Ladies and gentlemen, good day and welcome to the Bajaj Finserv Limited conference call, hosted by JM Financial Institutional Securities Limited. As a reminder, all participants in line 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, then zero on your touch-tone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Sameer from JM Financial Institutional Securities Limited. Thank you, and over to you, sir. Thank you, Sejal. Good morning, everyone, and welcome to the 3Q25 earnings conference call for Bajaj Finserv Limited. First of all, I would like to thank the management of Bajaj Finserv Limited for giving us the opportunity to host the call. As always, we'll have the opening comments from the management team, post which we'll open the floor for Q&A. From the management side today, we have Mr. S. Sreenivasan, CFO, Bajaj Finserv Limited; Mr. Tapan Singhel, MD and CEO, Bajaj Allianz General Insurance Company; Mr. Tarun Chugh, MD and CEO, Bajaj Allianz Life Insurance Company; Mr. Ramandeep Singh Sahni, CFO, Bajaj Allianz General Insurance Company; Mr. Vipin Bansal, CFO, Bajaj Allianz Life Insurance Company; Mr. Ashish Panchal, MD and CEO, Bajaj Finserv Direct Limited; Mr. Devang Mody, MD and CEO, Bajaj Finserv Health Limited; and Mr. Ankur Anil Kanwar, CFO Designate, Bajaj Allianz General Insurance Company Limited. With that, I would like to hand over the floor to Mr. Sreenivasan for his opening comments. Over to you, sir. Thank you. Thank you, Sameer, and good morning, everybody. I welcome everyone to the conference call to discuss the results of Bajaj Finserv Limited for the third quarter, ended 31st December 2024, at this Q3 of FY25. Let me first welcome Ankur Anil Kanwar, who is taking over as CFO of Bajaj Allianz General Insurance Company from tomorrow. He has been with us for over six months as a CFO Designate, and he will officially take over as CFO tomorrow. I would also. You must have seen from the release yesterday that I will be handing over the reins of the CFO position to Ramandeep from 1st February. Ramandeep is a familiar face to all of you. He has been part of this call for several years. I will continue to be in a leadership role in BFS as President of Insurance and Special Projects. I would like to thank all of you who have participated in the quarterly calls, which I have moderated for the last several years, for the support, encouragement, and valuable queries that have kept us on our toes, and my congratulations to Raman for the CFO position, so I request you to join me in wishing Ankur and Raman all success in their new assignments. As before in this call, we will largely be concentrating on the consolidated results as well as the results of our insurance operations through BAGIC and BALIC, and where material the standalone results of our company, BFS. Bajaj Finance has already had its conference call on the 30th. However, if there are any high-level questions on BFL, we would be glad to take that as well. To start with, in regard to the announcement by Allianz of their intention to exit from the JV agreement, all the discussions are still at a preliminary stage and not yet finalized. Therefore, we will not be taking any queries on this during the call. Any statements that may look like forward-looking statements are just estimates and do not constitute an assurance or indication of any future performance result. And as before, you are aware that as required by regulation, while BFS prepares its consolidated financials in compliance with Ind AS, the insurance companies are not yet covered under Ind AS. They have prepared Ind AS financials only for the purpose of consolidation. Accordingly, for BAGIC and BALIC, the standalone numbers reported are based on non-Ind AS accounting standards as applicable to insurance companies. Our results, the press release accompanying the results and our investor deck, have been uploaded on our website yesterday. I would like to draw your attention to the newly revamped investor deck with more disclosures, which we started from the previous quarter. We do hope you appreciate this and look forward to your feedback. Let me now move on to the highlights for Q3 FY25. Our consolidated total income was up 10% at INR 32,042 crores, and the consolidated profit after tax showed a 3% increase at INR INR 2,231 crores, as against INR 2,158 crores in the same quarter of the previous year. However, under the Ind AS, the insurance subsidiaries have chosen to hold a large part of the equity securities portfolio as fair value through profit and loss account, and also a certain amount as fair value for other comprehensive income. Therefore, the growth of the profit after tax, excluding the unrealized mark-to-market gain and loss, and including the realized equity gains booked under OCI for the quarter, was 23%, and for the nine months, was 13% over the same periods of the previous year. So overall, the core operating result of our company, we believe, has been very satisfactory for the quarter. During the quarter, BAGIC recorded top-line growth of 46%. However, if we were to exclude the volatile crop and government health, and also the impact of the 1/365, which is the new accounting methodology that was implemented because of IBNR and regulations, the growth would have been 6%. Previously, all long-term policies, which include certain types of health policies, some long-term dwelling policies, and certain other types of policies that BAGIC used to write, were accounted as premium on assumption of the risk. However, from this quarter, as per regulation, these gross premiums are to be deferred over the life of the policy. There will be an impact on top-line because of this. There may also be an impact on net return premium and the ratios, such as combined ratios. But in terms of the underwriting result and profit after tax, this is profit neutral. For the quarter, BAGIC recorded a profit after tax increase of 39% at INR 400 crores versus INR 287 crores, and the ROE is 14%, not annualized, versus 11.1%. The combined ratio, 101.1% versus 102.9%. Overall, I think BAGIC's combined ratio performance continues to be satisfactory, and the profit growth is also quite strong. BALIC recorded a top-line growth in terms of individual rated new business premium, which was quite muted in the quarter, mainly because of the change in the product mix and the change in the distribution arrangements that the company is making on account of the new surrender regulations. The company is focusing now on creating a sustainable product mix over the years, and if there are any questions on that, the BALIC team will be at their own, and Vipin will be pleased to handle that. Overall, the gross return premium increased by 16% at INR 6,361 crores. The profit after tax was higher by 106% at INR 222 crores versus INR 108 crores. This was also aided by a tax reversal of about INR 60-odd crores, but even excluding that, there has been a healthy increase in profit after tax. The new business value, which is the metric for life insurance, increased by 1% from INR 251 crores to INR 254 crores, reflecting the efforts to adjust the product mix, as well as the impact of the new surrender charges, which kicked in from 1st October of this year. BFS had a very good quarter this time. The consolidated net income was up 26% at INR 11,673 crores, and the consolidated profit after tax was up INR 4,300 crores, with an ROE of 19.08%. Given the general muted performance by the lending sector across banks and NBFCs, this result is very, very healthy. Now, coming to BAGIC, the growth for the general insurance industry during the quarter is 7.3%, with private sector growing at 5% and public sector at 11%. The growth has increased slightly from the previous quarter, largely driven by the public sector players. I already mentioned about the 1xM regulation, which is causing a bit of distortion in apples-to-apples comparison. So as we go forward, we'll continue to call that out for at least another couple of quarters. The gross premium for BAGIC grew 46%, and 6% excluding tender-driven profits and the 1xM basis impacts. The combined ratio already mentioned. The underwriting loss is again something which we're talking about at INR 43 crores versus underwriting loss of INR 85 crores in the previous quarter. And if you see the industry as a whole, it continues to bleed heavily in four and five figures for the whole year. The investment income and other income for Q3 FY2025 increased 23% to INR 577 crores, and the AUM as of 31st December stood at INR 32,633 crores, which is an increase of 8%. This is after paying a fairly healthy dividend of INR 662 crores for FY2024. So the continued commitment that the company continues to generate good float, and this augurs well for the future as well. So our objective in BAGIC, again, will continue to grow top-line on the segments that we prefer, continue to focus on maintaining a good quality insurance book with a combined ratio which is better than market, with superior risk selection, balanced business mix, and balancing profitability and growth at all times. On the customer front, BAGIC relentlessly drives the theme of caring culture, and we continue to remain focused on customer obsession. And in the investor deck, you'll find several metrics related to NPS as well as our digital initiatives for improving customer experience. In a market which is intensely price competitive, we believe this displays BAGIC's commitment to a balanced and profitable growth on the back of broad distribution and prudent underwriting while focusing on best-in-class service. Again, a solid result from BAGIC in terms of strong profitability and with a growth better than industry. And as usual, we will again reiterate that this is a long-term business, and a single quarter result because of the volatility in claims cannot be taken as an indicator of the future. So we continue to remain focused as long-term investors in this business and long-term value creation for shareholders. Moving to BALIC, as I mentioned earlier, the overall growth in IRNB was less than the industry, and the muted growth can be attributed to recalibration of business, what we call BALIC Version 2, which started last year but has actually undergone some changes due to the surrender charges. We focus on profitability. Our retail protection continues to grow strongly, 96% growth. We also have a higher share of units within the units, a significantly higher share of units which have a higher margin with a higher protection and wider attachments. We have made some changes on product regulations in line with what some of the major competitors are doing as well. This includes a variety of actions which Tarun and Vipin will explain if at all anybody has a question on those. And we have to see in terms of group credit line protection business, there is a temporary lull because of the pressures on lending by the banking and NBFC sectors. The renewal performance continues to be strong. BALIC's renewal premium grew 24%, resulting in GWP growth of 16%. And we are also heartened to see the number of new policies for BALIC growing by 13% to 5.5 lakhs in the nine months of FY2025. The VNB growth, due to the higher proportion of lower margin ULIP-linked business, which we are consciously trying to bring down, was muted this quarter, which also had the effect of surrender charges on the new non-par savings and traditional products that we sold in the quarter. The retail protection for nine months' growth was also strong at 54%, and we ended nine months at INR 264 crores of retail protection business. For the quarter, as I mentioned earlier, it was more than 100% at INR 108 crores. We continue to be focused on data-led decision-making. Significant investments are being made on data and analytics through our direct sales, through our sales and cross-sell initiatives. We now have a presence of 330 cities for our proprietary sales channels. On the institutional business side, we continue to expand our network of partners and grow business with the newer partners we have acquired over the last two, three years. BALIC ended the quarter with an AUM of INR 1,222,000 crore. Overall, while there have been pressures on top-line, it is also the start of a multi-year journey of improved profitability for BALIC. Again, both the insurance companies are among the most solvent in the industry, with solvency margin excess of 300% for both. In terms of the BHFL and VHFLs, since they both are listed and have had their calls, I would just briefly touch upon the results: good quarter on volume, NIM, OPEX. Loan losses seem to have stabilized, and I think we will get better flavor from the investor call that Rajiv had. The company is committed to bringing down the loan losses in the next year. The ROA was steady at around 4.5%, and the company booked the highest-ever new loans of 12 million, adding 5.3 million new customers in the quarter. During the quarter in November, we also announced BFL 3.0, a FinAI company, the details of which are available on our website. Strong growth on customer franchise and AUM growth. In terms of Bajaj Housing Finance, the 100% mortgage subsidiary of BFL, it continues to do well in a market where housing finance companies are always under pressure for margins. They have recorded a 25% increase in profit growth, a 26% increase in AUM. Both solid results. The capital equity ratio is very strong, post the IPO at 27.86%. GNPA and NNPA continue to be very low at 0.29% and 0.13%, respectively. Overall, for the lending businesses, BFL and VHFL are very strong quarters. Update on our platform companies: Bajaj Finserv Health. The numbers for the previous year are not comparable because of the acquisition of Vidal Healthcare, and this is included in the results for the current year. During Q3 FY2025, Bajaj Finserv Health carried out approximately 2.3 million health transactions. The provider network continues to expand. It now includes 86,000 doctors, 4,000 lab touchpoints, and 15,000 hospitals. However, going forward, the focus will be a lot more on the payer network, which includes insurance companies, governments, and employers. Bajaj Markets attracted 8.2 million customers on its digital platform, out of which approximately INR 0.98 lakh customers became consumers, became customers. The disbursement for the quarter stood at a little under INR 2,000 crores, and it shows 58,000 cards in the period. The major achievement for BFS Direct in this quarter, the marketplace business, is that the loss for the quarter is just INR 3 crores, and we are seeing very clear visibility on cash break even for the marketplace business of Bajaj Finserv Markets. Bajaj Finserv Asset Management, notwithstanding the volatility in the markets, ended with an AUM of INR 17,433 crores, which is about 8% higher than September 2024. During the quarter, they launched two funds, recording an AUM of INR 818 crores. The non-group share of AUM is 86%-93% in Q3 FY25, increased from 86%-93%. The dependence on the group for liquid funds is reduced substantially. Before we open for questions, considering the paucity of time, I would request the audience to keep their questions brief so that we can cover more queries during the forum. With this, I invite the questions from the audience, and over to you, Suneela. 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. The first question is from the line of Mahek from Emkay Global. Please go ahead. Yeah, hi. Thank you for the opportunity. And first of all, congratulations to Ramandeep Sir. My first question would be regarding BAGIC. So I just wanted to know what has driven the increase in the loss ratios for the motor TP segment, and if you could give us any color on the reserving experience. Secondly, the question would be on the retail health side. So IRDA had kind of published a circular capping the price tags in the health products to 10% for senior citizens. So just wanted to know your comments on how this impacts your business and overall how you look at the industry as well. And my third question would be for BALIC. So if you could just give us some more details on how you have kind of changed the product mix strategy post the implementation of the new surrender regulations. That would be from my side. Yeah, Tapan, would you like to take the first two questions, and then Tarun? I think let me answer the health part, and the loss issue I'll ask Ramandeep to take that one on the TP part, but I will try and see on the health regulation on senior citizen capping of 10% growth. We welcome the regulations on that basis because if you look at the principle of insurance, it is to take care of societal need, which is there. That's how insurance industry got created. Now, on a senior citizen basis, if the price goes up substantially, it becomes unviable for them to insure, and they get left out in this basis. The way insurance operates is that you collect money from many to pay to a few, and that is why when the regulator says senior citizen, they give you an option that you can do price correction at all levels so that your overall portfolio looks good. That is how the balancing has to happen. So it is not that if they do senior citizen, then you are stuck there because you have a cohort of book, and then looking at your loss ratio, you put that. If you look at the circular carefully, it also states that the insurance industry should collectively look at the negotiation rates of the hospital. It's a very balanced circular, which is very customer-focused in perspective of the senior citizens. So I think it will be good for the industry, and the industry will balance pricing in a way that the senior citizens don't get marginalized and left out from the benefit of the insurance and the world there. So that is the point of that circular, if you look at it in totality. Coming to the TP reserves, and if you look at the reserves, I've said this in the earlier calls also. The best way to look at is that what are the release which happens from a company perspective in terms of what were the reserves and the claim settlement ratio. Bajaj Allianz always had a very positive release in terms of the reserving and the settlement. The delta has always been very positive on that basis. And the correction keeps on happening as we progress. So at no point of time will you have seen in 23 years of Bajaj Allianz that there would be a situation in which the reserving was less than the claim settlement. So it has always been adequately reserved, and it had always been done well. Now, I'd hand over to Raman if he wants to add something to this. Yeah. Hi, Mahek. Yeah, so Mahek, if you recall Sreenivasan's comment in the opening speech itself, which said that ideally from a GI perspective, we should not look at quarterly loss ratios. What the right measure is to look at on a longer-term basis. So if you look at some aberrations which are there in the quarter, essentially come because there is a lag between reported claims and when the IBNR gets adjusted by the actuary. And hence, we often make this comment. But if you look at it on a nine-month basis, our actual loss ratios are lower than what it was in nine months last year. It's actually down from 79.5% to 77%. So it's just aberration of the quarter which gets settled in the subsequent quarters. Okay, okay. Thanks. And last thing on the BALIC. Yeah. So on the product mix strategy, that is a very specific question you asked. What we've done is, unlike the rest of the sector, which has changed largely the traditional plans only, we've gone ahead and relooked at the entire product mix. We looked at the entire product structures that we have. So it's not just about the mix. It's about the structure for each product that we had. And we've gone ahead and changed practically all our products, including ULIP, PAR, and non-PAR. As a result, what we've started doing in ULIPs is a significant percentage of our ULIPs now are with inbuilt riders and higher protection. That is a significant change that we've brought in. And of course, the traditional plans changes have been significant as well. In terms of if I look at Q1, Q2, Q3, we've also brought down our product mix in ULIP because while the rest of the sector, which to an extent also contributes to our muted growth. Got it, got it, sir. Thank you so much. Thank you. The next question is from the line of Madhukar Ladha from Nuvama Wealth Management Limited. Please go ahead. Hi, morning. Thank you for taking my question. First question on BALIC. So we see the growth has obviously come off significantly in this quarter, and the mix has also changed. So what I wanted to get a sense of is, and in the last few years, we've grown very rapidly. So I wanted to get a sense of what the growth trajectory in the near term would shape up like. Should we take this quarter as an aberration with sort of growth returning back to the 20%-25% sort of level? And also then, what product mix should we expect on this? And then on the health side, I think there is significant health insurance side, there's significant confusion in terms of what sort of commission payouts and the way commission payouts should happen. While I think GIC, IRDAI want commissions to be paid sort of on a yearly basis, and if payments are made, then that is not allowed. I think a large part of the distribution community is still sort of not in favor of this. And so how do you see this progressing? What approach have we taken? And some sort of color around that will be useful. Those would be my two questions. Thanks. So maybe I'll take the first one on BALIC, and Tarun can step in for the health question. So we had indicated very clearly in the investor day that while we've had, I'll use the word, trailblazing growth in the last seven years, and particularly if you look at the last three years, we've been the fastest growing across the sector with a CAGR of 27%. This quarter, while the changes were happening, we purposely took a pause and relooked at our entire product structures. With this change happening, it was obvious that the focus now is on profitability and profitable growth. And given the heft that the company now already has in terms of the size, it would be meaningful numbers. This is something I've kind of indicated in an earlier call as well. In terms of how I see this going ahead, we did have a tough month in November, I think purposely so because we had planned it like that after September, and the sector also had a tough month in November, but I think we had a tougher one, largely because of our agency business, which is 150,000 agents getting retrained, getting reoriented to these kind of products, and of course, the fact that there was a surrender value impact on commissions, the sector did, on the agency side particularly, had an impact all through. Good news is that December, we are back to a slight mild growth. January also, we are broadly in sync with a cohort of companies that we compare ourselves with. Agency, though, is still going to take some more time to settle in the new product mix and may take a few quarters before it starts coming back to its earlier growth trajectory. Bank assurance and PSF are largely getting back, but mostly in sync with the rest of the sector. I hope that answers your question. I'm not going to give any clear numbers because, as Srini made it clear, we do not make any forward-looking statements. And just on the VNB trajectory, so margins have improved sharply in this quarter. I'm guessing obviously because protection growth has been very strong. Now. That's what. Hello? Yes, sir. Carry on, carry on, please. Yeah, and any sense of what sort of a VNB growth target over the next three years, that could also be helpful, or how much improvement could we see in VNB margins? Yeah. Fundamentally, we've started looking at VNB and not necessarily VNB margins because VNB margins have some noise from the group credit life business particularly. So when we are looking at VNB, you will see two things happening. One, of course, margins itself will start growing faster than what we see in terms of growth. Rather, VNB would start growing faster than what you see in top-line growth because that is the way we have planned our product structures and not just the mixed-minded structures, which is a significant overhaul. And each of the products now, whether it's in the ULIP bucket, in all buckets, are profitable, and each will contribute to margins, which was not the case earlier, which was usually the traditional plans giving more margins, and ULIPs used to be a drag on margins. So fundamentally, that is a big change we brought in, which basically with growth coming in back will result in the trajectory of VNB being higher than the trajectory of growth. On the margins, although we, like I said, have some noise, and I don't really track that as much, but I know a lot of you track. BALIC is, of course, currently as per plan, planned at a lower margin for the current years. There's been a slight increase in margin versus margin, but you will see us going up higher because of the lower base. So I would rather that we not get any leeway because of the margin growth, but more because of the fact that we are focusing on the VNB growth. That's what we are more interested in. Got it. Very clear. Thank you. Sorry to interrupt, Mr. Madhukar. I will request you to repeat. No, my second question is left, yeah. Yes. The question regarding BAGIC, can you please repeat it? It was not clear. Sure. So I wanted to get a sense of how distributor commission payouts are working in this new sort of scenario, on the back end. I believe a lot of the large distributors still want upfront payment, whereas IRDAI and GI Council are not in favor of this. And also, it would adversely affect our EOM ratios. So in this context, how do you see the sort of industry moving? And finally, also given that EOM ratios are very high for a large part of the competition, what sort of action and competition has also received notices from IRDAI on this? So are we seeing any letdown in competitive intensity? Do we sort of foresee that? Any sort of early signs on the health side in particular? Thank you for the question. So I think in your question lies the answer. The regulations have been very simplified, be it product regulations, be it commission regulations. Now, the commission regulations stipulates EOM, expense of management. Well-run companies who have EOM less than 30, which is what they have to be there, I don't think they have any stress in terms of how they look at commission pay. The regulators do not stipulate how you pay commissions. It stipulates that you should be under the EOM, not that it controls how you pay commissions. And your company, I think Bajaj Allianz Company, the EOM is well below 30. It's one of the well-run companies with an EOM well below 30. So I think the question is more relevant to companies who have EOM over 30. And that is essential. I think it's a good practice because at the end of the day, what the policyholder gets also has a determination in terms of how your expense management plays out. And Bajaj Life has been a company for a long period of time, I think. From inception, we see it's been one of the lowest companies in terms of expense ratios. It should be there. So from that perspective, I don't think this has any impact on the company. And if I look at the industry, also if I look at the overall numbers for businesses, first and foremost, business which is long-term is not so significant in the overall business industry. Having said that, even there, I don't see much fall in terms of the business falling or the distributor not selling for overall for the industry also. So I would think for Bajaj Life it's positive. For the industry also, I don't see any negative happening overall. But given that, I'll just add something to what Tarun said on the life side. I think in the past, you have seen as a company, we are very, very focused on being profitable while seeking to grow. And there have been many instances. Even in 2018, 2019, I think we took a call to bring down ULIP from 70% to 40% in order to stabilize our profitability and margins. In the same way, you will find in Bajaj also quarter on quarter, year on year, there have been many changes that we make as we see the market economics develop. So clearly, the actions that life companies taking, Tarun and team are taking, are predominantly to weed out those segments of business which are not likely to give us profit, at the same time focusing also on rebuilding the right product mix, a more sustainable product mix. We believe in the long run, the life business is all about balance. Balance across distribution between channels, balance across products in terms of risk between par, non-par savings, term, and ULIP, and balance between profitability and growth. That will give us a longer roadway of consistent performance. So I think as a general message, I'm saying this because this question will keep coming up because there is a temporary headwind because of the surrender regulations. And of course, at the current time, there are also cyclical headwinds in the form of lower disbursement. So aggregate margins may not reflect the actions that the company is taking. So the next few quarters, you will see this evolve into hopefully a leaner, fitter, meaner BALIC. And that is the direction that the company we think will take. So just on the health insurance question, sir, my question was more with respect to sort of competitive intensity because a lot of the smaller players are running at EOM levels which are above sort of 30-35% for private and SAHIs. So in this context, paying upfront commission further increases those ratios. And loss ratios have also remained quite elevated on the health side. In that context, do we see some sort of corrective action in terms of pricing or some competitive intensity letdown, any early signs of that, or thought from that if you would expect anything like that? Plus now, senior citizens' pricing is also capped. So as your sort of population ages, those cohorts age, you will not be able to increase pricing beyond sort of 60 years of age, beyond sort of 10%. So does that mean that pricing at an entry level also increases? Yeah. So in the health context, some sort of understanding and clarity I'd appreciate. Yeah. So again, I think the question is a broad question for the industry. It is not specific to the company. As I said, for Bajaj Allianz General Insurance Company, it is positive. Whatever you have said, because this company operates well below the EOM limit of 30%. So it has like so obviously, this doesn't have an impact here. For smaller companies, if they are over 35%, they have to correct themselves at 30%. They have to have a clear glide path, and they have to deliver on that basis. The regulator is very clear on that. So obviously, they have to decide the strategy. I can't speak for them. In terms of senior citizen cap at 10% movement, it is that any increase in price should not be above 10%. And if you look at the overall portfolio, what percentage is senior citizen? What percentage is the normal increase in price that should happen? And you spread it across the entire cohort. And then in that circle, you also read the other part of the regulator clearly says that the industry should come forward with an agreement with hospitals in terms of standardized rates and procedures. That will also have an impact on the overall loss ratio. When you put all these things together, I don't think there's any apprehension in terms of business. I think it is good for the industry. And the industry will come together to deliver on those parameters and bring it together. So I don't think it's something which is so off the mark which is going to have an impact on the industry in terms of getting negative or not going in the right direction. All of what you see in here is moving in the right direction, and 30% EOM is a good limit to have, I think, in industries and companies above that will have to correct themselves and bring to that, and the companies are operating in that for like ever. I don't remember if I look at Bajaj Allianz General Insurance Company, even when we were at the early stage, that we would have had an EOM which would have crossed these kind of limits. So it's how you run a company, how disciplined you are, which really matters, so if you look at it from a skeptical perspective, it looks a bit odd, but look at the overall picture. It's a very good thing for the industry. I don't think there's any negative in this. Awesome. Thank you. Thank you, sir. Thank you. The next question is from the line of Nischint from Kotak Institutional Equities. Please go ahead. Hi. Thanks for taking my question. And first of all, congrats, Srini, Ramandeep, and best wishes to Ankur. I think firstly, on the life side, you seem to be making significant changes or probably overhauling the entire business. So just curious, does it mean that we sort of have a low, probably maybe a single digit or lower than industry growth going forward in the next couple of quarters, probably the next year as well? I'm just trying to understand the intensity of the change that you are making. And just on the surrender value guidelines, if you could quantify the change, some of your peers have done that. I mean the impact. Yeah. No, that's a very good question. As far as the changes, yes, they are substantial that we've done. In terms of growth, there is enough and more for us to take. I will not get onto which digit, single, double. I don't think we're used to single-digit kind of growth, so don't worry about that. We've always maintained the stand that we'll be going far faster than the rest of the industry. And you'll see that happening. It's a temporary blip. And while I would say that the base effect for a few quarters will play out, but overall for the year, as we see, growth will be quite visibly back. So while the changes are substantial and the rest of the sector has made changes because of surrender value only in Trad, for them, Trad remains still the heavy lifter on profits. What we've done is we've changed the entire slew of products that we have, including ULIPs, and also brought in the kind of riders we are adding, significantly different from what BALIC has ever done earlier in life. So that is an additional change which will take time to set in. But at the same time, whatever we get of that is only positive in terms of a trajectory on growth, in profitable growth. So that's how we are a little different from the rest of the sector. In terms of growth, it doesn't worry me much. Got it. Just if you would quantify the impact of surrender value guidelines as some of your peers have done it? See, whatever the peers do, we strongly think that they have to follow. If you look at what we've in Q3, in fact, our entire margin has gone up slightly. Slight, but yes, it's there, and particularly, we're seeing it in December. Hence, the impact we've now after discussions with all our bank partners, agents, deferral of commission, bringing commissions down in most cases, we've been able to get to a situation where this should be largely neutralized. I think the rest of the sector has done just that, and we still have a lower margin, so you'll see a margin going up in any case. Got it. Thank you. Just on the BAGIC side, if I look at the long-term policies, what was the ceding policy over here, and how is the inward commission for long-term policies treated in the P&L? Thank you, sir. So see, what we've tried to do is we've matched the outgo of commission with the inflow of commission. So because we were paying commissions upfront in most of the cases, our income also in terms of commission inflow is being received upfront so that there's a complete matching happening. If obviously we were to defer it, then we will have to change the accounting practice, but we will always try to maintain the balance between the inflow and the outflow. So as we speak, in terms of payouts, have we deferred it, or payouts remain as it is, and in terms of accounting, we have deferred both the sides? See, like the rest of the industry, we obviously contemplated and reached out to the distributors, while our need is very, very less, like Tapan rightly highlighted, somebody running at a 23% EOM versus 60% of the industry running ahead of 30%. Our need was far less, so we actually had an advantage versus the others, but we did have conversations with the partners. See, the reality of life was on one side where you're doing long-term motor business, market practices, you're paying commissions upfront, and hence, it was next to impossible for distributors to agree that we would end up deferring commissions on a certain line of products while on the other, you don't end up deferring it, so the success rate for the industry has been very low on that, and hence, for us also, we've been largely paying upfront only. Against that, the commission is also on the RS side being recognized upfront. Thanks. And just one final one for Tapan is, do you really see the non-life players coming together and negotiating with the hospitals the way, let's say, IRDAI is asking the industry to do? I mean, have you already seen any discussions on this in the IIB forums? Do you want me to answer the question as MD, Bajaj Finserv, or as Chairman, General Insurance Counci l? Whichever way it is. I mean, I guess. So as Chairman, General Insurance Council, it will definitely happen. Okay. Sure. But it's something that the industry will look forward to, is what you're saying. It has to. You have to understand one thing. See, what is the problem? Look at the media. In spite of the industry doing so much and in spite of the health portfolio and telehealth portfolio, the overall industry is not making money. So look at the media news. It is so negative at times. But what is the problem for health insurance? It is the medical inflation and no regulations on hospitals coming into court. And that is what the industry has been asking for. There is a three-pronged approach on health. One is the premium. The other is the tax, which is GST. And the third is the outgo in terms of hospital charges which is happening. Now, hospitals are not regulated. GST, the industry has been asking for reduction in GST. So the entire onus comes on the industry then to take care of the whole portfolio and do the societal need of serving the society and putting it together because others too, the industry has been demanding. Hopefully, they should at some point of time be considered. Now, if it is on the industry, then the industry has no option. But then too, on its own methodology, it generates, I think, to the hospital income of close to INR one lakh crore is what the industry is paying. Then it is necessary the industry comes together and at least does some correction on that basis to be able to deliver to society the requirement of a good health cover for the citizens of India. So from that perspective, there is no other option but for the industry to come together and do this. Got it. Got it. Thank you very much and all the best. Thank you. The next question is from the line of Shubhranshu Mishra from Phillip Capital. Please go ahead. Hi. Just two questions. The first one is we have a business line in health. The health card that we have, how is that progressing if one can speak on the MAU and DAU for the health app? Second is any management transition we are expecting in the Q4, any move from Bajaj Finance senior management personnel to Bajaj Finserv? Thanks. I'll take the second question first. Immediately, we are looking at it. I think Rajiv has put in a very clear message. But as a general rule, we do have across the group a very strong platform for nurturing and developing talent. And we do have about 200 people across the group of the top three, four levels whom we constantly monitor. We have talent cards for each of them. We map all our positions, the current ones and the ones coming out of NRS. And in the process, people are identified and prepared to take on new roles. And if you see the transitions that have happened in the last few years on the finance side, for example, I'm just giving an example. We have Vipin Bansal who was with the BFL, moved as CFO of Life. Ramandeep, who was in Life, moved to general, and now he's moving into Bajaj Finserv. I think this over time, you will see more of these. This is the way we build our businesses. We believe that as we go forward with the confluence of data, technology and regulation, we would find that people need to be at the lines between different areas of financial services are graying. Therefore, we would want people with multiple business experiences to be able to take on the challenges of the future. Over the next five, seven years, you will see this play out a bit more. We become more agile organization, with a very strong core team of people across all our businesses, whether it is the investing business, whether it's the lending business, whether it's the protection business, or whether it's our platform businesses. I'll now hand over to Devang for the question on Bajaj Finserv Health app. I think there are two. Your question was twofold. Number one, we have around 180,000 transacting users coming every month on app and around 450,000 transacting users coming on our web assets. Now, why web assets is significantly higher? Because where we have staged our business, our primary go-to market is to be app in app within insurers app or seamless product experience because we power not IPD benefit for all insurance, but we power a lot of OPD benefit for insurance insurers. And hence, numbers are significantly larger on web, which gets manifested as app in app, which is counted as web traffic on PWA framework. So those are slightly technical details. So to answer your point, that number is 171,000 per month in app and 450,000 per month on web. What we are more focused on is how many health transactions we are transacting, because equally important is to deliver health experience digitally, where I have given you the numbers around 550 or 1,000 per month is the number. 600,000 is the number per month. Last quarter, we have done around 22 lakh transactions. So I think that's where our main focus for future growth is. And we would want to move as many as possible on our digital assets. And we would be outlier in the industry to be able to do transactions digitally. When I am saying digitally, the consumer contacts us before contacting the provider or hospital or laboratory touchpoint is what our digital transaction numbers are all about. I hope I have answered your question. Understood. Thanks. If I can just squeeze in one last question. So the answer to the first question is a yes, that Rajiv would make a move to Bajaj Finserv in the near term. So as of now, we have not taken a decision. And Rajiv will continue with the FL. He has given us a three-month roadmap. All of these 12 months are over. We will see that as time goes by. Sure. Thanks. Thank you. The next question is from the line of Nidhesh Jain from Investec Capital Services. Please go ahead. Thanks for the opportunity. The first question is on BALIC. So what is the rationale of reducing the share of ULIP? As you have articulated, the focus is on VNB growth and not on VNB margins. So why are we reducing the share of ULIP in the product mix consciously? I think it's an obvious answer. Health does have a lower VNB margin than traditional clients, hence we are reducing focus on health. Sure. I thought the focus is on VNB growth and not on VNB margin. That's why I asked this question. Yeah. Okay. So you want to now ask the question on VNB and not VNB margin? So see, VNB, of course, has a few components, and so does the generation of the margin. The cost absorption capability of ULIP is far lower. And hence, it does take time to be able to pay itself out in lean months. And while it does give benefits on the gross margins as the months get a little bit more bulky, like you see in JFM. So we basically have to balance, as you heard Srini as well saying, the product mix based on the months we're in, and hence also get in the structures which are attuned to be sold in the Indian market. Being at a 29-year median age, there is a certain amount of products that would, of course, sell more because of economic growth. People will want to participate in the growth through equities, and some would want to save more. So when we play through those customer segments, and it's not a simple equation, it does require you to work on one and not work on the other. Sure. Sure. Second question is on Bajaj. So if you look at Bajaj, we have done quite well on profitability within the sector. We are very well capitalized, and our customer metrics are quite positive in terms of customer satisfaction. And we have a very strong distribution. But if you look at the last four, five years, despite a lot of these strengths that we have, we have not been able to gain market share. With the customer obsession that we have been displaying and the customer metrics are clearly showing, ideally, such kind of business should see a rapid market share gain in the retail segment. If you look at the float growth in the last five years, the float has grown at 12% CAGR. So why is the market share trend and float growth trend broadly in line with market and not significantly ahead of market? Okay. So I would like to look at it in a different way. First, if you look at BAGIC, it's in the top three companies of India and organically grown. It has not acquired any company or done any merger acquisitions. In spite of that, it's an organically grown. And if you look at it, it's on the top three companies, which is significant. It has moved up organically in 23 years' time, brick by brick, to become a top three company. First point. Second point, at all points of time, the margin to the market in terms of combined ratio has always been over 15%. It is not a 15% profit percentage. It's a full 15% combined ratio perspective, which means that in the industry, there are about 117. Bajaj has been close to 100. At times, in the industry, 120. Bajaj has been at 98, 99. So you give me any business in the world which for decades has beaten the combined ratio by such huge margin and organically reached the top three position, consistently moving up in terms of ranking in the market. So whatever parameter you said has allowed Bajaj to reach this position. Second point is you look at the number of policies issued last year of all companies. You will see Bajaj issued close to INR 3.6 crores. If I'm not wrong, I don't remember the complete number right now, but if Ramandeep can correct me if wrong. And even the larger in terms of top line, New India had issued INR 2.67 or INR 2.7 crore policies. In terms of the number of policies issued, Bajaj was the highest in the Indian market. So fundamentally, I think when you look at the positioning, the movement, as it has slowly moved up the ranks and where it stands over a long period of time consistently, to the difference of profit to the market that it has made in terms of combined ratio, the gap that it has kept at all points of time, to the expense ratio, and you heard Raman mention EOM of 23% vs 61% industry over 30%, the kind of discipline it has maintained, I think it's a fundamental thing. It's balancing of all three to not only just pushing your weight and acquiring rapid in terms of position and moving of the market with another one. It's doing the right thing consistently over a long period of time with delivery of the good insurance company. This is how it has to be. Raman, were my numbers wrong in terms of number of policies, or they were close to right? Very close to the exact numbers. Exactly. Thank you. I'll just add to the bit on advance premium. While you're taking a five-year CAGR, I think the big issue for us, as you know, in the past was the handicap on the two-wheeler business, which is where the largest advance premium or the float was getting generated. Our market share on new sales in two-wheelers, if I go just three and a half years back, used to be close to 3.5-4%, and in this quarter, if you see that same number is close to 12%. So I think what you're referring to is the past. If you look at actually the advance premium growth for the last three years, let's take this year, nine months, it's 24%. Last year was 26%. The year before that was 19%. So I think that handicap which was there earlier is now behind us. If you see the recent trend of advance premium growth has been very, very healthy, and that trajectory continues. Sure, sure, sure. That's it from my side. Thank you. The next question is from the line of Sanketh Godha from Avendus Spark. Please go ahead. Yeah. Thank you for the opportunity. See, I have two questions on BAGIC. Both are related to third party. See, if I look at other players in Motor TP, the loss ratios are meaningfully very low compared to what you guys are reporting. Just wanted to understand that is it too conservatism we are following, and therefore the likelihood of a release is very high going ahead? Or is it the product mix incrementally has changed in the favor of products where the claims are a little higher than normal? That is leading to the higher TP loss ratio. And second, the point I wanted to ask is that you seem to be growing very well in OD and probably gaining market share also, at least in the current year, but TP seems to be off compared to market share gain point of view. Any specific reason for the divergence in the growth trend? Or is it largely Hero tie-up is playing out in OD as a strong growth on a low base? That's my question on OD, Motor, basically. And second on general insurance is on, have you seen trends improving in commercial lines already? And if that is the case, then likely benefit of it coming in FY20 26 or calendar 2025, how do you see it? Sanketh, before I pass it on to Ramandeep and Tapan, broadly, I'll tell you how TP reserves because of the long-tail nature of the claims. The year in which you write TP, very few claims are reported, and the reporting peaks probably at the end of the third year, and there will be some more claims reported maybe a little bit after that because there's no limitation of time for reporting third-party claims, but by the fifth year, I think almost all of the claims have been reported, and after that, the reserving is largely to cover inflation or any other court judgments and tail factors. The tail is pretty long. I think 10, 12 years back, even then, the claims are not fully closed, though substantially the claims have been settled. And therefore, one of the best ways which we track and which I would think because now all the triangles are published by all the companies under the public disclosures, is to look at the pay-to-ultimate. What did you reserve in the beginning, and how much have you paid after year three, four, five? And that gives a good flavor as to what is the amount of conservatism or aggression that one is building into the reserve. Roughly, when we checked last time in terms of seven years, our ratios were compared to the market significantly below. That means a much smaller proportion of claims had actually been paid by the end of the sixth and seventh years, and even after the fourth year. Therefore, the actuarial release process also will follow that. And you would find that it plays out. Net-net, if you see the cumulative reserves with the revised ultimate losses, you would still find that there is a surplus for us across most of the vintages, almost all the vintages. So on a quarter-on-quarter basis, clearly, there will be variations as we find more claims reported and IBNR estimates being adjusted. But the real growth happens only by the end of the year when you have all the years' data. I'll hand over to Ramandeep and Tapan to take on the other flavor on that. And the other question was on TP rate increase and how it will impact commercial vehicles, I think. Okay. It falls on commercial lines, fire segment. The price has come. Okay. So let me answer the question. See, first and foremost, as a GI company, it's always better to be conservative than to be reckless on reserving, to answer your question. And Bajaj has always been conservative and never been reckless on reserving. And that's the point I made earlier also that if you look at our reserve releases, it's always been there because that is how a good GI company runs. On the part of increase of price for the commercial lines of businesses, yes, we see the trend happening there. And obviously, in my view, again, I've always mentioned this is that the market forces to determine the right price for the right risk. That is what should always be there. Right now, we see an increase in price happening, which is positive for the industry. By the lens being a large player in the commercial lines of businesses also, it will be good for the international company if this sustains and this carries on, which is there. But the likelihood of sustaining is there. As of now, it looks high, which should be the way to move forward. Have I missed any question of yours, or we have covered all? No, no, no. For two points. One was that what is the weighted average price hike you are seeing in commercial lines for FY24, like you said? And then second, the divergence with respect to OD and TP growth because you seem to be gaining market share in OD but losing in TP. Is it largely a Hero phenomenon or something else? So the first point is you will see about a growth of 10%-15% in terms of the hike happening in commercial lines of businesses in price, weighted average, the point you said. Second point in terms of OD, TP, and different lines, I've been asked this question many times. See, a good company is like a good orchestra. The right kind of instruments should be playing at the right time for good music to come, so you will keep on seeing shifts happening, and some players will gain market share, some we will let go, then at the right time, we'll again gain market share, some we'll let go. It's an orchestra. It is not that it is always consistent, and that's why you require a good management team, which is a good conductor to play this orchestra, and wherever it does well is fine. If you look at GI business, the amount of products that GI business has and the subproducts, it crosses 300 kind of thing. A lot of people don't realize the complexity, and I'm very happy to see the level of understanding of the analysts and all of you now. Earlier, it used to be at a very superficial level, but now you get down to the very good basics. I'm happy to hear your questions, but as you see this, the playout of all this is where you run a good company, so sometimes you'll see us increase OD. Sometimes you'll see us increase TP. Sometimes you'll see us increase commercial lines. Sometimes you'll see us increase crop. Sometimes you'll see us decrease crop. It's like that. It's a combination of all this, all these products, subproducts, mixture that the way it gets played out delivers good music, is what I may say, so. Sorry, my next question is on value. The point is that basically third quarter, as you highlighted, the growth was pretty muted compared to what we have been delivering in the past. So just again to clarify, is it largely because you were trying to realign the channels with the new norms? That led to the moderation in the growth, or it was a more conscious decision to slow down ULIP, which played the major role? And if realignment of the channels is the major reason, how much more time you will take to see that realignment happens and the growth will come back to the company? So that's one thing. And the second is just on credit life business, which seems to be bottoming out because we did the same amount of business what we did in second quarter. Just wondering whether we can see a positive outlook in credit life incrementally going ahead? Yeah. So see, the changes that we've done this quarter have been substantially on the product and the product structures. The mix tweak has been there. So you asked about ULIP. And are we steering away from ULIP? No, we're not steering away from ULIP. Some customer segments which will be very prone to ULIPs. And some distributors will be very prone to ULIPs as well. But on the whole, we are working more on the back end where we tweak our structures to the earlier questions that had come, tweak the ability to take more expenses, at the same time, structure them in such a way that customers get their bit as well. This quarter has been tough because we've had to do this on the fly all across. And we took a call that we've had a significant growth. We've reached a certain level of size. Now it's time that we start looking at our overall VNB growth, and that is what you will start seeing in the future. Whether specifically we will grow in every channel significantly, I think our agency will take a little bit more time to settle in because agencies are far more dispersed. Our institutional business and the proprietary sales channels are more or less back now, so we should start seeing them starting to clock industry-level growth while agency taking a little bit more time to come in as we reconfigure a lot many things because distributors are usually trained to sell only a few bits of product. They may not be very good at agency at all, so that training is going on. We're trying to engage with them more and trying to get them back on track. So maybe a quarter more may take before agency can start coming in. So that's on the growth and the product shifts. As far as credit life is concerned, yes, you're right. And if you can foresee the future and you're saying it's bottoming out, yes, then of course we'll be back. Everybody will be back in the sector. And as far as we are concerned, we have streamlined a lot of our credit life across partners. If you remember a few quarters back, when we were discussing, our focus used to be more based on a couple of partners. And even the mix was largely towards MFI. That, I'm happy to say, is quite well diversified now in terms of the partners we have, the number of partners we have. No set of partners now contribute. One or two partners do not contribute any significant part of our credit life portfolio, so that is kind of behind us, and as growth comes in, we'll grow in sync with the industry in credit life and maybe in some situations even better. Thank you. Ladies and gentlemen, due to time constraint, we will take this as the last question. I would now like to hand the conference over to Mr. S. Sreenivasan for closing comments. Thank you. Thank you to all the participants for joining the call. And a special thanks to the management team of Bajaj Finserv for giving us the opportunity to host the call. Thank you and good day, everyone. Thank you, everyone. Thank you. Thank you, everybody. On behalf of JM Financial Institutional Securities Limited, that concludes this conference. Thank you for joining us, and you may now disconnect your lines.