Ladies and gentlemen, good day, and welcome to the CSB Bank Q4 FY24 earnings conference call, hosted by Yes Securities. As a reminder, all participant lines will be in the listen-only mode. There will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during this conference, please signal an operator by pressing star and then zero on your touchtone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Shivaji Thapliyal from Yes Securities. Thank you, and over to you, sir. Thank you, Gavin. Good evening, and a warm welcome to all those who have joined the call. The CSB Bank management is represented by Mr. Pralay Mondal, Managing Director and CEO, Mr. B.K. Divakara, Executive Director, and Mr. Satish Gundewar, Chief Financial Officer. We specifically thank the management of CSB Bank for giving Yes Securities the opportunity to host their result call. The management will first be making some opening remarks, after which we'll throw the floor open for questions. I now invite management to make their opening remarks. Pralay, over to you. Thank you, Shivaji, and thank you, everybody, for joining our Q4 and annual result analyst call. To start with, a little bit on the global scenario, I think, the world has geopolitical risk at this point of time, though it is kind of stabilized little bit right now. But still, it is leading to fluctuations in commodity prices and strengthening of the U.S. dollar. It is also further aided, the U.S. dollar is also further aided by the strong economic performance by US and stagnant U.S. inflation. We believe that the current situation may delay the rate cuts a little bit in U.S., and rates may stay higher than anticipated. We do not believe that the current situation will force the U.S. to raise further either way, but when RBI looks at the rates, I think they will also, you know, have a close eye on what the global scenario is and take calls on how the rate cuts will be in India as well. On the domestic side, I think the system liquidity has moved back to deficit mode again for the last few days, and after staying in a surplus mode for a fortnight. The liquidity deficit will continue. However, we do not expect it to stress deposit rates for this quarter. The inflation has been easing slowly. The heatwave and the drought focus for some parts of India may impact food prices in the short run. This impact will, however, be really transitory. The overnight rates will remain range-bound between 6.5 and 6.75, and ten years is likely to range between 7-7.25 this quarter, though I think today it was on the higher end of this range. Also, the good news is, so far the projections on monsoons is good, and that is good for the rural economy as well as overall India as a whole from an inflation perspective. On CSB specifics, overall performance on both top line and bottom line was stable on a quarterly and financial year basis. Highlights of our performances are slightly improved profitability, net profit of INR 567 crore as on 31/3/2024, up by 4% from 31/3/2023 on a year-over-year basis. For the quarter end March 31, 2023, the net profit is at INR 151.46 crores, which is almost flat compared to Q3 of the same year. Provisioning buffer of around INR 171 crores over and above the regulatory requirements, including the contingent provision of around 105.06 crores we have, could maintain the NIM above 5% in a difficult market scenario for the quarter as well as for the FY. It is 5.04% and 5.09% respectively. ROA, we have been close to 1.8%. On our liabilities front, I think we focused quite a bit, and deposit grew by 21%, as against the industry growth of around 15%. CASA ratio stands at 27.20, because CASA grows slower than the deposit, we grew deposit much faster. On the asset side, net advances grew by 18% year-over-year. Industry has grown at around 16% year-over-year. We took a conscious call. I'll maybe we'll talk about it as we go through the Q&A. Gold portfolio registered a growth of around 20% year-over-year. Yield on advances for Q4 FY 2024 is at around 11.77%, with an improvement of 60 bps from Q3 FY 2024. Y ear-over-year FY 2024 is 11.35%, which was 10.92% for FY 2022, up by 43 basis points. On the asset quality metrics, metrics fairly stable in key indicators like GNPA, NNPA, PCR, etc. I'm sure we'll have some discussion on this in the Q&A session, so we'll detail out why our GNPA, NNPA and PCR you know deteriorated slightly, but still one of the best in the ecosystem, with 1.47% on GNPA, NNPA around 0.51, and PCR 86.44% when including technical write-off, and without that, somewhere around 65%. Continuing with the accelerated NPA provisioning policy of providing higher than RBI requirements and holding the contingent provision, which I just talked about, 174+ we are holding there. Robust capital base with CRAR above 24.47%. Low proportion of risk-weighted assets compared to the industry, primarily because of the gold loan portfolio. In terms of shareholder valuation, book value per share has crossed 200 mark and is at 209. Book value has grown exactly in line with our business growth of around 20% year-on-year. EPS for FY 2024 is at 32.67, ROE of 17.27%. On the distribution, we added a network of seven hundred—we have an overall network of 776 branches and 731 ATMs. We added 76 branches during last FY. While we go ahead with the branch opening strategy, we'll also invest into omni-channel banking, and we're also experimented with 25 branches, where we've divided the branches into gold and other businesses, and effectively creating two separate operations in the branches, and that experiment is working very well for us so far. Based on the success, we will expand on that this year in a significant way. Those are the numbers. In conclusion, I will say, and I will take little time on this conclusion, concluding message, because there are a lot of things happening in the bank which are beyond numbers. I'll say in conclusion that last two to three years, we have worked meticulously in getting our building blocks in place, which will put us on the right track to reach our SBS 2030 vision, sustainable and scale 2030 vision, to be a respectable mid-sized bank. These building blocks would include creating the right culture, right leadership, and creating the kind of hands-on leadership, I'll say. And defining the culture that will take us and our bank to the next decade, and putting clear process and practices in place to ensure that these are just not mere words, but to be communicated and practiced, starting from top management. Getting the experienced leadership in place inside each function at top three to four levels, including regional leadership, and they are leading through the examples. Why I'm talking about some of these four, five points is, that this is really what we are now living, breathing, eating every day, because we believe that to build a long-term bank, quarters, numbers will come and go, but these are the building blocks which will create the bank for the future. We are very clearly focused on SBS 2030, and these are more important, at least to us as management, than a few basis points here and there on numbers. The second part of the pillar is governance and compliance. We all know how important it is, and globally, this is becoming more and more important. So we are focusing on the highest level of governance and compliance, including experienced and knowledgeable board, and implementing the compliance culture in the letter, in letter and spirit. I myself look at each and every compliance part in the bank, on almost on a regular basis. And this is a key focus for me personally from the MD's office. Risk management, solid risk governance mindset and defined structure with clear guardrails, be it credit, policy, cybersecurity, market liquidity risk, operational risk, reputational risk, etc. One of the reasons you saw that our liability growth has been faster than credit growth is managing the liquidity risk, because we think that these are important parameters, which creates a long-term sustainable organization. I have been a part of very large organization building in past, and I can say with reasonable conviction that these kind of things are more important, at least from my perspective. This is what I tell my management to sustainably build these kind of pillars which will build the bank in the long run. The fourth one is customer centricity and customer focus. So we are clearly focused on execution and customer service and customer centricity. We are actually working hard towards making this as a key differentiator in the long run. Though I personally feel that we are a long way from that, we have to do a lot more, but we will be there. And we have a special vertical under our service and process engineering head, Tapaswi, who looks after this. I myself chair the service governance council meetings, where all CXOs meet periodically and discuss progress on identified areas of improvement in customer delivery and service. This is a subject very close to my heart and one of our topmost priorities. I have built businesses in past, primarily based on this kind of, this kind of parameters. Last but not the least, is technology. The most critical lever in the current phase is technology for us, as that is where we are putting our everything down. The bank won't have almost anything in technology that was running in the bank four years back, and everything will be new age and new implementations. We are talking of a complete transformational journey on the tech side. There, our motto is incremental to transformational mindset, because we don't want to incrementally improve, we want to transform the entire technology, stack amongst all, and this mindset is among all senior management, participate through entire leadership team and driven by our CIO, Rajesh, and our ITSC chair, Mr. Saxena, Sharad Saxena. We are on track with the various projects' implementation timelines as of now. We are planning to go live on phase one in current FY on our core system migration. We are told by our implementation partner, we are one of the first banks who are doing our Oracle OGL implementation together. The phase one, we should be able to finish in this FY. This will lead to process streamlining, and a lot of products and services which we plan to launch will be launched on the back of this. On the distribution front, we are looking at opening around 60-75 branches in the next FY, plus the project which I just talked about. So we, as senior management in this bank, want to think big and be accountable for the delivery on all of our priorities. That's why I mentioned these priorities. That's why I believe that we are ready to communicate this confidently to all our external stakeholders, just like I'm doing it right now. Because unless you put it upfront, you don't become accountable for this. This remains near English. We envisage FY 2025 to be the most challenging and exciting year in our 7-year SBS 2030 journey. We are ready as a team now, and each member of the CSB family is geared up to meet this challenge, and will engage more, evolve and involve more, and strive to do better in the coming quarters. We have four verticals on the business side: wholesale banking, SME banking, retail banking, and gold. Now, each vertical is led by extremely senior and very, very capable leadership. Our wholesale banking is led by Manish Modi, who's a well-known wholesale banker in the industry, and he's building his entire team, and hence you will see lot of changes which we'll bring in, in wholesale banking now. SME banking is led by Shyam Mani, who last two years has done very well, and now we are starting to see the fruits of that work, and we'll see lot more in the coming years. Retail banking, of course, is Narendra Dixit, a veteran across various organizations, big banks he's worked, and he is building up on the retail side. And gold is a part of Narendra Dixit vertical itself, which is integral to our branch banking today. So with that, I stop here, and I would welcome questions, and I'm sure there will be a lot today. Thank you very much. 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 withdraw yourself from the question queue, you may press star and two. Participants are requested to please use handsets while asking a question. Ladies and gentlemen, we will now wait for a moment while the question queue assembles. We have the first question from the line of Sumit Rathi from Centrum PMS. Please go ahead. All right, thank you for having me, letting me ask the questions over here. So congratulations on a steady set of number. Though there were some surprises and as you, as you alluded that we'll be discussing that. I had questions regarding one, the slippages. There is almost a 4 times jump in our almost 3 times jump in our slippage slippage ratio. And another thing which came slightly negative to me was advances growth year-on-year. As we have always kept the notion that we will be growing 1.5 times the industry growth, if not more. And you alluded to some extent that you took a conscious call, so if you give more idea about that, that would be very good to start with. So on asset quality, increased slippages and the advances growth, I would like to hear from you. Sure. Thank you, Sumit, for your question. Very relevant set of questions. So first of all, on the slippage, if you ask me, there is only one item there. Rest are all business as usual for us. There is one account, which is a INR 70 crore exposure with us. That's this account slipped, though it was not expected, but it slipped because of some technical reasons on their side. And we are reasonably confident that through this year, we should be able to pull that back and because there is not too much of a problem there as such. But if you take that out, and which led to around INR 17 crore-INR 18 crore of provisioning, because we do 25% provisioning, and another INR 2 crore because of interest this thing reversal. So other than that, it takes INR 20 crore. If you take that out, then pretty much everything else is business as usual in terms of the business growth, everything else is there. And this specific account, and this specific INR 20 crore, will answer your, the other two questions which you have not asked, which is GNPA, NNPA and provision coverage ratio. If we calculate all of them, you will see it normalizes back to where we were before and where we'll be again very, very soon. Coming to the second question on asset growth, I'll tell you what, why we were little careful. Because we take the RBI inputs and guidance very very carefully, and we listen very carefully. So when this entire thing, we are hearing that lending to NBFCs or unsecured lending, I'm not saying there is any problem there, but because we are very small as a balance sheet, we need to look at these things lot more closer and lot more carefully compared to some of the larger banks who have a large cushion. So I'm not saying anybody who's growing very fast, these businesses are doing anything wrong, but for a bank like us, you saw that just a slippage of INR 127 crore account, which you also know will repair itself very soon, can create so many questions, right? So we are very careful in some of these things. So we have stepped back in some of those businesses. That's number one. Number two is that on the wholesale side, if you see, we have grown negatively this year, primarily because of two reasons. We have de-grown our DA book, the direct assignment book. And direct assignment book is not really a wholesale business. It can, it can be parked anywhere. But we consciously decided that, for the rates, yields there, given the cost of funds where it is today and for the yields, what we get there, and for any kind of a risk which can emanate from there, we would not grow that book at this point of time unless things changes, which I only think that can change is rates. If it doesn't change, we will not do this business as much. And secondly, LCPD, again, it is also a clear decision based on rates, because these are not franchise business for us as yet, LCPD. This is a rate-oriented business, and at these cost of funds, we said that we'll not do this business. So other than these two, you will see that we had grown, SME has grown 28%. Last quarter, this question was there, why SME business has not grown? You saw that SME business has grown, retail has grown. Gold also, we took lot of preemptive actions because there are certain, you know, questions we saw in the media in various other environment, and we did everything to ensure that we plug any kind of operational issues which there can be at gold loan. Because anything to do with a regulatory question, not to us, but what we have seen in the system, we have proactively managed some of these things. So given that, even then, gold loan has grown by 22%, SME has grown by 28%, retail has grown well. The only business which has not grown is wholesale. Given that kind of a cost of funds, it was more of a commercial decision that we didn't want to grow those businesses at that cost of funds at this point of time. Again, because these are not franchise business, this can be built anytime. And right now, because we also knew that we are building a very strong wholesale banking team, now we will look at real mid-market, emerging markets and even large corporates entries in some places, wherever we can, and you will see a very clear turnaround on wholesale business in the next two years. So that's the primary reason where we didn't grow as much. But liability, you saw that we grew against a 14% industry, we have grown 20%. So to that extent, we have grown almost 50% faster than the system. Okay? So on the asset side, it was a conscious call. That's what I mentioned in the opening remarks. Yes, so very, very well understood, sir. Thank you for this. Another one aspect which I wanted to check on was our OpEx to average assets have also shown a slight high trajectory this time. I know we are into building phase, and there can be some expenses here and there in order to build well, the kind of vision we have for FY 2030. And I- and we really respect that, and we are looking forward to that. Still, are these just one-offs, or these kinds of surprises on OpEx to average assets can come again in the future? You are talking about OpEx to average assets. Correct. OpEx to average assets. So I think the primary reason for that is that the investment into technology at this point of time. So there are two investments we are making today. One is investment to technology, which is both OpEx as well as CapEx on the technology side a nd B is, we are building distribution. Along with that, we are creating various verticals and building the teams for future. Because we know that in the next 18 months, we'll be fully ready with all our technology and everything. If we don't start today investing into the verticals and creating, and after that, we sequentially start doing it, then we won't be able to achieve what we want to achieve by SBS 2030. So that's why we are starting investing into the verticals. We are doing bits and pieces business everywhere so that the branches can understands how to do cross-sale, what are the products, how do you do business, how do you have, you know, manufacturing relationships, key relationships. All of that stuff we are doing. On the transaction banking, we are building teams. Wholesale banking, we are building teams. Retail, we are creating a sales vertical, which will be in the customer acquisition and all of that. So two primary areas where we are investing: one is, investment into new verticals and people, with a vision of building a larger bank, and B is significantly into technology. Because if you are saying that you are rebooting the bank and changing everything in technology, you can understand that there is a substantial investment going in there. Having said that, what I can tell you with reasonable confidence, because I have done all these calculations till FY 2030, that FY 2026 onwards, you will start seeing tapering down of this, and by FY 2030, our, cost to income will be well below 50%. Today it will hover around. I have told you in my last call also, last to last call also, that we'll be around 65%, sometimes 2% higher, sometimes 2% lower. But clearly, FY 2026, 2027 onwards, you will see sharp tapering of this, and we will be well below 50% by FY 2030. So that's the way and that's, that's, that's the, that's the, that's the answer to your question. Great, sir. But one last thing, sir, on advances growth. Since from last two quarters, we are taking a conscious call of not becoming a victim of rate challenges and reducing NIM. Going forward, should we expect a similar kind of, say, for next two quarters? Or are we going to address it and we'll get back the advances in short term? I understand in the medium to long term we are there, but in shorter terms, are we going to address the advances challenge by somehow and getting back to our growth rate of 1.5x the industry? See, I have always said that we'll grow 30%-50% faster than the industry. So, I have to look at my calculator, but, at a 18% growth, we are closer to 20, probably 20% faster than the industry. But- Okay. Yes, I said before that we will not compromise growth for margins. Okay? Mm-hmm. So you will see this year that we are not, emotionally attached to a 5% margin. We can be lower than that. We will be lower than that. We'll be somewhere between 4.5%-5%. We will get our growth back. But one of the reasons we are not growing, not because of margins necessarily, at that high cost of funds, and we, we are trying to focus on, our average LCR, if I remember it correctly, was 117. Okay? So with the average LCR and which means that many days we are 126, 128 also on LCR. Average LCR means the, overall quarter average LCR. So managing an average LCR of 116 and managing a CD ratio of 82% in this kind of a dynamic and slightly uncertain environment was a bigger trigger for us than just margins. But I will never shy away from building business even at lower yields if it's a franchise business. See, DA business and LCPD business is not a franchise business at our life cycle of our bank. But if tomorrow Manish Modi comes and tells me that I want to enter this group, and I want, and I want to enter this group at this rate, and that's where I'm having a very low margin, I'll be happily taking that because that's a franchise business. Or if somebody tells me that I want to do this on the, retail side, and their margins are low, let's say home loans or something else, I'll happily grab that because that's a franchise business. So we are here to build a bank. We are not here to build an, run a niche bank. We are here to build a medium-sized bank by 2030 and then, try and look at even beyond that. But at this stage, growth will come back, and growth will come back, provided the ecosystem is, helping us, getting that growth, in a very balanced manner between liquidity, margins and risk. If all three gives me that opportunity, then only I'll grow. I will never shy away from building a franchise business, be it wholesale, retail or the same. Very well, sir. Congrats. Thank you, and all the best for that. Next quarter. Thank you. We have the next question from the line of Mona Khetan from Dolat Capital. Please go ahead. Yeah. Hi, sir, good evening, and congratulations on a good set of numbers. Firstly, you know, on the deposit side, I just want to check how much of repricing is still due, and when do you expect cost to come to be? Yeah. Good evening, Mona. Good to hear you. So on the deposit side, I think it's almost 80% done. Little bit because generally you know that, deposits are one year or lesser, average tenures in most banks, including us. Okay? So given that, and this, deposit repricing has been happening for a year or more, so, we are almost done. A little bit of a tail is left, maybe another quarter or so. So, and, you also know that our cost of funds is well below 6%. So we are one of in spite of, being a small bank and in spite of this entire liquidity challenge, et cetera, we have managed our cost of funds reasonably well. But yes, the cost of funds has gone up, cost of deposits has gone up, which has impacted the NIM little bit, but I think that's an industry phenomenon. Hmm, got it. And, secondly, how do you expect basically that next quarter also, the cost of funds could be? It is difficult to say, but see, at best, what, another 10 basis points here and there? I mean, I mean, I'm just taking a shot at it. I don't know. I have not done that number. But I will say I don't think more than 10-12 basis points here and there will be left anymore. Okay? Uh, okay. We have almost reached the peak, in my view. Unless some major global geopolitical issues comes up, et cetera, I don't know. But otherwise, but only point, Mona, is that what we are, we are thinking before, that suddenly this thing, interest rates will start reducing and things will change overnight. You saw that today, the 10-year G-Sec is 7.24 or 7.26, or something like that. So, things and globally also, it has now almost 4.6, I think, U.S. So given all that, I think, it's not changing very much. So I'm not seeing too much of change happening in the next 2 to 3 quarters. So we'll be pretty much where we are for the time being, and that's what I'm taking into my, into my plans right now. But it will be difficult to retain 5% NIM, given that we want to grow again. But overall, I think we'll be somewhere close to between 4.5% to 5%, maybe closer to 5%. Got it. Secondly, on the yield aspect, so this quarter we saw a lot of growth also coming from SME, where I assume the yields are lower. And therefore. And yet, when we look at the reported yield on advances, they have increased by about 25 basis points, from Q3 to Q4. So what is happening to yields, if you could give some color? I mean, some of your voice is breaking, so I didn't get the full question. But yes, I mean, just to give you a perspective, I told it last quarter also when this question came up on SME. I said that you will see I know what the kind of work is going on. You'll see the SME growth. So we are growing in SME, and you'll see that the SME growth has now started showing up in the, in the system. On the yields in SME, I think our yields are somewhere around close to 12%, somewhere around 12%, SME and MSME together. But, but actually, no, I think this is not, not the right number. So our yield is, somewhere around ten, 10.7%, our SME yield. But if you take the MSME yield, it is slightly higher. But broadly, the way it works is. See, I don't have the exact number in front of me, but I'll tell you. Broadly, wholesale works in the range of 9-9.5. SME works in the range of 10.5-11, okay? And gold works in the range of 12-12.5. In that range it works, okay? And rest are very small, like microfinance and agri and all that, that are in the range of 15%-16%. So this is the range where we are in, and this has been pretty consistent all across. Maybe it has gone up by 10-15 basis points here and there, but broadly in that range we have managed. So in case something got wrongly reported, I don't know, but this is broadly, my memory says these are the kind of range where we are on our wholesale SME, gold, and this thing. Retail is also again around between, around 10-11. Okay. And sorry, can you comment again on the corporate yield, wholesale book yield? I told you between 9-9.5. Okay. Got it. Got it. Thank you so much. Okay, just one last thing. So, you know, there have been media reports suggesting a probable merger with IDBI Bank, of, you know, if the Fairfax bid for IDBI Bank goes through. So if you can just, you know, share your, you know, comments, if any, around, how this play out and how do you see it? See, I'll tell you, media reports I can't comment on, frankly, because, you know, it, I think it's a flavor to the last two days is in a different flavor. Before that, that was a flavor. So they, they'll report what they think, right? But from my perspective, from purely from CSB perspective, I have absolutely no information about anything. Fairfax being a, you know, investor, they can look at any opportunity at any point of time, but I don't think that there is anything which I am aware of on this. And I, in one of the town halls in Chennai, somebody asked me this question, one of my employees, I gave a simple answer, that if I knew anything like this is happening, then I would have taken Finacle as a software and not Oracle as a software, okay? Because IDBI is on Finacle, and we have taken Oracle. So, I think that settles the question, that, you know, we are building the bank, purely based on, organic growth, and that's what we have been told to do, and we are investing into the bank in the same manner. Beyond that, I have absolutely no idea. Got it. That's helpful. Thanks a lot, and all the best. Thank you. Thank you. Thank you, Mona. Thank you. The next question is from the line of Prabal from Ambit Capital. Please go ahead. Yes, thank you. Am I audible, sir? Yes, Prabal. Thank you for coming on the call. Thank you for the opportunity, sir. So my first question is on your deposit strategy. We have seen around 30-35 branches getting added within the quarter, but fairly sharp rise in the ATMs that we have added, around 200 ATMs we have added. Just want to understand what's the process behind it? No, this is a very strange reason, let me tell you. I mean, this is very unique to our bank. Our bank, in past, they were all the branches were not having ATMs. Okay? Because we used to run gold as a primary product, and hence many of the gold-focused branches didn't have ATM. I just explained in one of the previous questions that how we are converting many of our gold-focused branches also into primary universal branches, because those locations are very good locations, and we never leverage them for the other businesses. So now, as a part of the full-service branch, we are adding ATMs and many other things we are doing in those branches to ensure they become full-service branches and just not the gold branches. So that's why you're seeing that the number of ATM additions are primarily because of those, those reasons, in addition to, of course, addition of new branches. If the question is, are we adding too many off-site ATMs? The answer is no, okay? Unless there is a very strategic location or strategic decision, generally, we are not adding too many off-site locations. Also, what we are doing is in certain branches where we are seeing more than 200, 300 transactions in ATM, there we are putting our second ATM also. That is also happening, but they are far and few. But primarily, it is basically we are making most of our branches full-service branches. That's why these ATM additions are happening. Got it. Second question will be on gold. This quarter, of course, there was increase in gold price, and that would have helped our AUM grow. But our LTV has not changed much, so how to think about LTV going forward, because it is still relatively high at 70%? I have to look at the data, but I think LTV did change. I'll tell you what. Our tonnage growth was around 8%-9%, around 8%, and our overall growth was around 22% in gold, okay? So as far as I remember, this is really dealing from memory, so maybe somebody else can help me with the number, or we can get back to you later on. I think our LTV was around 77%-78%, which has now come down to 73%-74%. Okay, so that's broadly, if I remember it correctly. Also, almost 80%, 78% or 79% of our business is agri gold loan. I think if you put all of these numbers together, I think the math will work out, in my view. Going forward, how should we think about LTV? Any range that you want to stick to? So LTV, we would see, there are two parts, right? Agri LTV, we keep it below 85%, and non-agri LTV, we obviously keep it below 75% because that's the regulatory norm, okay? For agri, there is no specific regulatory norm, but we try to keep it below 85%. Given that our agri is more heavy on agri in terms of portfolio, that's why, that, that's why it is slightly higher than 75%. Also, we like, as per regulation, we add interest, and that adds up to the LTV. So, so you can see that if 77%-78% of our business is agri, and, our, LTV is 73%, someone has given me the number, it's, 73.53% at this point of time, then you can as well understand that non-gold, non-agri, what is our LTV? It will be very, very low. Correct? So, I think we will keep it below 80%, okay, even if prices goes down. And, and we always factor in, in our sensitivity analysis, a 10% drop in gold prices, and then see, in terms of risk, where we stand. And we are very, very comfortable. And, we know that gold prices are almost at all-time high at this point of time, but, but we don't take that into consideration. We keep it around somewhere around 80% overall LTV. Now I've got the number. We are around 80% in Q2, against which we are around 73.53% in Q3 and Q4 on LTV gold. Right. And so given now, the retail and MSME have started growing 25% and above, so now we start expecting that eventually now gold will start seeing reduction in its share and SME and retail will make up for that. Has the time come now? Yes, absolutely. That's s ee, ultimately, we have said, given a vision of SBS 2030, whereby gold will be 20, SME will be 20, wholesale will be 30, and retail will be 30. So that is our vision for FY 2030. The only piece which will be a little backended will be retail, because retail, the real, you know, heavy lifting will happen between FY 2027 to FY 2030. Rest of the things, whether it is SME, now already happening, wholesale will happen in the next two years, and retail and this thing will start picking up. So this will help us in overall faster growth as a bank. So as you see, with larger balance sheet, we will actually grow faster because we'll have more levers. Today, we don't have levers. And hence, you will see FY 2027 to FY 2030 will grow much faster than what we are growing today, just because we will have those levers. And once we do that, it's not that gold growth will come down, may come down a little bit, but, not necessarily will come down significantly. But other businesses picking up will automatically take the business mix of gold down. That is going to happen, and that is a part of our very clear, structured, strategic, kind of a roadmap which we have designed for ourselves. Sir, I have two more questions, small questions. Can I ask it, I think? Sure. So on the yield side, we are seeing a very good jump this quarter. Going ahead, what are the levers which can help us improve yield here on? My view, you will not see too much of a growth in yield, because to see the question which you only asked before, if the business mix changes and gradually gold starts coming down even by 1%, 2%, 3%, here and there on the overall business mix, replaced by wholesale and SME, and to some extent, retail, weighted average yield will not go up. Okay? If at all, it may have some compression. But per product yield, we will ensure that we will not do business, which doesn't make sense for us, unless it's a franchise business. I'm willing to do franchise business at any cost, okay? Because franchise businesses are a very long-term impact. But otherwise, tactical business, I will not do just for the sake of balance sheet growth. That's the way it will work. Overall yield, I will say that we'll be happy to hold it where it is today, primarily because business mix will change. Right. The last question will be on other income. We saw a sharp jump during the quarter. Any one-off here? No, no, no, no one-off at all. I'm most happy with this, to report you the business which you have done on this, on this other income. And why I'm happy? Not because of the number, because this is exactly cleared out. I told it two years back, one year back, six months back, is one of the gap areas I found when I took over, is our core non-interest income to total income was below 5%. There is to be income on treasury and PSLC side, and for us, PSLC income has been, somewhat okay. Previous year was very muted, but not that high, right? So to that extent, we focused on, core fee income business. And this core fee income business, which, in my experience, is not only sustainable, it keeps growing as new businesses comes. We are not even heavy into payment business. We are not even heavy into retail asset business. Wholesale transaction business is starting to come. Even then, now, our non-interest income, the total income, is now reaching around 17%, okay? Which is in line with some of the best players in the market. My vision was to take it to 13%-14%. It has reached 17%. Now, one can argue that it has happened because your other income has not come. That is also true. It's a numerator, denominator game. But at least somewhere we have reached to a vision where we want to be there. And what is good about this is that it is sustainable. So what I am committing here is you will see a sustained growth in this, in this non-interest income, and we are not up-fronting any income. We are not doing any of those things. We always do the right practice. So this is core income, which will continue to sustain over the next years to come. Yeah. Thank you for answering, sir. I'm out of it. Thank you. Thank you. The next question is from the line of Saptarshee Chatterjee from Groww Asset Management. Please go ahead. Thank you, and great to talk to you, sir and team, and thank you for this opportunity. Sorry, sir, harping on this again, on the slippage part, the account that has got. So you have talked about there is some technicality, and therefore it has got slipped. I didn't understand fully. Can you please elaborate on this, key, what has actually happened, and this is from which industry, which credit rating? Some details on this, please. See, that level of details we can't share, because that is not right also to share. But what I can tell you is that, let me put it this way, that even 6 weeks back or 8 weeks back, I didn't know that this slippage will happen. Okay? So, otherwise, I would have given some kind of b ecause I always believe, I don't believe in surprises or giving surprises to the market. So there is no way I knew anything about it last quarter when we talked about it. And this will give you a perspective that this is something which is an event, a sudden event, which is remedial action is not very difficult, and we believe that remedial action should happen in 1 or 2 quarters' time, okay? So to that extent, when if I can tell with almost 99% confidence that next financial year, when you look at it, okay, we'll not even discuss this account, okay? Next financial year means FY25. So it, and when you are talking about FY2030, this is of no relevance to me in the longer term of things. One quarter here, one quarter there, can happen, but this is something which is not taking my sleep away, because this will get the remedial action and reversal will happen sometime in this year. When it will happen, I can't say, but it will happen, because this is not one of those issues which will drag on for a quarter after quarter and year after years. So we are pretty confident about it. Got it, sir. Got it. Thank you for this. Thank you for the details. And, generally, when we see the larger peers, they are maintaining around 1%+ kind of contingent provision. Any thoughts on building contingent provision, or you are comfortable at this level? See, we have around INR 170 crore of excess provision. This is regulatory provisions and including 105%, INR 105 crore of contingent provision. INR 171 crore, I think, is a reasonably good number for us, especially because our provisioning policy is very conservative at this point of time. So, our board believes that this is reasonably conservative, given that, again, you have to see it from a business mix. I don't know, other banks could have very different kind of business mix. And the day we get into the business mix, we may change some of our philosophies. But when 40% of the book is gold loan, where there is effectively no risk other than some small little risk, operational risk, which doesn't even flow through as a risk. And some of the other businesses where we have not seen that type of an issue, having more than INR 170 crore of excess provision doesn't make any sense for us at this point of time. With a, with such a high PCR coverage ratio, now this quarter has come down for technical reason, it will go back. So it will go back to 70%-75%. So I think we are quite comfortable with 171%, with vision of having a 75% PCR kind of a range. Understood, sir. Thank you. And, like, two data housekeeping questions. One is, you have talked about the yields across segments, can you also give some idea on the yield from the retail part? Like you have given microfinance, but the other parts, like supply chain or CV book, what are the yields that you are working on? And second is, what would be our non-gold, like, branches where we have other products available along with gold, the number of branches? Okay. So, yield, I think I've gave the answer, but I'll tell it again. Very transparently, I'm telling, that our wholesale yield is between 9-9.5. It's not that I'm not saying we'll not do business below 9, but I'm just saying somewhere in that range, our average yield remains. Our retail yield is somewhere between 10-10.5. SME is between 10.5-11, and gold is somewhere around 12-12.25. And, microfinance and agri is somewhere around 15-16. So this is where our yield listing is. What is the second question? The number of branches where we have other products along with gold. Yeah. So right now, we philosophically don't want to have any branch which is only doing gold business. So if there are some. I mean, first of all, you cannot do that also. Regulators, you have to have branches with tellers, with cash, with everything. But I assume your question is retail assets, fees, everything. So all branches does most of the business this thing, but SME is the real SME, the larger SME is focused on not beyond 100 branches, and MSME is focused on 200 branches. Fees we do almost everywhere. And retail assets, we are gradually building because we don't want to go all over the place in retail assets. We are going slowly. And what else? Savings, current accounts are there everywhere. So to that extent, I think most of our branches are there. But yes, there are some branches which are little more gold-focused, and they are mostly in 3 locations: Kerala to some extent, Tamil Nadu to some extent, and Andhra Pradesh and Telangana to some extent. Got you, sir. Thank you. Can I have just one small follow-up on this, on the retail yields? Yeah, yeah. In the retail, when you say that it is between 10 and 10.5, like, can you give some order of which are at higher yield and which are at lower yield within retail? It is difficult to say, but, I mean, I don't even have that number with me, but having run very large retail businesses in my life, I can tell you which range in the industry is, and we cannot be outside the industry, right? So, CV business will be between 9%-10%. Auto business will be somewhere around 8.5%-9.5%. Okay? The passenger auto, I'm saying. Okay, passenger car. Then, home loans will be somewhere around 9%. Okay? Then, inventory funding will be around 10%, nine and a half to ten. Okay? Then, some used businesses will be slightly higher, maybe 12%, 13%. LAP businesses will be somewhere around, ten percent, ten and, nine and a half to ten and a half. So I think. I'm not saying these are our numbers, because I don't know. Okay? But I don't think we are any, any way too different compared to what these markets are, because we do not operate in a different market, and we do not have a yield maximization strategy. We have a risk minimization strategy. So from that perspective, I would think that we will be in this range only in most of the businesses. Okay. Thank you, sir, for patiently answering the questions and all the best. Thank you. Thank you. Ladies and gentlemen, to ask a question, you may please press star and one. We have the next question from the line of Pallavi Deshpande from Sameeksha Capital. Please go ahead. Yes, sir. Thank you for taking my question. Just wanted to understand on the gold loan business, are we getting any benefit from the recent problems for this, for a leading NBFC, and do we see higher growth for next year on that account? Hi, Pallavi. Thank you for your question. First of all, I don't feel good if there are any issues anywhere in the banking ecosystem or financial ecosystem, because, you know, there is a learning for all of us. So only thing is, we learn from any of these regulatory measures. The market is too big. We are not even a large enough player. Our business mix in gold can be large, but with INR 11,000 crore to INR 12,000 crore book, what are we? We are very small, right? So to that extent, we are very focused inward in terms of what we can do, what we should do. I don't even think our segment of customers we have the same segment of customers compared to the industry which you're talking about, because our yields are around 12%. I would believe that any industry yield will be around between 16%-20%. So to that extent, I don't even think that we are in the same segment of customers. But philosophically, I'm not in that race that somebody else is losing business and I will take. We will, you know, we will have our own way of doing business. Is there any target for next year in terms of growth for this business? For gold business? Uh, yes. Yeah. So as I said before that, as a bank, we'll grow around 30%-50% faster than the system. And within that, I would say that probably gold will grow similar or maybe little lesser. So if the system grows, let's say, next year around 13%, I'm saying 13% because somebody, one of the rating agencies are saying around 12%-13%, it can be 15% also, I don't know. So if the system grows at 13%-14%, we will grow at 18%-19%. And if we grow at 19%, then probably gold will grow somewhere between 15%-20%. Great. Thank you. That's very clear. Sorry, was there any question? No. Okay. Thank you so much. Okay. Thank you, Pallavi. The next question is from the line of Jay Mundra from ICICI Securities. Please go ahead. Yeah. Hi, good evening, and thanks for the opportunity, sir. Sir, my first question is on wholesale banking, right? So we have added people, we have hired Manish Modi. And, you know, you mentioned that as of now, till this quarter, it was not a franchise business. I wanted to understand, sir, when, when-- I mean, what could be the pace for this business to become franchise business? And of course, the wholesale market is very, large market. Considering our size, our cost of fund advantage, our distribution, maybe the corporate connect, you know, how would you segment the entire wholesale market? And, you know, what could be the, you know, near-term segment which you would prefer to play in? Maybe by ticket size, maybe by certain industry, or maybe any, you know, to understand thought process on this business becoming franchise business. Thank you. Okay. No, no, that's a great question, Jay. So let me take a little time in answering this question. So first of all, if you look at the kind of leadership we have brought into the bank today, be it on the SME side, be it on the retail side, retail/gold, or now be it on the wholesale side, these are all guys who have seen businesses which are 20, 30, 40, 50, 100 times bigger than us. Okay? Which means they understand the entire market in their respective areas of operation, whether it is SME, wholesale or retail. But the challenge is that one could have handled the largest credit card business, but we don't even do credit card business ourselves directly. So question is where we stand as a bank, okay? So then when Manish has come in, he has to first see that where we stand and what are the steps to build. We are not in a hurry. Let me put it this way. Retail assets, I could have built just like that by appointing DSAs and getting businesses. Those are easy things to do, and I know DSAs, I know the market, but we said, "No, we'll not do this." And same brief is to Manish, that build the building blocks right, okay? Build the franchise business. What are the segments we want to operate, as you rightly said. As a size of a balance sheet, we can't even participate in most of the larger, larger tickets or larger consortiums or larger kind of other thing. Having said that, given he and his team, he's building a very good team also across the country. Each of these guys have worked in the largest, have lent to largest companies in the country also. So those connections has to be maintained, and in some form, through supply chain, through something, we can build some businesses, et cetera, we must do that. So that is something first we are working on. So, without taking names, I can tell you that after he has joined, I have gone and met 3 or 4 largest business houses in the country, and I know that we can't do business with them with our size, but still we are meeting and trying to see that how we can. Because each of these large companies, largest companies or largest conglomerates also have small, small, units, you know, with them, who are, which is a part of their group. So we are trying to see if we can work in some of these companies, et cetera, which has a larger kind of a guarantee of this larger company. So that is one segment which is very, very attractive to us. But yes, they will not come with great rates, but still we need an entry. So that is one. B is we will clearly operate in the mid-market, okay? In most of the geographies and in segments which will work well for us. We will work in emerging corporates. The way he has divided his team is and Vatsal looks after the corporate banking, Avinash looks after the emerging corporates, and Mrunal looks after the FIG business. So we never had segment in our wholesale seg- business. Under each of them, they are now building regional heads and things like that with good experienced people who are going to handle the business. So we are going the classical way of building a wholesale franchise. Parallelly, we are also having transaction banking head, Aman Singla, who is working both with Shyam Mani as well as Manish, and means the SME head and the wholesale banking head. And he is building products like SME supply chain. We are launching Vayana very soon, which is a software. We are going to have Trade Ops systems. We are building products out there. So we are building the blocks of building a proper high-end SME business and mid, mid-end wholesale business, okay? So that's the second part. NBFCs, we are always very strong, but as some of these, you know, manufacturing or other parts of the businesses starts growing, we are eventually CapEx will start pick up, private CapEx, maybe one year from now, and we have to be get ready for some of this those businesses. So naturally, as a proportion, as wholesale business goes up, NBFC business as a proportion will go down, but still NBFC business will be there. Government business is something else which they're focusing on, but that's primarily for liability, because they also will have a target for liability and fees, and you know that in the wholesale side, fees is a very important. We would like to have at least a 1.5%, 1.6%, 1.8% fees in the wholesale business. Means wishful thinking, but we would like to have that. Okay? So that kind of approach we are taking. So in short, what I can tell you is that, then we have a very good treasury team, TFX, other businesses. We have got Alok, who's a very good treasurer. So the treasury team, the transaction banking team, the wholesale team, and the SME team is working together in building a wholesale franchise. So it's, it doesn't take that kind of a time, a retail business takes time, but still it will take a year to start having a full-blown wholesale, because you need technology and other things as well to come together, but they are doing the building blocks. Given the pedigree they come with, they should be able to build the business along the way. We don't have to wait for everything to come to build the business, so they will build the business along the way also. We are pretty hopeful that both SME and wholesale will do very well for us this year. No, understood, sir. That is very elaborate answer and, very insightful. The other question we will partly, partly asked, and you have given your thoughts, but if I understand it correctly, sir, I mean, the credit environment has been very, very good in the last few quarters, and we had a large INR 70 crore kind of a slippages. And if I were to see out of INR 6,000 crore contract portfolio, this may be one of your top 20, top 30 accounts. I don't know, but because it has turned very, suddenly, as you said, without too much of a warning. But, I mean, does this, does this worry you in, in terms of risk management or, or any comment you can offer there? You know, because it looks like, you know, it is not a run-of-the-mill kind of a slippages. Thank you. I don't know what run-of-the-mill slippages is, but it is a surprise slippage, and it was not in our radar because it was not supposed to slip. So beyond that, I cannot say anything. That's the reason which we are also quite confident that we should be able to clear this. Having said that, on your original question, first of all, that is, if I have to put top 10 things which can keep me awake at night, top slippages doesn't fall in the top 10 in the bank, okay? I have 10 other more bigger worries than a slippage right now. Having said that, what we've also done is, we have taken potentially top 20 stressed accounts in the bank, potentially, okay? We have put them into the contingency provision of that INR 105 crore, because we were thinking what to do with this COVID provision what we have created. Then, after talking to our statutory auditors and ACB, audit committee, what we did is we and this is a disclosure I'm giving, we put certain provisions against potentially top 20 stressed accounts. And, I don't even think that any of these hundred. This was done only to ensure that this INR 105 crore contingency provision, we don't need to use it at this point of time. This is the most conservative approach we did, and I don't think we will need too much of usage of this contingency provision. In case we need, we have top 20, sorry, top 20 potentially stressed accounts against INR 105 crore of contingency provision we have kept. This account, by the way, this account was not even a part of this 20 list. So that's why I'm saying that this was a surprise one. If it was not a surprise one, I would have given an early warning to the market. So I'm confident that we will be this thing, and this will cure this. And I don't have, you know, any, I don't worry about slippages or this thing on the corporate side of the business. Understood. Thank you, again. Yeah. Thank you, and all the best. Thank you. Ladies and gentlemen, we will take that as our last question for today. I would now like to hand the conference over to the management for closing comments. Over to you, sir. Thank you very much. Thank you, Shivaji, for organizing this call. We had great set of questions, and, again, I want to reiterate that we are building the bank for the long run, as this 2030 is our vision. And I have not seen as much excitement in the bank as we are seeing today. So I'm very hopeful that we are on the right track, and hopefully, FY 2027 onwards, the real, you know, the real color of the bank will emerge, which would be very, very positive. Thank you very much, and have a good evening. Thank you. On behalf of Yes Securities, that concludes this conference. Thank you all for joining us. You may now disconnect your lines.