Thank you. Good evening, everyone, and thank you for joining Max Financial Services earning call for the quarter ended June 30th, 2026.

Our quarter one FY '27 results have been released and are available on our website as well as on the stock exchanges. Joining me today are Mr.

Sumit Madan, Managing Director and CEO, and Mr. Amrit Singh, Chief Financial Officer of Max Life.

With that, let me hand over the call to Sumit to take you through our performance and key developments during the first quarter of FY '27. Yeah.

Thank you, Nishant, and good evening, everyone. As you are aware, quarter one was marked by geopolitical uncertainties and a very volatile macro environment that weighed on the market sentiment.

Despite these challenges, the Indian economy remained resilient, supported by some very strong domestic fundamentals. Against this backdrop, we stayed focused on execution, continued to advance our strategic priorities, and maintained disciplined risk and capital management.

To begin with, we achieved a key milestone during the quarter with the completion of Axis Bank's acquisition of an additional 0.98% stake in Axis Max Life Insurance through an equity infusion of ₹381 crores, increasing its shareholding to 19.99%. The infusion enhanced our financial strength, raising our solvency ratio to a robust 198% while further underscoring the commitment of our promoters and their confidence in our strategy, execution capabilities, and long-term value creation potential.

With that context, let me take you through the performance highlights across our strategic focus areas during the quarter. Following a very successful FY '26, we have started FY '27 on a strong note, carrying forward our growth momentum and delivering a healthy performance in the first quarter.

Our focus remains on building a sustainable and profitable franchise while creating long-term value for all stakeholders, including customers, employees, distribution partners, and shareholders. In quarter one FY '27, our individual adjusted first year premium grew by 17%, outperforming both the private sector and the overall industry growth.

More importantly, our growth remains consistent and sustainable with a 2-year CAGR of 20%, which is well ahead of the private industry CAGR of 12% and double the overall industry growth rate of 10%. Our APE grew by 15% during the quarter, supported by balanced contributions from both proprietary and the partnership channels, growing at 15% and 16% respectively.

Our proprietary channels continue to be a key engine of growth, delivering a strong 3-year APE CAGR of 26%. While offline proprietary sales recorded 9% growth in quarter one, our online business continued to lead the market with a 27% APE growth.

Within partnerships, APE growth of 16% was driven by 14% growth from Axis Bank and 21% growth from other partners, again underscoring the breadth and the resilience of our distribution franchise. We also continued to make some very strong progress in the group credit life segment, delivering a 57% growth in Q1 FY '27.

It's also noteworthy that 45% of our GCL business has been sourced from partners we added in the last 3 years, diversifying our presence in this segment. In addition, we have onboarded several meaningful credit life partnerships during the quarter, which are expected to further strengthen growth momentum in the coming quarters.

We also continued to expand our addressable market through some very targeted strategic initiatives. During the quarter, we launched our USD-denominated offering of Smart Wealth Plan, enhancing our ability to serve the growing NRI customer segment.

Further, we launched Aurus, our exclusive proposition for high-net-worth individuals, designed to deliver a differentiated experience and tailored wealth and protection solutions for this very critical segment of customers. At Axis Max Life, innovation remains a core strategic lever, enabling us to address evolving customer needs while driving the long-term value creation for all our stakeholders.

Our focus continues to be on building a balanced and diversified portfolio mix that supports sustainable growth, improves the product mix, and enhances the margins. Q1 FY '27 largely reflected a normalization of growth across traditional savings products while maintaining the product mix trends seen over the previous recent quarters.

Participating products continued to witness strong traction, growing 48% and contributing 15% of the overall APE. The non-par segment saw a relatively lower contribution compared to the same period last year, reflecting a higher base effect.

Despite volatile market conditions, our ULIP business grew 19%, supported by the launch of Smart Wealth Plan. Protection remains one of our key strategic priorities.

During the quarter, we further strengthened our proposition for the self-employed customer segment, and as a result, our protection and health business grew 44%, led by 57% growth in riders, reflecting increasing customer demand for comprehensive protection solutions. Retirement solutions continue to represent a significant long-term opportunity.

Our annuities business delivered an exceptional 116% growth during the quarter. We further expanded our retirement portfolio with the launch of Smart Ride, a variable annuity product that combines guaranteed lifelong income with participation in long-term equity market performance, offering customers an attractive balance between security and growth.

The strong growth in our protection and annuity business, coupled with favorable yield curve, resulted in a meaningful improvement in profitability. Consequently, our VNB margins expanded from 20.3% in Q1 of FY '26 to 23.2% in Q1 FY '27, driving a robust 33% growth in the value of new business or VNB.

This reflects the success of our strategy to build a higher quality, more profitable, and a sustainable business. Needless to add, at Axis Max Life, customer trust, or the Bharosa, remains the foundation of our franchise, and we are proud to see this reflected across key customer-centric metrics.

In FY '26, we achieved our highest ever individual death claims paid ratio of 99.8%, reaffirming our unwavering commitment to standing by our customers and their families when they truly need us the most. Further strengthening this trust, our InstaClaim service now settles 67% of eligible claims within one single day, delivering a faster and more seamless claims experience.

We were also recognized as the number one life insurer in customer experience in India in Hansa Research's Syndicated Life Insurance CX 2026 study, improving from the second position held over the previous 3 years with a customer experience score of 61. These milestones underscore the confidence customers place in the Axis Max Life brand and our ability to consistently deliver on that promise.

Our 13th month premium persistency stood at 83%. Additionally, longer tenure persistency metrics, including 37th month, 49th month, and 61st month persistency, continued to improve on both premium and number of policy bases, reflecting the growing quality and durability of our business.

Customer advocacy also remains strong. Our overall net promoter score increased from 63 Our net promoter score increased to 63 from a baseline of 60 at FY '25 exit.

Touchpoint NPS improved by 2 points to 65, while relationship NPS again increased meaningfully to 61 from 57, all reflecting the strength of our customer engagement initiatives and some very strong service propositions. Axis Max Life digital, technology, and AI strategy is transforming the company into a platform-led, intelligence-driven insurer.

At the core of this strategy is pervasive intelligence with AI, Gen AI, and analytics embedded across customer journeys, distribution, underwriting, servicing, and employee productivity, all supported by some very agile technology platforms and a modern data foundation. In digital commerce and acquisition, we continue to strengthen our D2C franchise through superior proposition discovery, AI-led marketing, and lead nurturing and optimized onboarding journeys.

Our digitally empowered distribution platform, mSpace, as we call it, equips advisors with recruitment intelligence, personalized engagement, next best action recommendations, and performance nudges. The ecosystem now supports 36,000 monthly active users with over 90% adoption, helping us drive improved productivity and sales effectiveness.

Through our customer app, customers benefit from AI-enabled self-service, wellness offerings, personalized engagement, and digital servicing. We have also simplified claims experience across website and customer app to improve customer ease and accessibility.

With over 10 lakh installs and 4 lakh monthly active users, the platform is emerging as a key engagement channel across the customer life cycle. AI and analytics are increasingly becoming the operating backbone of Axis Max Life.

We now have 30+ AI/ML models in production across recruitment, sales, underwriting, servicing, and cross-sell. AI-based digital prospecting generated 38,000 recruitment leads.

Our AI sales co-pilot has supported 27,000+ sales interactions, recommendation engines have shifted 50% of quotes to higher value variants, and voice analytics has assessed 2 lakh+ customer interactions. In servicing, the Gen AI email bot has resolved 40,000 queries, while AI-driven cross-sell initiatives have delivered ₹58 crores of new business, demonstrating Axis Max Life AI's growing contribution to growth, productivity, and customer experience.

To summarize, I would like to highlight we've had a strong start to the year with solid performance across all the key metrics. While global geopolitical developments continue to shape the market dynamics, we remain confident in our ability to deliver on our guidance of outperforming the industry and drive sustained value for all stakeholders.

With that, I will now hand over to Amrit, who will provide an update on our financial performance.

Thank you, Sumit, and good evening, everyone. Very quickly, some housekeeping numbers.

At MFSL level, the revenue excluding investment income grew by 18% to 7,289 crore, and the consolidated profit after tax at MFSL stood at ₹180. The gross written premium for Axis Max Life has grown by 19% to 10,710 crore, in which renewal premium has registered a healthy growth of 20% and has touched 4,639 crore, which reflects the resilience of our in-force.

Individual new business sum assured, which is the measure of protection penetration that we're trying to drive within the country, has grown by 32% year-on-year and has touched 1,17,000 lakh crore for Axis Max Life per se. We continue to hold on to our rank 3 on individual sum business assured in the private industry.

Our embedded value end of the quarter stood at 30,415 crore with a growth of 15% year-on-year. The annualized operating RoEV has improved to 14.9% in quarter one FY '27.

There has been no operating variance during the quarter, and this compares 14.9% compares to 14.3% of the previous year corresponding period. We continue to remain focused on operational efficiency.

Policyholder operating expense as a percentage of GWP has improved by 185 basis points year-on-year to touch 16%, driven by focused productivity enhancement initiatives. Despite a healthy business growth, policyholder operating expense increased by only 7% during the quarter.

AUM has crossed a significant milestone for the company, surpassing 2 lakh crore, and closed at 2 lakh and 3,000 lakh crore at the end of June 30th, 2026 quarter, reflecting an 11% increase. As Sumit mentioned, VNB margins have improved from 20.1% in quarter one FY '26 to 23.2% in quarter one FY '27, resulting a growth of 33% in VNB, despite the GST impact.

As you are aware, on a VNB computation basis, we use the actual expense of the quarter to compute the VNB, and we do have an effect where the VNB improves along as operating leverage kicks in during the year. This improvement in VNB is driven largely by a higher protection mix and also supported by favorable yield curve movement, which helped offset the GST impact that had come.

The profitability outcomes achieved during the quarter reinforce our confidence in sustaining our re-enuring margin profile through FY '27. Going forward, we remain focused on delivering VNB growth that outpaces APE growth while maintaining disciplined execution and profitability.

With that, we'll request the moderator to open the line.

Hi, sir. Thank you for the opportunity and congrats on a great set of numbers.

My two questions. Just wanted to understand the margin increase that has happened.

This has, as you mentioned, only on the back of the protection mix improvement, or anything else to also call out in that, for example, if you could give some color on what would be the residual impact, if any, of the GST, and how we should think about it? Also I wanted to understand that solvency, despite this protection growth, has remained flat, how should we look at it?

If you could explain this, that is the first question. Second is, sir, on overall the structure simplification process, fundraise, etc.

Axis Bank had also commented in their call about looking at a potential staking increase, evaluating that, and plus your fundraise plans and structures in place, and how should we think about all these things given the new development? These will be my two questions, sir.

Okay. Firstly, on the margin profile, as I have said in the remarks, that it's to do with the protection-enabled growth that we have experienced and also the yield curve benefits that have come through.

Now, in this 3% approximate increase, you can say 30% is linked to mix around protection and some bit of operating leverage, and around 70%, you can say, is the yield curve, which actually has also helped offset the GST impact. As we had mentioned in the previous call that in quarter four, we had almost taken care of 80% of the GST effect.

Now that's largely behind us. From a GST perspective, there isn't any other effect which has been left out.

On the second one around solvency, Sumit mentioned in his opening remarks that Axis Bank infused around 380 crores during the quarter, which actually helped us lift the solvency profile of the business, and that's why the solvency at the end of June has come at 198%. Now, our solvency is, as you are aware, the regulatory threshold of the solvency is 150.

198% is fairly well above the regulatory minima and also above our internal thresholds that we drive from a risk-adjusted perspective. The approval of the enabling approval of QIP at MFSL was taken as an enabling approval, and which is valid until May of next year.

That was largely to support the growth requirements of the company. As at this point in time, I think solvency position is healthy.

We will keep evaluating, and you will accordingly be informed around if there are any fresh updates on that. With respect to your question around structure simplification, after the Insurance Act Amendment which happened in December, we're grateful for the regulator to have brought in now detailed regulations around how the structure simplification can be undertaken.

We are, obviously, there are technical elements which requires an internal consultation and some of those with our shareholders. We are in that process.

As we had indicated always in the past that we are quite keen in making that happen, I think the good news is that now all paths are paved for this. We will come back to you at appropriate time on our next steps on the structure simplification.

With respect to the Axis comment, I think, as Axis indicated, there's an opportunity which the banking regulations threw up. You will recall that Axis always was keen on taking stake up to 30%.

They are also in their internal process of doing the pros and cons around it, and depending upon how they kind of feel, I think both them and us will make adequate disclosures around this when time comes.

That's very helpful. Thank you.

Just one follow-up that should we, at this point of time, think the timelines that we were previously indicated in terms of the simplification process would still hold?

Sir, we had always indicated that the moment we file a scheme document, given it's an NCLT process, can take anywhere between 6 to 12 months. Those timelines hold.

I think you should wait for us to indicate after we have done our due consultations internally around a specific year of the timeline.

All right, sir. Thank you.

This is very helpful. Thank you and all the best for FY '27.

Thanks a lot for the opportunity. My first question is on the cost savings bit.

If I look at the Opex-to-GWP ratio that has improved despite the ITC loss, just wanted to understand that if you could draw some color here, what's driving this and where are you getting the efficiencies from? Moving to my second question, this quarter, we have been seeing the growth slow down here over the last two quarters, just wanted to understand

Better now? Hello?

Yeah. Is this better now?

Yeah. Sure.

I'll just repeat my last question. On the offline proprietary channel, the 9% growth, the growth slowed down last quarter as well, [unclear]

Yeah. It's largely related to the offline prop channel performance, if you could give us some color there.

On persistency, just wanted to understand what is the reason for 13th month persistency drop.

Okay. I think you've asked three questions because we couldn't hear at this side of the line.

The first question is you're asking what is driving this improvement in Opex-to-GWP. The second question you've asked us offline proprietary at 9%, anything structural, I guess, your question there.

The third one, you've asked us on persistency, if I could capture it right, the reason for the drop in persistency. I think on the first one, we have been on this journey of actually enhancing productivity across our distribution channel.

As you would know, in the last few years, we have been investing heavily on distribution channel. Whenever you invest, there is a period of maturity of the distribution channel where the productivity throughput starts coming through.

Some bit of overall productivity enhancement that we have experienced on the distribution side is one element. On the non-distribution element, I think when GST came in impacted us, we collectively, as a team, started taking many cost initiatives, and those can range from simple negotiations to travel-related restrictions to being far more careful on advertisement and marketing spend.

Those are a mix of reasons why the overall number looks lower. However, I must say that as a organization, we're committed to continuously keep expanding our distribution footprint.

Some bit of this will normalize. You should not take this fact that lower growth of Opex of the quarter to continue in the subsequent quarters as well.

There would be some normalization, but definitely, if you are looking forward to improving the jaw between sales growth and operating expense by PS kind of profile. On offline proprietary, to be very honest, it's a small quarter, and there were certain one-offs related to certain specific very consciously thought-through cancellations that we had to undertake, which actually impacted the numbers.

Had those cancellations not come through, the offline proprietary growth would have been robust. On persistency, we had explained earlier as well.

I think there was a specific variant of a product which actually, post its introduction, has not turned out to the way that we wanted it to turn out, which started creating certain impact on our persistency numbers. The decision to discontinue that variant was taken in the month of March itself, on a very sales-heavy month.

Despite it being a sales-heavy month, the decision was taken. Some bit of that pain is what is being felt in the persistency numbers.

Beyond the 13th month, you can notice that around 37th up to 61st month, there is an improvement in persistency that has happened.

That's very helpful. Just one last thing, I did not get the cancellation bit.

The cancellation was related to agent licenses being discontinued or policies?

There's certain policies that were sourced actually, we didn't feel that those fit the quality standards, this was a voluntary decision. Because it's a small quarter, some of this kind of comes through in the number.

If you remove it, the growth is actually fairly robust.

Understood. That's very clear.

Thank you.

Hi. Thank you for the opportunity.

Congratulations on a very good quarter. My question is broadly around our distribution strategy, not so much to do with this quarter alone, but how are we thinking about diversifying within our online proprietary, specifically not being dependent on one web aggregator too much, etc.?

My second strategy that I want to ask my question around is you've reached a certain size, from here on, for your growth to be at a certain level or for you to expand, you will want to move beyond metro and tier-1 and tier-2 cities. How are we planning out the distribution strategy for those markets?

I think

thank you for the question. We already are making investments as far as tier-2, tier-3 markets are concerned across all our channels.

We've seen some very good response coming to our products, to our brand in some of the smaller markets in the country. Those efforts will continue to happen.

On the specific diversification on the online prop that you spoke about, devoid of a large aggregator, actually only almost 45% of the sales in quarter one was outside this large aggregator. This number was 38% in the last year quarter one, this number has clearly grown.

Other than the large aggregator, we made some great inroads as far all the other aggregators are concerned. One of the channels which you must know we are exceptionally proud of is the entire D2C engine that we've built.

That's been giving us some very good traction. The profile of customers coming onto that channel again is very good.

The quality of business sourced from that channel again is very good. I think on the online proprietary, we are not now dependent only on one large aggregator.

It's a number which is well-spread across. I also feel we've developed a bit of a moat around it.

Whichever new aggregator is coming in, their first port of call is to AMLI. That is courtesy all the engines we've been able to build, all the integration that we've done across, which is now helping us improve our penetration in all the new aggregators who are also joining the industry.

Right. Thank you for that answer.

Just a follow-up, your first, on the tier-2, -3 markets that you mentioned about you're making an investment, that's primarily agents, right, or is there any other? Your new partnerships that you mentioned on the group credit life, are those also a part of those investments?

My second follow-up is on the D2C engine. If you can help us understand, I'm assuming that the majority of customers this D2C platform is pulling is from the urban markets.

Would that be fair to say?

Surprisingly, no. In fact, if you look at our online sales, it has a very healthy contribution of customers coming in from tier-2, tier-3 markets.

It also coincides with the first question that you asked with respect to tier-2, tier-3 and are these only the agents. Answer is actually across, not only agents, but when you look at the banking channel, when you look at the e-com channel, there is a very healthy mix of customers actually coming from tier-2, tier-3 locations.

I think the concept of some of these customers coming only from urban centers, I think across industry, that trend is changing at a very fast pace, and we are no exception.

That's very useful. Thank you so much and all the best.

Thanks for taking my question and congrats for a great set of numbers. On the looks of it, it is now very clear that any kind of a capital issuance is off the cards right now.

Just looking at the current solvency numbers, I was just curious I'm sure Axis Bank is having its own discussion in terms of increasing further stake in the company, etc., but how long can you really wait, or probably a couple of months down the line, you might have to still consider alternate capital issuance options. How long can you really wait for this?

Look, I think there is an internal risk threshold that we run. You are also aware that the accounting standards 117 will be in effect because we have sought a forbearance on the same, will be in effect for us from 1st April 2027.

Regulators also keen, at the same time, along with this accounting standard, to bring about the RBC framework as well, which has a potential to create buffers and releases from a growth capital perspective that the sector can get, given the efficiency of which RBC will bring about. It's important to keep some of these elements in mind as well, how things kind of progress.

I think next few months and quarters will give more clarity around timelines around some of those things. From a long-term perspective, I think that's a very important watch-out area.

If your specific question is that the 198% that we are sitting at, can we continue running it for how many more quarters before reaching our internal threshold? I think what you should also understand is that along with that equity raise that Axis did in the company, it also provides us additional debt capacity on that money as well.

We will leverage that as well, and I think we can stay above the risk threshold for at least two to three quarters quite comfortably as we see it.

Got it. That's helpful.

Just another one was on the profile of your annuity and non-par business. I'm just curious in terms of how the margins would stack up in these two products and does the swing between non-par to annuity, is it in any form margin diluted?

Not giving a specific number around these because we don't disclose margins at a product segment level, but as a whole, the margin profiles are similar-ish. It's not as if there is a drag getting created of one cannibalizing into another.

They're very similar-ish. Obviously, annuity has different flavors and forms, there will be some of those elements in play.

The individual annuity will behave differently than a group annuity, and so forth. At an aggregate level, the margins are quite comparable.

Just one last one is that can we read that slower growth in proprietary offline kind of has also become so little margin accretive?

I think we have in the past, in conversations indicated that the margin profile of our proprietary channel is actually now healthy. It is higher than the margin profile of the company at the margin.

In that sense, slower growth does not mean that it will be kind of adding to the margin. That could be an incorrect assumption.

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

Thanks, sir. Good evening.

Great set of numbers. Couple of questions.

The first one on the trend we are seeing so far in terms of the par and non-par. Is it going to kind of a continue for the rest of the year, or will we see some reversal here?

Second, if you can sort of a provide some kind of a understanding on your variable annuity product, what kind of a risk that is stayed with you and what kind of a hedging mechanism you are using to hedge those risk? Some bit of clarity there.

Thanks.

Thanks, Avinash. I think on participating and non-participating, from a trend perspective, you should understand that, from a product construct, both these product constructs try to solve fairly similar-ish consumer needs as well.

One over another has higher guaranteed component and the other one doesn't have equal and guaranteed component. Even par has a guaranteed component implicit in it.

It's a from a consumer perspective, these are stories and these are what you bring to the market from a freshness perspective, how many launches that you do. It will be a I think between quarters, etc., depending upon what launches we are doing, because any new launch always refreshes the distribution machinery.

We will navigate through some of these things. We do hope to get the trends, even on the non-par, to at least no longer be in such sharp de-growth.

It should move towards more in the positive in the green as the quarters kind of progress. One reason for that also is the base effect, because non-par in the last year, same time, was higher for us.

As years as the quarters kind of progress, that will moderate. More importantly, I think the segments of choices, protection, annuity is there.

We continue to remain focused and we're keen that those trends hold, and we are able to tap onto that opportunity that India presents with respect to those product forms. On your second question was on variable annuity product that we have launched.

That product actually has two components. It it there's an element of fixed return, and on top of those fixed return, there's an element of ability of the annuitant to participate in the equity upside in the equity story that the country has to present.

Now on the fixed portion of the return, needless to say, there is a hedging strategy which is in play as it it follows in other products. On the variable component of the equity side, it's a bit of a participation behavior which exists.

The product obviously has been launched with fair bit of deliberation. In our assessment, it does not bring on any additional risk onto the company because of this particular this particular feature, because that is participated by the annuitant himself.

Clear. Thank you.

Hi. My first question is on, there has been so much discussion on the commission regulations, right?

More of a broader picture, I understand things can really be very different, or whatever there's out in the media that can be very different from that, or in line with that. Just wanted to understand, I think there are two partners which would be key ones for us where things can be different.

One is your parent bank, Axis Bank, as well as the other big web aggregator that we work with. Now in case there is a commission cut, would you expect the behavior of these channels to change, or how do you think this could kind of pan out for us in the medium term?

That's question number one. Second is Axis has seen some pickup in momentum in the recent quarter as well as So how do you see Axis Bank as a channel growing?

Especially there was earlier a question about tier-2, tier-3 growth. That also can we see some Axis Bank playing a meaningful role in that segment of growth?

Those would be my questions. Thanks.

I think, firstly, on commission regulation, as the regulator has spoken on multiple forums. They are proposing to bring a draft, and they want to follow a consultative process with the entire industry.

At a macro level, very frankly, the way we see it is that anything which is good for the consumer is good for the entire ecosystem. We will welcome those regulations, and it is a great initiative by the regulator, and they will want to follow a very long-drawn consultative process here at least is what we are picking up from the media news articles as well.

Rather than getting a specific into what does it mean to one channel or over another channel, and each of these channels actually are at different efficiency levels for us, and also the nature of the relationship that we have with some of these channels are different, Axis being the promoter of the company. Hence, rather than giving you any specific response on an unknown thing of what the specific change is, it is better that we wait for some of these draft regulations that is being spoken of as and when they come.

At a macro level, we'll just reiterate that, I think, whatever is good from a consumer's perspective will always be good for the industry as well, and we are a firm believer in that. We'll work and we'll navigate through some of these things.

This is not the first time such things in the history. On Axis Bank, I'll request Sumit.

Sure. I think on Axis Bank, we've been having some consistently good growth now, and this quarter has been no exception.

Before I answer your specific question around tier-2, tier-3, also important to highlight, and we've discussed this in the previous investor calls as well, that we've kind of fragmented the bank as a whole. We look at Bharat banking as a separate segment.

We look at emerging channel as a separate segment. We look at branch banking as a separate channel.

Recently, the focus has also come around the asset vertical where we are increasing the retail insurance penetration. All that focus that we've been speaking about on the earlier investor calls also, I think everything is coming together now reasonably.

In fact, I would say, very well. That's the reason why you see growth coming from the emerging channels, and the overdependence on, let's say, a channel like a branch banking drastically going down.

The emerging OA share alone, if you look at in the emerging panel, has been at almost 75%. If you look at the overall growth as far as quarter one is concerned, and we look at affluent channels separately, we look at HNI channels separately, there's been some very healthy growth coming across these channels as well.

If you look at Bharat banking and Axis Bank's presence, if you look at the overall number, 65% of the customers for us at a company level are actually from tier-2, tier-3 markets, so that gives a bit of a fillip to our overall numbers. We have almost around 2,000 2,736 RUSU branches, which again have added to the pace of growth across Axis Bank.

Like I mentioned, the Bharat banking channel at Axis Bank has also been coming very handy with respect to all the growth. The overall reach for Axis Bank alone is almost at some 3,200 cities with some 692 branches.

We also have the privilege of partnering with some very specific banks which have improved our presence in the smaller cities and the hinterland of the country. You have a Capital Small Finance Bank, which is there in the hinterlands of Punjab.

You have certain other banks down south which are catering to our masses in the tier-2, tier-3 market, in those states. I think overall, we are very conscious of the growth that the country is seeing in some of the smaller markets.

We are well-equipped with our presence, with our technology, with our people to extract the maximum pace out of the opportunity which exists in these markets.

Just one more question. If you could give your guidance on the VNB margins.

Last year, we gave that guidance, and we are pretty much there. How should we think about VNB margins for this full year?

I think rather than calling it guidance, from an aspirational perspective, we have been saying we will want to make the VNB grow faster than the APE growth, and we leave it at that, which actually does mean that there would be a consequent margin improvement. The year has started to a great start, but we'll keep our focus on that.

We do intend to grow VNB at a faster clip than the APE growth.

Thank you so much.

Hi. Thanks for taking my questions and good set of results.

Congrats for that. Just on par APE growing by 48% in the quarter.

Wanted to understand what is the PPT profile of that growth. The reason is under Regulation 8, first-year regular premiums with a PPT of less than 10 years, can use 80% of allowable EOM versus 17.5% for renewal and close to 5% for single premiums.

Is the par push a way of expanding your allowable ceiling?

Samant, sir, can you hear us? Sorry, we are not able to hear you properly.

Could you please repeat the question, please, because we were not able to properly comprehend what you were asking.

Okay. Did you hear part of it?

Okay. I'll start from

May I request you to kindly repeat from the very beginning, please, if you don't mind?

Sure. Yeah.

I'm saying par APE growth was very strong in this quarter, quarter-on-quarter 48% y-o-y. I just wanted to understand the PPT, premium payment term profile of that growth, because under Regulation 8, if you see the first-year regular premiums with a PPT of less than 10 years, carries 80% of allowable EOM versus 17.5% on renewal and 5% on single premiums.

Is this par push a way of expanding your allowable ceiling? The second component of the same question is, what was your par fund utilization for FY '26 if you can provide that number?

That is question one. Second question is on the amalgamation.

The share entitlement ratio will be struck on a look-through economics or with reference to MFSL's traded price? Does the resulting cap table change any shareholders classification, or trigger fresh regulatory approvals?

Yeah. These are two questions.

I'm sorry. The last question we couldn't follow, but I think the first question we understood because your voice is very, very muffled.

Maybe my connection because even I'm not able to hear you back. Anyways, let's continue.

Yeah.

We'll answer the first one. Let us answer the first question.

I think given our scale, etc., expenses of management limits that regulator has set in, we operate well within those thresholds. That is not the reason why a specific action is taken around anything around participating products.

This is what I heard you speak actually. With respect to your question around is there any specific trend of PPT within the par products, there's nothing like that.

It's very secular. It is business as usual from that perspective across channels, depending upon the mix that they usually sell, and that's the kind of growth that we have seen.

Other question, I couldn't understand.

Okay. Let me try for the second question.

On the amalgamation of MFSL into AMLI, share entitlement ratio will be struck on a look-through economics or with reference to MFSL's traded price? Are you able to follow me, or probably I should Yeah.

I think it's a little bit premature when the scheme of arrangement comes through, obviously, you'll see the specifics and details around it. Having said, you will appreciate that MFSL is a fairly simple structure, and it's a very light operation, and largely, the asset that they hold is an equity into life insurance company, Axis Max Life.

The swap ratios, etc., fairly will be simple and, if I may use your word, a look-through kind of values. There isn't a big adjustment that needs to be done.

Okay. Just a follow-up small thing.

The capital requirement through FY '28, is it fully covered through this ₹1,600 crore QIP, or it might have been answered earlier, but sorry for that, asking again.

What we were trying to explain was that, firstly, it's an enabling approval which goes up to May of next year for capital perspective, and while we had taken that approval and the shareholder consent on the same, we had indicated that it is largely to support the growth capital requirements of Axis Max Life. Now, what we're also seeing is that the developments that are happening around the new accounting standard adoption by the regulator, also the risk-based solvency framework, there seems to be progress being made quite strongly on both the fronts.

We would want to see the outcomes of what the final risk-based solvency framework kind of comes through. At a macro level, such a framework does make the insurance company more capital-efficient and provides more buffer from growth capital perspective, but it's a little difficult to comment specifically around some of those things, given that element is not finalized.

I think the regulatory intention is to make more capital efficiency within the sector, thereby providing adequate capital for pursuing the growth aspiration.

What is your internal solvency sort of the band?

As a methodology, every year, depending upon the kind of risks that we have on our balance sheet, we run a certain risk threshold scenario. Number hovers anywhere between plus, minus 180% to percentage.

Yeah. Yes.

Thanks for that, and all the best. Sorry for the disturbance in line.

Yeah.

Yeah. Thank you for the opportunity.

My question again, probably, is more on solvency and Axis stint. Is it fair to say that if Axis' approval of going from 20 to 30 gets delayed, this ₹1,600 crores of QIP, what you have kept it on abeyance right now, you might do it eventually to support the growth?

That's a fair assumption to make?

Look, if RBC doesn't come on time, as we had indicated in the past as well, then your assumption is correct. If there is a development which happens on that framework, maybe the numbers vary for us.

Understood. Thanks.

Just one more clarification. This 198% solvency, what you have reported in the end of the June, includes the sub-debt which you are redeeming.

If you remove that number, I'm believing that you are raising one more round of sub-debt to compensate for that coupon rate, then still solvency will be closer to 200 with the additional sub-debt what you will raise?

Sorry. Can you say that again, Sanketh?

No. What I was asking is that you're redeeming your sub-debt around ₹480-₹490 crores as per the result.

Will you be raising another round of sub-debt because what you reported at June end includes that sub-debt. Now given that sub-debt will go away, solvency will naturally fall.

Then you are raising another round of sub-debt to boost it up back to 190, 200 level?

Your observation is correct. We have actually already honoured the call on the sub-debt.

This was done on 31st of July. We will recoup and raise both that amount and also the amount that we got from an additional capacity of Axis infusion that happened in the first quarter.

Yes, we will be doing a sub-debt raise.

Yeah. Thank you for taking my question.

I had just one question. To an earlier question, you had responded saying that almost 70% of the margin uplift is on account of yields and 30% is on account of the product mix change.

Just wanted to know if I look at the yield curve of the June curve, the Q2 VNB will be priced off the June curve, so that's already almost 50 bps lower at the long end than the March curve. Should we expect some bit of unwind on account of this yield change in say the Q2 margin?

That's the only question I have.

Look, dynamic pricing of products depending upon yield curve is a natural process as a life insurance company we follow. Your observation is correct.

You are saying that at the end of the June, the curve has moved, which could take away some, not the entire, but some benefits that were available in the first quarter from an yield curve perspective. It's a par for course for an insurance company depending upon environment, etc.

You continue doing repricing, but from the aspiration perspective, we hold steady to some of those things that we expect the VNB growth momentum to be faster than the APE growth momentum as we conclude the year. We're working towards some of those aspirations.

Right. That 70% and 70-30 split, that is correct.

That's right, right?

Yeah. Look, there is a reality of as year as the quarter kind of progresses, the operating leverage plays out.

Typically, if you have a good, healthy start from a mix perspective, the operating leverage play out is also superior. Doing that I think you're trying to do that maths of 70% will go away and and consequently, there could be pressure.

I will not go in that direction because operating leverage of the quarter also helps offset that.

Yeah. Thanks so much.

Thank you.

Thanks for the opportunity. My question is on annuity.

What is driving such strong growth in annuity business? Is it driven by the new product launch that we have done?

Do you sense a customer behavioral change because annuity traditionally has not been large product in India? Is it changing, and what is driving that?

Look,

we had a few launches of annuity in quarter 3 last year, and that particular product that we launched came into the base, which was very well accepted across distribution channels given the unique retirement need and annuity products solve for. Some bit of this superlative growth that you're seeing is also coming out of a bit of a low base effect of quarter 1.

Having said in the current quarter, we have also launched a new variable annuity product which was asked at the start of the call by Sambhav, which will also give us a positive lift. It's a combination of product launches on the annuity space, which is actually helping us drive that momentum.

Quarter 1 120% growth numbers have some bit of the base effect as well.

Any particular channel which is driving this growth?

No, it's a fairly accepted product. Yes, across all channels.

Axis and agency both, obviously, are leading the way. There are these specific customer segmentation around the silver segments as we call it where annuities become quite popular.

I think the team has been able to sell the product well. Also it coincides with our overall growth across all channels, including the proprietary business.

Important to mention that because strategically all channels remain the key engines of growth. There was a question earlier around propriety also, and important to say that some of the input parameters on proprietary, which is the offline proprietary, still remain strong, and annuity, of course, forms a key part of that bucket as well.

If you look at the last 36 months or so, we've had a very consistent growth as far as offline propriety channels are concerned, and we not only look at the output or the final number as far as offline prop is concerned, but we also follow the input vectors very seriously. If you look at the advisor recruitment, we've actually grown on that parameter.

Top advisor premium again, which is a very critical component of the offline proprietary channel, we've seen a growth of 28%. FLS productivity, and Amrit mentioned about some of the initiatives we've taken around AI and tech, again, we've seen a 7% growth as far as FLS productivity on the offline proprietary channel is concerned.

I think, importantly, whenever we launch a new product, Amrit just mentioned about the variable annuity, I think the engine is right now well-equipped across all channels, be it Axis, agency or bancassurance, proprietorship as a whole to be able to capture the most out of it. Again in annuity, it looks like a very sustainable, scalable growth for us.

Yeah. Thanks for the opportunity.

Can you please give some color on how the competition is fairing especially on the banca channels, Axis as well as some of the other larger banca channels? Has the couple of unlisted players become a lot more aggressive in those channels?

If that is driven by higher payouts or more lucrative product offerings, and how do you intend to counter that?

Very difficult to comment on what some of the other players are doing. I can largely talk about some of the strengths that we have and how, I would say, in a very consistent manner, we've been at the numero uno position at some of the banks.

Our counter share at Axis always hovers around 65% to 70%. In Yes Bank again, we are the number one player.

What gives us all the more confidence is the separate vertical we have called strategic alliances where we get into new partnerships. Just as a case in point, across the seven last banks that we acquired, and you will appreciate just the acquisition or signing of the agreement with the bank is only a starting point.

It's far more difficult to become a dominant player in any of the newer banks. At least from that perspective, Axis Max Life Insurance has done very well.

In the last seven banks that we've gotten into a partnership where we've not been the first, second, or the third player, we've, in fact, been the fourth, fifth, or the sixth player. Across these seven banks, we already have a counter share of 25% plus.

Four out of these seven banks, we are actually now the number one player. I think the important point is across all the banks our story has been very consistent with respect to the growth.

In terms of what the competition is doing, the market is always competitive. It keeps us on our toes.

It keeps us demanding more out of one another. I think we are a little ahead as far as some of those discussions across people, technology, products are concerned.

Understood. I was just, Sumit, trying to understand if any of the players are becoming increasingly irrational in open architecture banks.

That's all. Thank you.

We like the term irrational. We've heard it a few times.

All that we can say is you can count on us as far as the Bharosa is concerned. We'll never go that route.

It won't be wise or prudent on my part to comment on what some of the other players are doing in the market.

Got it. Thank you.

All the best.

Thank you, ladies and gentlemen, for being on Max Financial's earning call. We look forward to more such interactions in the future.

Thank you once again. Goodbye.