Ladies and gentlemen, good day and welcome to the ICICI Prudential Asset Management Company Limited's earnings conference call for the quarter ended June 30th, 2026. Joining us today on the call are Mr. Nimesh Shah, MD and CEO; Mr. Naveen Agarwal, Chief Financial Officer; Mr. Abhijit Shah, Chief Marketing and Digital Business Officer; Mr. Vipin Bhandari, Senior Member from Business Team; Mr. Harshil Sanghavi, Lead Investor Relations, who will be available to address your questions following our opening remarks. As a reminder, all participant lines will be in the listen-only mode. There will be an opportunity for you to ask quest ions after the presentation concludes. Should you need assistance during the conference call, please signal an operator by pressing star and then zero on your touchtone phone. I now hand the conference over to Mr. Nimesh Shah, MD and CEO of ICICI Prudential Asset Management Company Limited. Thank you. Over to you, sir. Good evening, everyone. I trust you guys have had the opportunity to review our earnings presentation and the investor materials that have been shared on the stock exchange and our website. I'll straight start with the industry. As you know, markets have behaved relatively where we were on March 31st, 2026 till where we are on June 30th. There has been a positive movement in the markets. Everything is a reflection. Whatever you see the numbers is a reflection of that. Overall, the industry qu arterly average AUM grew by 15.4% year-on-year, reaching INR 83 lakh crore. The sequential growth in quarterly appears to be muted. However, comparison of closing AUM between the two quarters indicates a strong momentum reflecting a growth of 11.6%. Equity and equity-oriented AUM stood at INR 45.2 lakh crore. As the market sentiments improved during the quarter, equity market witnessed a broad-based recovery across segments wherein small caps outperformed with a return of 24%, followed by mid caps at 17.2%, while large caps lagged behind, delivering a recovery of only 8.9%. As all analysts understand, a lot what happens to the P&L is dependent also on this particular numbers, the last line that I mentioned. During the quarter, net flows for equity category was more than INR 1 lakh crore. Categories like mid cap and small caps were at the forefront of attracting highest amount of equity net flows. Categories like thematic funds and hybrid, specifically multi-asset funds faced reduction in net flows when compared sequentially. While the industry saw a steep fall for the month of May 2026, net flows for the month of June 2026 rebounded by 26% month-on-month, coming back to the pre-Middle Eastern crisis levels. June 2026 recorded SIP contribution of INR 31,781 crore. Monthly SIP inflows remained largely stable throughout Q1 despite volatile market conditions, demonstrating the resilience and stickiness of retail investor participation. In the debt segment, overall the quarter witnessed redemption by institutional investors and tighter liquidity conditions resulting in a sequential moderation of 6% in average AUM. Passive AUM grew by 25.3% year-on-year to INR 14.673 lakh crore. Industry continued to have a positive new customer addition, reaching 6.2 crores, which represents an increase of 12.1% year-on-year. I now hand over the call to Harshil for covering the performance of our company. Thank you, Nimesh. Good evening, everyone. For the quarter ended June 2026, our total mutual fund quarterly average AUM reached to INR 11.17 lakh crore, which is up by 18.3% year-on-year, thereby maintaining our position as the second largest AMC with a market share of 13.4%. In active schemes, we continue to maintain the highest market share of 13.5% with a quarterly average AUM of INR 9.25 lakh crore. As of June 30th, 2026, we continue to maintain our leadership position in equity and equity-oriented schemes with a market share of 14% and a quarterly average AUM of INR 6.31 lakh crore. On year-on-year basis, we outperformed the industry growth rate by 3.6%, recording a growth of 19.8%. It is important to note that in Q1 FY 2027, we continued to receive one of the highest net flows amongst the industry. The quarterly average AUM of our equity-oriented hybrid schemes grew to INR 2.22 lakh crore. This represents the largest market share of 26.6% as of June 30th, 2026. For the quarter ended June 30th, 2026, our margins on an annualized basis stands at 66 basis points for equity, 32 basis points for debt, 12 basis points for liquid, 12 basis points for passive, and 30 basis points for arbitrage. There is no negative impact on account of changes in the TER regulations. As of June 30th, 2026, we have a unique customer base of 1.73 crores. Notably, in this quarter, we added every seven of 10 new customers from the industry. In June 2026, our systematic transactions, which includes SIP and systematic transfer plans, moderated marginally to INR 4,872 crore from INR 5,104 crore in the month of March 2026. Similar to the industry trend, we saw a moderate dip in the first two months of the quarter, followed by a rebound in June 2026 as compared to May. Our distribution mix of our mutual fund equity quarterly average AUM is as follows: where MFDs accounts for 36.2%, national distributors accounts for 15.9%, ICICI Bank share at 7.7%, other banks contributing 10.7%, and direct representing 29.5%. SEBI introduced Specialized Investment Fund under mutual fund, which is well-positioned between traditional mutual funds and alternative investment products. SIF is a distinct brand assigned to SIF, launched by ICICI Prudential Mutual Fund. We have launched four strategies. iSIF Equity Ex-Top 100 Long-Short Fund and iSIF Hybrid Long Short was launched in previous quarter, while iSIF Active Asset Allocator Long-Short Fund and iSIF Equity Long-Short Fund in June 2026. Our quarterly average AUM of SIF is INR 2,678 crore. Coming to GIFT City, we have launched our first offering in GIFT City, the ICICI Prudential Smart Navigator Fund, which is an inbound fund. It is encouraging to see that the fund is gaining traction and witnessing growing investor interest. Let's move to our alternates business. Just to clarify, comparative data has been restated by considering the effect of acquired business of ICICI Venture. Our alternates business comprise listed equity focused PMS and AIF, private credit, real estate, private equity, early-stage private equity, and offshore advisory. For June quarter end, our alternates quarterly average AUM stood at INR 79,446 crore. Within alternate, our PMS AUM grew to INR 28,996 crore. Our AIF quarterly average AUM stands at INR 22,737 crore. For the quarter ended June 2026, on an annualized basis, the gross yield on our PMS and AIF business was 1.91% and the net yield, that is after reducing the fees and commission expenses attributable to PMS and AIF business was 0.95%. Yield on assets under advisory was at 30 basis points. Coming to AI, our focus is to deliver value across three core pillars: customer and distributor experience, operational efficiency, and investment management. On customer and distributor experience, our goal is frictionless interaction. Today, a customer can use our natural language search engine on our website, which has already processed over five million queries. For our customers and partners, we have embedded an engine in our mobile apps and distribution portal that delivers hyper-personalized prompts, which helps to engage better with the clients. On the operational efficiency front, 60% of our customer queries over emails are replied through AI. We are actively expanding such capabilities by transitioning outbound SIP renewal calling to an AI-driven process. In investment management, through our proprietary platform, we are building a conversational layer over our investment data. At present, we are using AI to generate summaries of reports, videos, DRHPs to suit our requirement. It enables faster processing of data and gives our investment professional a head start so that they can focus on alpha generation and judgment. I hand over the call to Naveen for covering the financial performance of the company. Good evening, everyone. Let's cover the financial performance for the quarter and yields that are presented on annualized basis. As we mentioned earlier also, all the data have been reinstated by considering the effect of acquired business of ICICI Venture. Our operating revenue stood at INR 1,564 crore, representing a growth of 17.6% year-on-year. Our operating net revenue mix from mutual fund was 90.02%, alternate 8.54%, and advisory business 1.44%. Other income of INR 181 crore turned positive from negative vis-à-vis last quarter on the back of positive mark to market. Operating expenses amounted to INR 464 crore, which was an increase by 11.7% year-on-year and 14.3% quarter-on-quarter. The sequential increase was largely on account of employee expenses. As you would recall, we had mentioned in our previous con call as well, the ESOP-related expenses have been debited from this quarter while in the previous P&L, last year P&L, there was no such charge. And also particularly in Q4 of FY 2026, any provision that we had made in the previous quarters of last financial year was also reversed. Our operating profit before tax, which indicates the core profitability of our business, reached INR 1,100 crore. This represents a 20.2% increase year-on-year. Profit after tax stood at INR 965 crore, which is up by 23.1% year-on-year. For quarter ended June 2026, our gross yield and net yield on an annualized basis stood at 52.4 basis point and 48.3 basis point respectively. Net yield is arrived at after reducing fees and commission expenses on PMS and AIF business, which is shown as an expense item in the P&L. For quarter ended June 2026, our operating margin stood at 36.9 basis point as compared to 36.1 basis point for the quarter ended June 2025, which is a year back. Thank you for your attention. I look forward to discussing our performance in more details and addressing any questions that you may have. Thank you very much. We will now begin with the question and answer session. Anyone who wishes to ask a question may press star and then one on their touch-tone phone. 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. Again, to register for a question, please press star and then one. Your first question comes from the line of Rahil Shah with HSBC. Please go ahead. Hello. Thank you for the opportunity. My first question is, I just wanted to understand the drivers of change in market share, both in terms of equity, AUM and SIP flows. Can you give more color on how much it's maybe driven by, say, MTM difference and how much is actual change in net flows? Something around net flow market share where you said that you are getting high yields but sequentially is it higher or lower? Some color on that could be helpful. Rahil, if you look at it from a one quarter basis, given the high base of equity AUM, the change in market share would predominantly be driven by mark-to-market. Net sales in one quarter would not make that much of a difference. As we mentioned in the beginning, mark-to-market that has been received in the industry is a function of how each of the segment has done. Whether it is small cap, mid cap and large cap. The change in our market share has also been predominantly on account of mark-to-market. Just to reiterate what we mentioned with respect to the indices, small cap in this quarter showed a return of 24%, mid cap 17.2 and large cap 8.9%. That is what you would see reflecting in the mark-to-markets and the respective AUMs as well. Understood. In terms of SIP flows? SIP flows for the month of June has actually seen a rebound vis-a-vis May. While from March to June, if you see there's a small fall. Rahil always see for the quarter because monthly there are a lot of changes that happen because of month-on-month. Normally always look the numbers from a quarter point of view and not from month-on-month. Don't analyze too much month-on-month numbers because the numbers sometimes over a quarter it gets stabilized. Maybe if I can request to give the quarterly number because we don't have that. That would be helpful for every one of us. Just a related question around if I see the distribution mix I can see that the growth from banking channel including ICICI Bank, there has been a sequential degrowth compared to a very healthy 3%, 4% growth for the direct and national distributors. Again, what explains this divergence? Is it something where banks have kind of slowed down selling mutual funds? Some clarity here would be helpful. Again, if you look at the distribution mix it's spread across from a servicing perspective, the distribution mix all the channels whether it is mutual funds or national distributors or ICICI Bank, we continue to serve all of them. The small changes that you see, for example if I look at what was the number for June quarter vis-à-vis let's say previous quarter I do not see much change for example in mutual fund distributor category or on a bank on an overall basis. Frankly the numbers have not really moved that much. June mix and March mix is pretty much in line. Maybe from a mix point of view it's same but if I see in absolute terms there has been 4%, 5% increase in AUM from direct or national distributor while for banks it's like flat to lower. What explains such divergence within a quarter? Is there anything specific to read into it? Are you referring to the industry numbers? No. Your ICICI AMC numbers. You give the mix number but I just multiplied it with the AUM. In our case as of June, the direct share was 29.5% of the equity AUM. You must see the equity AUM. I don't know if you're looking at the total. I'm looking at equity. Maybe I'll take this offline. Yeah. Thank you. Thank you. Your next question comes from the line of Piran Engineer with CLSA. Please go ahead. Yeah. Hi, team. Congrats on the quarter and thanks for taking my question. Firstly, just some number keeping ones. Naveen, what was the ESOP cost in 1Q? We had indicated, I think last year, when the ESOPs were gr anted, that for the full year, ESOP cost would be between the range of INR 125 crore to INR 130 crore. Sorry, that's also three years, right? Yes, that was the three-year cost of INR 120 crores. Correct. This year? For this financial year, the cost was indicated between INR 64 crores to INR 68 crores. Correct. Will that come equally each quarter, or was it front-ended in 4Q? In 1Q, sorry. No, it would be in proportion. It would not be front-ended. That would be as per the Black-Scholes method. It is charged based on the total vesting period, and it will not be front-ended. Okay, understood. This is the base to sort of model the employee OpEx on, because last quarter we had some reverses. Before that, we had another accounting method. This INR 200 crore quarterly OpEx is sort of a base to take as a thumb rule. Correct. Okay, fair enough. Secondly, going back to that SIP number on slide 17, your SIP is for the month or it's the average for the quarter? No, that is a number for the month of June. Okay. April and May would've been even lower than INR 48 billion. The trend has pretty much been in line with that of the industry. What happened in the industry is what we have witnessed in our number as well. Okay. How do we think about it? Is it like the stoppage ratio has gone beyond 100, or is it just like the ticket size per customer has gone down? Piran. Like fewer people or lesser amount per person is what I'm trying to understand. Piran, effectively, it's not that the new SIPs have not been coming. If you look at the industry level also, the new SIPs have come in. Obviously, if the SIP trigger number has fallen, that's obviously because the stoppages of the old SIPs have been more than the new SIPs. Frankly, the count-wise, it does not matter. No one should look at it from a count perspective. It should be more from the perspective of if the new SIPs have come in and how much of the old SIPs have stopped. The net of it is reflected in the SIP trigger number. Understood. Just lastly, the industry and our debt AUM declined this quarter. Is it seasonal or it's just simply because bond yields spiked and there was some uncertainty in the market? Yeah. You rightly said there has been a reduction in the debt AUM. We understood it's largely on account of institutional investors redeeming among tighter liquidity condition. It's the liquidity that the corporates would be having, where the corporates are investing because of the war situation, where they're investing more in the working capital. If they invest more in the working capital, their surplus liquidity decreases, and to that extent, investment in mutual fund decreases. It's more liquidity in the system, nothing else. Understood. Okay, it's nothing to do with seasonality. Like in 1Q, it goes down or anything like that. Got it. Okay. June to June, I won't say seasonality. It is more of how are the corporates in India behaving. Understood. Okay. Yeah, that's it from my end. Thanks and wish you all the best. Thank you. Your next question comes from the line of Madhukar with JP Morgan. Please go ahead. Hi, sir. Thank you for taking my question. On the fees and commission side also, we are seeing the increase in that number, both on a QOQ basis and on a year-over-year basis. Probably also because the assets under advice which have come right now also have some fee payment happening. It'll be good if you can explain that a little better. The fee and commission number, as you see, is a number which is effectively the distribution fees that we pay for alternate PMS and AIFs. Unlike mutual fund, any distribution fees that we paid for PMS and alternate, it's rooted through the AMC. The increase that you see is because of the increase in the underlying business. If the volumes of PMS and AIF go up, the underlying fee would also go up. That is effectively a reflection of growth in the underlying business. Got it. Thank you. I'll come back in the queue. Thanks. Sure. Thank you. The next question comes from the line of Piyush Kumar with Magnus Hathaway Investments. Please go ahead. Yeah. Am I audible? Yes, sir, you're audible. Please go ahead. Yeah. Sir, my question is regarding the SIP inflows this quarter. As we can see on slide number nine, the SIP inflows are down 1% QOQ. What could be the reasons for this? I mean. We all know how the markets have behaved. In fact, we would say that if you look at the numbers over a longer-term period, if you look at it vis-a-vis, let's say March of last year or even September, you would see the June quarter number showing an uptrend. Even when you compare on a very short-term basis what happened to this number vis-a-vis May, there has been a bit of a rebound. As Nimesh mentioned a little while back, ideally you should see the number on a quarterly basis because there could be some adjustment in one month vis-a-vis the other month. The numbers of 31,000 that we see at an industry level, 31,781, we would say it's still a very healthy number. Okay. Sir, going forward, which scheme are you most bullish on? What do you see the trends in the Indian market and the Indian investors behavior? From our perspective, as you know, our AUM of the total equity AUM that we have, the hybrid AUM has a large component of that AUM. All our products are suitable for an investor on a long-term basis. We believe that if anyone stays in our product over a period of seven, eight years, he would obviously get a good return. See, overall, we are believers of a moderate return world. That is where I sometimes feel it suits my business. The expectations, the customer when he comes in, he's slightly skeptical. This kind of environment, the customer is also asking four questions and is not going by euphoria before investing. That's a good environment. We believe it's a moderate return world, and the series of products that we have created on dynamic asset allocation, whether it is Balanced Advantage Fund or multi-asset fund or asset allocator fund, I can go on. There are a series of products that we have created which mix equity and debt in some proportion. The way I look at it, Indian customer is now feeling the pain of volatility. In those times, it can be a good dynamic asset allocation. Look at what has happened in the last two years. In the last two years, I was in Patna and one of the distributors, I asked him that, "Two years there has been no return. There must be a lot of pain." His reply was, "No, sir, it is okay in your funds." Because he was referring to my dynamic asset allocation, which has given a reasonable return to the customer anywhere between 10%-20% over the last two years. When the market has hardly given any return. I think this dynamic asset allocation category overall. In addition to that, we are very like what SEBI is allowing us in SIF products. Though I agree the distribution is not very huge today vis-a-vis a mutual fund because you have to clear an exam and all, but the products are very beautifully constructed. The use of derivatives can be much more over there. It can be used to hedge your position, even if you are invested in midcap, small cap. We have got a midcap, small cap fund over there also, but where I can hedge the position if I feel that midcap, small cap is too overvalued. There are a series of products. Frankly, we are a supermarket where I've got product for the common man, I've got product for HNIs, I've got product in the various asset classes. I believe that Indian customer and overall the family offices will move towards very different kind of products will go from the AMC, including something like commercial real estate. I believe that family offices, in addition to looking at equity, if somebody can give them in an organized way, commercial real estate, which gets a good yield also for the customer, as well as there are escalations possible. I think the entire product suite would work well for the customer. Okay, sir. Thank you so much. Thank you. Your next question comes from the line of Prayesh Jain with Motilal Oswal Financial Services Limited. Please go ahead. Hi. Good evening, everyone. Just some color on the SIP again. Sorry to harp on that question, but just some color as to where are you seeing the pain or not pain exactly, some slowdown, whether it's the direct channel through brokerage platforms, through distributed route. Probably some color on the ticket sizes, whether the smaller ticket sizes are closing down more or the larger ticket sizes are closing down. That is point number one. Question number two will be on. One second, sir. You take the second question later. Sure, sir. You asked on SIP. Let me give my perspective before Naveen gives you the details. I'll try to reply the question the way I look at SIPs. If a person continues-- what has happened in the market is there are various kind of distributors selling SIP. There are various customers going on various platforms and buying SIPs also. The responsible distributor would have given a long-term outlook. Some of the customers where there is handholding, they would have come with a long-term outlook and their expectations of SIP would be more realistic. There would be some other channels where only past performance, the customer might have self-selected also past performance. I saw in a typical year in 2023, if somebody has looked at last one year return and entered into a SIP. Say he has entered into a small cap SIP or a PSU SIP or various sector SIPs looking at only past returns, those kind of SIPs. I divide SIPs always responsible distribution or self-selected. If the quality of sales is good, it will sustain. If the quality of sales is not good, it will not sustain. It has got nothing to do with the size of SIP. If after two years your portfolio is positive, you'll continue the SIP. After two years, if your portfolio is negative, you'll not continue the SIP. It is more to the nature of quality of sales or quality of purchase, which decides whether the SIP continues or not. Now Naveen can give you some number color or whatever you would ask. Sure. Thank you, sir. The numbers I believe you already have. Thank you. Got it. It answered in the earlier question also, numbers. Yes. I believe numbers you already have. Sure. Second question. You have another question also. Second question was on the expenses. How do you think the full year is going to pan out for the expenses, whether it's OpEx or whether it's the employee expenses? How do you think, where are the investments that we are making? How should we see about the overall expense growth compared to, say, FY 2026, what we had? We don't give guidance for future, but with respect to this quarter, I think I explained, if you look at it on a quarter-by-quarter basis. If you see specifically the employee expenses, that has shown a higher growth and this is on a quarter-on-quarter basis. The reason I explained, which was also mentioned in the previous call. If you look at it from an overall perspective, see, one thing is you must exclude when you look at our financials, our fee and commission numbers are also stated as part of the expenses, and hence we also give you the net yield. When you look at our expense base, you must remove that. Fee and commission on PMS alternates. Yeah. That should be removed from the expenses. You must look at the expense net of that. Being pretty much in line, whether it is on Q4 or on a Y on Y basis. Got that. Last question. What are the product launches that we can expect on mutual funds, AIFs, PMS, across these categories over the next one year or so? As you would have seen, there have been various approvals we have received. We came up with some SIFs in the first quarter. See, the whole idea of having products in ICICI Prudential is that we are preparing an AMC for the future also. When I've got four SIFs, it's not that SIF is going to completely change my P&L tomorrow, but I start creating a track record on those products. One has to think from a long-term point of view. Balanced Advantage Fund, we started some years. For three years it was only at INR 300 crores or something like that. Then after showing a track record, you start publicizing that. Irrespective of the nature of markets, whether the market is in a euphoric condition or the market is subdued, we will come up with our launches. You must be seeing a lot of launches, and you will see regular launches in the next nine months, and maybe Vipin can give some color on that. Hi. It is more for creating a product bouquet for the future. Don't look at the numbers alone. Look at more from the capability to create a track record, and then based on a track record, it can lead to future sales. Hi. The whole idea of launching ideas is to see opportunities available in market. There are multiple ideas which we are launching on MF side. Under MF, we have products which we have launched, currently running, which is under fund of fund categories. We are launching a new category, which we are super excited about, which is life cycle fund, wherein we have got the approvals. In near future, we should be launching those ideas along with the contra category, which has got approved. This is on MF side. Equally, we are excited on ETF. We have approvals in multiple ideas, and this is under MF category. If I have to talk about ideas under SIF, we have already four out of seven which are approved. There is one more approval which we have, which is under sector rotation SIF. This is on SIF side. Equally excited we are on the entire alternative ideas. We have a successful idea which is running, which is commercial real estate, which we will launch the next series of it, and we have multiple ideas under real estate and also on the equity side. Got that. Thank you. This is super helpful. This life cycle is a very interesting one. It will also have the year. Typically I will launch 2031, 2036, 2041. You're launching a year. The guy has got so much clarity. If you're retiring in 2041, you are collecting the money for 2041, or if your son's education is in 2036. It will help a lot whether it is retirement or a person's son's education, daughter's education, whatever is the goal, if it is in 2031, 2036 or 2041. I think SEBI has introduced a brilliant category. You'll see us launching those products in the year. Okay. Thank you. Thank you. The next question comes from the line of Dipanjan Ghosh with Citi. Please go ahead. Hi, good afternoon, everyone. A few questions from my side. First, when we look at your PMS business, obviously, it continues to do well. Even when I compare with your overall mutual funds or equity mutual funds, it seems that the growth rate sequentially has been far better for the last few quarters. I would presume that this favorable growth in PMS would be a factor of relatively higher flow contribution as mark-to-market differential might not be that high. I just wanted to get some sense of the structural driver behind these flows in the PMS business, and maybe some color on the distribution strategy or channel mix in that business. That's the first question. The second was on the advisory business. Dipanjan, let me first finish PMS, we'll go to the second question. Sure. First of all, your assumption that it may be more because of flows and not because of mark-to-market. Unlike in PMS, I've got a reasonably big pipe product also, where the composition of mid-caps, small-caps would be higher. To that extent, the mark-to-market over there would be higher. Having said that, in PMS, the overall alternates will not only have products like PMS AIF, which will be a factor of mark-to-market as well as sales. Also, when you sell alternates, a part of the AUM will come when you actually call for that money. Right? Suppose commercial real estate, if I am calling for 50% of the funds today and 50% later, in the AUM, you will see only 50%. Right? Whether it is private equity, whether it is any of the alternate products, you won't see the entire sales being reflected in the numbers per se, because the client will give the money later also. Overall, forget quarter or this one, it's a good business where you can take a better, different risk metrics than in the mutual fund. Mutual fund, I'm very clear that the retired school teacher is my target customer, and the risk management is that much more strict in the mutual fund side. Here, maybe we'll play with concentration risk. Right? In a mutual fund, typically, we'll have 50-plus stocks. In a PMS AIF, on an average, you would have 30 stocks. Right? That's what, if I have to play concentration, if I have to play more slightly higher risk parameter, here, the customer does understand that he's taking that incremental risk for the incremental return. Focus is on everything. In mutual fund also, on PMS also, we have segmented the market. In different market segments, we'll be focusing on different products. Got it. I hope that gives some color on the PMS. Sure. That's fair enough. Just maybe one small follow-up on that would be that, you mentioned that on the alternate piece, obviously, the AUM that you're reporting, it's fee-earning AUM. As and when you call the money, obviously, the AUM kind of see the jump. What's our trajectory, let's say, over the next two to three years? In a previous participant question, you also mentioned you have a pipeline for commercial real estate and some real asset funds also. How should one think of your aspirations in that segment? Let it become big. Let it become that material. Otherwise, we will spend too much time discussing that where it is not. I would rather first make it big so that it is material to discuss that. Today it is not that big vis-à-vis the overall AUM. Got it. Fair enough. Second was on the advisory business. The AUM in the advisory business has seen some moderation. Just wanted to get some idea on what are the drivers behind it. Advisory is more of international business. International business, you know there is a lot of FII selling that has happened overall in India, and similar trend would have been reflected in my interaction. Advisory is essentially advising international outfits. To that extent, there would have been redemptions, and that is why you would have seen lesser flows or lesser AUM over there. Last question was on the, coming back to the SIP part. To the extent possible, will it be possible to give some color of the SIP mix across some schemes or a broader mix, let's say, between hybrid, pure equity or anything that you can give some color on that part? I think we've only put out the number, which is on a total basis. We haven't given the breakup across the schemes. As you know which are the schemes in which we are bigger, the SIP numbers in those schemes, obviously, for us, also go in that line itself. It will be more on equity funds. Pure equity funds, the SIP will be more towards it. Luckily, we have a lot of investors who have varied requirements. We see a lot of SIPs coming in hybrid also. We see SIPs coming in multi-asset, SIPs coming in BAF, wherein customer is looking at products which are less volatile, and the goal is closer than what he needs in next three to five years. It's mix of both. Reply to your thing is, we don't market SIP separately and mutual funds separately. We market our mutual funds. Some customer prefers to. It would be in line with what Naveen said, it would be in line with our AUM story. Got it. Thank you, and all the best. The data is in front of me, but it is too dispersed to tell you any. It is spread across. I can see some 20 on my screen in front of me. I can see some 20 schemes. There is no problem in sharing the data, but it is spread across. Got it. Sure. Thank you and all the best. Thank you. Your next question comes from the line of Shreyas Pimple with Nomura. Please go ahead. Hello. Thank you so much for the opportunity. Understand the color of investment book that we have, INR 4,225 crore. The reason is for the quarter, we have seen INR 181 crore of other income, which amounts to around 17% of annualized yield. I understand you highlighted that small cap, mid cap, and large cap had different kinds of MTM gains in the quarter. What I wanted to understand the color of this investment book. First of all, you have highlighted mutual funds, AIF, and corporate bonds as segmentation. How much of the 23.5% AIF, other equity and REIT is subject to mark to market? That was the first question. Second question on that was how much of the investment book would be around in large cap, mid cap, and small cap, if you can give the bifurcation. On a broad basis, we mentioned earlier as well, if you look at our overall investment book, about 50% of the investment would be on account of seed capital. The seed capital is effectively, most of it is driven by the SEBI formula. To that extent, it is largely driven by the mark to market as we get in the respective underlying asset classes. Now vizavi is March to June. Obviously, as of March, you would have seen in our numbers there was a market fall as on towards the last days of the month, last days of the quarter, hence there was a big mark to market loss. As of June, towards the end of June, on 30th June, the markets were up. Hence, we had a mark to market gain. 50% of the overall investment in seed money is what you should take as a ballpark number. Got it. Just on that, 23.5% is into AIF, other equity and REIT. How much of it is subject to MTM? We'll come back to you on the number separately, but broadly, if you see, as I said, the other way of looking at it is 50% seed and 50% non-seed. Got it. Yeah, that was the only question I had. Thank you so much. Thank you. Your next question comes from the line of Abhijeet Sakhare with Kotak Securities. Please go ahead. Hi. Good evening, everyone. My first question was on the OPEX. Now, just from an accounting point of view, when we have the salary hikes for the year, does that get spread out throughout the four quarters, or there is a first quarter impact playing out there? The salary hike would be on actual basis. Whatever gets paid out on a month-on-month basis is what you would see as a reflection in the number. The salary is increased only once in a year in April. Whatever is increased has been increased for the whole year. Abhijeet, if you're looking at the number vis-à-vis the last quarter, I think I mentioned in my opening remark as well, and we had mentioned in the last analyst call as well. Last year, there was no charge on account of ESOP or similar head. This year it has come in, and in Q4 specifically, there was also a reversal of any such charge that we had provided for in the previous quarter. To that extent, the numbers are looking elevated. When you look at the total employee cost on a Q1Q basis. Got it. Looks like this is like the quarterly run rate. I mean, the ESOP point you had clarified earlier, even from a salary hike or salary revision point of view, there is nothing in terms of one-off in the first quarter in terms of the normal seasonality as well. This is the quarterly run rate. You're right. Just to clarify, obviously these quarter numbers and also the previous quarter numbers now include Venture as well from an expense perspective also. Understood. Is it possible to quantify the impact because of Ventures? That has not been really material. Okay. It's a small number, as you know, the entire business acquired, but run rate basis, you must now take the June quarter number as the quarterly number. Understood. Got it. That was the only question. Thank you so much. Thank you. The next question comes from the line of Mohit Mangal with Centrum. Please go ahead. Good evening, and thanks for the opportunity. My first question is that, in the opening remarks, you said that there's no negative impact on account of changes in TER regulations. Fair to assume that you have passed on all to the distributors? Yes. Okay. Thanks for the clarity. My second question is towards the employees. We have seen that employee count has increased 6% sequentially. What was the reason for that? If you look at it from a quarter-on-quarter basis, sometimes the hiring happens in a particular month and the count increases mainly on account of additions that we do at the sales level. Typically, campus hirings happen in the Q1, the employees come in Q1. Sometimes the Q1 number looks elevated, but I don't think you must read anything more than that in those numbers. Understood. There's also a small addition on account of employees that have come over from ICICI Ventures as well. Understood. Lastly, in terms of debt, I think, the growth kind of has come down sequentially, and even on year-on-year basis, it's in lower single digits. Any kind of color on the debt AUM? I think Nimesh answered that a little while back. Effectively, it's a reflective of what has been the behavior of the institutional customers who park money in the debt scheme. If they see the usage of that money more in their business and for their working capital purposes, you would see this money moving out of the debt liquid schemes into their respective businesses. I think that's what we have witnessed at the industry level in this quarter. Understood. This is helpful. Thanks, wish you all the best. Yeah. Thank you. The next question comes from the line of Neeraj Toshniwal with UBS. Please go ahead. Hi. On the alternates net yield of 95 basis points, just wanted to understand how the trajectory will kind of move forward because it has been quite volatile over the last couple of years. Just want the sense that how should one model it and what is the right way to think about it? I think we mentioned it earlier also. What we have observed is that these yields and the net yield in the alternate business typically hovers between 90 to 100 basis points, and the difference is also on account of the composition of the product mix. It's a function of that. It's pretty much in line with the larger range that we've seen over a period of time. Sure. On the new products which you mentioned, like life cycle products and all, how is the mix? Do you mostly look towards debt within that given it's goal-based, and how you're thinking about it and what kind of yields we should be building in those products? If any more color you can give. These are more like insurance endowment kind of products, which is very goal-based. Just wanted to get some sense. Do they kind of conflict with insurance products or it's totally a new way of building out the product allocation, asset allocation within that? Of the alternate AUM, if you look at, we mentioned those in the numbers as well. The largest component is the PMS AUM, which is long only equity. Any inflows that come in is from across clients, and that is more equity-linked. This is the case where we have Category III AIFs where again, it is equity invested. Only in the Category II funds, whether we have private credit or commercial real est ate or any other funds. That is where it's more debt linked. The new launches, whether it is the new scheme on the PMS or the AIF side or Category II would be there in all categories. This life cycle fund would be outside of this AUM or? Life cycle is more on MF side, and as per SEBI regulations, they follow the expense structure, which is predefined by SEBI. The asset mix, what would be likely assumption within that? The way SEBI has structured these products is they start with more of equity initially, and over Suppose you have taken a 2041 product, initially it will be more of equity, less of debt. As the years go by and as you go near the redemption, the debt component of those funds will increase. Okay. More of like a NPS approach then. Yeah. Sure. Yeah, got it. Yeah, that's it from my side. Thank you. Your next question comes from the line of Pranav Tendolkar with Rare Enterprises. Please go ahead. Pranav, your line is unmuted. Please proceed with your question. Hello? Yes, Pranav. Please proceed with your question. Yeah. Thanks a lot, sir. Sir, can you just tell me what kind of yields on an industry level you see for active equity funds? Are they holding up? That's one. Second is that there are so many questions that are asked on SIP. Do you see any structural change in investor behavior of SIPs? That's it. Thanks a lot, sir. I'll take the SIP one, the easier one first. I think SIP is the way India. There's nothing new about SIP. This is how India saves. Even when there was no systematic investment plans by mutual fund, there was a recurring deposit with banks. Customers always preferred every monthly. It's the way India saves. There is nothing new or strategic new. I think SIP has been doing well because it is a customer need, because customers in India save monthly. Nothing new about SIP. What was the first question? It was about? Active equity. Yields. Sustainable yields. You see that sustainable yields will be around this, right? Barring whatever structural changes we are doing because of the real estate fund and other AIFs, et cetera, structural yields you see holding up, right? On the mutual fund side, SEBI has done a very good job of regulating the expenses, the expenses keep on coming down as the size of your fund increases. That is the best thing to happen because it has become a very good product for the customer, from a push product 20 years back, it has become a pull product today where people sell mutual funds that the customer gets attracted to their website and then they can do other products. This transition has happened because the charge on the mutual fund is very less. I think that's the best thing to happen. The probability of beating the benchmark increases to that extent. The mutual fund has become a pull product from a push product only because we charge less. I think SEBI has just changed the way we charge, this structure, almost at 100 basis points, he gets a product which is actively managed, the customer. Thank you, sir. Thank you. The next question comes from the line of Divij Punjabi with Banyan Tree Advisors. Please go ahead. Yeah. Hi. Thanks for the opportunity. I have two questions. First is, what is the current view on small and mid-cap valuation? In an investor's call where I'm looking at, I am not getting into the market calls and all, right? There are separate calls we do for the investors on where we see the market and why. Overall, we have always believed that the way you position in the market. Let's discuss this when we are talking to the investors call, not when you are my investor in the mutual fund, I discuss that. Sure. I wanted to understand from a sales point of view some time ago, like you're not pushing small and mid-cap because of the concerns around valuation. Sure. Second one is around the passive After two years of mediocre performance, the situation is not the same as it was in September 2024. All right. Sure. Second one is around the growth in the passive, which has come out quite good. What is the driver of this growth? Passive, if you're looking at the numbers, we know there was a lot of inflows, especially in the categories of gold and silver at the industry level also. That has been one of the big drivers. Apart from that, the rest of the growth has been pretty much in line with the overall industry. Passive effectively comprises of, as you know, ETF and index funds. On the index fund side, of the total passive index base is small. ETF, there are also a lot of institutional investors who park money on the ETF side. The growth numbers are also driven by their appetite or their change of focus. Barring the flow increase that we saw, if you look at it on an year-on-year basis vis-à-vis gold and silver, the numbers have been pretty much in line with overall industry. Okay, sure. Thanks. Thank you. The next question comes from the line of Gaurav Jani with PL Capital. Please go ahead. Thank you. The first question is, hopping back again on the staff cost. Excluding the ESOP charge that would have been recognized in the quarter, barring the appraisals which generally are chunky in nature or quarterly in nature, staff cost logically should rationalize, right, in the coming quarters? I think, Gaurav, I gave the explanation. If you are looking at it vis-à-vis last year, if you look at it on a year-over-year basis, our employee cost has gone up by 11%. That is the right comparison that you should see. If you are looking at it from a quarter-over-quarter basis, you would see a larger increase, but that is because of the one-time phenomenon that happened in last quarter of last year. I explained that earlier as well. There was some of the reversals that we had done in the previous quarters. That is why the numbers are quarter-over-quarter basis is looking higher, but the number that you see now for this quarter is the right base to look at. This is the run rate for the quarter. I understand the base, which you had anyway explained, I think in the last quarter. What I am going to get at is after Q1 of 2026, right? There was a moderation in staff costs sequentially, which I believe was related to the appraisals which happened in Q1, sir. If you look at Q2 2026 over Q1 2026 or Q3 over Q2, there was some moderation, sir. Your first assumption itself is not in line with how this company functions. Whatever changes were to make on the compensation would have happened from April 1st onwards. Right? Whatever is effective April 1st onwards, that will be accounted in that quarter itself, April, May, June. It does not happen that you do appraisal in April and the salary starts increasing sometime in the next quarter or something. It happens on 1st April itself since the time the company has been in operation. It is effectively an annual performance appraisal cycle. Effective 1st April. Compensation change happens in the month of April. Effective 1st April. Understood. Sure. Coming back on the SIP, just one thing I wanted to check with you guys. For the industry, SIP on a quarterly basis has increased by 1%. It's been a while since we have seen such a low growth. INR 938.5 billion over INR 929.3, translating to about 1%. Would we be in line with the industry in that sense or would we be kind of lower or higher? Sorry, which is the number? You're referring to SIP AUM? SIP flow for the quarter for the industry. That has only been sequentially up about 1%, which has been a while, such a low number. Just wanted to check, are we in line with industry or lower or higher in terms of the quarterly growth in SIP flow? Our numbers would trend that of the industry on a quarterly basis. You are adding April, May, June number for the industry. Our numbers also would be pretty much in line with that of the industry. Perfect. That is what I wanted to check. Thank you so much. Thank you. Ladies and gentlemen, we will take that as the last question for today. I now hand the conference over to Mr. Naveen Agarwal for closing comments. Thank you everyone. We appreciate the interest shown by the analyst and investor community. Thank you very much and wish you all a very good evening. Thank you. On behalf of ICICI Prudential Asset Management Company Limited, that concludes this conference. Thank you everyone for joining us, and you may now disconnect your lines.