Ladies and gentlemen, good day and welcome to Nippon Life India Asset Management Limited Q1 FY 2023 earnings conference call hosted by InCred Equities. 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 touchtone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Jignesh Shial from InCred Equities. Thank you and over to you, sir. Yeah, thank you, Michelle, and good evening, everyone. On behalf of InCred Equities, I welcome you all for this earnings call of Nippon Life India Asset Management Limited. On behalf of the management, we have Mr. Sundeep Sikka and Mr. Prateek Jain, our CFO, and the entire management team of Nippon Life India Asset Management. I now hand it over to Mr. Sundeep Sikka, CEO of Nippon Life India Asset Management. Sir, over to you, sir. Thanks. Good evening, everyone, and welcome to our Q1 FY 2023 earnings call. We have with us our Chief Financial Officer, Prateek Jain, Co-Chief Business Officers, Saugata Chatterjee and Aashwin Dugal, Chief Digital Officer, Arpanarghya Saha and Shin Matsui, nominee of Nippon Life Insurance Company. Our detailed investor presentation and press release have been uploaded on the exchanges as well as on our websites. Before we take our questions, let me share with you some comments on the recent industry trends and our Q1 performance. This quarter has seen significant market volatility owing to the continued geopolitical uncertainty, high crude oil prices, increasing inflation and weakness in currency, coupled with FII outflows. In the past, too, we have witnessed that global sentiment and local economic indicators had an impact on the Indian asset management industry. The industry assets declined marginally by 2% in this quarter after witnessing a positive momentum for seven quarters. The decrease was mainly due to the fall in equity as well as fixed income assets while ETF rose. However, the secular trends in terms of investor additions continue to remain steady. The industry further expanded its base of unique investors, which grew by 1.6 million in this quarter, representing a 5% increase over March 2022. The growth in the investor base and consistently higher quarterly SIP flows indicate an investor preference for mutual funds as an avenue for long-term wealth creation. At Nippon India Mutual Fund, our priority is to be future ready and capture the long-term opportunities. Our overall market share rose by 16 basis points to 7.40%. AUM increased by 16% to INR 2,794 billion. At Nippon India Mutual Fund, investor interest remains our only constant. We added 1.3 million investors in Q1 and continue to have largest investor base in the mutual fund industry. We increased our share of industry unique investors to 37% with a base of over 30 million investors. In line with the investor first motto and the proven governance philosophy, Nippon India Mutual Fund is committed towards institutionalizing approach towards fund management. As in June 2022, no category of equity has more than 16% of the total assets. Majority of the funds are jointly managed and no individual fund manager manages more than 23% of equity sales and that too is spread across funds which have other co-fund managers. Systematic flows are a stable and a key driver for industry long-term equity flow. Nippon India Mutual Fund annual systematic transaction book is at INR 97 billion. Quarterly flows increased by 30% to INR 23 billion. On a gross basis over 383,000 systematic folios were added in Q1. Our systematic AUM rose by 7% to INR 482 billion. 51% of our SIP AUM has continued for over five years vis-a-vis 22% of the industry. In volatile market, folios with lower ticket size have demonstrated longer vintage and better stickiness. 13% of our SIP folios have continued for more than five years versus the industry average of 9%. Today, Nippon India Mutual Fund offers industry's best suite of products in passive category. With strong growth in investors' passive assets, our ETF ecosystem is already in place and far ahead of its peers in terms of investor base and mind share. In this segment, we manage an AUM of INR 601 billion and have a market share of 14.1%. Excluding ETF allocation, which goes to two specific mutual funds, we would be the largest ETF player in the country. Our gold ETF is the biggest fund in the category with assets of INR 68 billion. Nippon India Mutual Fund share in industry's ETF folios rose to 60%. In Q1, we added over 1 million investors and account for 83% of the total folio additions in the mutual fund industry during this quarter. Nippon India Mutual Fund has 74% share of ETF folios on NSE and BSE. Our ETF average daily volumes across funds remain far higher than the rest of the industry. Nippon India Mutual Fund always had an unwavering focus towards building a digital-centric business. With a futuristic vision and a clearly articulated strategy in place, digital has become one of the keystones of our long-term growth and sustainability. In Q1, digital platforms contributed up to 55% of our total new purchase transactions. Over 750,000 purchases were executed through digital assets, an increase of 25%. Nippon India Mutual Fund has a well-diversified and a minimal distribution base, and a wide presence through 275 locations across the country. As on June 2022, we had over 85,500 distributors in panel with us. The NFP base rose to 85,300 with an addition of 1,200 distributors this quarter. Now, on our financial performance. For the quarter ended June 30, 2022, the profit after tax was INR 1.1 billion, a decrease of 37%. Operating income rose by 1% to INR 1.7 billion. Operating profit as a ratio of average assets under management was 25 basis points in Q1 FY 2023, as compared to 28 basis points in Q1 FY 2022. In the past, the company has followed a consistent dividend policy. In FY 2022, NAM India declared and distributed the highest ever dividend with a payout ratio of 96%. Over the last eight financial years, NAM India has distributed a cumulative dividend of INR 34 billion. As we grow organically through our physical and online channels, we remain open to evaluate investments in strategic opportunities that add to profitability or complement our existing businesses and ultimately are in the interest of minority shareholders. As a signatory to UN-PRI, we have already begun to integrate ESG aspect into areas of strategy, business operations, investment management and governance. We have introduced a formal ESG framework in FY 2022 and have disclosed our vision and objectives and the progress in the annual update. Through a combination of responsible investing approaches of screening, ESG integration, and active ownership, we remain committed to build a resilient portfolio that will not only provide sustainable returns for investors, but also have a positive environmental impact and social impact. To sum it up, I would like to reiterate that at NAM India, investor centricity remains the key theme. We strive to deliver a superior performance and sustainable returns to our investors and in the process add value to all stakeholders. We are confident to continue our trend of profitable growth in coming quarters. With these comments, we are happy to take your questions. Thank you. Sir, shall we start with the Q&A, question and answer session? Yeah. Yes. Okay. Thank you very much. We will now begin the question and answer session. Anyone who wishes to ask a question may press star and one on their touch tone phone. If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question is from the line of Sameer Dalal from Natvarlal & Sons Stockbrokers. Please go ahead. Yeah. Hi. I had a question regarding your other income loss. You showed a loss this time of about INR 17 crore. When I look at your breakdown of your investments, only INR 240 crore is in equity, about INR 2,500 crore in debt in the mutual fund schemes. Have the debt side also underperformed that badly that the overall returns are showing a negative? I mean, I just want to understand, I mean, given most of it is in debt, how we reported a loss for this period in the other income. I'll request my colleague, Prateek Jain, to take this question, please. Yeah. Sameer, actually, if you see what has happened is that, you know, as you mentioned, there is INR 250 crores of equity exposure and broadly the market has fallen about 10%-15%. Our schemes have been, you know, because of the mark-to-market impact has been about, you know, in the same range of 10%-12%. Broadly the major MTM impact is coming from there. Also, the yields in the 10-year G-Sec, if you look at it, has gone down by about 50 basis points in this one quarter itself. Also Paras have a rub-off effect on G-Sec shorter end of the curve as well. On an overall basis there has been some decline in the, you know, on the fixed income side also. You have to understand that, look, you know, our investments have been, you know, because of the skin in the game requirement, we have to invest into all our debt schemes, you know, across the portfolio. That may have also resulted in MTM impact on the fixed income side. Therefore you see the overall, you know, impact, which is of about INR 7 crore on the standalone basis and about INR 17 crore on the consolidated basis. Would it be possible to share how much of your portfolio is into long-term debt, short-term debt and, give a break-up of that? I mean, because if the short-term debt really, even if the interest rates move up, the impact is not much. It's basically the long-term debt have taken a hit, I'm guessing. I just want to know in the future if- 70% of our debt is in the short-term category. Sorry, what percentage? 70%. 70% is in short term. That's right. Okay. Given 70% is in short term, I mean, I'm just still again trying to extrapolate. I mean, it doesn't matter, it's a small amount, but net-net, that's affecting your profitability for the quarter, right? If you look at it. Second thing is your fee income has also gone down a bit. I mean, as a percentage of total this thing. Has there been any change in certain structures of brokerage given out or commissions given out that have affected your earning income? Sameer, I'll tell you. If you just go and, you know, see, this is the, you know, complete accounting impact. If you look at, the markets were almost at its peak. 4th April or if it was March, was the time where the market was at its peak. If you see market has recovered significantly, but at the 30th June when the accounts were drawn, the market was at its trough. What happens, this is a balance sheet event date. You know, you have to take the market impact. When we were preparing our financials for the quarter of March, the valuation was at the peak and when we were making the valuation date balance sheet for the quarter, you know, it was the lower trend, and therefore you know those has to be accounted in, you know, our MTM income. Yes. That still affects your yield on this thing. I'm saying your yield is down. Any particular reason why the yield is down? On the yield side, again, you know, because of the market impact on our equity schemes, obviously the realization in terms of equity yields were comparatively lower because the equity assets have declined to the extent of MTM impact. Also, whatever we have seen the growth into our assets have come into the you know more low-yielding assets, which is the liquid and the ETF, and that is the reason of the lower yield. Okay, fine. Okay, I'll come back in queue. Thank you. Thank you. The next question is from the line of Lalit Deo from Equirus Securities. Please go ahead. Yeah. Hi. Thank you for your. Sir, just wanted to understand, sir, if you look at the increase in total folios. It's majorly it has been driven by the ETF segment. Sir, just wanted to understand the new folio additions on the equity side and how has that trend been over the last 12 months? I think from our perspective, yeah, I think broadly as we have mentioned earlier, total I think, the very high percentage has come in ETF. We have also seen 375,000 new SIPs getting added during the quarter. Again, ETF what we are seeing are new investors are coming and in active it's a mix of both, new investors, whereas the existing investors are also going for top ups. What I think we'll do is try to usually Abhishek will share with this information post the call. Sure, sir. Sir, like, with respect to operating expenses, there has been a sharp increase in the other operating expenses sequentially. What are the reasons for the same? Sir, like with respect to operating leverage, apart from the increase in AUM, what are the other levers for us to improve the operating to have a better operating leverage? I think from the last quarter, if you look at it, you know, Q4 of 2022, we had other expenses of INR 138 crore, which is now at INR 145 crore. I would not call it as a sharp increase. You know, there is a INR 7 crore increase in overall basis, and predominantly because if you look at last two years, we have not given much increment to our employees. This year. Last year was, you know, from a profit perspective, one of the best years for us. Therefore we have given, you know, inflation-linked increments to our employees. That is one reason. Secondly, after the, you know, if you are comparing compared to the sequential quarter, what has happened is that, or corresponding quarter, I think, you know, the economy has completely opened up now and, you know, business is as usual and normal. There are certain expenses, you know, which is related to that, which has gone up. Also the fact that, you know, we have carried out certain marketing initiatives which you would have witnessed, both in terms of our television campaign as well as the newspaper campaign, which is, you know, again, as part of our future readiness, you know, and future investment for the future. Those expenses have resulted in this increase. However, we remain committed to continue to work and, you know, operate this company on utmost frugality, and that has been our approach for the last you know, three to four years, and we'll continue to operate in that fashion. Also one has to, you know, importantly, as Sundeep mentioned in the call that look, you know, the way we have diversified in terms of our fund management, et cetera you know, we are geared up if the assets has to grow from here. You know, even if it has to grow one to, one and half to two times, then there are no significant investments or expenses will be required. That's where the operating leverage will come into play. Sure. Thank you. Thank you. The next question is from the line of Mittal from HDFC Securities. Please go ahead. Hi. Good afternoon, sir. Thanks for the opportunity. Sir, you know, now, first question is around yield. I mean, there is a sharp drop in equity yields in this quarter. Whereas for the other peers, when you look at the equity yield for the other players, we have seen that, you know, for them, the yield has sort of improved in Q1 after the normalization in the macro environment. For us, you know, even in Q1, there's been a very sharp drop in the yields. If you could explain, what's been the reason? No. You know, there has not been a sharp decline. I would say that what has happened in terms of our overall yield, one, we have to see that some of our fixed income or the debt assets have now, you know, we have seen shrinkage in our fixed income, and those money has come in terms of ETF as well as the liquid. Our market share as well as our overall composition is, you know, skewed towards. While we have maintained our equity composition of 42%, but the debt which has declined has gone into ETF and liquid. Therefore, there has been some change because of the impact of this composition. Because of the mark-to-market impact, you know, there has been an impact on the overall yield. B ecause of mark-to-market, your assets go down, but ideally your yields should be going down, right? Ideally, the yield should improve if the absolute assets go down in the year. My question is around yields actually. Because even, you know, if I do understand that, you know, the share of debt has gone down, but even then the drop in the yield seems quite high. On a sequential basis actually. No. If you see from our perspective, you know, what we have been maintaining is that, look, we start the year anticipating what could be the cost likely to come in. We pre-empt that expense now only. What we have done is we have anticipated what is the likely yield which will be going to be the end of the year, and we start building up on that basis, so that, you know, in compliance with the SEBI circular, no excess, you know, the brokerage remains within. What has happened in the last few years, you know, there has been a higher intensity of competition and a lot of new money has come through NFOs, et cetera, and which has been at a significantly higher cost. Based on that, what we have done is, you know, we have pegged our realization based on the expected new inflows and the expected new cost. You know, based on that, you know, we see some decline in our yields on our equity assets. You are trying to say that our yields are actually charged. From what I understand is that the yields are charged on a daily basis, so this is something that we are charging an estimate, some estimated yield, on our P&L? See, because what we have to do is, as per the SEBI requirement, you have to charge equity expenses, you know, expense on equities keeping the average brokerage expected. What we do is we, you know, always try to estimate what would be the yield, you know, what would be the average brokerage cost and what would be the average margin which will be realized, and based on that, we peg our fees. S ir, can you know, some outlook on the yields front? Because if yields continue to dip at such a rate, then, I mean, you know, any operating leverage playout seems quite unlikely in our business. Because the yields have been falling at such a fast pace, whereas the growth in the assets hasn't been, whereas the inflows have been coming to the passive. If you can share, you know, give us some color around the outlook on the equity yields. I would say that, look, you know, this downward pressure on yields to continue for some more time, because, you know, there has been a slew of new players who have come in. Also, while last two quarters we did not see much of NFOs, but we have seen NFOs coming in. Therefore, you know, there has been a tendency that, look, you know, from a distribution fraternity, the money will get, you know, or rather the, you know, these pressure would be there, you know, so it will be felt on the yield. That is one reason. Secondly, as you mentioned that, look, the, you know, while, you know, the asset grows up from here, obviously there would be, you know, decline in the realization. The third bit is that, look, from the overall yield perspective, the composition has been changing. The composition is changing, and there has been both on the debt and the equity side. What we have seen is lot of the new money has started coming on the passive side. We have seen, you know, good amount of inflows on the passive side, both on the equity as well as fixed income side. All of these are putting some pressure on the yield, and which we see that it is likely to continue for some more quarters before it becomes or because of the base effect it comes down. More importantly, you know, there is what we also expect that from here on, once the, you know, the yield curve moves to the or reaches the peak, you know, from there on, when the yield curve changes or when, you know, the interest rate cycle changes, a lot of money will come into the long tenure and the credit side of the fund. That's where, you know, once that will lead to the change in the asset mix again. What has happened there is a flight to safety at this point of time. W e have seen that when the money will flow into those asset class and those categories where we have a propensity to have higher money, I think you will see there has been an overall increase in the yields. I think this is a cyclical nature. Yeah, sir, I agree that, you know, with the change in interest rates, flowing to debt will return. My point is that, you know, on the equity side, I mean, you know, for how long this pressure is. Because when we look at yields on a quarter basis, it is very difficult to know until when will this pressure continue to remain. I mean, for one year or two years, five years, I mean not able to I'll tell you that look, this from our perspective, you know, since we do not completely participate in the way the competition goes ahead and, you know, share their fee income with the distributors. You know, we have our own benchmark and, you know, we continue to maintain our profitability, which we'll continue to do so. However, you know, this we could not control was the outflows and, you know, the churn from the old asset to new asset. But what we've seen is the pace of that has significantly come up. What, you know, from December 18 till about December 21, you know, we've seen significant outflows from our schemes. You know, there was gross outflows which was happening despite getting lot of AUM. There was, you know, net outflows. That has been now arrested, and we are seeing net positive AUM. Also, the overall redemptions have gone down. This means the vulnerability to those old assets getting churned has now come down significantly. Hence, the impact going forward will not be significant unless we also start sharing a significant portion of our fees with the distributor. There is one which was, you know, what we could do proactively to stop it is that not to share significant amount of fee assets. The second was the redemption, which was beyond our control. Got it. Sir, you know, just one thing on the passive side, given that most of these new fintech companies are coming up with a plan to launch schemes on the passive side, what do you think? Given that these schemes are sort of quite easily applicable by the other AMCs, what sort of innovation do you see on the passive side going ahead, given that we are seeing outflows in this segment? From our perspective, we clearly see. I think you mentioned the fintech. I think it's not only fintech. Clearly, I think India still remains highly underpenetrated, and I think more players is going to be more competition, which is going to be good. I think from our perspective, I think more than innovation, I think what we want on one side, we continue launching new products, especially on the passive side. On the active, we have already articulated in the past that we will not be launching new schemes for the sake of launching till the time we see they can be scaled up. On the passive side, we will have the launch of few schemes, but ultimately, like anything else, the key focus is going to be on execution. It's not just going to be launching a scheme. I think we believe on the passive and the ETF side, we have the ecosystem in place. I think we'll continue the strategy of executing. I mean, it's new players coming, what competition is doing. I think we keep an eye on that. I think our core focus remains, you know, I think what is best suited for the investors' interest, what is best suited for the portfolio, and we'll continue launching schemes based on that. Could you help us with the schemes already there in the pipeline for the next 6-12 months? Slide number 17 of our presentation. Sorry, 17 of the presentation. I think all the entire detail is there. Got it. Thanks. That was all from my end. Thank you. Thank you. The next question is from the line of Kunal Thanvi from Banyan Tree Advisors Private Limited. Please go ahead. Yeah. Thanks for the opportunity. Yeah. My question is again on, you know, trying to understand, you know, where Nippon India, you know, stands in the, you know, in terms of profitability, market share, because if you look at equity and debt, both the categories, we have been not able to, you know, gain back the lost market share. The market share is either stable or we continue to lose it. At the same time, if you look at our yields, we are seeing, you know, the fastest, you know, compression in the revenue yields compared to, you know, peers, both listed and unlisted. What's happening out there? Like, you know, we are not as we said, you know, we are not participating in giving high commission. Also our realizations are coming down and at the same time we are not gaining market share as well. Can you help us understand the sharp fall in the yields which, you know, from say 40 or 520 to our revenue yield was at 48 basis points. It is at 45 basis points. The change in asset mix won't explain this kind of fall, right? We have seen this kind of change in asset mix in previous cycles as well. If it is like what are the, you know, what's happening out there? Because at one end, we are seeing losing yield. At the same time, we are not seeing increase in market share. If you can explain to us, you know, and how one look at market share versus yield, you know, phenomena, because when we look at other AMCs, there's a clear, you know, inverse relationship. You give more commission and get higher market share. In our case, on both ends, you know, we are seeing pressure on both sides. Kunal, I think I'll give some initial comments and then it will go to Prateek. I think firstly, I think from our perspective, I think we talked about market share. I think we have seen a market share grow for five quarters it has been going up. Now pace, so which asset class, I think again, I'll stay out of that right now just because it's already in the presentation, we don't want to repeat it. I think the first comment there, I think for five quarters back to back, the market share has been increasing. Number two, I think again, from our perspective, we clearly believe, I think when you talk of market share, even one of the most difficult things to execute in this industry has been retained. I think our retail market share, our retail portfolio accounts market share, everything has been increasing. Having said that, I think I'll go to the last part of it, this thing, and different from AMCs will have different strategy. One strategy we're very clear, we are not going to do any business which is going to be at a loss. The change that you're seeing is due to a product mix, number one. I think in equity over the last five quarters, I think we have started seeing better inflows. I think with the improvement in performance, I think we are seeing the gross flows are getting better. The redemption has totally stopped. Clearly we believe there's going to be lag effect and I think the composition of equity is actually increased further in the next few quarters. As for the realization is something completely different? I think, Kunal, has already, you know, spoken about the yield profile. You know, you are right that what has happened is the recent increase in the market share has come through the low-yielding asset which is passive and liquid. You know, what you could see is the pace of decline of our equity assets. You know, the net outflows which we were witnessing has been arrested. You know, the kind of depletion in our equity market share which we were witnessing has gone away. You know, obviously from you know since the time you know we actually started exiting our past group from there on till about you know you know last December 21st, if you see, you know, we were seeing continuous outflows coupled with you know some you know not so great performance. If you now see it, there are one-year and three-year performances come up and in the last six-odd months, if you see, you know, we have been able to arrest that decline. Also, if you see on the fixed income side, large part of the money which has gone out is the FMPs, you know, which we had. Obviously, you know, those were time-bound and, you know, we could. While we have got them back, much part of it, but that has come into the low-yielding assets. You know, those assets have matured and they've come into us and I think at the appropriate time, you know, we will be able to migrate them to the high-yielding assets. Again, as Sundeep Sikka mentioned, you know, for us, you know, the philosophy has always been the investor first. Importantly during these times, I think the best strategy from the fixed income side has been, you know, to have on the shorter end of the curve. Large part of our asset, even in the fixed income category, has come into the shorter end of the curve. Therefore, growth has come on liquid ETF and shorter end of the curves are dead and that has an impact on the realization. Importantly, we have been witnessing, you know, decline in the equity assets which has now got arrested and we in the last six months have seen, you know, decent amount of positive inflows. We would like to build on that momentum and you know, and you know, going forward we're likely to see that, you know, higher share of, our higher market share in the equity asset as well. Sure. Just a follow-up on that. One, if I get it right, the large part of the yield fall is because we are winning market share in lower yielding assets. Second follow-up question was, if you can help me with, you know, equity, average equity yield that you had in Q4 of 2022 versus this quarter. We do not give individual breakup, you know, of the yields. You know, largely, you know, if you ask me the decline, you know, is in line with the industry. Sure. Thank you. If you see the schemes, you know, various schemes because, you know, from our perspective, whatever distribution commission what we've been paying it is, you know, is lower than most of our peers also because of the mix of the, you know, large part coming through IFAs. Our average brokerage is lower and that is where we'll continue to lose. What has happened is that, look, when I'm saying and we are admitting that look, we saw lot of outflows. A lot of the old assets which were higher yielding or which will have a lower trail has been replaced by the new trail. Sure. All right, thank you. Welcome. Thank you. The next question is from the line of Dipanjan Ghosh from Citigroup. Please go ahead. Hello. Good evening. Am I audible? Yeah. Please go ahead. Yeah. Just one question from my side. If you can give some color on your wallet share across top distributors in the banking category or MFPs or national distributors, more from the equity flows perspective, as we see, let's say in the last one or two quarters. Yeah. Hi, Dipanjan Ghosh. What are the types? I'll just share data from the last two quarters. Broadly, the equity market share flow from a flows perspective. When it comes to MFDs, we are roughly around 7%-8% of the industry. From banking and the larger wealth managers will be slightly lesser, maybe around 5%-6%. The IFAs are of course higher market share, closer to 8%-10%. From a blended perspective, it will be around 6%-6.5% as a company. So that's where we stand today. We have a very high SIP concentration in the SIP flows will be close to double digit, that has incrementally gone up over the last eight quarters. Our net sales has started becoming positive in the last three quarters. That is the broad numbers what I can share. Just to, you know, confirm 7%-8%, 5%-6% was on the banking channel, 8%-10% was on the MFD channel, 7%-8% was on the national distributor, large distributor channel, and on a blended basis, around 6%-6.5%. Is that correct? Yeah. Our larger share of wallet comes from the IFAs. Yeah. Just maybe a follow-up on this. On this 8%-10% wallet share that you gave across the IFAs, you know, if you can segregate your overall flows through the IFA or the MFD channels between, let's say, the top 500 IFAs versus the rest. Not maybe from last two quarters, but maybe, you know, whatever trends you have seen, let's say, for the past one, two, three years out there. We do not comment on these granular data in terms of our engagement with the distributors, individual distributors or you know group of distributors. I think whatever disclosures are required and you know which is available on the industry you know or the peers you know that data is made available either through MP you know or through our presentations. Sure. That helps. Thanks and all the best. Thank you. Thank you. The next question is from the line of Akshay Jain from JM Financial. Please go ahead. Yes. Good evening, sir. I have two questions. Number one, can you please share some broad range of yields across segments, specifically on the equity side? Maybe, you know, if you can give some color on what you are making on, say, the old stock versus what you're making on new flows. See, it's in the same range, you know, is about close to about 80 odd basis points, you know, on the overall basis, you know what we earn, 75-80 basis points on the, you know, the overall basis, I would say, on the equity assets. In terms of the old one, again, you know, it all depends, you know, in which asset class, which category, you know, at what time the investor has come in, you know. The good news is that, look, we have almost, you know, almost 30% of our assets, which are more than four year old now, which is actually, you know, that all the money which could have churned, you know, would have been churned by now because you see the pace of churn has come down dramatically. I think this is the assets which is there, which is continue to yield a good, you know, yield for us. However, as we continue to grow from here on, the buy of this asset will keep reducing and hence, you know, there will be a pressure on the overall yield. From a competition perspective, you know this will insulate us, you know, from the perspective that, you know, our yields are not gonna drop as much as compared to Because now that the, you know, outflows have been arrested, the yield drop will not be as significant compared to some of the players who will continue to have this churn happening. Other good news is that because, you know, our fund performance has also come up significantly up the curve, that will also arrest the churn and also we'll see some decent amount of inflows back into our equity schemes. Understood. About the range in debt and liquid and others? I can, you know, share with you even in the last two years, you know. Though this shift of the debt assets from credit to, you know, more safe and that started September 2018, from the IL&FS issue. You know, from that period if you look at it, the average blended yield on the debt would have come off, you know, for the industry as well as, for us, close to about 10-12 basis points. Understood, sir. The second question is on the tax rate. Your listed peers have benefited, you know, from two things. One, on the deferred tax which has been reversed on, say, MPN boxes, and number two, the benefit of indexation on the investments which they receive. In Nippon's case, you know, we are not seeing, you know, any benefit on the tax rate side. Any comment on this? No. See, what we do is, and we have commented in the past as well that look, we create that ETR. What is the effective tax rate which we would be there not considering just this quarter because you know the, accounting standard require us to anticipate. We have not taken the impact. We assume the market gonna be flat for the year and based on that we have accounted for the profit and that's how we have calculated the ETR. Understood. I'm able to make you meet that. See, what we are assuming is that whatever earned income we are earning, you know, we'll continue to earn irrespective of this one-time mark-to-market impact on the equity scheme. Because we assume the market will become flat by the. Neither the appreciation nor the decline we are considering. Okay. While calculating the ETF for the full year. Based on that, we are calculating. Therefore, if you see, the effective tax rate is about 25 odd%, 24%. Understood. What about the indexation benefit? See, what we do is that, you know, from our perspective, till the time we do not sell or we do not trade into that, we do not calculate any kind of long-term or short-term capital gain on our equity investments. Understood. Okay, thank you. Thank you. Thank you for that. Thank you. A reminder to all the participants to press star and one to ask a question. The next question is from the line of Krunal Shah from ENAM Investment. Please go ahead. Thank you, sir. Most of my questions have been answered. There's one question. What are the yields in ETF products and the yields in ETF? ETF would be in the range of, you know, we have, you know, said in the past 11-12 basis points, and, you know, which will remain that way. Okay, thank you so much. Thank you. The next question is from the line of Mohit Surana from CLSA. Please go ahead. Yeah, hi, sir. Just one of the previous answers that you gave on your share in gross inflows of various distribution channels. If you could also, if you have the data handy, you could also tell us your share on gross direct inflows, which is like non-distributed, and also your share on redemptions. Mohit, you know, apologies, but you know, what I've been disclosing in our investor presentation, you know, that is what we comment on at this point of time, because some of this is, you know, like, data we have not been sharing. However, as and when, you know, we believe that, you know, such data need to be, you know, disclosed and, you know, we will definitely take up the lead and, you know, start disclosing it. But at this point of time, we do not disclose the individual shares from particular segment, you know, gross flows from particular segments, you know, in terms of distribution. However, you know, total distributed assets, as well as, you know, our share of assets from IFAs, bank distributors and national distributors is already provided in our presentation. Understood, sir. The second question is, with regards to the operating expense now, you've mentioned in one of your previous responses that, there's some increase on account of higher activity, et cetera. Do we assume this is, kind of a new normal and a new steady state and, you know, if there is any outlook that you want to share for the full year, growth in operating expenses? That's all from me. No. See, if you look at it, you know, from an employee expenses, all what was supposed to be, you know, get accounted in the first quarter itself, because the increments, and the provisioning, et cetera, you know, if you've seen, we have been consistent and we'll continue to be consistent. That has been there. This will be the steady runway. Unless, you know, there is a significant change in our profitability, based on that, you know, if it is a good year, we may decide to share some more variable. Or if it is not a good year, we may, you know, which you have seen in the past, that we may work on our variable payouts. That is the one case. You know, that lever have always remained with us, and that is completely contingent on, you know, what kind of profit we make. At this point of time on our anticipated profit basis, we have already provided adequately, and we do not see a significant change in the numbers going forward. In terms of the other expenses, if you see, there has been you know, marginally, a marginal increase in terms of rather two broader reasons. One is you know, the marketing spend what we did. I think we'll continue to invest into marketing because we are seeing good traction and our performance has been good. I think these are the right time for investor to you know, invest. Obviously we'll reach out. We are seeing good traction of new investor coming in, and therefore we'll continue to invest into the marketing spend. Besides that all the other non-discretionary spend, you know, we'll continue to keep a tighter controls and, you know, we'll try to see that how much we can squeeze out of it or at least not let them grow from year over. Okay, understood. Just a follow-up. Is there, do you foresee any seasonality in terms of spends across the quarter? As I told you, there are only two things which we have said in the past that we will continue to invest in the future. One is the marketing. You know, given the traction and given, you know, how our scheme continues to do and how we want to spend. That is one area. The second area is the digital. You know, we have seen, you know, significant increase in the activity on digital, and that is one area we believe that, you know, we will keep investing. But all these investments, while, you know, as a part of conservative accounting, we account it in the same quarter where we spend. But the benefit of these, you know, it's likely to accrue in future as well. You know, this is how you have to see. The details of these expenses are also available, you know, on our annual reports. You can see that, you know, how we've been, you know, spending and, going forward also, you know, these are the two areas, marketing and digital, that is where we believe, you know, some higher allocation which may happen. Understood. Thank you. Thank you. The next question is from the line of Abhijit from Kotak Mahindra Bank. Please go ahead. Hi, good evening. I have one question. Of the new retail ETF customers that you're seeing over the last one year, do you have a sense of how many of these are starting their mutual fund investments through the ETF route? Or these are largely sort of already existing investors and sort of now experimenting with an ETF product as well? I think at this point of time, we may not have that kind of a color. I think we clearly see an opportunity going forward where, as to how to cross-sell, up-sell our various products. I think very, very difficult to at this point of time, give this answer that I think whether they are existing or new. Our strategy will be to cross-sell, various other products to them. Sure. Got it. Thank you so much. Thank you. As that was the last question for today, on behalf of InCred Equities, that concludes this conference. Thank you for joining us, and you may now disconnect your lines.