Ladies and gentlemen, good day, and welcome to the Anand Rathi Wealth Limited Q3 FY24 earnings conference call. This conference call may contain forward-looking statements about the company, which are based on the beliefs, opinions, and expectations of the company as on the date of this call. These statements are not the guarantees of future performance and involve risks and uncertainties that are difficult to predict. As a reminder, all participant lines will be in the listen-only mode. There will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during this conference, please signal an operator by pressing star and then zero on your touchtone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Feroze Azeez, Deputy CEO. Thank you, and over to you, sir. Thank you so much. Good afternoon, friends, and thank you for joining the earnings conference call for the third quarter and the nine months ended 31st December 2023. With me, we have Mr. Jugal Mantri, the Group CFO, Mr. Rajesh Bhutara, the CFO, Mr. Chethan Shenoy, the Executive Director and Head of Product and Research, Mr. Vishal Sanghavi, Head Investor Relationship, and SGA, our investor relations advisors. Indian economy has shown robust growth, and our markets remain resilient despite global uncertainty. With expanding investment opportunity and a thriving market, wealth management firms are likely to attract more clients seeking professional guidance. During the last quarter, we have added the highest number of HNI families, and our client base is now at 9,641 families, and our assets under management have grown to INR 55,057 crore, a 43% growth on a year-over-year basis. In the first nine months of FY 2024, our consolidated revenues increased by 35% year-over-year to INR 555 crore, and consolidated profit after tax grew by 34% year-over-year to INR 169 crore. The consolidated net flows grew by 41% year-over-year to INR 5,411 crore. Equity mutual fund net flow saw a remarkable 85% year-over-year increase to INR 3,854 crore, despite the industry experiencing net flows of -29,000 crore in equity and growth-oriented scheme, net of the SIP inflow of INR 1,41,000 crore approximately. This growth highlights our client families' trust in us and our deep understanding of our clients' requirement, backed by meticulous research to gain insight into the risk associated with achieving their financial goals. Our trail revenue for nine months of FY 2024 stood at INR 186 crore, which grew by 32% on a year-over-year basis. The role of our team of relationship managers has been a key to our consistent growth. Relationship managers, which increased by 45 in number on a net basis over the past 12 months, bring the total number of relationship managers to 322. Importantly, this quarter also, we saw zero regret attrition, showcasing the strength of our workplace culture. Our superior client retention capabilities have helped us to manage our client attrition rate below 1.1% in terms of AUM lost for the first 9 months of this financial year. We remain confident that the private wealth management space in India has massive growth potential and the HNI space still being a highly underserved market. I will now request Chethan Shenoy to take us through the digital wealth management and the OFA vertical businesses, which are our subsidiaries. Chethan, over to you, sir. Thank you, Feroze. The company's digital wealth is an extension of our private wealth offerings to mass affluent segment. This segment aims to deliver a comprehensive and scalable wealth management solution through technology, featuring real-time portfolio restructuring, access to high-quality private wealth product research, simple customer education, and a 360-degree digital delivery model. The AUM in the segment increased by 47% year-on-year, reaching INR 1,491 crores. Revenues from this segment grew by 79% year-on-year, reaching INR 18 crores. Now, moving to the Omni Financial Advisor, OFA business. The OFA business is a strategic extension for capturing the wealth management landscape to service related clients through mutual fund distributors using our technology platform. This is a subscription-led business model, where our proprietary technology is used to solve the common pain points of a mutual fund distributor. As of December 31, 2023, OFA has 5,932 mutual fund distributors and has assets under administration on its platform of INR 1,24,410 crore. Total revenue from this segment grew by 15% and stood at INR 5 crore. Now, I hand over the call to Mr. Jugal Mantri, Group CFO, to take you all through the financial performance of the company. Thank you. Over to you, Jugal sir. Thank you very much, Chethan and Feroze bhai. Wish you all a very happy Makar Sankranti. As far as concerned with our financial synopsis, our consolidated revenue for the quarter ended December 31, 2023, stood at INR 187 crores. ... compared to INR 140 crore in Q3 FY 2023, registering a growth of 34% YOY. The revenue for nine months of FY 2024 stood at INR 555 crore, compared to INR 412 crore in nine months of FY 2023, registering a 35% year-on-year growth. Trail revenue for Q3 FY 2024 stood at INR 72 crore, which grew by 43% year-on-year, and for the nine months ended, trail revenue stood at INR 186 crore, witnessing a growth of 32% YOY. Profit before tax for the quarter stood at INR 78 crore, registering a 34% year-on-year growth, whereas profit before tax for nine months of FY 2024 stood at INR 226 crore, registering similar growth of 34% YOY. Our profit after tax for the quarter stood at INR 58 crore, registering a 34% YOY growth compared to INR 43 crore in Quarter Three of FY 2023. Profit after tax for nine months of FY 2024 registered a growth of 34% year-on-year, at INR 169 crore, as compared to INR 126 crore for nine months of FY 2023. The PAT margin stood at 31% in Q3 FY 2024, and 30.5% in nine months of FY 2024. Earnings per share for Q3 FY 2024 stood at INR 13.9 per share, and for nine months of financial year 2023-24, it stood at INR 14.5 per share. Return on equity on an annualized basis stood at 42% for nine months of FY 2024. Coming to the Private Wealth vertical, for nine months of FY 2024, our flagship Private Wealth vertical's revenue grew by 34% year-on-year to INR 531 crore, and profit after tax grew by 33% year-on-year to INR 166 crore. With this, we can now open the floor for question and answer. Thank you, Mr. Dorothy. Thank you. Thank you. We will now begin the question and answer session. Anyone who wishes to ask a question may press star and one on their touchtone telephone. If you wish to withdraw yourself from the question queue, you may press star and two. Participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question is from the line of Samyak Shah from Sameeksha Capital. Please go ahead. Yes. So congratulations on good set of numbers, and thank you for giving me the opportunity. So, I just wanted to know that what will be the alpha generated by us on nine-month basis? Sorry, I couldn't hear you. If you could just repeat the question, Mr. Shah? Yes. Am I audible now? Yeah. Hello. Hope so. But yeah, we'll try, I'll do an attempt to hear you better this time. Yes. So what would be the alpha generated by us on mutual funds this time? Okay. Alpha generated by us, as of the model portfolio, we run a 14-scheme model portfolio currently. The alpha generated as of yesterday, I can tell you, I don't know the 31st December number, but those 14 schemes are in the public domain. It is 14.23% from 1st April, absolute. Okay. Other products have increased from 12% to 15% this year. So which are the products offered in this segment, and what will be the average yield on those products? Sorry, I couldn't get you again. Yeah, other products, like, other products share has increased from 12%-15%. Correct. Uh- He's talking about the AUM- Yes. which we classify under other products. Yes. I understood. I understood you. Work in progress which has grown up. Yes. See, when we get assets, that's our raw material for the subsequent quarters. So when you look at other products, you have, when a client we analyze, we generally don't onboard him, generally with just a check. We sometimes take his stocks in our Demat account, which will over a period of time get realigned. So first, we show him our strategy or show her the strategy, whoever the client is. Then, once the strategy is accepted, the person, we say that there's a lot of tax implication, exit load implications to what you currently are doing. So we take that in our custody, and that's work in progress. And we're very, very happy to see that number, 13 becoming 15%. It implies that you have more money to align for the subsequent quarters. And that's where that's 13%-15%. Other product could be a tax-free bond, could be a stock, could be a PMS, which may get on the anvil for a change. So realignment happens post the custody moves to us. Okay. And have you launched any new offering in Non-Principal Protected Structured Products? No, we personally believe in just doing the same thing over and over again, if it works. So, the structured products we currently design require two macroeconomic variables, which is high interest rates and reasonable vol, and that continues. So this design has not changed for the last February 1, 2013, was the first issuance. So the design has remained similar because the external environment has been similar too. So, we might be doing the 1,300 times the same product. So no innovation. Innovation is in the optimal extent, only when the clients stop making money or are projected to stop making money, is when the design changes. Okay. When seeing product-wise AUM mix, share of those products have reduced from 29% to 24%. What is our target AUM mix? See that, that again, alignment opportunity next quarter or the subsequent quarters. When the mark-to-market gains in structured products are gonna be lower than a year where market Nifty, I think, started this year on first of April of about 17,400, and I think, has moved up about 18, 16, 17% as of December end. So, the change in proportion is because of the mark-to-market gain in one of the primary products being higher than the other, which implies that when I take a portfolio to the marketplace and realign, because the strategic allocation for a client, let's say, one of my clients, whom I am an RM to, has 65, 35. 65 equity mutual fund, 35 non-principal structured product. If that was the desired allocation on first April, and that was actually allocation on first of April, there is a realignment need of 5-6%, because of the differential Mark-to-Market. So that, proportions will be restored back to 30%. That's the hope, and that's possible. Yes. And what will be the gross and net in, like, issuance of MLDs, these non-structured products, non-principal protected structured products? Yes. So gross and net, I will request Jugalji to give you precise numbers. Yeah, but the net has gone up significantly. Jugalji, can I request you to give those numbers, nine months gross and net? Yes, please. See, the gross mobilization in case of nine months is INR 3,994 crore. And the net mobilization in non-PPSP is about INR 3,000 crore. No. 9, Jugalji? In the first nine months. That's equity mutual funds, right? Non-Principal Protected Structured Products. Gross mobilization is INR 3,994 crore. Sí, sir. In the first, in the nine months. Gross mobilization is INR 3,994 crore. And net- And net? Is INR 915 crore. Yes. Okay. Yes, that's really helpful. All the very best. Thank you so much, sir, for your question. Thank you. We have the next question from the line of Dhaval Parekh from IIFL. Please go ahead. Thank you so much for the opportunity, sir. Am I audible? Yes, absolutely. Yeah. So sir, I had few questions on the MLD part. So just wanted to know, within the gross or the primary issuances that we do, what proportion of it could be a self product and I think, from the Nuvama Wealth product? And secondly, on the duration of the product, what is the current duration of the MLD products that we sell to the clients, and has it significantly changed post the change in the regulations last year? Okay. Thank you. That will be my question. Second question was what, sorry, Mr. Parekh? The second question was, the duration of the MLD products that we sell. Is it a 3-year product, 5-year product? And has it significantly changed post the tax regulation change last year? No. So, on the first one, what are the proportions? The proportions I can give you precise numbers, but, Jugalji you have a proportion number, and then I'll give you- Yeah, yeah. For the gross mobilization in the first 9 months, as I said, it is INR 3,994 crore. Out of this, INR 3,590 crore is issued by the group company, and remaining INR 404 crore has been issued by the third party, which is Nuvama. Okay, thank you. Yeah. Thank you. And, the second part of the question, is there any change? In August 2020, I think, we went from 3 years to 5 years. That was one of our learnings from COVID. It has been largely 5 years post that. And, there has been some regulatory change on some, MLD or structured product, non-principal protected structured product issuances. Mm-hmm. Nuvama's sourcing could be lower in this quarter. There is some regulatory change on certain issuers. Anybody who has issued a principal protected structured product has some changes in regulation. I'm just trying to bring it to your notice now that you have the topic. Okay. Okay. Since Anand Rathi Global Finance has never issued a listed product ever, like we had also during the MLD tax change, highlighted that we don't believe in taking market share in things which we don't believe in. So we never did, not even one listed structured product, now called MLDs, has ever been done. So there is no change in regulation for ARGFL, but there has been a change in regulation for anyone who has issued both of them in the past. Okay, sir. Thank you, sir. And just last one, last one point on this. What is the yield that we make on this product, sir, currently? The yields we make are 1.17 on all mature products, approximately. Per annum. Yields are always per annum on average market value. If a product began at INR 100, matured at INR 180, the average capital is considered as INR 140, and the yield is 1.17 for about 1,200 products when we last computed after maturity. Okay. Thank you so much, sir. Thank you so much. Thank you. The next question is from the line of Bhavin Pandey from Athena Investment Fund. Please go ahead. Hi, team. Congratulations on great set of numbers. First question would be on the increase in AUM we have seen, some could be attributed to MTM gains. And whatever inflows we had, could we get a breakup of how much is from the increased wallet share and how much is from new customer additions? Sure, sir. I will have to ask Jugal Ji for that number, which is there in front of me, and Vishal Ji is going to bring it to my notice. Jugal Ji, you wanna take that if you have that handy? Yes, yes, it is available. The new money which has come to us is about INR 5,620 crore, and M2M gain is about INR 10,260 crore. And there is a AUM attrition or adjustment that is about INR 260 crore. The proportion between existing and a new client is about 70%-70% from existing clients, to be precise, 73%, and the rest is all from new clients. Okay. Okay. And Feroze, when we look at equity markets, especially in the Indian markets, we have seen sort of a dream rally. And, you know, we can see that SIP numbers and everything has gone up in general. But when we look at a scenario where we could see a down cycle, so how do we make ourselves immune to a situation like that? So we are already immune. Let me tell you, there's some... There's one, which is a perception, the other is the reality. Perception is that a lot of money has come into mutual funds, which is correct. But if you look at the nine-month number, if you, you look at this number, this was mind-boggling to me, so I thought I'm trying to bring in attention. INR 141,000 crore has come in the form of SIPs in the first nine months. Still, the net addition in terms of flows is about INR 112,000 crore, which implies if you remove- if SIPs were zero, the amount which is there would have been INR 29,000 crore negative. In the same period of nine months, the corresponding net of SIP number for Anand Rathi stands at INR 3,557 crore. In a period of 9 months, if SIPs were to be zero, hypothetically, you would have had a minus INR 29,000 crore outflow. In that period, Anand Rathi Wealth Limited has a INR 3,557 crore inflow. So like in the past couple of calls, I would have said that our dream is to be a 3-4% market share in equity mutual funds. This is a green shoot of the same. Last year, full year, if SIPs were not there, the total net flow of equity mutual funds would have been minus INR 9,000 crore. In the same period, if I remember the number, for Anand Rathi Wealth net of SIP, the number was close to INR 2,500 crore positive. You gain market share on 3 counts. One is better funds chosen, you get better mark-to-markets. Second is you get better, market share in net flows, then your market share on AUM goes up. So when we have a dream of 3-4, we are, we are backing that with effort and energy to make sure that that dream has a larger chance of getting fulfilled. So to come back to your question, are we agnostic to the direction of how the market is behaving in terms of their affinity to buy mutual funds? I would like to believe yes, because our SIP total inflow has just been INR 2,250 crore. We are also now focusing on SIP. You would be, in the next year or two, you'll be very pleased with us as a shareholder of what kind of SIP numbers we will mobilize from the HNI fraternity. Wonderful, wonderful, Feroze. Seems pretty much clear. And just one last thing before signing off. Do you see one, sort of a reversal in the trend in the debt MF space as we are anticipating a string of rate cuts in the year ahead? I don't see that, because if you look at the cumulative rate cuts expected in the, in the country, in the world, our estimate is about 155 rate cuts by central banks are gonna happen in the world. But India is not gonna see huge mark-to-market gains on the debt side because we didn't see mark-to-market losses. If you look at our 10-year, GSEC is at 7%. In June 2022, when the rate cut cycle happened, we were somewhere thereabout, about 50-60 basis points more is what we have seen. So we've not seen the long end of the yield curve in India move up dramatically. So if that's the case, the repo rate changes have not transpired into the long end of the yield curve. So expecting to make mark-to-market gains when the short end of the yield curve gets lower, may not be real. Because we, in India, we've always operated in an upward-sloping yield curve, but the short end of the yield curve has now gone up, so we have a flattish kind of an yield curve. Hence, I don't expect huge mark-to-market gains on the debt side, even if interest rates on the lower end, repos and reverse repos are below. You didn't lose money, so you are not entitled to make as much, is the key message. ...So powerful. Thanks, thanks, Feroze, and congratulations again. Thank you so much for your wishes. Thank you. The next question is from the line of Gaurav Nigam from Tunga Investments. Please go ahead. Yeah. Thank you. Thank you, sir, for taking my question. Sir, I have one question on the OFA business. I have not followed up, I think you may have mentioned this earlier, but can you help explain what is the business model of this OFA business and how it is different from the other national MF distributors? Sure. Sure, Gaurav, bye. Let me try and attempt doing that. OFA business, which is an abbreviation to Omni Financial Advisor, is a SaaS platform. It is a reporting platform, which are subscription, on a subscription model basis, we provide to IFAs, close to about 5,600 IFAs, okay? Give or take. And the assets which use the platform for reporting is close to about INR 120,000 crore of assets get reported. They're not in our broker code, or this is not a sub-broker model. Unlike other B2B businesses, where there are sub-broker models also being utilized, this is just a pure SaaS platform, for a fee. The reason why this business exists in a wealth management firm is because there are multiple avenues of monetizing this huge consolidation of IFAs on the reporting platform, given the fact that the advisory capability under the auspices of Chethan Shenoy has 122 research people, which an IFA may not be able to procure himself because of the cost constraints. So, to answer your pointed question, it's a SaaS platform where a subscription fee is paid on an annual basis, and 5,600 of them use it for their clients to report close upwards of INR 100,000 crore, you know, of assets which are not in our distribution whatsoever. Understood, sir. Thank you for explaining. You understand, Mr. Nigam? Yes, yes, yes, yes. So just a follow-up on this. If let's say those IFAs end up scaling up, let's say INR 120,000 crore become let's say INR 240,000 crore, does... Is there a possibility of our fee going up? Is it like relate, like in any way related to the AUM growth? Not currently. Not currently, because you are wanting to build scale and then try and monetize. Understood. Understood. But going forward, what are the avenues for monetization, sir? If you can help explain it, if it is possible. Gaurav, our principle always has been to under commit over deliver, so I don't even want to tell you stuff which is on paper. We generally test. Now, if you remember, we are one of the few IPO period participants who have vocally told that, "Please value our profit-making digital businesses at zero." We said that because we like to under commit and over deliver. So there are several methods of monetizing it. Are we very confident that we have cracked the code? The answer is no. So I would not create hope unless I am very sure that it is doable. Because I, of course, I can rattle out those 4, 5 methods of monetizing, which are there, in my mind, but I think it would be unfair for me to create expectations when trial and error. Because we try to like... I would have also on the private wealth business said, we spent 10, 15 years. Rakesh Rawal, who is our professional guru, joined on first April 2007. After 15 years, I, we said that we know exactly how to scale this business now. We have done our mistakes on smaller basis. Now, you will see us grow at a larger pace. So, if I, in the primary business, if there was 8, 10 years of trial and error and trying to be very confident, we love the statement which SEBI made to AMC, "Become better before you become bigger." So we always want to be better, and then I think on the private wealth stage, we have got to that stage where we can say, now we're trying to become bigger. We've not got anywhere close to on those digital businesses, to make that statement. Understood, sir. We'll, we'll track it and wait to hear from you more on this. Thank you for answering. I almost didn't give you an answer because I just don't want to, in the public domain, give answers today. Sure, sir. Thank you. Thank you. Ladies and gentlemen, if you wish to ask a question, you may please press star and one. The next question is from the line of Rohan Mandora from Equirus. Please go ahead. Good afternoon, sir. Thanks for the opportunity and congrats for good set of numbers. Sir, I missed the number on net MLD issuance. Was it INR 915 crore for nine months? Just want to reconfirm. Yes, it was 915. Yes. Sir, what were the secondary issuances for this quarter, for three Q? Feroze, can you look at that number? Yes, INR 427 crore. INR 427 crore. Okay. And sir, in one of the earlier participants' question, you indicated there's some regulatory change because of which the other sourcing partner may have a lower contribution incrementally. So what is that regulatory change? Is it something other than the budget announcement? Just want to understand that. Yes. There was. You can read up on the circular. It says that basically there is, there is a regulatory change which came as lately as a few months back, two, three months back. Any company which has issued a listed structured product, that's whom that regulation is applicable.... So I think I can send you that regulation. Rohan, of course, you understand our business one of the best, so I'm sure you you've tracked up much before. And I have, I think, Vishalji and our SGA team will send you that circular. Sure. Payal, if you could get this sent, please. Sure, sir. Thank you, Rohan. Bye. Yeah. Actually, just one more thing was that for FY 25, what would be the total MLDs that will mature? FY 2025, we will have about, if I'm not wrong, don't go precise numbers, I think we will have about INR 800-900 crore of full maturity. We will have a reasonable portion which has got into the long-term category. About INR 4,000-5,000 crore would have got into the long-term category from a taxation standpoint, and about INR 800-900 crore of maturity. If your question is stemming from your worry whether we will have enough net sale in structured product, if you want to understand that bit in conjunction of our asset proportions, when there is gonna be realignment opportunity, you will be able to project the kind of revenues I'll be able to do in FY 2025. Basically, we have a very simple business model, Rohan, of course, you understand this. Whatever assets we get, like, if there is INR 2,900 crore, which came new to Anand Rathi Wealth in the quarter, we are gonna earn 1.25% yield at least, per annum. That's our business model. If there is a client who gives me short-term money, I don't even take it. If there's a client who wants 20% IRR, we don't. We filter our clients and assets at the gate of entry. So if you want, if we got to almost INR 950 crore of net mobilization in the last quarter, INR 950 crore, average INR 933 crore, you should try and see on a monthly basis, if I collect this amount, which is my run rate now for this quarter, and see what will be my AUM, what will be the AUM on account of client portfolios growth, okay? Our clients' portfolios growth over the last 8-10 years on an overall basis has been 12%-14% return. Clients have made 12%-14% return. That's one assumption. Next 10 years, will they make 12% return with our strategy? In our belief, with the kind of environment India is in, they will make 12%. So that's the automatic growth. The second variable is how much money new will I bring on a monthly basis. Third variable is what is the yield I will make? The fourth variable is on the revenue, how much PAT do I make? If you project this for the next 5 years, that's the business model I look for as a professional, and that will give you a sense of where this business is headed. Structured product sourcing is an outcome of alignment. Now, if our structured product proportions have come down, given first April, if I go to a client and say, "Now, I'm, it's time for me to realign," I will have to sell some mutual fund and bring it back to 30% if that is the agreed allocation. If it is 35%, I will bring it to 35%. So the kind of money, alignment which is need, which is needed in client portfolios is enormous. So to answer your pointed question, not too much maturity next year, point one, INR 800 crore-INR 900 crore of market value. The long-term category, 4-year+, 4.5-year+, which are almost close to maturity, which can be sold in secondary, to people, is about 4,000-5,000 crore. Plus the alignment opportunity, you can compute from mutual funds to structures because you have to realign, like asset allocation gets realigned. If equity does very well, people reallocate between equity and debt, right? Right. Realignment. Similarly, we realign between equity mutual funds and structured products. So that change, the reduction in the structured product AUM as a mark-to-market AUM value, will help you ascertain what kind of alignment opportunities our business has in FY 25, and that's mind-boggling. Sure, sir. And, sir, in terms of the payouts to RMs, is there a difference in the proportion that is paid out for revenues from MLDs and from mutual funds? I'm asking this because the employee expenses have declined Q-on-Q, whereas the revenues were broadly flattish. So I just want to understand that, please. No, we have the... By the way, now that you've brought me to this topic, Rohan, by which people don't get in a... Because you have to read between the lines. Why is our attrition 0? That's a shocking number for a financial services firm, because everybody would want to hire your, we want to hire your people, but people don't leave. Our formula has been constant. Our remuneration formula, which is on the basis of total comp, fixed plus variable of 2 people generating the same revenue will always be equal. In spite of somebody negotiating a better fixed, he will get a lesser variable. If somebody is not a negotiator of a best fixed when he enters, he will get a larger variable. So the total comp concept was introduced in June 2007, and even the Excel sheet password has not changed. There is very few in this country or the world, as wealth management outfits, who can say this, that we have not changed the bonus or the remuneration formula for the RM fraternity for 16 big years. I've worked for some, a couple of them in the past. I have spoken to at least hundreds of them. Everybody's mesmerized that how can you have a bonus formula which is constant? Now, coming to your pointed question, sir, saying that there is there a differential payout? The answer is no. Why is there a difference in employee cost? There could be bonus provisions which are supposed to be-... Firozbhai, if you recall, in Q2 FY 2024, we had an unfortunate incident where we lost Mr. Rohit Rajgopal, and there was one time payment, ex gratia payment because of his sudden death. And that is why that additional cost of about INR 2 crore is there in Q2 FY 2023, and that is why the personal cost is slightly higher in Q2 compared to Q3. That is the reason, Rohan, there is an aberration over there in Q2 FY 2024. Otherwise, there is no reason for this manpower cost to be lower in Q3 in FY 2024. Sure, sir. Thanks. Thank you. Just lastly, what would be the mix of... So in the new sourcing that we are doing between RMs and AMs, where are we typically recruiting them from currently in the last 1, 2 quarters? Just trying to understand the landscape. Sure. I'll tell you our strategy. Our strategy has been hire best people, best people from smaller brands. Okay, we tested this hypothesis. I have, of course, done about 400-500 interviews between 2015 and 2017, 2015 and 2017, and I tested several hypotheses of what has got the best odds of success. We realized that best people from a smaller brand will hit the road, hit the ground running. So, so you will see a large portion of our team was hired from a smaller wealth management outfit in those periods. Because when a client moves from a sticky bank platform, if the technology is the hook in the previous advisor, then we don't hire. So where do you hire from? Standalone wealth management outfits. Anybody who has spent more than 5 years, 6 years, 10 years, who has proved credibility that he doesn't move on a drop of a hat, are the only people we hire. So we don't hire anybody who has not spent more than 4 years in the previous organization. That's an embargo in our company. And the longer the period, the longer the propensity for him to bring in clients, and if he is from not a very big brand, it becomes easier for him to get assets. Otherwise, we have these internal people whom we are training, 340 people being trained internally, is a lot. So every time you see those sharpest one who have shown capability of intellect, intent, value system, and communication, irrespective of language, get promoted on a periodic basis. So just like a college has a fewer seats, right? An IIM today does not hire 10,000 people to educate. So we have, we try and make sure that we, we promote as many as we can, teach to be able to take the legacy forward without diluting our brand in the marketplace. That's the principle. Sorry, your question was well pointed, where do you hire from? But I think it's more important for a prospective shareholder or a shareholder to understand principles, because that's where the business essence lies, not in the numbers. Thank you, Rohan. Bye. Thank you. The next question is from the line of Prayesh Jain from Motilal Oswal. Please go ahead. Yeah. Hi, good afternoon, everyone. Good afternoon. So just, you know, one bit longer term question as to, how do you see your mix between NMDs and mutual funds evolving, say, in the next three years time frame? What is the kind of diversification that you would like to bring apart from these two products as well? If you could throw some light on this. So diversification is not, can't be the cause of any product being approved. That's why we don't have... There are 21 product lines in wealth management, unlisted stocks, PMSs, AIFs, perpetual bonds, insurance, so on and so forth. The reason why we do two is not that the service providers or product providers in the category don't want to tie up with ARWL, right? Anybody would want to tie up with us, right? A PMS, an AIF. Mm-hmm. Because my client doesn't need it currently. We like to operate at an uncomplicated fashion of LCM. If I can get to my return objective of 12%-14% without having the tenth product, I have just noticed another portfolio which I analyzed of triple-digit crores of a person for 10 years, has bought 84 unique products across 14 different product lines, and the IRR for the last 10 years is 10.68, and the beta is 1.1. So if I can achieve a better beta and a better return with fewer products... So to answer your pointed question, the business needs diversification will never be the cause of a third product. My client needs the third product, then the outcome is gonna be diversification from your perspective. We do products in a very controlled environment, a laboratory environment, right? Mm-hmm. That's why there are two products, not that tomorrow I can't. So if there is evidence that this is gonna help me better my risk-adjusted return, that product will come, the third will come, the fourth will come, even the tenth will come. But we have done enough research to figure out that I don't need any more at the moment. So someday after two years, I might go hammer and tongs on the fourth product, more than equity mutual funds, maybe. As long as mathematically it's right. And how do we test mathematics? We use Monte Carlo simulation, we use Markov chains, we do all the statistics which is there in those big fat finance books- Mm-hmm. and apply them to manage these thousands of products. Sir, but in, in the sense that, you know, your customers, how many of your customers would be kind of, you know, subscribing to the other 20 pro- or other 19 products that you spoke of 21 products?... or the other 19 line of items, they will be subscribing elsewhere, with, you know, other, other kind of, you know, wealth managers. And are we kind of missing out on that AUM? I would love to miss out on that AUM. That's been the strategy. Okay? When you do what is right to the client, the client—you just have to show him the logic of why you're not doing something. Okay. For everything I don't do, I have a strong logic, non-refutable logic. In my opinion, mathematics. On perception, of course, it's a refutable logic. Okay. So clients appreciate the fact that you're telling him why you don't do something, okay? Mm-hmm. That way, he's buying real estate. I can become a builder. Mm-hmm. Mm-hmm. Right? So what we do is, then I show him that I have analyzed close to 2,400 properties. The IRR of these properties is 8.82% after 11.42 years of holding period. Mm-hmm, mm-hmm, mm-hmm. If you bought Nifty, these families, which were 700 families, would be richer by INR 2,000 crore. Mm-hmm, mm-hmm. Now, tell me, sir, why should I tie up with a builder to provide you an under construction apartment with this data? Right? Got that. So, what I'm saying is two people come on the same page if there is evidence, mathematical evidence of doing something or not doing something. Okay. Okay? So, like the Anand Rathi Global Finance structured product model portfolio, it started on first of February. If somebody would have invested in that, his money would have been INR 5.5 crore in 10.66 years. But if he invested in Nifty, it would have been INR 3.3 crore. This is hard fact. So mathematics helps decision-making, and that's why you see so much consolidation. Why is there 15% in other products? Because there's logic presented to them, and somebody has to be my client to understand the exact nature, because for the lack of time, I'm not able to articulate what depth of mathematics. No, no. I appreciate, appreciate that. And just on this, MLDs, probably you would have answered this, but just from a clarity perspective, how much of the AUM that you have today is. Does Anand Rathi manufacture MLDs or it's completely outsourced? Anand Rathi Global Finance is the largest issuer for Anand Rathi Wealth Limited. Okay. Okay. Because, that's one NBFC, which in our opinion, is the safest NBFC in the country from an asset standpoint. Mm-hmm. They have the largest investment portfolio. Mm-hmm. Okay. And what is the share of this entity in your total AUM today? Out of INR 55,057 crore total AUM- Mm-hmm. About the non-principal protected structured product has got total allocation of around INR 13,300 crore. Mm-hmm. Out of that, about 80%-85% is with Anand Rathi Global Finance, and the rest is with the third parties. That's what you mentioned, that incrementally it will be more, it will be more Anand Rathi rather than the third party. It's already see around 80%-85% is with Anand Rathi. So it, it will continue in the same ratio. Oh, okay. Got that, got that. People will also come around with the regulation, right? All the other issuers are not going to stop issuing. That's why I said for this quarter. Mm-hmm, mm-hmm. What you may see as risk is what I see as good night's sleep. I'm telling you this. Mm-hmm, mm-hmm. Okay? Got it, got it. Thank you so much, and I wish you all the best. Thank you. The next question is from the line of Abhijeet Sakhare from Kotak Securities. Please go ahead. Yeah, hi. Good afternoon, everyone. First question is on mutual fund sales. Any broad, industry level observations that you can share in terms of, how do you see commission payouts been trending, for the past, let's say, 6-12 months, in terms of, you know, let's say, large, mid, smaller, smaller AMCs, NFOs versus older funds? Any broad sense that you can share will be very helpful. Yes, sure. For whatever it's worth, I'll give you my opinion. I think commissions on the regular side don't have too much scope for compression. That's why the circular which, circular no, a discussion paper, which was issued by SEBI, was held back, more or less. So, from a commission standpoint, of course, NFOs have taken a hit. Anand Rathi Wealth Limited never did one NFO. B30 commissions might get restricted. Again, we don't have any stake there. Smaller schemes get larger commissions. I think economies of scale, the regulator likely wants that to be passed on to the consumer, economies of scale. I think our average model portfolio scheme size is upwards of 5-digit INR crores, so we've not used that lever. So these, these are the 3-4, which you rightly pointed out, could have some compression. As a business, we have had a sense of that, because, I've not done any of those so far. So commissions might have a headroom of 10-12 paisa compression at best. Currently, if I'm not wrong, the model portfolio schemes give us post GST about 1.09. I think, for Anand Rathi Wealth, the compression is gonna be lower because we've not used any of those levers. So if you've not earned from it, you don't lose it. But from an industry standpoint, a 10-12 paisa, 13 paisa compression over the next 3-4 years is possible. You know, this compression is more of a pass-through, right? Like, not really AMC is trying to, increase their share of overall TER. How, how are you seeing it? ... it is basically pass-through, sir, like the GST component, for example- Sure. which AMCs were passing on their share of fees. GST was being charged to the client, but the distributor's GST, the distributor was paying. So yeah, to answer your pointed question, I would see it as a pass-through, and the illustration to exhibit that is like the GST bit. Understood. Very clear. Second is, on structuring of, MLDs, just, you know, for better understanding sake, like, how does the transaction, get executed? Do the investments have to sit on your balance sheet for a few days or weeks before it gets sold to the clients, or it's like a pure agency transaction? If you could just explain. The period would be a few days at best. 3, 4. Yeah, you buy and sell them, downsell them. Buy and downsell them, okay. The average stack, weighted average stack of the entire volume would not exceed 3-5 days. Understood. Got it. Thanks a lot. Weighted average stack. Rupee value stack. Yeah. Got it. Got it. And sorry, can I just squeeze in one more? In terms of this, the transactions on the MLD side, there's no explicit regulation that governs it, right? Like, I mean, I understand the accounting sense and how you kind of make business, how you make revenues in the overall transaction, but there's no explicit regulations like what you have on the mutual fund side that guides these sort of transactions, just from a risk point of view. No, because this is just a bond. Okay? Like a bond trader- Yeah. This is a bond, buy and sell. So, the answer is no, but this is no different than I buying a bond on my prop book and giving it away. I got it. That, that's clear. Thanks. Just that the return is variable, in a normal bond, the return is a constant. Got that. Thank you. Thank you. We have no further questions, ladies and gentlemen. I would now like to hand the conference over to the management for closing comments. Over to you, sir. I'd like to thank everyone for being a part of this call. We hope we have tried to answer your questions to our best ability. If you need more information, please feel free to contact Mr. Vishal Sanghavi, our investor relations head, or Rajeshji, our CFO, our Strategic Growth Advisors, our investor relations advisors. Have a wonderful week, and thank you so much for spending your time with us. Thank you. On behalf of Anand Rathi Wealth Limited, that concludes this conference. Thank you all for joining us. You may now disconnect your lines.