Ladies and gentlemen, good day and welcome to the Aptus Value Housing Finance India Limited Q4 FY25 earnings conference call, hosted by Dolat Capital. As a reminder, all participants' lines will be in listen-only mode, and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal an operator by pressing star and zero on your touch-tone phone. Please note that this conference is being recorded. I now hand the conference over to Ms. Mona Khetan from Dolat Capital. Thank you, and over to you, ma'am. Thank you, Sejal. Good morning, everyone, and welcome to the earnings call of Aptus Value Housing Finance India Limited to discuss its Q4 and FY25 performance. We have with us the senior management from Aptus to share industry and business updates. I would now like to hand over to Mr. Anandan for his opening comments, after which we can open the floor for Q&A. Thank you, and over to you, sir. Thank you, Mona. Ladies and gentlemen, good morning to all of you. I am Anandan, Executive Chairman of the company. I welcome you all to this conference call to discuss the company performance for the quarter-ending March 25. I have with me Mr. P. Balaji, MD, Mr. C.T. Manoharan, CBO, and Mr. Sanjay Mittal, CFO, and Mr. John Vijayan, CRO. At Aptus, we believe in strong growth without losing focus on the quality of the loan book and good financial metrics. We're very happy to record that Aptus had a very good FY25 supported by business growth, stable asset quality, continuous focus on high productivity, and a robust business model, good distribution network, and penetration in sales markets, deep integration in sales markets. Customer centricity, along with appropriate tech initiatives and diversified product and income stream, have enabled the company to achieve good business results. Our net worth, if you are aware, stands over INR 4,300 crores, and to calculate adequate capital efficiency, this comes with good support from banks, NHB, mutual funds, and DFI on the borrowing side, and with strong on-ground demand for both home loans and small business loans, which gives us confidence to pursue strong growth, scalability in the years to come with sustained profitability. Further, to support our vision of reaching loan book of INR 25,000 crores by FY28, we've been continuously strengthening the organization by investing in new branches, relevant technology, and strengthening the company with quality manpower across all functions, more particularly in the middle management. I will now hand over the line to Mr. P. Balaji, MD, to discuss the business focus operating financial parameters. Thank you. Thank you, sir. Good morning, friends. As we have been explaining in the earlier calls, we will continue to focus on our key strategies, which are as follows: growing disbursement and loan book, both in housing loans and small business loans, considering the large headroom available in the low and middle-income segments in Tier 3 and 4 cities. Expanding operations continuously in the states of Odisha and Maharashtra. Increasing penetration in existing geographies by opening new branches. Strengthening analytics and digital adoption. About 21% of our business in Q4 FY25 has come from customer referral apps, construction ecosystem ads, and social media channels. Our focus shall be to increase the leads through these channels in addition to the leads from the physical branch network. Continue to focus on productivity, collection efficiency, OPEX, and cost of funds. The new mobile-first lead management software, which was launched in April 2024, has settled very well and is bringing in good improvements in terms of streamlining of our processes, service delivery, lesser downtime, improved collection productivity, better regulatory compliance, and improving overall efficiencies. We are continuously monitoring the functioning of this new system to bring in more improvements. Now, coming to the major performance highlights, our PAT grew by 25% year-on-year to INR 10,865 crores. Disbursement grew by 10% year-on-year to INR 1,064 crores. Disbursement growth for the year was at 15%. We have 300 branches as of March 2025. Of this, 10 branches are in the states of Maharashtra and Odisha, and the balance 290 branches are in the states of Tamil Nadu, Andhra Pradesh, Telangana, and Karnataka. Total branches added for the year were 38. Total live customers crossed INR 1.6 lakhs. It is 21% growth year-on-year. NPA was at 1.19%. Now, coming to the asset quality, collection efficiencies were at around 1.16%, and our 30+ DPD improved to 5.91% as of March 2025, as compared to 6.21% as of December 2024. Net NPA was at 0.89%. Provision coverage has been consistently maintained at around 1.03%. We are carrying a total provision of around 111 crores, including a management overlay of 55 crores, and this when computed as a percentage of the NPA goes up to a coverage of 87%. Credit cost for the quarter was at 0.3%, which was almost similar to the previous quarter. NIM was at 12.96%. OPEX to assets were at 2.63% despite investment in new branches, technology, and HR. AUM was at 751 crores for the year, which is a growth of 23% year-on-year. ROA was at 7.73%, and ROE was at 18.76%, which is one of the best in the industry. For the quarter, the ROE crossed 19% and was at 19.66%. Now, coming to the funding, during the quarter, we diversified our borrowing further by issuing NCDs, aggregating to INR 325 crores to mutual funds. Of the total borrowing, 52% are from banks, 15% from NHB, 19% from NCDs issued to FPIs and mutual funds, and the balance is in the form of securitization. As of March 31st, we had sufficient on-balance sheet liquidity of INR 1,155 crores, including undrawn portion of INR 6.8 crores from banks. I would like to highlight one of our strategic shifts in the funding approach this quarter. We executed our first direct assignment transaction for a small amount of around INR 75 crores of non-housing portfolio in our housing finance company. As you are aware, we have historically maintained a conservative stance and stayed away from DA. However, given the evolving funding environment and the long-tenor nature of our book, we saw merit in exploring DA, which will complement our strategy for both diversification of borrowing and ALM management. This also helps us to strengthen our PBC criteria. Going forward, we will be looking at doing DA transactions on a selective basis. With this, I close my remarks, and I open the floor for the question and answer. Thank you. Thank you very much. We will now begin the question and answer session. Anyone who wishes to ask a question may press star and one on their touch-tone telephone. If you wish to remove 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. Questions. Why don't? The first question is from the line of Rajiv Mehta from YES Securities. Please go ahead. Yeah, hi. Good morning. Congratulations on good performance. My question is on disbursement growth. So while the first half of the year was impacted, but when you look at the second half, which was pretty normal, even in the second half, the disbursement growth was 15% by and large. So, I mean, can you share disbursement growth figures, say, at the state level? Because when you look at the state-wide growth momentum, then Tamil Nadu seems to be coming back, but AP seems to be losing some steam. So first, could you comment on how can we improve the disbursement growth on an overall basis of 15%? And are there any geographies which need to be focused on to improve the disbursement growth, particularly AP? Thanks, Rajiv, for the question. I'm sure this question might be there with all the people. I'll just explain it for the benefit of others as well. If you look at our disbursement growth, as you rightly said, it is 15% year-on-year. But if you look at our INR 3,604 crores of disbursement, this is actually an 11-month disbursement as against the 12-month disbursement of last year, which was at around INR 3,127 crores. So if you factor in that one-month disbursement, the disbursement growth would have been around 18%-19%. And if you look at the year-on-year disbursement for the last quarter, it has grown by 10%. Basically, it is because of the data set. If you look at our disbursements last quarter, Q2 FY24 was around INR 750 crores, and Q3 was also INR 750 crores, which spiked up to INR 968 crores in Q4 FY24. But in FY25, the disbursements have actually evened out. If you look at our Q2 FY25 disbursement, it was INR 935 crores, and Q3 was INR 930 crores, and Q4 it has become INR 1,064 crores. So it is actually because of the data set that growth is at 10%, and it is not because of any market sentiment or market availability. So also, as you rightly said, Tamil Nadu is also almost coming back to normalcy with other Asset Under Management growing at 14%, and Tamil Nadu growth quarter-on-quarter was 14%, and year-on-year was around 11% on the disbursement. So actually, we are not seeing anything on the ground. It is basically the data set which has had an impact on the growth. Okay. So basically, I was actually looking at the second half only because the second half was pretty normal, and that kind of adjusts the base for making it more comparable. So even in the second half, the disbursement growth is 15%. So the point is, if we were to grow at 25%-30% in the next year, if that is the expectation, then given the current runoff rate, we need to grow our disbursement next year by 26%-27% on the current year base of FY25. So can we scale up to that kind of disbursement growth in FY26? And what can be the sources of growth improvement? You can talk about branch addition plans. You can talk about how the productivity at the sales officer level can be improved. Whether we need to do more sourcing from outreach channels and how could that be driven? Just wanted to get more clarity on how the growth in disbursement will come about at a much higher level for us. If you look at even at the 15% disbursement growth, the loan book growth has been at around 25%. So for the year FY26, our guidance will be around 24%-25% of disbursement growth and around 28%-30% of loan book growth. But how this will be achieved, I'll give you the following things which we'll be focusing. One, the first thing is the new business from new branches in new states. Basically, in Odisha and Maharashtra, we already have 10 branches. We'll be opening 10 more branches in this year. So the business from those branches will contribute to the growth. Next one is business from new branches in the existing states. So in this year, we are planning to open a total of around 40 branches. So the business from that will contribute to the growth. Next thing is impact of full-year business on the new branches, which has been opened last year. We have opened 28 branches. So the full-year contribution of those branches will also contribute to the growth. Over and above that, the productivity improvement in the sense that actually increasing the ATS. Currently, it is around 8-8.5 lakhs. We want to increase it to around 9-9.5 lakhs without impacting the LTV and the installment to income ratio. So that should contribute to the growth and also improving the per loan officer productivity, which is currently around 3-3.2. That is, we are planning to make it up to 4 per loan officer per month. And also, having an optimum number of people at the branches, that will also contribute to the growth. Over and above that, we have this digital marketing initiative, which is working fine. With 21%, at least we want to make it up to 25% immediately, and then in the years to come, we'll be making up to 30%. So this is actually all this has been broken down across branches and also the sales officer-wise, which gives us this confidence of giving this guidance of around 24%-25% disbursement growth. And also loan book growth of 30%. Okay. And just on funding side, will you share the incremental cost of borrowing now for the HFC and for the NBFC from the banks? And also, please give us some color on how the existing bank loans will be priced down, what is the benchmarking of it, and how it can be priced down in the coming quarters. And lastly, on NHB funding, is there any time frame in mind or any pipeline for that? Yeah. As far as the funding is concerned, the rates of interest of housing loan HFC borrowings is around 8.5%. It continues at 8.5%-8.7%. And on the NBFC, we are still borrowing between 9%-9.25%. But having said that, if you look at the total borrowing, 56% of our borrowings is variable, which is linked to a variable rate interest rate. Of that, 30% is linked to repo rate, which means for that, I will get a benefit of at least 0.5% maybe in this quarter itself. Already, we have got 0.25% reduction in two or three borrowings which we have taken, and this is likely to come in. And of course, the balance 26% on the MCLR, which is linked to MCLR, the interest rate reduction can start coming from June to July. Of course, incremental borrowings will be negotiated hard for beginning in those kinds of interest rates. That is broadly on the interest rate. NHB borrowings, we have got a sanction of INR 300 crores. We'll be taking a decision on when to take that money out. Great. Thank you so much for answering my question. Thank you. The next question is from the line of Ramesh from ICICI Securities. Please go ahead. Yeah, hi sir. Congrats on a good set of numbers. So just two things. One on this revision on the Stage 2. So when we look at Stage 2, our sales actually fell by 20 digits consistently, wherein the PCR actually gone up to 8.5% versus 7.8% sequentially. So just wanted to get a sense that what is driving this high provisioning in Stage 2? I mean, is it due to VC funds stress in some pockets or how one should look at this number? Yeah, actually, good thing. We are not seeing stress in any of the markets or any of the products. See, what has happened in the housing finance company, the market recovery is very good, and we have recovered almost 5.5%-6% growth during the quarter. We wanted to maintain the provision coverage ratio at around 1.03%. In the NBFC, the loan book from INR 1,900 crores has gone to INR 3,000 crores. We wanted to strengthen the provision coverage there, and we are still maintaining at 1.03%. That's the whole reason this number is there. If you look at the credit cards, it has remained the same at 0.3%. Correct, and just to follow up on that, so do we foresee any derailment either on growth or collection due to this Tamil Nadu bill? This Tamil Nadu ordinance, yes, it is a fact that it has been announced by the Tamil Nadu government. But what we feel, I mean, it has been clearly stated in the ordinance that it is available only to unregistered MFI or money lenders who are charging a serious rate of interest. So the kind of customers whom we serve, basically with an average ticket price of around eight- nine lakhs, our initial feeling is that it might not get affected very much. We feel that the impact can be there in MFI and also low-ticket loan providers. So of course, this is initial take. We are having a very close watch on this. As of now, we have not seen that kind of trend. Our collection efficiencies are better, but we are watching this closely. Got it, sir. Sir, my last question again on this geographical concentration and the growth trajectory. So when we look at last five years, sort of we have been able to reduce the dependency on the market, which it shared falling to almost 33% in FY25 from 52% to 34 years back. But at the same time, AP share is now more than 40%, and AUM touching almost INR 4,500 crores. So just wanted to get a sense on this base, whether this 30% growth rate is sustainable in AP market, and let's say if we feel that there is still under penetration in this ticket segment and we'll be able to grow at 30% + in AP. So then in the next two years, our dependence on AP will further increase, right? So what is the plan to de-risk the growth from our dependence on any one state? See, actually, if you look at it, that's the reason why we have ventured into Odisha and Maharashtra. So the business, which was around INR 5 crores of the AUM two years back, it has become INR 55 crores as of now. It is a healthy growth, according to me, because first year was formative years for these two states, and after that, the growth has come. We will be getting more growth from Odisha and Maharashtra this year. To that extent, the AP growth will come down. Having said that, the penetration, I mean, still the market availability in AP is quite huge. That is also going to contribute. With Tamil Nadu coming back to normality, the distribution of AUM will likely to improve across states. Of course, Karnataka also is likely to chip in more. Yeah. Just to add to what Mr. Balaji said on India, while we have 113 branches in Andhra Pradesh and having a good growth rate, as you mentioned, but we see a very good opportunity in Telangana as well, where we have currently only about 53 branches. And even the current year, the growth rate in Telangana is one of the best. So in Telangana, we have grown by 31%, same as Andhra. But Andhra base is higher, as you mentioned, but Telangana growth is much lower. This is an opportunity, not only in Telangana, even Karnataka for that matter, in addition to the Maharashtra and Odisha that Mr. Balaji mentioned. Got it. Got it. And maybe just last question on the spread from my side. So let's say we've already seen 50 basis points of reported cut in the next six- nine months if there is another 50 basis point reported cut. Where do you see these spreads settling from exit Q4 quarter numbers? If you look at this, as I told in the earlier remark also, if you look at the total borrowing, 30% is linked to repo rate. So if you factor in a 50 basis points cut on that 30% borrowing, it will be 0.15% reduction that can come in. And of course, we don't know how much more rate cuts are going to come, but if it comes, that benefit also will come in. But also the 26%, which is linked to MCLR, the interest rate reduction can start coming in from maybe July or so. That's what I'm getting to hear from banks. So if that's something, that would be another added bonus. The thing is that this is where after this slightly standing out because we have got this 80% fixed-rate loan book. So spreads are likely to improve. Spreads are likely to improve because of this interest rate reduction. Got it. Got it. So we don't foresee any pressure on the settlements at least in the year coming. Yes. Absolutely. Okay. All right. This is great, sir. Thank you and best of luck, sir. Thank you very much. Thank you. The next question is from the line of Dushyant Parikh from Morgan Stanley. Please go ahead. Thank you for taking my question. I just had questions around the credit cost, so there seems to be some reconsideration between the prior quarters, especially when we look at the nine-month reported number versus the full-year number in the other income line, which gets knocked off in the credit cost. If you could just help us explain that, and also, secondly, if you could help us explain the reconciliation between the standalone credit cost and the Aptus Finance NBFC credit cost, which came in higher this quarter, whereas the consolidated credit cost seemed largely in line with what we had in the previous quarter, so if you could just help us explain that as well. Those were my two questions. I'll explain this question. See, there have been, I mean, RBI has directed all the NBFCs to, we have to go for a change in auditors every three years. So there are some auditors who are telling that the bad debt recovery has to be seen separately in other income. But there are some auditors who say that it has to be set off against the ECL provision. So basically, we go by that auditor's opinion, and this quarter onwards, we have set it off against the ECL provision and the credit cost, whatever is the bad debt recovery. So that's the answer to the first question. Then the next thing is on the reconciliation. If you look at it, what is the question on the reconciliation? I have not really done it. Sure. I'll just repeat my question. So essentially, we had about INR 80 million credit cost in the NBFC subsidiary and a small INR 10 million credit cost in the standalone book, whereas the consolidated credit cost has come at around 79 or 80 million. So if you could just help us reconcile the math on that? Yeah, I'll explain. See, what is happening, if you look at it, in the housing finance company, the bad debt recovery was high during the quarter. So it was almost INR 5.5 crores to INR 6 crores, which got merged in the standalone financials. Whereas in the NBFC, what has happened is we all know from INR 1,900 crores, the book has grown to INR 3,000 crores. So there is a strengthening required on the provision front in that company. So we have provided more there to take care of the 1.03% provision coverage ratio. If I don't do that, then what will happen is I need to write back the provision, which will only result in additional profits. So we wanted to maintain this 1.03%. That is why we did that. Understood. That's actually quite helpful. Those were my questions. Thank you. Thank you. The next question is from the line of Yash from Citigroup. Please go ahead. Hi sir. Thanks for taking my question. So what is on the operating expenses with sharp jump quarter on quarter by 11% or so? So is it one-off, or it is largely volume linked? Yeah, actually, it is volume linked. If you look at our OPEX, first, what has happened if you look at it, we have invested in branches. We have invested in technologies, new Lead Management System. So all this is contributing to this increase. But still, ours is one of the best. If you look at the OPEX to asset, it is around 2.63%. And even if you look at the cost-to-income ratio, on the gross income, it is maintained at around 14%, both for the quarter and also for the full financial year. And if you look at the net income, it is around 20%. I mean, after reducing the interest cost, it is being maintained at 20%. So this 2.63%-2.7% cost-to-asset will continue. That will be the guidance from us. 2.63% to, sorry? 2.63%-2.7%. Yeah. 2.7%. Okay. Okay. Got it. And so second is on the balance transfer out, if you can share the trend on it, given our housing loan yields are north of the peers at 15.5%. So are we seeing any increase there? If you look at the balance transfers, we have been consistently around 2.2%- 2.5%. While our pre-closures are around 7%, the balance 4.5%, the pre-closures are coming from the old source of the customers. If you look at our kind of customers who are self-employed, unless salaried customers, they get some business inflows, bulk inflows from their business, the first thing they do is to close the housing loan. So if you look at our total pre-closures, it is around 7%. Of that, 4.49% is out of old source. The balance transfers are around 2.5%. And this 2.5% has been maintained by us for the last 15 years. So we don't see that kind of an impact because of the balance transfers. Got it. So no major impact despite high pre-closures and peers. And lastly, if you can just share the loan to sanction ratio and this for the quarter as well? Login to sanction ratio is around 78%-80%. Got it. And that has remained stable through the year? Yeah, it has remained stable. Got it. Thank you, sir. That's it from me. Thank you. The next question is from the line of Manika Bansal from Master Capital Services Limited. Please go ahead. Hi, sir. Thank you. Thank you for taking my question. So my question is on the NBFC side. So you have opened 10 branches in Maharashtra and Odisha, right? So what is the plan and opportunity do you see over there? If you look at our strategy, we have always been growing on a continuous basis. And that's why we chose Odisha and Maharashtra because it is closer to the states of Telangana and Karnataka. And Andhra as well. And the initial experience has been very good. The people there are good. The credit quality is good. And of course, we are a credit-driven organization, so we choose our customers properly. And these two states are offering good scope for increase in the disbursement and also the consequence loan book. So with that in mind, we'll be opening 10 more branches in this current year and increasing the loan book rate. Okay. And one last question. What is the 1+ DPD? 1+ DPD is around 7.5%. Okay. Okay. Thank you. Thank you. The next question is from the line of Karthikeyan Kumar from Ashoka Stock Broking. Please go ahead. Hello? Yes. Sorry, you're on a mixed call. Yeah. So congratulations on heady numbers. So most of my questions are answered. I just wanted to understand this presentation that you have made, like if we come to page number eight of your PPT investor presentation. So here you have taken your total income for calculating NIMS. So is there any reason for including fees and commission income in the line item? I just wanted to understand the perspective on this. No. NIM is, see, whatever is after the clause 41, that is being computed. In the clause 41, interest, interest on FD, all those kind of income is getting added. So that is how the NIMS are computed. If it is specific to ratio computation, I can take you offline and then I can give you a full explanation. Okay. Thank you. Yes. Thank you. The next question is from the line of Amit Javeed from Javeed & Partners. Please go ahead. Right. Amit, I will request you to unmute your line and speak, please. Understood, sir. Hello? Due to no response from the current participant, we will move on to the next participant. The next question is from the line of Nitesh from Investec India. Please go ahead. Thanks for the opportunity and congratulations for a good set of numbers, and it's heartening to see that Tamil Nadu growth has come back, which I think is. Yeah. You are so perfect, Nitesh. Yeah. So what is the guidance for next year in terms of disbursement, overall disbursement growth and AUM growth for FY 2026? AUM growth, we are guiding around 28%- 30%. Disbursement growth will be the result, around 24%, 23%, 25%, or maybe 25% as well. Sure. Sure. And secondly, the strategies, right? Huh? I explained the strategies on how the growth is going to come. Hope you have listened to that. Secondly, this assignment income, I think this is the first time we have done a assignment income. Why there is a change in strategy and how should we model it? What percentage of AUM will be assignment done on an annual basis going forward? See, actually, the thought process of direct assignment came in. First, we wanted to test this transaction because we have not done this for years, and we wanted to do that and test how the portfolio of assets is being felt by the persons who are buying the portfolio. That is the first thing, and also, considering the evolving funding environment where RBI has also been insisting on diversifying the borrowing, and so that is one thing which has triggered this thing. Third thing is, of course, it is an ALM management tool. That is also the third one. The fourth thing, the major more important thing is to improve on the principal business criteria. If you look at our principal business criteria as of 25th March, it has improved to 64.3%, so that is more of a thing, so going forward, also, we'll be doing selectively. I mean, it is not that we'll be going really aggressively on this assignment because. So maybe INR 100-150 crores every quarter, we might be considering doing this. Yeah. I just want to add to what Mr. Balaji said. I mean, this thought process in terms of all of us are aware that the financial metrics of Aptus is one of the best in terms of ROE in the fourth quarter crossing 19%. Despite this attractive financial metric, when it comes to inter-company comparison with other housing companies, other NBFCs who have been pursuing direct assignment system for almost three to four years, somehow in this inter-company comparison, our view is sort of ignored. In the sense, our numbers are always compliant with all the other companies who have been booking the assignment income. That by their NIM and ROE, whatever reported, incorporates income arising out of the assignment. That is, our income is not. Our results are not, so we would also want to, at the end of the day, when the investors and analysts look at the inter-company comparison, we are really at a disadvantage, and that's also a factor which we have taken into consideration in addition to the various other elements like diversification of resources, defining principal business, and things like that. So this is something which we have discussed in detail and taken into consideration. Got it. Thank you. So in this segment, are we doing housing loan or non-housing loan? We did the INR 75 crore assignment of non-housing loan to the housing finance company. Okay, and the cost of funds from this? No, sorry. That's where the issue of principal business comes in in terms of housing company, yeah. Lastly, what will be the cost of funds from this source of direct assignment? Is it better than our overall cost of funds, or? It is around 9%. For a yield, it is giving us around 18.5%. Okay. Okay. Great. That's common sense. Thank you. Thank you. The next question is from the line of Rakesh Kumar from Valentis Advisors. Please go ahead. Yeah. Hi, sir. So just firstly, one question on the ALM side. I was looking at the average tenor of the borrowing is around 7.5 years, and average loan book tenor is around 9-11 years. So interest rate cycle would not just ALM positioning would help on the margin expansion? So if you look at the ALM, what we need to look at is what you rightly said is we are on the asset side, it is around 10-11 years, and the borrowing side is around seven years. So there is a small gap. But if you look at the leverage again, our leverage is very low. So to that extent, we are comfortable on the ALM. And even as of today and going forward also, all the buckets, it is surplus. That's because our spreads are around 9%, and the NIM is around 11-12%. So we don't see a problem there. And we want to limit the leverage to maybe four-five times. So that's how the whole ALM issue also will be managed. And secondly, sir, the preference to borrowing equity breakup and floating rate loan around 19%. So in this interest rate cycle, 38% kind of funding part of floating rate loans. So how much would be the drag in terms of the margin because of the rate cycle? Actually, we've got the benefit, right? See, what is happening on the asset side, if our fixed-rate borrowing is 80%, I am not under pressure to pass on the interest rate benefit which is going to come in on the borrowing, on the 38% borrowing, to that customer. So as compared to other companies, we are at a slightly advantageous position in terms of spread improvement and NIM expansion. No. What I'm trying to say is that 19%, approximately 18.6% of the loans are floating rate, right? So anyway, that rate is going to come down. And that is being funded by the equity, which is 38% of your total borrowing mix or which you're using in the business. So basically, on the asset yield side, your yield is coming down, which is being funded by the fixed rate kind of equity. Though it has a cost of equity, but just from the accounting perspective, it will compress the margin, right? But on 19%, even if I have to reduce it by 0.25%, what will be the compression that will come in? And that is the only part that has been non-reduction in the loan book. Yeah. Sorry, sorry, Amit There are some overlaps. Could you come again, sir? On the 19% of the loan book, even if I have to reduce by 0.25% because of the interest rate benefit that I'm getting, what is going to be the impact? Because 80%, I'm not going to reduce at all. So that would be offset. That's what we are trying to explain. Got it. Yeah. Total marginal, but just thinking that. It's very marginal. We can discuss it offline for the specifics. Yeah. No, sir. Thank you. Thank you, sir. Thank you. The next question is from the line of Mona Khetan from Dolat Capital. Please go ahead. Yeah. Hi, sir. Just a few questions from my side. So firstly. Ma'am? Yes. Yeah. Is it better? Yes. Yes. Yeah. So in your PTT, you have given this time the average ticket size in housing book, it's about INR 9.2 lakhs. So this is an incremental average ticket size, right? At the portfolio level, it should be a tad lower. Is that a fair understanding? It is on the portfolio level. It is on the sanctions. Got it. Got it. Current year. Current year. Yeah. Sure. And when it comes to your bank borrowings, what share is fixed rate bank borrowings? If I'm correct, you do borrow at fixed rate from banks. And what is the typical tenor in those borrowings? 44% is the fixed rate. Typical tenor is if it is bank borrowing, it is around five years. If it is from NHB, obviously, it is 10-15, 10 years or 15 years. So of the total borrowings, 44% is fixed rate. But of the bank borrowings, how much is fixed rate versus floating? I don't have that number. I'll communicate to you here. Okay. And within that, what is the typical tenor when it comes to bank fixed rate borrowing? Is it also five years typically or lower? Yes. Yes. We don't borrow lesser than five years. So that is very clear. But this basic number, I'll get back to you. Got it. And when I look at your self-employed versus salaried mix, if I look at the last couple of quarters, the share of self-employed has increased. So how do we read this? Is it driven by some regional factors or any change in lending approach? A few quarters back, it was almost self-employed share was almost 71, 72. It increased to 78. So how do we read this? It's not a major increase, Mona. The thing is 72- 71, to say 73 or 74. But see, our kind of customers are self-employed customers. But that philosophy doesn't change for assets. The salaried customers are basically their cash salaried customers, plus one member in the family will be running a business or something like that. So that is what is getting classified as salaried customers. So the underlying for any of our customers is mostly self-employed people and mostly giving essential services. Got it. And just one thing on the assignment portfolio that you did. So incrementally, also, we plan to do only non-housing portfolios to benefit from the loan mix requirement? Yes. How large could this be as a share of the AUM? No, actually, I told you, we are not going to be very aggressive on this front. Maybe 100-150 crores a quarter, we'll be able to do this. Sure. Thank you so much. Thank you. The next question is from the line of Aman from PhillipCapital, PCG. Please go ahead. Hello. I'm audible. Yes, Aman. Yes. Hello, Mr. Balaji, and congrats to the management team on a strong quarter and good results. My question is specific to Odisha. I think one of your peers also, I mean, the bigger peers also tried going into the state, but didn't really have much business there. Is that something that is sort of slowing down our expansion plans in any way? Because I see, if I remember correctly, you have mentioned about 10-15 branches every year and potentially 10-15 branches in Odisha and Maharashtra over the next couple of years, right? I mean, is that something that is mainly going to? No. What I mentioned was 10 branches in both Odisha and Maharashtra. So that means five branches more in Odisha this year. And if you're asking specifically about Odisha, we are actually having very positive response. And the loan book which we have built is very strong, and the repayment patterns are very good. And we will continue. See, the thing is how we select the customers is the differentiator. See, if some other company has ventured into this state and they were not successful, that doesn't mean that we will not be successful. So the thing is we are a credit-driven company. We will be funding the same profiles like what we fund in the other states. So this will continue, and we will continue to choose our customers correctly. So that is how the Odisha portfolio will grow. And we are very confident about that state. No, I get your point, sir. But so of course, I do not want to comment on the competitor, but I would like to know what is working for you really because you have the option of choosing the borrower, right? But the borrower, of course, has many other options, your peer lenders and some regional players. So what is working for you that is driving the borrower sort of to come to Aptus for you? If you look at the biggest thing, just to add a point here, when we can look at the Odisha as a state and Maharashtra state, that's one thing. But our strategy is continuously expand. And being that we are already present in Andhra, Telangana, and Maharashtra, and we are starting our entry into Odisha and Maharashtra in the adjacent districts only. The adjacent district, for example, Odisha, which is connected with Srikakulam in Andhra and Vizianagaram in Andhra. Now, the adjacent districts, the culture of the people, the culture, the earnings is almost the same as the Andhra adjacent districts like Srikakulam and Vizianagaram. Similarly, in terms of Maharashtra also, we are present in Telangana and Karnataka, and we are really starting with the adjacent districts, and progressively we'll build up over time in this state. That's one element. In other words, they are not really totally, totally new because Odisha is not actually the 10- 15 branches that we started last year. They are really serving the adjacent districts of the Andhra today. Okay. Now, going forward also, we want to add element. Secondly, really, our credit underwriting is much more we believe is much more relevant and deeper. With the philosophy that whatever business that we do is going to be credit-driven rather than disbursement or volume-driven. Okay. Got it. I think that broadly answers my question. And sir, my last two questions will be on disbursements and the income. So a couple of quarters back, I remember Mr. Balaji mentioning a bit about some issues in Karnataka with respect to the E-Khata, right? And one of your peers, again, mentioned that to an extent, these issues have been solved. So have we seen any disbursement pickup in the state of Karnataka? Definitely. There is a good disbursement pickup. If you look at last year also, I think there has been a good growth. Just wanted to know. Okay. And sir, one last question would be in the Maharashtra disbursement. So have we seen any sort of competition in terms of the rates? Because I think Maharashtra is a fairly competitive state with a lot of lenders, right? So have we seen any pressure on our incremental disbursement deals? No. But as Mr. Balaji also explained, again, we are in this complex expansion mode where Maharashtra just to give you a broad guideline on the Karnataka, it is around 26% growth has come. The E-Khata issue has got solved, and the growth is coming back in Karnataka. That is one. Now, coming to Maharashtra, again, this complex growth is being followed, and most of the branches are close to Telangana state, where the credit culture of these people spills over to these branches. We have not seen that kind of pressures on the yields. We will be continuing this kind of growth in this state as well. Okay. So just to conclude your explanation, I would assume you are sticking to the border states where the culture is pretty similar to the current states. And of course, the rate is fairly small for us, that we do not see much of yield pressure. Yes. Absolutely. Yes. Okay. Perfect. Thank you, sir. That answers my question. All the best for the next year. Thank you. Thank you. Ladies and gentlemen, you may press star and one to ask a question. A reminder to all the participants that you may press star and one to ask a question. The next question is from the line of Shweta from Elara Capital. Please go ahead. Thank you, sir, for the opportunity and congratulations on a good quarter. So a couple of questions. So can you provide some color on Gross Stage 2 because sequentially the absolute has remained slightly sticky? So should we attribute this to a particular geography or say concentration of quasi-home loans or business loans which are contributing to this? Even the ECL has sort of gone out there. So yeah, that's my first question. No, basically, Stage 2, we are not seeing any stickiness across products or across states. If you look at Stage 2 additions, around INR 5.4 crores, it has gone up to INR 5.7 crores. Of course, on percentage terms, it has reduced from 4.93%- 4.72%. So we are not seeing any kind of pressures on the Stage 2, and it is slightly better in this quarter as compared to the last quarter. Okay. So it's broad-based. So basically, no concentration. Yes. Yes. Yes. Okay. So my second question is, who are the takers of our DA out cases? There are some NBFCs who take our loans, maybe small finance banks and some of the NBFCs. I don't want to name them, but it is that way. But the amount is very small. Yeah. Sure. Noted, sir. And sir, lastly, what is our employee attrition run rate? And how are we in terms of incentivization vis-à-vis industry standards? Thank you. If you look at attrition, at the top management level, there has been no attrition, and at the middle management level, comprising of cluster managers and everybody, area managers, it is around 4%-5%. And at the branch manager level, it is around 10%. Of course, on the field level, as compared with the other companies, our attritions are also slightly high, around 40%-45%, so one thing is we have introduced a scheme on retention incentives and, of course, handholding them for the first three months to perform better, and if there is a certain stage in the company for the first six months and he is able to contribute to the company with two loans or one loan per month, we try to incentivize them by way of a fixed amount. Of course, disbursement and loan incentive policies per month, if they are able to do more business, their income levels are also going up. Those are some of the things which we are taking care to control the attrition, and hopefully, that will improve in the future as well. Okay. So just a follow-up question. So what is helping us driving down our OPEX on the cost front? So I'm not talking about cost-income ratio or OPEX to assets. In general, we've been doing well on OPEX driving down. So which are the key components which are aiding that? So it's actually everything. If you look at it, if you look at our salary and incentive structure, it is more driven by productivity rather than the increase in the cost. So we demand productivity in whatever we do. And similarly, if you look at other expenses, even if it is IT, we don't go for many big names. We just have persons who develop it for us and at a maybe very reasonable cost, but it has the same features as anybody else is having. So that is one thing. Then the next thing is we are wired that we are frugal, and we don't want to spend very much on our branch infrastructure because we strongly believe that the people at the branches have to be on the field, be it sales or credit or collection, who has to do more business or more collections. We have a basic infrastructure which provides basic furniture, internet, and telephone connectivity, and maybe computers. These are all the things. It is not one thing which is driving this cost down. It is basically all-round things. Sure, sir. That's helpful. Thank you so much, and best of luck for your future interviews. Thank you. The next question is from the line of Amit Javed from Javed & Partners. Please go ahead. Amit, I would request you to unmute your line and speak, please. We do not have a response from the current participant. We will move on to the next participant. The next follow-up question is from the line of Rajiv Mehta from YES Securities. Please go ahead. Yeah. Thank you for allowing a follow-up. Just wanted to check on a couple of things. So again, circling back to the cost, so we are confident about achieving the disbursement growth and the yield growth numbers that you've spoken with the same cost structure in terms of, say, employee salary, incentives, and the locations where they're present. Does that mean commissions given out? Yeah. No, no. Definitely, Rajiv. If you look at it, I explained the strategies on how we are going to get the growth. Thank you. Basically, we are I mean, all this, the strategies which I told, has the productivity element in mind in that. So there is no compromise on the productivity. So definitely, we will be able to achieve this at these cost levels. No, no. Thank you. And sir, one thing, I mean, the rejection rates for the logins in FY 25 versus FY 24 were stable or higher? Because I think in one of the previous answers, you said that login-to-sanction ratio has been stable, implying that rejections have also been stable. Yes. Yes. Absolutely. It has been stable also in the years. Got it. Yeah. That's it, sir. Thank you. Yes. Thank you. The next follow-up question is from the line of Dushyant Parikh from Morgan Stanley. Please go ahead. Thank you for taking my follow-up question. I just had my question is to sort of help us refresh your credit cost guidance. I think that you have put out a press release at 40-45 basis points. I just wanted to understand this a little bit more and contextualize it in light of the accounting change that we had with the auditor change where we are now netting off the direct recovery from our credit costs and also from a point of view of provision coverage that we would like to maintain on the book. Thank you. Thank you for the help. Because we were not able to hear you properly. That gave us some echo. But what I understand is you want some guidance on the credit cost, correct? Yes. In the context of the fact that we have this accounting change with the new auditors, with the netting off of bad debt recoveries now within the credit cost. That is just an accounting treatment. So the accounting treatment will not have any addition on the credit cost. See, what our guidance on the credit cost is around 40-45 basis points. So that is the guidance. While we want to better that, but because by way of more bad debt recovery or something like that, but the guidance will be around 40-45 basis points. Understood, and that will be growth of bad debt recovery, right? Yes. Yes. Absolutely. Okay. All right. Thank you. Thank you. Ladies and gentlemen, that is the last question for today. I now hand the conference over to the management for closing comments. Yeah. Thank you, Mona and others for organizing this conference call. I would like to express my sincere gratitude to all the analysts and most of my friends for taking time out to participate in the call today. Please feel free to connect with us in case you have any further questions. Thank you. Thank you. On behalf of Dolat Capital, that concludes this conference. Thank you for joining us, and you may now disconnect.