason for this difference, not the NBFC.

No, correct. The quasi home loan has a lower base, so that base effect will always be there, right?

Okay. My second question is a simple bookkeeping question.

We've in the past been giving the advances split in the IP in absolute numbers. This time you've changed it to percentages.

Because of this, Odisha and Maharashtra numbers are looking a little off. Can you give the absolute split of the advances?

I can ask Amit to contact you and give you the exact numbers on the state-wise loan book. Actually, if you just work out the percentages, it will come.

What is our loan book in Maharashtra and Orissa? ₹162 crore.

Together.

Particularly in

Maharashtra and Orissa, now we have crossed about ₹160 crore, which is about 1.2% of the

book. This is helpful, sir.

Sir, my last question is, difference between the AUM and the advances have dropped by ₹115 crore in this quarter. What would be the reason for this?

What? Difference between?

The difference between AUM and the advances book that used to be ₹1,175 crore.

AUM and assignment.

It's

basically ₹13,648 minus ₹12,691, it's almost ₹957 crore. That is basically the assignment which we have done.

Yeah. If we do assignment...

Also...

Yeah.

If we do assignment... No,

one second. Let me clearly tell you.

If you do direct assignment, that gets added in the assets under management, but it gets out of the balance sheet assets. First.

Next thing is the balance sheet asset also gets reduced by the ECL provision, and also the processing fees that is yet to be recognized as per the Ind AS. Okay?

Those are the causes for the difference.

Got it, sir. Thank you for taking my questions.

Hi, thank you for allowing me a follow-up. Sir, just two questions.

First on credit cost, your guidance of 50, 60 basis points for the whole year, just want to understand from two perspectives. One is this write-off, you said that you started doing aggressive write-off.

Is this an acceleration of policy and would this remain an ongoing policy of write-off? Second is when you look at stage one provision also, you've drawn down from that provision of stage one, and now it is 24 basis points, it used to be 40 basis points, six, seven quarters back.

How should we look at your credit cost guidance in view of how the write-off will happen and how the stage one provision coverage will be maintained going ahead?

What is happening, first of all, the credit cost at 0.6% will be maintained for the year. This regarding the stage one provision which has got reduced, basically the behavior of the customers in terms of repayment in the stage one category has been very good as per the ECL model, and that's why this percentage coverage has got reduced from, say, 0.3% to 0.24%.

Since we saw some deterioration or some increase in stage two assets, we increased the provision coverage there. That's the whole logic.

On the write-off, have you switched to a policy of doing it...

Write-off, this policy will continue of anything more than 500 days will get written off.

Okay, 540 DPD, right? Okay.

Yeah.

Got it. Just on connectors, you said 8% contribution in disbursement.

Two things: what is the number of connector right now, and what can the number go to, and also their proportion in disbursement maybe, say, next year?

We have got right now across 333 branches, we have around 1,000 connectors, average three to four connectors per branch.

Thank you.

Hi sir, thank you for taking my question. I'm sorry if this has already been answered.

If you could just give me the breakdown of the slippages that have occurred?

What is the slippage? Where I'm not able to understand your question.

Any slippage that has happened in this quarter and if you could give me any breakdown for this?

Slippage, that's what we have told. Stage two, from 6.21% in March, has gone up to 6.87%.

NPA is also gone up from 1.52% to 1.7%. I will give the numbers to you maybe through our investor...

Sorry, sir?

No, the numbers will be given to you. You may contact our investor relations, Mr.

Amit. He will be able to give the numbers.

Sir. Thank you.

Yes. Yeah.

Thank you everyone for attending the concall. I would like to say my sincere gratitude to all analysts, investor friends for taking time on all to listen to us today.

Please feel free to contact us if you need to have any further queries. Thank you.

Thank you.