Ladies and gentlemen, good day and welcome to L&T Finance Limited Q3 FY 2025 earnings conference call. As a reminder, all participant lines will be in the listen-only mode, and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal an operator by pressing star then zero on your touch-tone phone. Please note that this conference is being recorded. We have with us today Mr. Sudipta Roy, Managing Director and CEO, Mr. Sachinn Joshi, CFO, and Mr. Raju Doddi, COO, and other members of the senior management team. Before we proceed, as a standard disclaimer, no unpublished price-sensitive information will be shared during the call. Only publicly available documents will be referred to for discussion during interaction in the call. While all efforts will be made to ensure that no unpublished price-sensitive information will be shared, in case of any inadvertent disclosure, the same would, in any case, form part of the recording of the call. Further, some of the statements made on today's call may be forward-looking in nature. A note to this effect is provided in the Q3 results presentation sent out to all of you earlier. I would now like to invite Mr. Sudipta Roy to share his thoughts on the company's performance and the strategy of the company going forward. Thank you, and over to you. Thank you so much. A very good morning, everyone, and thank you for joining us today. I'd like to wish all of you a very happy and prosperous new year on behalf of the entire leadership team at L&T Finance. Today, with me on the call are our CFO, Mr. Sachinn Joshi, and the senior management team of L&T Finance. Today's call is divided into two sections taken sequentially by myself and our CFO, Mr. Sachinn Joshi, who will be talking about the overall business metrics and financial performance at length. Post that, we'll be happy to take questions on the call. Before moving on to the highlights of the quarter, I would like to give you some flavor on the macroeconomic scenario and the sectoral outlook. The global backdrop remains uncertain at this point in time, as possible policy pronouncements in the U.S. cloud visibility of outcomes in global trade and financial markets. In the meanwhile, strong growth momentum and high policy rates in the U.S. continue to drive flow of funds toward the U.S. dollar assets, adding pressure to the financial assets in the rest of the world. Sharp shift in the external landscape has triggered tighter liquidity conditions and currency volatility in the domestic financial market as well. In the meanwhile, delayed government spending, mixed demand signals, and credit squeeze have hit the GDP growth momentum in the domestic economy. Slower urban consumption and moderate investment activity have only partly been offset by rural recovery, leading to a sharp dip in growth during the second quarter of FY 2025. Government's first advanced estimate of real GDP highlights a tempered pace of economic activity in FY 2025 at 6.4% annual growth, well below the 8.2% growth in FY 2024. Acknowledging the headwinds to consumption demand and private investment in the economy, RBI has also revised down its real GDP growth projection for the current fiscal year. RBI has revised up its inflation projection, highlighting the challenges of bringing down the headline inflation to target level in the current fiscal year. While headline inflation has seen some moderation in November and December, as improvements in mandis arrival of vegetables and bumper Rabi harvest helped ease price pressure on volatile components. Core CPI inflation and WPI have seen some uptake, indicating broadening of the inflationary pressure on the economy. High inflation level and delayed government spending have hit the disposable income available with the consumers for discretionary spending. Urban consumption has shown signs of fatigue with the exhaustion of pent-up demand, while rural consumption, despite gradual improvement, remains inadequate to offset the urban drag. Unexpected weather events, depreciating currency, and worsening of geopolitical conflicts constitute major upside risks to the expected moderation in inflation levels going forward. Hence, monetary and fiscal policy interventions to support consumption are key to a sustained growth recovery in H2. In the quarter ahead, we expect rural recovery to continue and hope for uptake in urban demand as inflation levels drift lower. Some of the squeeze in economic momentum is always reversing in Q3 FY 2025, and fiscal support has picked up as well. With further fiscal and monetary support expected in the upcoming budget announcements and monetary policy announcements, we keenly watch for these early green shoots to turn into strong growth drivers in the coming months. I would like to share that despite the challenging operating environment in the macro-finance sector, our diversified franchise has enabled us to achieve the highest first-quarter disbursements of INR 15,210 crore, a growth of 5% year-on-year, and we have been successful in sustaining the trajectory in line with the L&T 2026 goals. Our retail book now stands at 92,224 crores, a substantial growth of 23% year-on-year. The numbers reflect the strong execution engine aided by a proactive portfolio management and prudent risk management that we have put in place over the last couple of years, and we will continue to bolster the execution bias in every initiative we take. Many of you have attended our Investor Digital Day in November 2024, along with RAISE24, our AI BFSI conference, where we showcased several of our technology initiatives, some of which could be transformational when successfully completed. I'm pleased to share that the progress on these initiatives during the last quarter has been satisfactory. Our next-gen credit underwriting engine Project Cyclops was extended to 100% of dealerships in Two-Wheeler Finance and was also launched for the farm equipment finance business. In our pursuit of innovation and fostering partnerships within the lending landscape, we established a strategic partnership with Amazon Pay to develop cutting-edge credit solutions while also extending PhonePe partnership to Personal Loans, thereby delivering a seamless digital lending experience to our customers. Additionally, we launched knowledgeable AI KAI and AI-powered chatbot that revolutionizes the home loan experience. Furthermore, as announced in Investor Digital Day, we have commenced to work on Project Nostradamus, a first of its kind, AI-driven automated portfolio management engine. We intend to release a beta version of this new technology engine in Q2 FY 2026. As we look ahead, we remain dedicated to driving innovation and enhancing our offerings to better serve our customers. Now, I would like to provide an update on our quarterly performance against the L&T 2026 goals. The first milestone was to achieve retailization of greater than 95%. I'm pleased to share that we have surpassed this target with 97% retailization at the end of this quarter. We had earlier set ourselves a retail book growth target of 25%. However, given our outlook of the business environment in different segments, we have consciously chosen to slow disbursements in segments where risk-reward was not in our favor. Consequently, our retail book growth for the quarter stood at 23% year-on-year, a growth rate that we are satisfied with given the current circumstances. Specifically, as delineated in slide number 30, you will observe that quarter 3 FY 2025, our RBF disbursements were calibrated downwards to INR 4,599 crores, while simultaneously in other business segments such as Farmer Finance, Housing Finance, and Personal Loans, we have maintained growth trajectory based on our confidence in our new generation underwriting capabilities and the market potential. In particular, we have skewed our sourcing efforts towards onboarding more prime customers who, in general, exhibit credit resilience during downward credit cycles. In line with this, in the two-wheeler business, 69% of our disbursements in the month of December 2024 was to the prime segment, a number which has jumped to 75% + in the elapsed timeframe in January 2025. Thirdly, the retailization thrust had to be credit-calibrated with a goal of retail GS3 below 3% and NS3 below 1%. I would like to inform that while the quarter witnessed increasing slippages owing to macro challenges in the RBF segment, the retail GS3 and NS3 levels stayed close to the threshold levels. The corresponding consolidated asset quality metrics in this quarter remained healthy, with GS3 at 3.23% and NS3 at 0.97%, which is below the long-term threshold of 1%. The fourth and last milestone on ROA front. We have moved from tracking retail ROA to consolidated ROA in the range of 2.8%-3% as per our original long-term 2026 targets. Our consolidated ROA for quarter 3 FY 2025 stood at 2.27%, down 26 basis points year-on-year, which is a mix of two factors. First, the compression in NIMs and fees on account of a conscious calibration in RBF business and an increase in credit cost during the quarter. I would like to highlight that our credit cost over the past 12 quarters has been in the range of 2.6%, thereby displaying predictability across cycles. We remain confident that in accordance with the initiative towards sourcing better-quality customers and investing in next-gen underwriting platforms like Cyclops, along with the improvement in macroeconomic environment, will help us resume our journey towards delivering the 2.8%-3% ROA. Now, I'll likely quickly run you through the key highlights of our performance in quarter 3 FY 2025. We recorded a consolidated profit of INR 626 crores in Q3 FY 2025. Despite the calibration in RBF disbursements, the retail disbursements for the quarter stood at INR 15,210 crore, registering a 5% year-on-year growth driven mainly by robust performance exhibited by the Farmer Finance, Housing, Personal Loans, and SME segments. Retail book for quarter 3 FY 2025 stood at 92,224 crores, up 23% year-on-year, and consolidated book grew at 16% year-on-year, reaching 95,120 crores in quarter 3 FY 2025. Our five-pillar strategy continues to be central to our roadmap to the future. We continue to granularly execute the five-pillar strategy, details of which are available from slide number 12 to slide number 28 in the investor presentation. The year had a challenging operating environment with certain macro events like prolonged heat wave, severe floods in several states, and temporary slowdown of government expenditure and grants due to general elections, leading to an increased credit cost for the rural group loans and microfinance business portfolio, thus warranting a case for utilization of the macro-prudential provisions created during COVID, which was in FY 2021 and FY 2022. We estimate, based on current trends, that before utilization of macro-prudential provisions, the total credit cost in the rural group loans and MFI business will be in the range of INR 950-INR 1,000 crores for the full year FY 2025. In light of the above, the audit committee and the board have approved the utilization of an amount of INR 100 crore out of the macro-prudential provisions in quarter 3 FY 2025. Our advanced estimate of the macro utilization in Q4 is in the range of INR 300-INR 350 crore, based on a peak credit cost on the roll-forward book of Q4 FY 2025. With the abating of the macro events and the early green shoots of stabilization of collection efficiency in December 2024 and January 2025 till date seeing slightly better than the same time last month, we anticipate an improving collections efficiency trajectory for the rural group loans and the MFI portfolio during February and March 2025, thus signaling sustained recovery trends in this business. Our analysis tells us that the onset of MFIN 2.0 guardrails from April 2025 will ultimately lead to the recovery of the credit profile of the sector, albeit at a marginal cost to growth. This norm should be value-attractive for participants with high-quality franchises. As asked by many of you in our earlier calls, we have endeavored to give you detailed portfolio cards on our RBF business in the investor presentation. You may please refer to slide number 16-20 and slide number 35 of our investor presentation for the same. We are currently evaluating adopting the CGF credit guarantee scheme in certain geographies and segments to optimize the unforeseen event risks in the RBF business. We'll be in a position to provide greater details around this in the subsequent quarters. As mentioned earlier, we would now like to give a brief update on the five pillars of execution that we had enumerated over a year back and continue to be in implementation mode against the same. Customer acquisition, we are continuously working on deepening the customer acquisition funnel, both horizontally as well as vertically. And in the last quarter and this quarter as well, our focus has been on new customer acquisition, albeit with the necessary credit adjustments to maintain future portfolio quality. Accordingly, there has been a calibrated channel optimization in two-wheeler and rural finance business vertical with sustained focus on better quality and under-leverage customer acquisition. Hence, we added a total of 5.8 lakhs new customers during the quarter. Further details around customer acquisition and repeat share are available on slides 13 and 14 of the investor presentation. Sharpening credit underwriting, our proprietary credit engine Project Cyclops, which was operationalized in quarter 1 FY 2025, has been extended now to the tractor business, which is currently live with 24 scorecards and having been scaled to 100% of the two-wheeler dealership, where it is currently live with 18 scorecards, showcasing encouraging results with Net 0+ reduced by 120 basis points in the two-wheeler portfolio over a four-month period when benchmarked to the non-Cyclops portfolio. Cyclops will be implemented for the Personal Loans and SME business loans in the coming quarters. Futuristic digital architecture, we have spoken at length on our technology initiatives on our Investor Digital Day, and granular details on our technology initiatives have been provided for each line of business. Our biggest technology initiative for next financial year will be operationalizing Project Nostradamus, a state-of-the-art, first-in-industry AI-driven automated portfolio management engine. Brand visibility, we continue to focus on our brand building with Jasprit Bumrah as a brand ambassador for L&T Finance products, having successfully concluded RAISE, India's premier AI-themed event in the BFSI sector, which saw more than 8,000 registrations and reached an engagement level of 3 lakhs. We participated in the India Bike Week 2024, where the unveiling of the LTF Zoom two-wheeler loans took place. As we move ahead, you will see a set of integrated marketing campaigns and targeted branding exercises in the upcoming quarters. Capability building, on the capability building front, I'd like to inform you that the regional business head structure was further strengthened during the process with institutionalization of periodic reviews and processes. Additionally, we worked upon capacitating and upgrading our infrastructure at various branches across the country, while also opening an integrated technology operations and data science facility at Mahape, Navi Mumbai. On the employee initiatives front, we continued to work around performance and productivity with the introduction of integrated employee scorecards and took several employee engagement measures during the quarter, details of which have been provided in slide number 28 of the investor presentation. As part of our strategic growth map, we are committed to building a well-diversified asset profile, minimizing concentration risk on any single line of business. With that end goal in mind, we remain committed to growing our existing and new lines of business, while also looking at synergistic opportunities. Among our new product initiatives, our team has been successfully scaling our Micro LAP, warehouse receipt finance, and supply chain finance products. In the Micro LAP domain, as we shared in our Investor Digital Day, our existing distribution is being leveraged to upsell this high-secured, high-ROA product to the cream of our RBF customer base. The Micro LAP asset book has crossed the milestone of INR 300 crore in Q3 FY 2025. Some of you may recall in our Investor Digital Day, we had called out a book size of INR 214 crores for this business, exciting growth, albeit on a low base. Similarly, our warehouse receipt finance business housed under our Farmer Finance vertical also has shown encouraging initial traction. This business, which operates on a first-of-its-kind completely paperless journey and digital workflows driven through a network of 25 branches and presence in 80 mandis, has achieved cumulative disbursements of INR 350 crores in FY 2025 YTD. Lastly, our supply chain business housed under the SME vertical was launched in Q3 FY 2025, and while it is still early days, we are optimistic that this business too can scale significantly and profitably. I will now request Mr. Sachinn Joshi, our CFO, to take you through the financial updates. Thank you, Sudipta. As always, I'll be walking you through the financial performance of the company for the quarter. Consolidated NIM plus fees stood at 10.33% versus 10.86% for Q2 FY 2025. Of course, this was on account of a conscious shift in the disbursement and book mix due to a challenging credit scenario in RBF. Consolidated PAT for the quarter stood at INR 626 crores. Healthy quarterly disbursements, Retail Disbursements were seen at 15,210 crores, which are up 5% year-on-year. Our retail book stands at 92,224 crores. This is up 23% on a year-on-year basis on the back of healthy Retail Disbursements during Q3. Our consolidated book stands at 95,120 crores, which is 16% up year-on-year. Consolidated ROA stands at 2.27%. It is down 26 basis points year-on-year, and consolidated ROE correspondingly is down at 10.21%, down 1.14% year-on-year. Coming to retail businesses, let me start with Rural Business Finance. The business registered quarterly disbursements of close to 4,600 crores. This is down by 16% YOY, the trajectory aided by prudent disbursement strategy. The book size reached 26,231 crores. It's down 1% quarter -on -quarter, but up 14% year-on-year in Q3. Coming to Farmer Finance, the disbursement stood at 2,495 crores in third quarter, up 23% year-on-year. Better than average monsoon and festive season demand resulted in a double-digit growth. This led to the book size reaching 15,075 crores, reflecting a growth rate of 9% year-on-year. On the urban segment, Urban Finance, the segment which comprises two-wheeler, personal loan, home loan, LAP businesses, it saw a 21% year-on-year jump in overall quarterly disbursements. As a result, the overall book size increased to 43,957 crores in third quarter, translating into a 31% year-on-year growth. The two-wheeler business registered a quarterly disbursement of 2,414 crores, which is down 5% year-on-year, partly due to strengthening of the documentation and credit guardrails taken by us during the quarter for sourcing of better quality credit-tested customers and shift towards prime customer base. The book size increased to 12,676 crores, which was up 21% year-on-year. On the personal loan front, we achieved disbursements of INR 1,642 crores, translating to a growth of 94% year-on-year, with the book size at INR 7,820 crores. This book has increased by 22% year-on-year. During the quarter, double-digit growth in this segment was led by scale-up of fintech partnerships and expansion of physical distribution through the DSA channel, with focus on salaried prime customers. Our large partnership business has already started meaningfully contributing to our origination volumes. It was around 12% of the overall disbursements done during the month of December, up from a mere 3% contribution in September 2024. On home loan, we achieved quarterly disbursements of INR 2,475 crores. This was up 24% year-on-year, and the book size stood at INR 23,461 crores, an increase of 41% year-on-year, while maintaining a pristine secured portfolio performance. Coming to SME Finance, our Q3 FY 2025 disbursements stood at INR 1,249 crores, up 29% year-on-year. The book stood at INR 5,817 crores. The growth in business volumes was aided by building additional channels to diversify the existing sourcing funnels. Let me now hand over the call back to Sudipta to make his closing comments. Thank you, Sachinn. In conclusion, quarter 3 FY 2025 has been a challenging quarter for the entire industry. Our teams have worked extremely hard to deliver a reasonable outcome for us. We are cautiously optimistic that the worst is behind us, and we are hopeful going into our annual business planning exercise for FY 2026 that we will be able to continue delivering on our promises of asset growth, profitability, and ROA. I thank you all for our patience sharing. We now open the floor to questions. Thank you. We will now begin the question and answer session. Anyone who wishes to ask a question may press star and one on the touch-tone telephone. If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use handsets while asking a question. Ladies and gentlemen, we'll wait for a moment while the question queue assembles. The first question comes from the line of Sanket Chheda with DAM Capital. Please go ahead. Yeah, hi sir, good morning and congrats on a pretty good set of numbers, more so on MFI front where we have been meaningfully better versus peers. So my query was on one of the notes to accounts wherein we reversed to P&L account as you mentioned. But when we see the credit cost ex of the overlay also, it seems that the benefit has not been taken into P&L. So has that been resolved for the SRs that we would have received against this ARC sale? Just a clarity on that is what I would request. Sachinn, there was a disruption in between. We lost majority part of the question. For the benefit of others on the call, can you repeat the question once again? So, sir, my question was regarding the ARC sale related notes to accounts wherein we have mentioned about 250 crores of provision reversed to P&L. But when I see the credit cost X of overlay also, it doesn't seem that we have taken that benefit. Is it that we have resolved that 250 which was available for reversal against the SRs that we have? And once that SRs get monetized, that's the time when it will be reversed on P&L. Yeah, thank you, Sachinn. Thank you for asking that question. There have been some queries on this. You are right. Actually, as for India's accounting, we cannot take whenever transfer of assets happens to ARC. The provision reversal is just a routine item which comes as a credit. But 85% of whatever asset goes to the ARC comes back as an investment on the book. So in this particular case, INR 250 crores got first credited. It got reversed to the P&L, and then the same amount of provision was created when the SRs were created on the books of the 85%. I will just enumerate the exact chronology and the numbers that have been shown over there. So INR 776.37 crores was the principal outstanding of the loan transfer. This was the cost. The EAD against this was INR 815 crores. And this INR 815 crores of asset was actually sold at a gain at INR 833 crores. So about 18 odd crores of gain was made on this. This 75% of this INR 833 crores was actually booked as an investment, which comes to INR 708 crores. Against this INR 708 crores, we have first of all adjusted the profit made on this because that also cannot be taken to the P&L. 18 crores was adjusted, and the INR 250 crores which was reversed to the P&L was also adjusted against this. Totally INR 268 crores has been adjusted against the INR 708 crores of SR value. The net carrying value in our books as of 31st December stands at INR 440 crores. Because both are the assets on the loan book also is being accounted through the FVTPL route, and the investments are also accounted for in the same way, you can't see the actual provision which has been made, which has actually got subsumed into the financials. Maybe when we do the 31st March full-fledged financials, this will be visible. But yes, you are absolutely right that there was no credit taken and adjusted against the credit cost. This is just a setting of just getting reversed from loan book and getting again adjusted towards the SR security receipt which has been booked in the book. I hope it clarifies. Yes. And this was a real estate account, right? That's right. That's right. Sure, sir. That's all. Thank you, sir. Thank you. Thank you. Next question comes from the line of Digant Haria with GreenEdge Wealth. Please go ahead. Yeah, hi. Thank you for the opportunity. Two questions, though. First is that you mentioned that our tractor and two-wheeler, we have significantly reduced the risk by going more towards the prime segment. So when I look at your provisioning, even if I remove the whole microfinance-related provisions of 170 crores this quarter, we are roughly at a run rate of, say, 400-450 crores of provisions for the quarter for the rest of the business. So do you think that the benefits of this whole moving towards prime and this better underwriting, all of this is already showing in the provision number, or the credit cost can still go down further in the non-MFI part of the business? That's my question one. Okay. So yeah, Digant, in a sense that the full benefit of all the work that we have been doing is still not visible because it is a gradual process. You have a legacy portfolio or at a particular trade profile, and you have this new portfolio coming in at a lower credit cost trajectory. Obviously, the new portfolio has to build, and the old portfolio has to wash out for the entire benefit of this to be visible. So I would reckon that it will take a couple of more quarters for this to be fully visible. It is not fully visible yet. However, internally, when we monitor the credit performance of the new portfolio vis-à-vis some parts of the legacy portfolio, that is already visible to us, but it will take a couple of more quarters to fully classify. So just to add in terms of numbers, if you recall, in the previous quarter, we had made a mention that there were a couple of steps taken, especially on the farm portfolio. We had stopped the repossession at 90 +, and there will be an impact on account of this through the roll forwards for a couple of quarters. I think by Q4, that impact should get over. So one is on the farm portfolio, this is the impact. On the two-wheeler, the tier two, tier three, tier four, those kind of cities, the impact which you saw in the micro loan piece, we talked about the rural, there was some impact on account of heat wave and all across the country. So two-wheeler also, after Sudipta has come in, we have already changed the strategy and started moving towards prime. And as we speak, I think 49% to 50% of our book now is prime. The impact on the credit cost will start because as this book starts seasoning, you will start seeing the impact coming into the P&L. And I think two to three quarters is what perhaps we will take to see the complete benefit of the pristine quality of the two-wheeler book which is being built now. Yeah. And Digant, if you see, we have put in two additional slides this quarter in the investment deck, which is slide number 23 and slide number 24, where we have given an index representation of two-wheeler portfolio balance. And you will see that our two-wheeler portfolio balance is already at about on an index basis at 84% in December 2024 compared to 100 index in December 2023. So it is also trending down. And if you look at our sort of Net Non-Starter in our farm equipment finance business, which is basically the number of people who bounced their first EMI, right, that is at 25% level compared to the same number in December 2023. That means in December 2023, 100 people bounced the first EMI. In December 2024, only 25 people bounced the first EMI. So we put this in an index form just to sort of demonstrate the better quality portfolio that we have been focusing on building and how some of it is showing up in the leading indicators, which is the bounce rate. We consider bounce rate being the leading indicator of credit quality, and that is currently trending well. Obviously, this over a period of a couple of quarters will find its way into the credit performance because as the new portfolio builds with these better credit parameters, that should obviously translate into lower credit costs. Perfect. Perfect. Thank you so much for the detailed answer. Second question is, Sudipta, on this whole NIM plus fees guidance, we have it in the corridor of 10%-11%. But now let's say we have done quite well in microfinance versus competition or versus what the general sector is. But that also maybe next two, three quarters, the growth may not be as strong as it was in the past. So obviously, that fees and the fees plus interest income is highest in that division. How do we compensate that given that we are seeing more growth in the LAP home loan portfolio, which are obviously at much lower IRRs? So how does this whole trade-off work for the next 12 months? And then is the 100 crore of extra OpEx that we saw in this quarter related to collection efforts in microfinance division? Yeah. So I'll give you the answer to the OpEx question. That's very straightforward. The fact is that this being the festive quarter, we had certain festive-related spends. Secondly, as you are aware and we had informed last one is that we have actually beefed up our collections workforce. So that has got an additional component of expense. Plus, there were certain technology-related expense during this quarter because we have been operationalizing Cyclops across all our lines of business. So these are the three primary main drivers for some of the increased OpEx that we have seen this quarter, and so on the NIM and fees, yes, there is no easy answer to this. This is a journey that we have told that we are going to travel, and obviously, the sort of ongoing trade challenges in the microfinance sector obviously does not help us sort of does not smoothen the journey for us. Obviously, there are a couple of things to this. First and foremost thing is that we have to increase our fee base. We are working on increasing our insurance penetration. Right now, we do insurance only at origination. However, we have a full insurance distributor license right now. Now we can sell through the life cycle. That team is building. We are putting together a technology platform for the same. So we are hopeful that over the next couple of quarters, some more of those fee revenues will come in. In terms of growth, we are trying to grow our slightly higher yield secured business. For example, our micro loan business, though, a little bit on a small base, we are trying to grow it. We already have 80 branches. We are going to grow it much more in the next couple of quarters. You can see that Personal Loans have been growing quite well. Personal Loans, on a quarter-on-quarter basis, has, on a year-on-year basis, grown by about 94%. Our large partnerships are scaling up well. And one of the things we have noticed is that in terms of digital delivery, sometimes you can sort of work on increasing your interest yield without losing too much of expense on that. So we'll work on some part of nullification for our Personal Loans growth. And we are hopeful that even though certain markets in the RDF business, JLG business, there is stress, there are certain virgin markets where actually you can safely grow. And I can give you an example. There are certain markets that we have ventured into in the last couple of quarters, new markets like UP and Telangana. Our collection efficiency is 100%. And we continue to sort of judiciously deploy our branches there. We are focusing on Western UP where collection efficiency trends well. We are focusing on Western Maharashtra where collection efficiency trends well. So we are finding those pockets in the JLG business where our collection efficiency is trending well and where we can do safe non-leverage business. So it's a tight balancing act. And I do believe that it will not be easy, but we will try to definitely be within that corridor. Obviously, there's one large sort of part wherein if a possible RBI rate cut or a couple of cuts were to come next year, that will probably ease the challenge a little bit. But we cannot obviously count on that completely. So overall, a couple of irons in the fire, and we will continue to work towards sort of that trajectory. Just to add, in terms of the overall modeling, yes, last quarter we had mentioned that it could be in the range of 10.5-11. But directionally, just like your two-year earlier question, we were talking about how we are moving more towards prime. So what would happen directionally over a period of time? Maybe the NIM plus fee, it may actually be slightly downwards. But at the same time, the OpEx plus credit costs also will move downwards. So the ROA, which is if you're actually de-risking yourself or bringing down the risk, you will find that the ROAs will overall adjust. So the whole ROA tree would possibly move left, where you will see that the 10.5-11 may actually come down slightly. But at the same time, you will find that the operating expenses because the productivity levels would increase, and the overall OpEx as a percentage of the book, as well as credit cost as a percentage of book on account of the steps being taken, may move downwards, thus actually impacting the ROA only positively. So we will still stick to, over a period of time, the ROA directionally to be in that corridor of 2.8%-3%. But the all other numbers, the percentage terms, they may actually change for the better because we will have a much stronger book with maybe slightly lower yields. But coupled with steps which we will be taking, as Sudipta mentioned, there will be other line items of fees and all which will get added. There will be new businesses or products that we may get into over a period of time, which we will start working on the next full-year business plan. And we will possibly come back to all of you at the end of when the results for Q4 come out. Thank you so much for the detailed answers. Thanks, Sachinn and Sudipta. All the best. Thank you so much. Thank you. A reminder to all the participants, please restrict yourself to two questions. Next question comes from the line of Kunal Shah, Citigroup. Please go ahead. Yes. Thanks for taking the question. So firstly, maybe if you can just highlight how much has been the rate, particularly on the two-wheeler and PL because outside of MFI, also we are seeing a slightly higher stress out there. And still, in terms of the growth in PL, that seems to be quite aggressive. So would we look at pulling back growth at any point in time because of the higher delinquencies in PL? Kunal, I'll take the PL growth question, and then Sachinn will take the rest of the part of the question. See, PL, we are very clear that we will not do PL to any leverage segment or any non-prime segment. Our growth in PL primarily is coming from prime salaried segment. So if you see our DSA, we do 99% salary in our DSA channel. If you look at our large partnership, our target in large partnerships is towards prime salaried rate. In fact, some of the metrics are absolutely clean in this business. So we are very, very clear that our PL scale-up will be very, very risk-elevated. See, on a percentage terms, it might seem high. But from an actual quantum perspective, we are still doing about INR 550-600 crores of PL a month, which is not very, very large. So we are gradually scaling up this business. And the metrics are currently absolutely okay. And we do believe that as long as we do prime salaried business with a sharp eye on both aggregate debt burden as well as unsecured exposure, overall metrics, we should be fine. And we are implementing Cyclops for PL also this quarter. Parallelly, SME and PL Cyclops are implementing this quarter. So as PL and SME Cyclops get implemented this quarter, the unsecured business, I believe, will be run in a far, far more safer fashion. Hi, Kunal. Sachinn here. Yeah. Yeah. On the write-offs, usually we don't give these numbers. Last quarter, we gave the number as an exception. But the overall write-off, like we mentioned on the call previously, is a function of it's a technical write-off, right? Because any asset which gets provided up to 100%, there is a pool of assets which are taken up for writing off in the book. But at the same time, that does not mean that business stops the effort on collection of the thing, right? So yes, RBF, you have seen that the roll forwards have been happening. And out of that pool, last quarter we had given, we had specifically clarified that the whole write-off was not RBF. All I would like to say is that it is distributed amongst products. So it is not one business where the write-offs are very high. About INR 300 crore, I can share for the micro loan pieces what we wrote off. And the rest, all the businesses have been almost equitably done. Yeah. So more in terms of the credit cost, not particularly the write-off. But if we have to look at it, credit cost is very clear this time in terms of how much MFI is contributing. And maybe you indicated that from the wholesale side, there seems to be zero impact, no recoveries, and no provisioning during the quarter. So how would be the breakup there between particularly two-wheeler, tractor, and consumer loans? See, on the Digant's question, we already responded to this, that for a couple of quarters, farm, two-wheeler, and PL will see some challenge. And thereafter, you will start seeing things changing for the better. Because whatever challenges we have faced in the first quarter are not restricted just to rural business, right? I mean, the election time as well as the heat wave, all this led to liquidity going out of the market, led to a situation of over-leveraging, and there has been an impact across businesses. The most was felt, of course, in the micro loan market, but the other businesses also got impacted to a level. Plus, at the same time, we have been directionally moving ourselves more towards prime and all. So like we called out in the last quarter, it will be two to three quarters of some pain, which will be, and it is not just one particular business. What we would like to highlight is it's not one business which is going through a major turmoil or anything. It's just that certain key activities like farm, on account of repo stoppage, two-wheeler, because of some challenges in certain states are the reason why the credit costs have been slightly on the higher side. So you will see. So the reason was the repayment rate in two-wheeler was quite high. Okay. If we look at it, INR 2,400 crores of disbursements and the portfolio staying flat. So that suggests a very high maybe the rundown rate. So just wanted to check, is it like a relatively higher credit cost and write-off in two-wheeler, which is particularly leading to that? Yeah. So primarily that was the case. That is not the case, and the write-offs have been, as I mentioned, across all the three, four products, they are distributed. So no specific major hit in one particular product. Now it could be on account of. Yeah. Kunal, if you recall, we had started sort of the prime movement in two-wheeler journey sometime last year, right? In September of last year, when we started moving in towards the prime of two-wheeler. So actually, some part of that, actually, if you look at our portfolio, 49% of our two-wheeler portfolio is prime, right? Which is basically half of our two-wheeler portfolio is now prime. And on an incremental basis, as I said, in the month of January, almost 75% of the through-the-door disbursement in two-wheeler is prime. So around April and May, we saw some spike in two-wheeler delinquencies, along with which is a contiguous product along the microfinance business. But we saw also stabilization of the same around August, September. We saw stabilization around the same. The downward trajectory continues, which is also demonstrated by the portfolio bounce rate sort of index representation we have given in slide 23. We are very, very confident that whatever credit costs that we have seen happen in Q2 and Q3 in the two-wheeler business is on a sharp downward trajectory over the next couple of quarters. Kunal, just to add, I was just looking at the numbers after you gave the breakup of two-wheeler. What has happened? This was a festive quarter. There is a trade advance book. Usually, advances are given to the dealers. So there is a trade advance book which has reduced by INR 350 crores close to. So that is one impact because of which you are seeing that. That is specifically for this quarter. Hello, Kunal? Okay. Yeah. Yeah. Thanks. Yeah. So that's perfect. Yes. I think trade advance ongoing is leading to that. Yeah. Yeah. Thanks. Thanks. And all the best here. Thank you. Thank you. Next question comes from the line of Mahrukh Adajania with Nuvama. Please go ahead. Yeah. Hi. I had a question that LTF plus three plus Lists is around 7%, and then four plus is around 2.5%. Four? Yeah. It is two and a half is only two and a half is LTF plus four. If you take the entire block, LTF plus four up to whatever, the whole block is 4%. Yes. So if you just take LTF plus four, which I guess is two and a half, correct? Not 5-6. And then if you take LTF plus three, that's 7%. So basically, you have a gap of 5%-5.5%, which will have to convert by April 1. So your call on picking of credit cost is driven by the fact that this 5.5 will reduce to near zero, or how do you think about it? See, Mahrukh, on this, you have to look at that, that it has been resolving itself quite well. From 10% in quarter one, FY 2025, it has come down to 7%, right? So you can see that on an average, on a quarter basis, average has been 1.5% resolution on an average on a quarter basis, right? And the collection efficiency on this pool is also at 98.7%, the collection efficiency. The collection efficiency is not extremely bad on this. Now, one of the things that we have to keep in mind is that from April 1, the NBFC overall 2 lakh leverage guideline comes into play, which has more of an impact on disbursement, actually, rather than an immediate follow-through impact on the repayment capability of the customer, right? So what we expect is that this number, which is there at 4% and at 2.5%, to orderly wind down over the next couple of quarters. Anyway, we have pushed in about additional 900 collectors on the ground. And one of the focus of those additional 900 collectors is to focus on the geographies where collection intensity is needed. So that effort is already continuing. And we are reasonably confident that this 7% + 2.5% number will be reasonably wound down over the next maybe max two to two and a half quarters. Got it. But basically, if the run rate is 1.5%, then it would require three quarters to wind down, or it does not work that arithmetically? See, no. See, one of the things that Mahrukh, you have to keep in mind is that the entire portfolio is not bad. The 7% portfolio has a 98.7%, is close to 99% collection efficiency. So a majority of the part of the portfolio is good. So we need not panic on the portfolio that is good. A small part of the portfolio has strengths, right? And the focus should be on that small part of the portfolio. Got it. Okay. Makes sense. And then just one clarification on the SR provision to the reversal and the additional provision, that accounting is done through the same line, right, of provisions? Yeah. That's right. Okay. Thank you. Thank you. Thank you. Next question comes from the line of Saurabh Kumar with JP Morgan. Please go ahead. Sir, just two questions. One is on the microfinance portfolio. Number one, what's the write-off policy? And just in terms of number of customers, what will be the collection efficiency? How many of your customers are fully paying right now? The number of customers? On the fourth part, like I mentioned earlier when a question was being asked, so write-off policy, actually, once any asset is fully provided to the extent of 100%, it qualifies for a write-off. And the write-off is more like a technical write-off for us because after the write-off also, the efforts do not come down. The write-off policy, specifically on micro loans, the provisioning of 100% is the moment it crosses 90 DPD. For all the other products, it all depends on the ECL model has been built in where the 100% provisioning happens based on a particular DPD. The actual write-off in the book happens basically the finance takes a call on when the technical write-off has to be done in the books, like I mentioned earlier also. But the effort on account of write-off should not be linked to the fact that we will stop pursuing those customers in terms of collection. So we also have reasonable collections happening out of the assets which have been written off. So if you can just detail the microfinance is at 90 days, 100%, where will Personal Loans and where will two-wheelers be to reach 100%? Sorry, can you repeat that? Microfinance, you provide 100% at 90 days. Yeah. When do you provide 100% on PL and on two-wheelers? No, it's a ECL model. So it takes. I will have to check on that. Thanks. Thanks. Got it. On the other piece, which you talked about, on whether it really is relevant on account, it's not relevant. What is important is actually how is the customer levered. And that we have already during our Digital Day also, we clearly mentioned the portfolio that we have is how levered it is. Ours is the least levered book that we have. So my limited question was your C includes overdues. So basically, what I was trying to get is essentially all the customers which are paying on time. So the balance will be basically part paying or non-paying. And that basically creates your overdue list. So I just wanted to know if your collection efficiency is 99%. In terms of customers, how much will it be? Is it 97%? Is it 98%? Yeah. So in terms of, see, collection efficiency first input does not include over days. We report zero DPD collection efficiency. And in terms of the number of customers, it is 99.22% i s correct, right? So including overviews. Yes. Yes. 99.22. And the number of customers. All right. Okay. Thank you. Thank you. Next question comes from the line of Nischint Chawathe with Kotak Institutional Equities. Please go ahead. Yeah. Thanks for taking my questions. One was on Project Cyclops. You said that Cyclops is implemented in two-wheelers, and we are now looking at implementing it in Personal Loans and SMEs. So I mean, I was just curious, why would you sort of scale up the book just as yet, right? You'll probably implement Cyclops and then kind of scale it up. Yeah. So just two things. Cyclops we are already implemented in two-wheeler 100%. And in tractor, it is implemented. It is live. We are scaling up the number of dealer coverage slowly. The SME and Personal Loans, we are advanced stage of readiness to deploy. And the current sourcing that we are doing, we are very, very confident of the current quality of sourcing. We are only doing absolutely super prime salaried customers where the Net Non-Starter number is as low as 40 basis points. So this is not the number that we normally give out, but I'm giving out the number because you asked the question. In December, our new salaried sourcing, our Net Non-Starter number was only 40 basis points. So does it mean that after implementing Cyclops, you probably go towards slightly one segment lower or something like that? No, no, no. See, the thing is that, see, Cyclops is designed in such a way that it targets target PD. So once we put the PD, then the customers who qualify in the portfolio mix towards that PD is only what will go through. We are at any point in time not saying that it will help us go towards a more riskier mix, so that is not. In fact, one of our guiding principles of our Personal Loans business is that we will do our Personal Loans business with the majority salaried profile, right? That will be the profile of our personal loan business. Cyclops helps us to sharpen the credit outcome in that segment even further. Cyclops, I'll tell you, in terms of it, the maximum benefit for Cyclops will come in case of the two-wheeler business and the farm business and the SME business, primarily because this business has a large contingent of customers who are new to credit and a large customer segment with thin bureau, right? So the way the Cyclops is constructed, it helps actually underwrite NTB and thin bureau much better, right? Whereas in Personal Loans, we are actually going for customers with a little thicker bureau track. So probably the alpha on Cyclops on Personal Loans will probably be of an order of magnitude slightly lower than that we are seeing in the two-wheeler business or in the farm business. So on the personal loan business, it's age-old experience that is driving the current sort of growth momentum. Though on a percentage basis, again, I'm repeating myself, though on a percentage basis, the number might look large, but on a real absolute amount, this is INR 550 crores of qualified salaried Personal Loans a month is not really a very large number. Got it. And since we are on this, maybe as a one-off, can you share the yield and ticket size in personal loan segment? The average ticket size in Personal Loans is INR 2.5 lakhs, and the average yield is about 17% odd. Got it. Just one more curious thing. Any specific reasons for change in Chief Risk Officer? No. Actually, we have already put the. So the departure of the for better opportunities necessitated a change. Okay. Got it. And just one last housekeeping question. You mentioned that you added 900 collection officers in the micro loans business. So what is the aggregate number as we speak? See, in micro loans business, the guy who sells is the guy who collects. Overall, just a second. I'll take overall, everyone is a collector and everyone sells, but specifically, in terms of collections, it will be about 2.5 thousand people. So there are two things. In our micro loans business, we have the normal regular 1,200 for collections. In addition, 1,200 for collections. Yeah. Got it. So basically, we have the normal kind of microfinance employees who are collecting. In addition to that. We have and another hard bucket collection team. That's around 1,200, which we have put up for the first time right now. That's right. Got it. We have added to it. We had it. We have added to it. No, that's what I'm saying. How much did you have and how much have you added? That's my question. 900. 900. Yeah, 900. We had it. So overall, addition of people in the microfinance team has been about 900. Now, some of them have been deployed in the regular course of work. Some of them have been added to the hard bucket collections team. The reason, for example, let's take this example. In a meeting center, you currently have five people. These five people are servicing 1,000 accounts. So our average accounts per collector is 200. We wanted to bring down the accounts per collector in a meeting center. So what we did is the 900 people that we added, some portion of the 900 people went to our regular meeting centers. So that our accounts per collector come down. Our accounts per collector came down from 560 to 480. And a small portion of the 900 was deployed to the hard collections bucket team. Is my answer? I think that's it. Yes. Perfect. I think we understand the magnitude of how people have been deployed. Got it. Thank you very much and all the best to you. Thank you. Next question comes from the line of Abhijit Tibrewal with Motilal Oswal Financial Services Limited. Please go ahead. Yeah. Thank you and good afternoon, everyone. So I mean, most questions have been answered. Just two questions that I had. First thing is, so to sir, in MFI, from what we have put out in our presentation, your peak credit costs are likely going to come in for a few. So first thing is, can you explain why is that? Now, why I ask this is what you have said, if you actually provide 100% on MFI loans after they are 90 DPD and maybe technically write them off, and if your collection efficiencies are increasingly getting better in December and January, then why is it that our peak credit costs should come in the fourth quarter? Yeah. Abhijit, let me take this. So usually, the credit cost comes with a lag of a quarter because as we have already disclosed the collection efficiencies the way they panned out in October, November, and December. From 99.43%, it came down to 99.26%. Finally, it ended with 99.39% in December. So when the collection efficiency comes down, which was the case for two months, October and November, there will be roll forwards which will actually keep happening, and also the roll forwards happening out of the previous quarter customers. So whatever roll forward finally happened, net of the collections, because the collection effort is still on, right? Those will ultimately lead to a credit cost panning out because the moment these customers move to 90-plus bucket, we will have to start providing cost. So as we are seeing a sign that December has actually improved vis-à-vis November, we have said that there is we believe that what may happen, assuming that this trend continues in January, February, and March, the collection efficiencies, as they start improving, the roll forwards will slow down. And hence, in the first quarter of next financial year, the roll forwards will slow down compared to quarter four. So on relative terms, we have mentioned that quarter four may turn out to be the highest in terms of the credit cost. Yeah. So the principal flows tend to get bunched up because you have stabilization efforts continuously going on. And then so some customers get stabilized, some customers roll forward for one month and then roll back. So this process continues. And typically, what happens in retail portfolios, most of this, when the deterioration starts within a period of time, they tend to get bunched up at one particular point of time where, across a couple of months, you see high credit costs, and then the curve shifts downwards. We expect that the peak of this curve will happen sometime between January, February, and March. And that is why the advanced estimate of macro utilization that we have given for Q4. So Abhijit, just one more piece. We are all aware of the one more guardrail, which is to be implemented by MFIN, which will be effective 1st of April. We will have this, and this is going to be across the industry. We already responded to one of the questions earlier that we will have to wait and watch how this guardrail impacts because the impact is going to be across the whole customer base in the industry. So we'll have to wait and watch on that. Again, the players who have least levered customers will be benefiting out of this compared to companies who have high levered customers in respective buckets that we have shared in our presentation. So we will have to see what will be the impact of that. But bearing that, if the trend continues, if the December trend continues into January and March, then what we mentioned would prevail. Got it. Just to follow up on that, given that we are still looking forward to this MFIN guardrail implementation from April and whatever we just highlighted, can there be a scenario that this MFI stress or MFI credit cost, which we think will peak out for us in Q4, can spill over to the next financial year as well? See, the guardrail initially was supposed to be implemented from 1st of January. Pushing it to 1st of April is going to only support all the industry players, and it will also help customers figure out ways and means of making repayments and getting alternate sources available. Yeah. Let me add to that. See, we can't crystal ball gaze as to what will happen, right? But the fact is that given the fact that in general, the Kharif arrivals have been good, there is a reasonable amount of liquidity which is building up. The Rabi sowing has been very, very good. So we expect that in the month of March and April, when the Rabi crop comes, it will also be reasonably good, which will augur well for the liquidity. We expect that there will be a soft landing, but we will have to wait and watch. As Sachinn said, the players with the better franchises will benefit because they have the less non-leveraged customers. So now the disbursement impact on repeats, et cetera, will not be impacted that much, especially for their exclusive customers. And I would like to point out that we have a very high proportion of exclusive customers, our prized customers, who are, again, relatively non-leveraged. So we are hopeful that the entire industry will have a soft landing post-April, but we'll have to see how it pans out. Got it. Thank you. And just one last question because you just mentioned the better franchises. So just trying to understand in the past, even in our presentation, we have called out that we picked up this leveraging early, and which is where maybe we slowed down or maybe we didn't go after leveraged customers. Just trying to understand, I mean, over the course of these last six, nine months, have you had a chance to understand if our model in rural business finance or MFI, is it different from the other peers which has helped us deliver better asset quality outcomes than the industry? See, I think not to comment on what others have, but I will say some of the underpinnings of discipline that we follow and which obviously is up to the investor and the analyst community to analyze and benchmark with others. One of the things that we do is that obviously we do not rely on third-party origination of MFI loans, right? All our MFI loans and JLG loans are originated by our own people. We are very close contact with the village distribution that's on ground. The second thing which we have is that obviously we have a very, very tight leverage. And as I've told earlier, from January itself, we started tightening our leverage conditions and started letting go of some portion of the repeat. The last thing is the third thing is that we have a very strong RCU network and a branch process vertical who goes and every loan that the field level officer books, there is a second-level check, and out of the second-level check, there's a sample of third-level check. So actually, it almost goes through a three-level check before the loan is granted. The second thing is that some of the discipline that we have been following for many, many years. For example, if a particular meeting center dips below 98% collection efficiency, we immediately stop disbursement there and focus collection there. Now, this is a hard guardrail. That means in a meeting center, if collection efficiency were to drop between 98%, the app freezes for those field-level officers. Even if they want, they can't unload a single loan in that particular meeting center. Then the focus entirely shifts towards collections. Last but not the least, we have extensive data analytics for geo-selection and expansion. We only go in areas where we think have got less non-levered customers when we can get non-leveraged customers on board. The last thing is that we also, because we understood that the industry was getting slightly leveraged, we said that we will invest in a channel that gets non-leveraged and fresh customers, which we call our FXO channel or fresh sourcing officer channel. Now, we have a reasonable amount of people in about approximately 1,000 people. You were taking a couple of 50 or 100 here and there. When you have approximately 1,000 people, which we call fresh sourcing officers, whose only job is to get fresh non-leveraged customers and to get into villages that are non-penetrated. So in a way, the business has been structurally designed to go after non-leveraged customers. And wherever there has been instances of leverage, the business has been structurally designed to take a pause before business starts again. This provides an automatic inbuilt, what I call a speed governor mechanism, right? Wherein you are not allowed to speed up in an area where you have sort of worrying asset quality. Whereas in areas where you have rather non-leveraged assets or opportunity sitting, the organization is designed to speed up on those areas, albeit safely. Right? So in a way, it is for the entire investor analyst community to benchmark and see whether this sort of practices of ours has helped us sort of keep us relatively in a straight path during this trying period. and only time will tell as to who are the ones who have better franchises and who are the ones who do not have. Got it. Thank you for the detailed answer, and thank you and wish you and your team the very best. Thank you. Next question comes from the line of Chinmay Garg with ICICI Securities. Please go ahead. Yeah. Thank you for the opportunity and congrats on good set of numbers. Firstly, just continuing on the insurance fees, I think we mentioned we increase the share of insurance fee in the overall income. Currently, what would be the total percentage of insurance income and the total fee income pool? Can I have their number? I don't have it. Just give us a couple of seconds. If you can give us, I don't have their number handy instantly, so. Sure. And so, on the margin front, insurance fee pool. Insurance is a percentage of average book would be about roughly average over the last three quarters would be about 1%. 1%. Yeah. Okay. Okay. Sure. And so, on the margins front, I think we mentioned, given the rate cut, there would be some benefit of going over there. So, in terms of our fixed book, also largely, what percentage of the book would be fixed in nature? Entirely almost? Yeah. Except for home loan, all the other pieces will be fixed only. Sure. And also, on the PL part, I think we mentioned we have a ticket size of INR 250,000 and a yield of 17%. And so, what would be the tenure or your average tenure also for these loans typically? About 30 months. About 30 months. See, we are in the business of prime PL. We do not do HTPL or anything like that. Absolute prime salaried PL. Sure. Sure, and so just lastly to dwell upon the ROA fees again, I think for the quarter we recorded 2.3%, and we are gradually looking at 2.8%-3%, so given that our yields will contract and similarly the credit cost or OpEx would contract and resultant benefit on ROA, so how does that ROA move from 2.3% to 2.8%, so more benefits come from the income fees or the OpEx fees, and on the leverage, then what would be the optimal leverage that we would be targeting? In turn, I think it's slightly premature talking about because these couple of quarters are an aberration, right? We have spoken earlier about the ROA trajectory that we wanted to move on. Now, there is some shift which is happening. There is some impact specifically which has come up. So I think two to three quarters, you will have to live with this aberration, which would mean, as I mentioned earlier, the 2.8%-3% is what our targeted ROA. Now, this was part of our Lakshya 26 strategy. If there are going to be a few challenging quarters, maybe it will move a couple of quarters down the line, but directionally, we still want to achieve that. We will be working, as I mentioned, on the business plan for the next financial year and also a long-term plan for the next five years. If there is a change in this, as part of those discussions, we'll come back. But at this point of time, we are still fixated on the fact that 2.8%-3% is directionally what we are looking at. It may just, if there are a couple of quarters which are challenging, it may just move ahead by a couple of quarters. That's it. Sure. That is helpful. And just last thing on the leverage part, so what could be the optimum or best leverage we could look at? Debt equity of 5:1 is what we would like to be at. But we are right now at 3.4. So as a AAA, I don't think we would want to go beyond that at this point. And the leverage will be 6 then. Sure. So that is very helpful. Yeah. Yeah. That's it from my side. Thank you and all the best. Thank you. Thank you. Thank you. Thank you. Next question comes from the line of Abhishek Murarka with HSBC. Please go ahead. Hi. Good afternoon, everyone, and congratulations for the performance. So just in terms of markers, trying to look at all the conversation that has happened so far, looks like GS2, at least, Gross Stage 2, that should start showing improvement, or at least that should not increase going forward, right? Because GS3 might go up or write-offs might go up, but forward flows into GS2 should not happen, and also looking at your next non-starters and the bounce rates you have shared for Two-Wheeler Finance, it looks like things should improve there, so ideally, GS2 should not increase from here. Is that a correct understanding? It will all depend on specifically for micro loan, as we mentioned, that we have seen some green shoot. We have seen some improvement coming up in December, right? But I think we have to wait for a couple of months more to see whether directionally it is panning out. So at this point of time, we would not really want to commit that stage 2, nothing will be there because there are various businesses, and all these businesses are sort of in a transition. So there is part of the book which has moved towards prime. There is part of the book which is still from the earlier before the strategy was changed. So at this point of time, I would just like, in case you're asking this question from modeling point of view, I would say that you should continue holding on to the assumptions because we will still need some kind of visibility coming out of this challenging time, which I think is one or two quarters away, post which we will be more we can possibly talk more formally on how stage 1, stage 2, stage 3 would really pan out. But we believe the credit cost and all would be in line with last one or two quarters. Okay. No, I was just trying to understand the direction of NPA and ECL credit cost to try and understand why it would remain elevated for two quarters when you're showing good numbers on bounce rates and net non-leveraged credits. Yeah. Yeah. Because the seasoning takes time. The two-wheeler and farm, as Sudipta mentioned, only the two-wheeler book and that too over a period of few quarters has moved from 0 to almost 100% on Cyclops. Farm, we have just begun. We are yet to start off on the PL. And then SME. So till the time this whole transition does not happen, we cannot pinpoint that this particular quarter. It will be business by business, right? Maybe one year down the line, once every product moves on to Cyclops, then we will be able to say firmly that, yes, now the transition has been over, and the credit cost now will follow a particular trend. But till that time, I think, and then we also have a challenging time on the micro loan front where we have a 26,000 crore book. So I think all these factors are leading to a situation where it will be difficult to specifically say the challenging time will on the other businesses, the credit cost has been slightly elevated for various reasons pointed out earlier. So I think you need to give us a couple of quarters, and then you should start seeing. So H2, which is quarter three onwards, you will start seeing the impact of Cyclops in terms of the benefit which flows onto the credit cost line. Yeah. See, Abhishek, what I would like to add to what Sachinn said is that all the leading indicators of the work that we've been doing are looking good. So we are satisfied with all the leading indicators, and we have put certain indexed representation of some of those leading indicators in the analyst deck. As I said earlier, portfolio washout and the replacement or the replenishment of the portfolio with better credit fundamentals typically takes a couple of quarters. A couple of quarters means four to six quarters. So obviously, we are about three quarters into the journey. It will take for another two to three quarters for the full some headline impact to start being visible, which, as Sachinn said, takes us to about latter part Q2, early Q3 of FY 2026, right? When you will start seeing the real impact of that. The current macro situation does not help us also, right? Because the current macro situation makes us also sort of adds a lot of noise into whatever we are seeing, right? So I would like to add to what Sachinn said is that for us, this is a marathon journey. It's not a sprint, right, and we are very satisfied with the progress that we have made on the journey. The building blocks are more or less in place. What we are doing is that now we are in the process of optimizing those building blocks which have been put into place. So my only request would be that we should be a little patient and give us a couple of more quarters for that benefit to build out in terms of numbers. Got it. Got it. Thank you. Thank you for your time, Sachinn. Thank you so much and all the best. Thank you so much. Thank you. Next question comes from the line of Subramanian Iyer with Morgan Stanley. Please go ahead. Hi. Thanks for the opportunity. So on micro loans, you have given a lot of texture on asset quality and that there are a few important rebounds. But I had a question on micro loans beyond this current asset quality cycle. So how are you looking at loan growth structurally? I mean, because of the changes happening at an industry level, do you see that loan growth here is going to be structurally lower than what it used to be in the past? And also, are you expected to reduce loan yields given that the regulator had also been making comments on this all through last year? So essentially, looking at structural growth and profitability beyond this current cycle, your thoughts? Yeah. Thanks. One of the things is that I do believe that this is a business. This is my personal opinion. Industry opinion might vary, right? My personal opinion is the safe speed of this business is anywhere between 15%-20%, not more than that. So the industry probably for the last couple of years has been driving this business as 40% + growth rate, which obviously has led to some. It's sort of part contributory to this asset quality sort of challenge that we are seeing in this. So I do believe that after the infill guardrails come into being from April, the industry structurally will have to adjust itself to, if I were to use the old English proverb, cutting the coat according to the cloth, right? Which will mean somewhere between a 15%-20% growth rate on an annualized basis. And I think that's a safe growth rate. So I do believe that on the longer term, this industry will settle between this growth rate. The second thing which I think is on the yield side, we have already sort of tempered down some of our yields. And if you see, and if you go to our website, our yield differential is from 16%-23%. The absolutely trade-qualified fourth cycle customer, non-leveraged fourth cycle customer ends up getting a low rate of 16%, whereas most of the new customers coming into the fold will get a rate of 23%. So the average yield is closer to a little shade lower than 23%. Because we have a portfolio stock, et cetera, which is priced at 24, which was our previous yield, our average yield still remains high. But over a period in time, this is sort of the interest range that the industry will move towards. So yes. So some of the supernormal yields that we might have seen in certain sort of franchises, probably those will get tempered over a period of t ime. Thanks. That was a very clear answer. Just one more question. What is your guidance or your view on retail loan growth for you in FI26? I can't really crystal ball, Glenn, and say that what should be the retail loan growth. By Q4, we will see. By Q4, we'll be able to see. We are guided by the Lakshya goals of 25% +, et cetera. But again, what I said is that we will exercise caution, and wherever the risk-reward equation is not in our favor, we will choose caution over growth. This is a very clear philosophy that we are following, and we will follow this philosophy. So what we will need to see is how the collection efficiencies for all lines of business pan out in this quarter, January-February-March, which I think will be a quarter of stabilization for the entire industry. And probably a much more clearer guidance is probably we should be able to give in some time at the end of Q4. Yeah. I think we should be, we would have by now, by then, finalized the business plan as well. Yes. Finalized the business plan. And also, the growth rate would differ depending on the business we are in. For example, personal loan, SME, younger businesses will grow at a much larger pace, whereas the mature businesses will grow perhaps at similar lines, barring MFI, which is one piece which we will have to look and figure out what kind of growth we can consider. We need some more clarity on that. Thanks so much and wish you all the best. Thank you. Thank you. Next question comes from the line of Wuzmal Handu with Goldman Sachs. Please go ahead. Thank you so much. Good morning, sir. Just one question from my end. You spoke about the near-term pressure on NIM + Fees on account of the changing mix that you see right now. Just wanted to gauge your thoughts on when do you anticipate this trend would stabilize for your book? And then eventually, when do you potentially see operating leverage playing out? Yeah. So NIM + Fees, already we responded to this. I think depending on how when the rural business loan piece actually stabilizes and which. Perhaps we believe that one more guardrail which is being implemented by MFIN will come into play from 1st of April. So we still see two to three quarters of turbulence at the market level, okay, at the industry level. But we would like to state that we are still better off. So the impact may be lower is what we believe. We will have to wait and watch on this because this is a large significant portfolio on our books. As well as the fact that we are moving more towards prime is also adding to the change that we anticipate on the NIM + Fees, which may come slightly on the lower side. But that should actually get compensated or more than compensated by two things. One is the increasing productivity and the lower effort on collection cost because that's a significant part of our operating expenses, as well as the reduction in the credit cost, which we hope will start getting factored into our P&L from H2 next financial year, so two to three quarters is what we believe that we'll have to continue with this, and then we will start seeing the positive impact of it. Okay. Okay. Thank you. That's really helpful. Thank you. Thank you. Ladies and gentlemen, that was the last question for today. We have reached the end of question and answer session. I would now like to hand the conference over to Mr. Sudipta Roy for closing comments. Yeah. Thank you, everyone, and thank you for your participation. As I said earlier, us along with the entire industry is going through a little bit of trying times, if I may use that word. But I think this is not a very protracted, deep valley downturn that we might have seen earlier. I do believe that this particular downturn, especially for the overall industry, is, and I'm not speaking only of the microfinance business, but speaking of other asset lines also, is a much shorter duration cycle that we might be seeing. And we remain hopeful that this shorter duration cycle will probably see a bottoming out sometime between quarter one and quarter two of next year. And then probably because the deleveraging has happened quite a bit as far as data available with us. So I do believe that things probably will get onto a normalized trajectory sometime at the end of quarter two or starting quarter three of next financial year. So with that in mind, we remain focused on building all our capabilities. Even while we are going through some of these sort of on-ground challenges, we have not stopped for a single day in sharpening our tools of execution such that when things become normal, we are able to race much faster than others and take a share of the market opportunity which is available, obviously in a risk-calibrated fashion and deliver those returns for our shareholders. So thank you so much and wish all of you a great quarter ahead. Thank you. On behalf of L&T Finance Ltd, that concludes this conference. Thank you for joining us. You may now disconnect your lines.