Ladies and gentlemen, good day and welcome to Muthoot Finance Limited Q2 FY23 earnings conference call hosted by ICICI Securities. As a reminder, all participant lines will be in the listener-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 touchtone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Ansuman Deb from ICICI Securities. Thank you, and over to you, Mr. Deb. Good evening, ladies and gentlemen. On behalf of ICICI Securities, we welcome you all to the Q2 FY 23 business conference call of Muthoot Finance. We have with us the management of Muthoot Finance represented by Mr. George Alexander Muthoot, Managing Director, Mr. Alexander M. George, Whole-Time Director, Mr. George M. Alexander, Whole-Time Director, Mr. George M. George, Whole-Time Director, Mr. George M. Jacob, Whole-Time Director. Mr. Eapen Alexander Muthoot, Executive Director, Mr. K.R. Bijimon, Executive Director, and Mr. Oommen K. Mammen, Chief Financial Officer. I now hand over the call to the management for the opening remarks, following which we will open the floor for Q&A. Over to you, sir. Get into the numbers and the business of last quarter. The consolidated loan assets under management increased to INR 64,300 crore, up by 6% year-on-year for the half year, and consolidated profit after tax increased to INR 902 crore, up by 9% Q-on-Q for Q2 financial year 2023. Standalone loan assets under management increased to INR 57,230 crore for this half year, which is up by 4% year-on-year. Standalone profit increased to INR 867 crore, up by 8% quarter-on-quarter. Compared to last quarter, our AUM has also started slowly growing. Our profit has also improved compared to last quarter. Another key highlight is, RBI had given, or rather we had requested for the first tranche of 150 branches, new branches to be opened. We have got the permission for that. Out of that, by September, we had opened 24 branches, and we hope to complete all the 150 branches which are in various stages of construction and fit out by end of December. We are the first NBFC to launch the Milligram Reward Programme, a gold reward program for all our customers. As our CSR initiative, the Cup of Life entered the Guinness World Records by distributing 1 lakh plus free menstrual cups across 126 venues in 24 hours. The program was aimed at eradicating the menstrual taboos and creating menstrual awareness in the society. Also glad to state that we have now been classified as an Upper Layer NBFC, one of the top 16 NBFCs in the country. We feel it is definitely a recognition of the size and the size and the thickness of Muthoot Finance. A meeting of the board of directors held today was considered to approve the unaudited results for this quarter. I think all the other details, et cetera, are there with you. I think we will now get on with the clarifications and questions or clarifications which you want from the management. Over to you all. Thank you. Ladies and gentlemen, we will begin the question- and- answer session. Anyone who wishes to ask a question may press star and one on their touchtone telephone. If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use handset while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question is from the line of Manoj Oberoi from YES Securities. Please go ahead. Yeah. Good evening. Sir, I would like to know what was the incremental yield of gold loans in second quarter? Yield is 17.3% for the quarter. Sir, incremental on the disbursements done in second quarter? I don't have that. The yield on the portfolio as of the quarter is 17.3%. Okay. Sir, what part of the book will be yielding less than 10%, or below? Right now, I don't think we have moved all the weaker loans to higher bucket. I don't think we'll have any portfolio. Okay. The entire AUM is on standard products or standard rates now? Yes. Okay. Just last question on how has been the momentum of disbursements during the festive season, say October and November? Has it picked up significantly? Can one assume that disbursements in this quarter, Q3, can be significantly higher than Q2? I think, you know, we'll have to reserve that answer, because it's not there in public domain. You know, let's speak it after the third quarter. Generally, you know, if you can look at our disbursement, it is going at a certain pace. I think that should be hopeful about maintaining that level of disbursements. Okay. Thank you. Thank you so much, sir. Thank you. The next question is from the line of Abhijit Tibrewal from Motilal Oswal. Please go ahead. Yes. Good evening, everyone. Just two or three questions. Would it now be fair to say that large part of your focus is now back on lower ticket gold loans which have relatively higher yields? Maybe a related question. On the borrowing side, till when can we expect that you will continue to see the benefits of higher cost debt retiring and being replaced by lower cost borrowings? In terms of our borrowing costs, you know, I think our $450 million external commercial borrowing is already got repaid in October. That was done at a very high cost. That will have some savings. The borrowing cost as of September 13th stands at around 7.98%. There'll be some decline, which will be happening in the third quarter. I think, since the borrowing cost is also going up, I think, in the third quarter also we are expecting it to remain somewhere around 8%. About the loans, yes, as we said earlier, the teaser loans are not there now and very low interest rates are not there now. We won't have any such loans with us now. Okay. Sir, what proportion of your gold loan book today would be towards those higher ticket teaser rate loans which you did during December to March? I understand you've migrated them to higher interest rates. What proportion of your gold loan book would be towards those higher ticket loans that you did during December to March? At that time there were some 20%-30% of our book. I don't think today we don't have any such book because they have either migrated or closed the loan. They have either migrated to the higher scheme or we would have closed their accounts because any loan account is there only maximum of 2-3 months. In the last one quarter, all of those loans have closed and gone. Some would have got migrated, some would have closed, and they have taken the loan at the new rates. Understood, sir. Sir, sir. Sir, my last question is on your operating expenses. More particularly, what proportion of your employee expenses are variable in nature, such that when you see a decline in your disbursements, you also see a commensurate decline in your employee expenses? Also your advertisement and promotion intensity, let's say the expenses that you incur on advertisement and promotion has substantially moderated in this quarter versus last quarter. Is there some seasonality to that, or was it a conscious strategy to reduce your ad and promotion spends given that you now see the competitive landscape turning much more dynamic? We have not taken any decision to reduce our ad spend. We will be continuing to do. Maybe some of those expenses will come in the next two quarters. Whatever we have budgeted for the advertisement expense, we definitely will meet, will be doing it. If it is just a seasonal nature, some quarters, some months our advertisement will be lesser, but, coming months it will be same. Suffice me to say that our advertisement spends would be on track or whatever we have budgeted, we will do. Your next question was about the employees, incentives, et cetera. Some of those things in the last quarter and this quarter, et cetera, some of these incentives and bonuses, et cetera, would be paid in, Onam bonus, et cetera, would have been paid last quarter. The Diwali bonus, et cetera, would have been paid somewhere else. Overall, by the end of the year it will be the same. Understood. If you could just maybe one last question here. Earlier you suggested that large part of those teaser rate loans have either migrated or closed. Just wanted to understand then why is it that the yields are not improving? If, I mean, large part of these teaser rate loans have moved to, I mean, higher interest rates, like you suggested, upwards of 10%, or they either, I mean, kind of closed down, then what is the reason that we are not seeing an improvement in yields? There is definitely improvement. It is only that we have not reached the highest level which we had reached much earlier. Probably we should not be thinking of very, very high yields also because things are changing. Probably our yields as is, what you said is not correct. The yields are improving, but it has not reached the- Earlier level. Very early level there was a very high yield, but we may not have reached there. Definitely we have increased. As you said in the first question, somebody asked our today's yield is 17%- 0. 3. 17.3% and that definitely is much better. Probably we just we have not reached 19% and 20%. See, after a while we should be improving. That also is the of the economic activities exercise there. Sir, thank you for patiently answering all my questions. I will take that in the direction. Thank you. Thank you. The next question is from the line of Umang Shah from Kotak Securities. Please go ahead. Hi, sir. Thank you for the opportunity. Sir, the first question was in terms of value. We have very high auctions in FY 22. However, in terms of number of accounts that we auctioned, we had the highest number of deals in 2016, FY 2016, which was pre-demonetization. Sir, could you go back in time and give us a reason for the same of why 2016 was the highest year for auction for us? I think, 2016, I don't remember. Around the NPA actually. Yeah, yeah. The 2016 was the year when there was a steep decline in the gold price. There was an increase in the regulations. Well, I don't exactly remember. It was about six years back it had happened. Now it has almost stabilized. The steep, very lumpy AUM options are not there now. Only last year and this year, only the regular usual options are there. Usual options are, they're part of the business. Correct. Right, sir. Sir, second question was, sir, in terms of increasing aggression by commercial banks in gold loans, sir, do you think that some of it is also coming from unorganized sector accessing this credit? No, I don't think it is. Unorganized sector has always been there. They would not be growing much, but they will be stabilizing on what they are already doing. Of course, the banks are certainly doing more gold loan business today. Right, sir. What I meant was the unorganized sector, pledging the gold of their customers and taking loans at 8%-9% from banks and then further lending them to other customers, like using banks as their source of financing. Yes. That we call that as repledging. It is actually prohibited. It is not permitted to take unorganized loans, unorganized sector's loan and then lend money on that, b ecause we can do loans or the bank can do loan only to the owner of the gold. If somebody is taking, collecting gold from many others and taking it to NBFC, no NBFC does that. We are not permitted to do that. I'm not sure whether banks are doing it or are doing it. I'm not sure about that. If somebody is doing it is not permitted. Great, sir. Thank you so much for clarifying on these points. Thank you. The next question is from the line of Aditya Jain, Citi Analyst. Please go ahead. Hi, sir. Please can you speak about your stance on credit card business? Credit card business, I think, we have given a letter or something applied for permission to RBI. I think they are in the consideration stage. We have not heard anything from them as yet because the credit card we are asking. In fact, we were asking for a payment card. Prepaid card. Prepaid card. Yeah. Sir, by when can we expect the changes to be incorporated and the credit card business to commence? Actually it's the regulator. I'm not the person to comment on that. The vibes and the conversations which we're having with the RBI, that they are looking kindly at that and probably they may come up. I don't have any timeline with me, but I think I'm hopeful that they should be able to do something on that. They have not given any indications as yet. Sir, just to add on, so our existing customer base would be the target market for the credit card business or are we gonna foray into newer- This is far too premature. Okay. Thank you. I think this works for me. Thank you. Thank you for the time, sir. The next question is from the line of Ganesh Nagarsekar from individual investor. Please go ahead. Hello, sir. I basically have two questions. One, if you look at the AUM growth of other private players in the market, they're growing at quite a good rate. Are we kind of losing market share and EPS? What are we kind of looking to do, kind of how are we trying to deal with that? Secondly, on the new branch growth that's there, how does the AUM per branch typically scale over the first two to three years? If you could give some amount of clarity on that. I'm not sure from where you are saying that other NBFCs are growing. If they're growing or everybody's growing. I don't know. I don't have any statistics on that. I may not be able to comment on that. About our company, I should be able to say. The other NBFC because we still do not have, I think their results are coming out only later. Other than that, we have no visibility on other NBFCs growth. Then your next question was about. What was it? Second part was. The AUM per branch for the new branches that you're opening? Right. How does that typically scale? Right. Over two, three years, sir? Right. It takes Right. It takes a year or two for a branch to stabilize. Once a branch gets opened, it takes a year or two for the branch to gain good traction. Anyway, from day one itself, we start making business. We have seen some branches attaining very good levels in one, two years, three years time, and some attaining a very good level by four, five years. It depends on the location of the branch. It depends on location, means locality where they are, and the need of the people to take loans and the mindset of the people to take a gold loan instead of some other loan. All those factors are we take or consider view from that and then open the branch. Sometimes, in some cases it is quick, sometimes it takes a little time. Anyway, no branch becomes profitable in quick time. Maybe in one year or so every branch becomes breakeven. Understood. Thank you, sir. Thank you. The next question is from the line of Arun Selvan, Independent Advisor Private Limited. Please go ahead. Good evening, sir. Thank you for giving me this opportunity. I wanted to come back to the same question which was asked earlier with respect to the yields after the teaser loans, the teaser rates have been withdrawn. If I remember last quarter you said that the teaser rates were withdrawn or you had migrated most of the customers to higher rates. If I look at the yields over here compared to Q1 of FY 2023, the yields have barely moved. I can see a very, very small change in this. Is there high amount of competitive intensity that you're seeing nowadays? Portfolio was there. That is one of the reasons Q1. I'm sorry, I couldn't hear the last sentence. Could you repeat that? You couldn't hear me? Okay. The yields in Q2 is a function of the old loans which were given earlier at higher rates getting redeemed also, and also the lower rates in that quarter. In this quarter, the benefit of that very old higher rate loans are not there in the Q2. The Q2 new loans are at not teaser rates. It is a function of both of them put together. That is why you are not seeing the impact of that in the way you said. In Q1, the old loans which were at very high rates were there. That helped to compensate to some extent the teaser rates. In Q2, those loans are getting retired. The very high loan interest rates are retired. We have only the lesser of that. The positive is that the new loans are at higher new rates. I hope you understood. Yes, sir. Yes, I follow you. Would that mean that you, the guidance of perhaps the rest of this financial year, in terms of our yields will be better than what we already have? Yeah, I think the quarter-on-quarter yield should inch forward also. Okay. If I can squeeze one last question, sir. Is your guidance for the annual growth rate in the loan book remaining the same or would you be revising it to some extent? We don't want to revise it now. We are hopeful that we should be able to achieve the 10% in the next two, three quarters. Let us see. We are putting our best efforts to do it, and we hope to achieve that 10%. This quarter we were able to grow a little. Probably next two quarters we should hope to do better. Okay. Thank you very much, sir. Thank you. The next question is from the line of Sanket Chheda from B&K Securities. Please go ahead. Yeah. My two questions were answered in the previous one. Thank you. If I can squeeze in one thing on, sir, Q3, whatever incremental disbursements are happening, if you can give us a flavor of what would be blended in on that. Will it be about 17.3% or 17.5% to get a directional level on the range? This incremental lending we do at several rates. We do at 12%, 15%, 18%, et cetera. Blended. It should suddenly be going up, but we cannot if the proportion of the 15%, 14%, 20%, 15% depends on the geography. Geography depends on the place and the seasonality also. We will be trying our best to get higher yields in the disbursement in the coming quarters, if that is what you want to know. We cannot say that we will have only a fixed rate, et cetera. The rates are dynamic, so it is need-based evaluation, et cetera. To one of the earlier questions, if I understood that maybe Q2, the yields being more because we had some a portion of teaser rate loans and now which has run off. Going forward that drag won't be there. Is that correct? Okay. You are correct. The teaser rate drag will not be there. Sure, sir. Those were the two questions, sir. Thanks, sir. Thank you. The next question is from the line of Shubhranshu Mishra from PhillipCapital. Please go ahead. Hi, sir. Thank you for the opportunity. Two questions. One is on the yield. Just to focus on the yield itself. We mentioned that we had very much done away with the teaser rates in April or May. Which means then second quarter won't have had as much of an impact of those teaser rates. Why is it that the yield is almost static, sir? It's first quarter was 17.2%. Here we are at 17.4%. Any possibility of increasing the yield by around 1%-2% in the second half? Otherwise, we are seeing our return ratio is compressing. Second is on the AUM growth. Earlier we had a guidance around 10%-15%. You just mentioned in the previous question, the answer was around, you guided around 10%. We are decreasing our AUM guidance for the full year. Is that a correct understanding, sir? I think, regarding the yield comparison with the Q2 and Q1 and Q2, I think I explained it in detail 2-5 minutes back. I explained that part in detail. To answer one part of your question, yeah, that also I answered that our yield going forward should definitely be inching forward. The third part of your question was about the guidance. We have always said 10%-15%, but because of all these, the growth which is not happening Q1 and Q2, we still stand by the 10%. Not that we have reduced it. We said 10%-15%, but because of the present situation, we should be looking at least 10%. Sure, sir. If I can squeeze in just one last question, sir. This is usually so many systems also disbursement and collections are always higher than the first quarter. This is the only second quarter in the last 2-3 years where the collections as well as monthly disbursements have dipped by quite an extent. Why is that, sir? No, see, compared to last year of the same quarter is what you are saying. Last year of the same quarter was. No, sir, last three years, sir. Last three years if you compare 1Q versus 6Q, always an increase over 1Q. Okay. Not necessarily that, sometimes the situations would have changed, the economic situation would have changed. That is I don't have any other explanation for why it is not there in the, as a trend in the last three years and this year. I don't have any specific reason for that. There's nothing specific in that. Understood, sir. Thank you so much. First of all. Thank you. The next question is from the line of Shweta Daptardar from Elara Capital. Please go ahead. Thank you, sir, for the opportunity. A couple of questions. Why the tonnage has not moved quarter-on-quarter? Madam, I think somebody has asked. The tonnage is actually a function of the gold price. If the gold price is low, the tonnage will be higher because people have to bring more gold. To take the same amount of gold, if the gold price is high, they need not bring 100 g. They need to bring only 95 g. If the gold price is low, they have to bring 105 g. That is, it is exactly the function of the gold price. If the gold price is high, the tonnage will be lower. If the gold price is low, the tonnage will be high. That is exactly the function of that and b ecause people bring only the required amount of gold. You can't ask people to bring more gold. That is the function of that. What we need to look here is the disbursement amount, because our profits or our income is based not on the gold with us, but with the other. The second part, gold is only a collateral, and even today our average lending is less than 30%. We still have good margin to cover. Okay. I thought because gold price has also not moved much, exactly why I raised that query. Anyways, I got the moot points. Secondly, somebody touched upon this question already on AUM per branch. While you mention it takes a year or two, you know, for the branches to stabilize. Can you just guide on the fact that incrementally how much does a new branch add to the overall AUMs? I told you it takes a year for the branch to reach the break-even level. After one year it becomes break-even level and then it starts growing only. It takes two, three years or four years for the branch to reach its full potential. Okay. One last question. It's a new branch. Only the new branch. Okay. One last question, which also you have partially answered already. You mentioned that you are hopeful of 10% full year growth. But if I look at quarter-on-quarter movement and if we expect a 10% growth, does that mean Q3, Q4 will be two robust quarters going forward? That's what we hope to. I think you and I cannot say whether it will be a robust or a non-robust quarter. Sir, where I'm coming from is because you also mentioned that you do not see much of competition coming from unorganized side, barring banks who are largely focusing on high ticket loans and who are already on, you know, competitive rates. Is it fair to assume Q3, Q4 will be much better and therefore 9%-10% growth is plausible? That's what I said, yes. Okay. Thank you, sir. Thank you. The next question is from the line of Amarnath Bhakat from Ministry of Finance of Oman. Please go ahead. Yeah, hello sir. Can you just give a clarity regarding this branch opening related, RBI approval? How many approval do you have for opening the new branches or if that problem has resolved? I think there is no problem. It is only that RBI had kept the new branch permissions on hold for a year or so. Now they have permission to open branches, and we have requested for 150 branches. They said, "Okay." Of that, we have opened 35 branches. The other branches are in various stages of construction. Probably by end of December, we should be able to open all the 150. Thereafter, if we feel we need more branches, we'll apply for more branches. There is not any- That means out of the INR 150 you applied for, you got it, right? Yeah, yeah. Yes. Yes. Yes. Yes. Okay. That was very comforting. Now, if I look at your revised or current ROA and ROE, which is now came down to, say, ROA of 6% and ROE of around 18%. Now, can we take this is a new normal, b ecause previously your ROA, ROE is much higher? Of course, the situation was different. Now, considering the current situation, for our own projection basis, can we take this 6% ROA and around 18%-19% ROE is something normal going forward? No, I think that we would like to see it go up, and we would expect it to go up slowly also. We don't think, we don't want, we would not like to keep it as a normal. We'd like to grow into it. We should see at least slowly going up. Sir, one more question. In the staff side, I can see your number of staff added only in the Q2 is around 587. If I deduct the Q2 total minus Q1 total. 587 staff in one quarter, when the business is not that much going. Just can you elaborate why those staffs are going and what is the purpose of adding that many staffs in one quarter itself? 500 staff out of, say, 20,000 staff is nothing, sir. Adding and telling us that adding itself is 2% more. 587 added in one quarter. That is nothing. No great number, sir. It's just a 1%. If we open 150 branches, you know, we at least require 600 additional staff. We can't, you know, when we are looking at opening in next couple of months, you know, we have to train them. Earlier, you know, this was going as a regular process. Now this has come up, so we recruit. Then some employees leave also. You know, all those things have been kept in mind when it comes to the recruitment part. Sir, one is like a subsidy part, sir. Especially this, I can see the fantastic growth happening into this, microfinance side especially. If you can give little more light about that part, because it appears to be growing very fast. What is your outlook in respect of this, microfinance side of the business? Microfinance is a good business. It is well appreciated by everybody, the customer, the regulator, the government. Everybody would like to see the microfinance business grow. We see lot of potential there in terms of it putting purchasing power in the hands of people. We see the sector offers good potential. Sir, have you something to keep in mind? My purpose of asking the question is, have you something in mind that at what percentage you intend to grow the microfinance book at 20% or 30%? Some kind of an idea can you give that at what percentage you are trying to grow that particular book? No, we don't have any particular guidance on the microfinance percentage itself. As demand and things, we will grow that business also. Okay, sir. Thank you very much. Thank you. The next question is from the line of Aditi Jha from IDBI Capital. Please go ahead. Thank you, sir. Thank you for giving the opportunity. Most of the queries has been answered. Sir, a few data points if you can share. Sir, one is that during the quarter, if you can share what was the auctions which we have done. We did INR 578 crore. INR 578 crore. Okay, sir. Secondly, if you see the presentation part in that where you have shared Stage 1, Stage 2 assets, loan assets, there has been a slight hike in the Stage 2 loan assets from INR 461 crore to INR 864 crore. How one should see that part going ahead? Any impact in terms of Stage 3 assets going forward or any provisioning which could be required during next two quarters? Actually, things occur normally, you know. You know, if in a particular quarter disbursements are higher, 12 months afterwards, you know, naturally the Stage 2 could be higher, you know, depending upon the collection efforts which we do. You know, this all, you know, this will fall into the overall risk management metrics for us. You know, we look at, you know, what is the interest accrual. Suppose if the customer has regularly paid interest, you know, we allow much more risk in that particular portfolio. So we allow these customers to, you know, some more time. That's how, you know, we have the Stage 2 and sometimes even the Stage 3 assets also go up. You know, unlike other financial institutions, here it has to be treated slightly differently. Because it is fully collateralized with gold. Even somebody reaches Stage 1 or Stage 2 or Stage 3, we are not going to lose our money. It's only giving extra time to the customer. Okay. We don't require any ECL provisioning because of this regulatory part, I said, going forward. My sense was that. We have to make sure suppose the Stage 2 goes up, naturally the you know, the ECL provisions will increase because you know, Stage 2 also requires ECL provisioning. The ECL provisioning will not return on ECL book. The Stage 2 and Stage 3 did not- That's what I was trying to say. That's the point we were trying to say. Provisioning is just like a provisioning in our book. We are not losing any money there. Awesome. Lastly, sir, on the cost of funds, though on the yields you have spoken, so how one should see the cost of funds moving for the full year FY23 as compared to FY22, as we are seeing repo rate hike and other, hikes are happening in the bonds also. I think, you know, it should come to somewhere around 8% we should be able to manage, you know. Let's see how, you know, it is. You know, at least in the third quarter we should see it remaining around 8%. Okay. For full year 8% we can consider till now? I'm not sure about the fourth quarter. Depends upon how, you know, the rates are going up. Okay. Thank you, sir. That was very helpful, sir. Thank you. Thank you. The next question is from the line of Madhu Chandak from MC Pro. Please go ahead. Hi, sir. My question was about your loan growth outlook. We have seen 1% kind of a sequential growth in the loan book this quarter. When we interact with the private sector banks, we have seen that the gold loan has been identified as a kind of a trust area for them. What I really wanted to understand from you is if they are putting a focus on gold loans, obviously their yields are going to be much lower than yours. In that case, which is the pocket of the market which you are targeting to grow your loan book by 10%? If you could give some qualitative understanding about the same. No, madam, I think we have very good guidance of at least 10%. Hopefully in the next two quarters we should be able to achieve that because there is no specific market, et cetera. No other market which we don't want to tap. We have 5,000 branches, which cater to the local people there. We don't leave any type of customer or any type of a loan size, et cetera, behind. Whatever comes we will do, and that is what we've been hoping to do in the next two quarters. I just want a small understanding from you, sir. I mean, what is that banks can't do that you can do? I think we are getting too much into details, madam. I don't think on this what bank can do, what we cannot do, et cetera. Want to be improved always. We will do that. I don't know what you mean by saying what banks can do and what we can't do. I mean, is there a segment which is something where the banks cannot penetrate, which will remain a forte for someone specialized like you? That is what I'm trying to understand. See, banks have always been doing it, you know. The fact that NBFCs are, you know, excelling certain activities because, you know, we are able to do it in a cost-effective manner, better service to the customers. You know? That is the key differentiator as far as any NBFC is concerned. The same applies to us also. Okay. What you're trying to suggest is, it is the cost factor which will give you an edge over banks in certain pockets of the market. Is it correct? No, it is not the cost. Service, it is service part. The service quality, the better service quality. The service quality. Okay. Got it, sir. Thank you very much. Thank you. The next question is from the line of Shreya Shivani from CLSA. Please go ahead. Hello. Thank you. I have two questions. First is on your borrowing profile. We can see that the share of term loans from banks has risen up to 56% now. It used to be at like 47% in the first, in the second quarter last year. Any color you can give to us on this, where would you see this mix going? Will it increase or will you be trimming it down? First is my first question is on that. The second is on the liquidity on the balance sheet. I think you guys had mentioned last time that you've reduced it and you'll maintain it at this level. I can see it is at 12% level for second quarter. Will it be, will it continue to be at 12% going ahead? Just a confirmation on that. No. You know, as far as the level of borrowings from banks, you know, it all depends on you know, the cost factor, availability of funding. You know, depending upon the scenario, we try to tap that particular market. Now, you know, bank funding was easily available at some point of time. We tap that market. We wanted a better yield, better rate of interest. So we tap that market. The whole borrowing program is based on the availability and, you know, at what price. Those factors were kind of acceptable for us. That's why, you know, the bank borrowing proportion is higher. I agree. On the liquidity. Yeah. Yeah, on the liquidity part, you know, September end, you know, liquidity levels have been kept high, slightly higher because, you know, the first tranche of ECB was getting due for payment by October end, which we repaid as of now. We were preparing for that, you know, about INR 3,700 crores of repayment. That's why we have kept a slightly higher liquidity as on September 13. Though we have brought down the liquidity levels during the quarter. In the intra quarter, we had brought down the liquidity a little bit. I think, you know, our endeavor is always to, you know, keep a normal liquidity. We don't want to keep a higher liquidity as, you know, you know, there are higher, you know. Interest differential. Interest differential. I think, you know, going forward, we'll try to prune our liquidity to a certain extent. At the same time, we need to take care of the LCR requirement as well as the, you know, comfort of the debt investors, et cetera. We will maintain a certain reasonable level. Got it. Also, sir, next tranche of ECB repayment is due when? That is, I think in September 1st, 2023. September 1st, 2023. Okay. That's it, sir. Thank you so much. Thank you. The next question is from the line of Mahrukh Adajania from Nuvama Institutional Equities. Please go ahead. Good evening, sir. Sir, although this has been partly answered through many questions earlier, in response to many questions earlier, I would seek some more clarity. Who are your main competitors right now? W hat is the time frame they've evolved in, b ecause when we speak to state banks, they say that they were not earlier doing non-agri gold loans, and only over the last 2-3 months they are going aggressive on non-agri gold loans? But we don't have separate numbers from them. Likewise, are there any FinTechs who are directly competing with you in your segment? Ma'am, I think you answered that yourself. We also don't have much, you know, understanding on their, what is their portfolio earlier and what is their portfolio as of now. You know, I think, without those finer points, we'll not be able to answer that question from you. Right. In any practical sense, the feedback you get from branches and stuff like that? No. See, you know, banks have, you know, probably around 60-70,000 branches across India. We are only having 4,500. You know, every bank trying to do every business little bit. Certainly, you know, if, you know, if it is 4,500 against 70,000, naturally it is a competition for 4,500 branches. Okay. Got it. Thank you. That was the last question for today. I now hand the conference over to management for closing comments. Thank you. Thank you all investors. Thank you for supporting us. From our side, we will assure that we will do our best in the coming days, in coming week, coming months, also to keep in mind the interest of our investors and all other stakeholders, and hopeful of doing better in the next two quarters. Thank you. Thank you. Thank you. On behalf of ICICI Securities, that concludes this conference. Thank you for joining us, and you may now disconnect your lines.