Good day, and welcome to the earnings conference call for Q3 FY 2025, hosted by Piramal Enterprises Limited. 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. The results material has been uploaded on the company's website, and you may like to download and refer to them during the discussion. The discussion today may include some forward-looking statements based on the management's expectations that are subject to uncertainty and changes. These must be viewed in conjunction with the risks that the business face. On the call today, we have with us Mr. Ajay Piramal, the Chairman, Mr. Anand Piramal, Director, Mr. Rupen Jhaveri, Group President, Mr. Jairam Sridharan, CEO, Retail Lending and MD, PCHFL, Ms. Upma Goel, CFO, and Mr. Ravi Singh, Head of Investor Relations, Strategy, and Sustainability. I now hand the conference over to the Chairman, Mr. Ajay Piramal, for his comments. Thank you, and over to you, sir. Thank you all for joining us today for the Piramal Enterprises earnings call. Before we get into the quarterly results, I would like to highlight the macro backdrop as we see for our businesses. India's economy has been facing headwinds. Moderating investment growth, tightening liquidity, and expensive long-term capital are slowing India's economic activity. FY 2025 GDP growth is expected to be at 6.4% compared to 8.2% in the last year. However, I am certain that these short-term challenges will ease reasonably soon, aided by policy support. We expect domestic demand to gain strength and a revival in public CapEx on infrastructure. As we look back at our own performance in the third quarter of the current year, some key trends stand out. The business mix continues to steadily shift in favor of growth business, which comprises retail and Wholesale 2.0. Growth AUM now accounts for 87% of our total AUM versus 34% in March 2022. With this changing mix, the consolidated AUM growth and margins are getting stronger. In the Q3 FY 2025, our total AUM grew by 16% year-on-year versus the 15% growth guidance for FY 2025, and consolidated business NIMs also improved 60 basis points Q- on- Q with this mix change. The legacy discontinued book rundown is on track, with AIF recovery coming in on expected lines. The legacy AUM was down by INR 1,713 crores quarter- on- quarter to INR 10,353 crores. These are now 13% of total AUM at the start of the year. We reconfirmed bringing this book down to less than 10% of total AUM by March 2025. In this quarter, we recovered INR 551 crores of the AIF book, leading to a gain of INR 376 crores. This puts the nine-month gains of AIF at INR 557 crores. We have used these gains to build buffer and provide for legacy AUM rundown in Q3 and the rundown expected over coming quarters. We expect further significant AIF recoveries in the last quarter of FY 2025 and in 2026. Amid a worsening asset quality environment for the sector, we are encouraged by our portfolio's performance. Delinquency trends for the overall retail portfolio have been stable in a narrow range during the last three years. Secured products form 78% of our retail AUM. Wholesale 2.0 has maintained its 100% collection efficiency. The credit cost for growth businesses was at 1.9% versus 1.6% in Q2 of FY 2025. Retail's operating performance continues to strengthen. AUM yield is stable, and fee income has expanded over the last three quarters. More importantly, OPEX to AUM is down 200 basis points in seven quarters to 4.5%. Pro forma, the PBT ROA of growth businesses, was at 1.4%. This is a similar level as in the first half of FY 2025. The capital and liquidity position of the company continues to be strong. Our capital adequacy stands at 23.7%, and we have cash and liquidity of more than INR 8,000 crores. As a further boost to our balance sheet, we announced earlier in the month that PEL, through its subsidiary, will become eligible to receive an estimated amount of $140 million, subject to final closing adjustments, expected to receive in the financial year 2026. This is in connection with deferred consideration from the sale of Piramal Imaging. The company may also receive further amounts in subsequent years from any eligible profits and future earnouts relating to Piramal Imaging, subject to a maximum of $200 million inclusive of the above $140 million. Moving on to the proposed merger of PEL into PCHFL, with reference to application of PCHFL conversion into the NBFC ICC, RBI has directed us to submit the COI with a new name, namely Piramal Finance Limited, and revised MOA, altering the main object clause in line with the intended business of NBFC ICC. The application for reservation of name change is being filed with ROC. Another application for issuance of NOC for merger of PEL into PCHFL is under review with RBI. We expect to complete the merger process, including the NCLT approval, by September 2025. To conclude, while the external growth environment and asset quality climate have indeed moderated in FY 2025, we are encouraged that we are on track to meet or do better than the targets we set for ourselves at the start of the year on business growth, business mix, and operating performance of the growth business. Our focus will stay on sustaining the superior business growth while keeping a tight control on portfolio quality and expanding the profitability through margins, fee, and OPEX ratios. With this, I now hand over to Jairam and Upma to discuss our business and financial performance. Thank you, Chairman. Let me start with the discussion on our retail lending business. In the third quarter of FY 2025, Sir, are you clear? You're not clear to me, Jairam. I don't know if the voice is clear to others. Sagar, are you able to hear clearly? There's a lot of ambient noise. Sagar? Your line is coming up clearly, sir. Okay. Okay, thanks. In third quarter FY 2025, our retail AUM grew by 37% year-on-year and reached a total of INR 59,093 crores. Disbursements for the quarter stood at INR 8,362 crores, up 9% year-on-year. Disbursements and unsecured products were slowed down and were down 12% YoY versus 24% YoY growth for the secured products. Our flagship mortgage businesses, comprising home loans and LAP, grew by 35% year-on-year to an AUM of INR 40,027 crores and now account for 68% of retail AUM. Our mortgage book has exhibited robust asset quality in the last two years, and at present, the 90+ delinquency ratio is 0.5% in housing loans and 0.4% in loan against property. Other retail products also demonstrated robust AUM growth, with used car loans up 119% year-on-year, salaried personal loans up 111% year-on-year, and business loans up 37% year-on-year. In business loans, the microfinance AUM was roughly flat, with a 10% AUM growth YoY, and the unsecured business loans AUM was up 49% YoY. Digital loans, which we had put some brakes on about a year ago, saw AUM and disbursements both down, with AUM down 25% on that metric. The asset quality side, the retail portfolio remains healthy and stable. 90+ delinquency at 0.8% is slightly up but is within the narrow range we have maintained over the last three years. We believe that our diversified multi-product portfolio lends the stability, even as different products undergo their own cycles. In our presentation, if you look at slides number 19 and 20, these slides show the 90-day past due trends over the last three years, and they also show the vintage risk trends for those tranches that have been booked over the last three years. Within unsecured, you will notice that microfinance, which we report as part of the business loan segment, has seen sharp deterioration in the last four quarters. Microfinance 90-day past due delinquency is at 5.5% versus virtually nothing five quarters ago. Microfinance is about 2% of our retail AUM. The rest of the products continue to witness benign delinquency trends. Credit costs in the secured lending business remain largely unchanged. Within unsecured products, credit cost was a tad higher in Q3 versus Q2, but with a lower gradient than in the first half and whatever delta is there is largely driven by microfinance. In our unsecured portfolio over the last few quarters, four key shifts in our customer selection strategy. Number one, we are moving towards more branch-based origination versus digital origination. Number two, we are moving more towards salaried versus business customers. Number three, we are moving more towards cross-sell and away from new originations. And finally, number four, we are emphasizing a little bit of a mixed shift towards lower risk-return, higher ticket cases than what we used to do in the past. Our data show that these choices are making a meaningful, favorable impact on the portfolio, and you will see some reference to this on slide number 20. Overall, we expect retail credit costs to remain range-bound in line with the longer-term guidance that we have offered in the past. On slide 14, which is our slide on customer franchise and cross-sell, you will see that our customer franchise grew by 24% year-on-year to 4.5 million. We have been able to capture a sizable portion of our customer originations for future cross-sell opportunities. In the third quarter, the share of cross-sell rose meaningfully in unsecured disbursements in line with the four strategic shifts that I mentioned before. This, we believe, will also aid in reduction of delinquencies and credit costs in the unsecured business in the future. From a distribution strategy standpoint, we now have a network of 514 branches, establishing a strong presence across 607 districts in 26 states. As highlighted in the previous quarter, the pace of branch opening has been moderated to five to 10 branches per quarter versus 20 to 30 branches per quarter that we were opening earlier. On slides 15 and 16, we have shown the improvement in our productivity metrics. You can see clearly that productivity on a per-branch basis and a per-employee basis continues to improve across our network. Our branch vintage mix is also maturing, and we are widening the product reach across the network, making sure that more and more products are available from every branch that we have open. If you look at slide 21, you will see the trend of our OPEX ratio. This is a very important operating metric. For For the last several quarters, we have consistently reduced the OPEX to AUM, which now stands at 4.5% at the end of third quarter FY 2025, down from 4.7% in the previous quarter and from 6.5% in the fourth quarter of FY 2023. We aim to continue the strength in line with our long-term guidance of 3.5%-4%. On the same slide, on the left-hand side, you will also see that the AUM yields have been very stable in retail after a mild dip in the first quarter due to the accounting policy change on processing fee. Now, that accounting policy change has been absorbed, and slowly, the retail fee is expanding to catch up with the new steady state. Underlying cash fee collection has remained unchanged or improved in this period, and the reporting fee is now just catching up. Slide number 12 talks a little bit about our emerging new strategies on the liability side and a little bit on... Here, we have made a strong start in the direct assignment and co-lending programs. They're a big part of our liability strategy now. We now have 12 DA and co-lending partners, including the largest PSU bank in the country and two of the top three private sector banks. The momentum on new partnerships in DA, co-lending, and new channels such as CSCs and digital has sustained. Most recently, we announced partnerships with RBL Bank and MobiKwik. We have a meaningful number of similar tie-ups in the pipeline as we speak as well. The retail AUM is now almost at INR 60,000 crores, and we expect scale-up of our multi-product retail strategy to continue at a healthy pace, even as portfolio quality remains a very big area of focus. Simultaneously, operating leverage will continue to improve, expanding our profitability profile. With this, I want to move to the wholesale lending bit. My colleague Yash has been kept away due to pressing personal commitments, unfortunately, so I'm going to channel Yash's thoughts and share with you the state of our wholesale lending business. During the quarter, we disbursed INR 2,075 crores in Wholesale 2.0, a YoY increase of 24%. We continue to see faster-than-expected repayments in this portfolio, and so AUM grew by 60% YoY to INR 8,916 crores and 13% QoQ. Repayments are happening across both the CMM and the real estate lending businesses. This indicates better-than-expected performance of the book, which continues to benefit from economic tailwinds across corporate and real estate sectors. Since new wholesale lending business, we have had 100% collection efficiency and have not experienced any delinquency in the portfolio. The portfolio has an average ticket size of INR 77 crores and an effective interest rate of 14.4%, showing a well-balanced asset duration and diversification. Encouraged by this performance and by market tailwinds, we will continue to build a granular, high-quality, profitable portfolio in a calibrated manner. On the legacy side, the legacy AUM reduced by INR 1,713 crores quarter on quarter to INR 10,353 crores. Thus, in the nine months of FY 2025, we have achieved a reduction of INR 4,219 crores in this book. In this process, over this nine-month period, we have taken a haircut of around 24%. This proportion is similar to the haircut proportion that we have taken while reducing the book from INR 43,000 crores to INR 14,500 crores between FY 2022 and 2024. In other words, our haircut ratios continue to remain steady at around the 24-25% kind of mark. We continue to work on paring down the portfolio through a combination of organic cash flows, refinancing, asset sales, and accelerated repayments. Based on all the work in progress on some of the larger legacy asset rundowns, we feel confident that we will meet our target of bringing the legacy AUM to less than 10% of total AUM by March 2025. In this third quarter, we recovered INR 551 crores in the AIF book, with P&L gains of INR 376 crores. We expect further significant gains from this AIF book in the fourth quarter and in FY 2026. With that, I hand over the call to Upma to walk us through the financial performance. Thank you, Jairam. Now, moving to our financial performance, in Q3 FY 2025, we reported a consolidated net profit of INR 39 crores. Profit before tax, including AIF gains and associate income, stood at INR 91 crores. INR 100-crore quarter-on-quarter reduction in profit before tax was primarily on account of two elements. First one is reduction in our non-core income in Q3. That's INR 42 crores gained on sale of property and INR 20 crores dividend income. Another area is INR 30 crores lower profits from our fund and the insurance JV business. In comparison to Q2, book taxes increased by INR 25 crores, from INR 27 crores to INR 52 crores in Q3. This is primarily on account of higher profits at PEL standalone. Book taxes are expected to be reversed to the NCLT order for merger in case the order is received on or before the tax filing date for FY 2025. Our performing PBT for growth business stood at INR 212 crores, which translates to PBT ROA AUM of 1.4%. In this quarter, while calculating performing financial ratios for individual businesses, we further simplified the business-wise cost of fund methodology. We now use same cost of funds for all the assets, which is same as the company cost of funds. This change has no impact on consolidated ratios. For growth business, this has led to 50 basis points reduction in the cost of funds, including equity, which currently stands at 7.1%. Had we used similar methods in the first two quarters of FY 2025, the cost of funds in Q1 and Q2 would have been lower by 50 basis points versus the reported performer numbers. Our total GNPA and NNPA ratio stands at 2.8% and 1.5%, respectively. Our net worth stood at INR 26,924 crores, with a capital adequacy at 23.7% on consolidated balance sheet basis. Our cost of borrowing stood at 9.2%, marginally higher by 10 basis points versus quarter two. We are actively diversifying our borrowing mix, and our securitization and international borrowing share has now increased to 23% from 6% in December 2023. Our fixed to floating rate debt mix has improved to 42%-58%. The fixed floating gap between assets and liabilities has now been mostly neutralized to align the balance sheet better with the declining rate environment. With these remarks, I would now like to open the floor for questions. Thank you. 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 the 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. Our first question comes from Avinash Singh from Emkay Global Financial Services Limited. Please go ahead. Yeah, thanks for the opportunity. A couple of questions. First one, if I mean, again, I'm going to legacy book. So on legacy book, if I see, quarter has seen close to INR 1,700 crore kind of runoff. And if I look at your credit cost overall and adjust for the INR 287 crores of credit cost in retail, and then also look at how the provision in this legacy book has moved, it suggests that, I mean, on this INR 1,700 crore rundown, the total provision is coming closer to INR 700 crores. So that broadly translates to kind of a 40-odd%. And the remaining, I mean, that is close to INR 10,000 crores that's left. Of course, we are provided 18%, but typically, this will be kind of a bit difficult accounts than whatever we have sold over the last couple of years, almost INR 43,000 to INR 10,000 now. So I mean, am I - can you calculate or like in this INR 1,700 crore whatever runoff has happened, the provisioning has been lower? If at all, I mean, if you can help me with this math on this part. The second, just more kind of understanding the accounting. If I see that the detail, thanks for that disclosure, the Excel that's available, that the DA income of INR 100 crores for the quarter has been kind of added into that, added into the income piece or interest income piece as given in the same format. And then, of course, INR 100 crores has been adjusted to our provisioning cost. So how does this account work? I mean, in the same P&L, where does this INR 100 crore appear? Because typically, there also, it should be part of that some income. Okay, thanks. Okay, I'll let Upma answer the second part of your question. Let me take the first part, Avinash. Thanks for your question. So the legacy provisioning math is the following. See, it's INR 1,713 crores is the reduction in the legacy book. We mentioned that in the nine months, the haircut overall has been about 24%. Actually, if you just look at the quarter, the haircut is close to 30%, right? Roughly 30% haircut on a INR 1,700 crore reduction. Mota mota, INR 450 crores is the mota mota in that range is kind of the haircut that we have taken in the legacy book, of which INR 150 crores has been funded from pre-existing provisions. If you just look at the provisioning pool last quarter to this quarter on the legacy assets, you will see that it has reduced by INR 150 crores. Essentially, we have used INR 150 crores from legacy assets and another INR 300 crores new provisions we have created. That's kind of the math, and the rest of it is coming from the growth book. So you see about INR 600 crores and change of that, about INR 300 crores and change comes from the legacy book, and about 300 comes from the growth book. And the legacy book kind of INR 300 odd crores is more or less just getting netted off by the INR 300 odd crores increase in the AIF that you see below the line. That's kind of the very conceptual math on provisions for how the legacy book comes out. So legacy book, quarter three, about a 30% haircut. Total for nine months, about a 24% haircut. That's kind of the situation. And the two years before that, also 24% haircut. That's kind of the math so far. Last quarter, legacy book haircut was quite low. So that's why nine months is only coming to 24%. But that's how it is. Nine months' total is 24% haircut, the same as what it was the prior two years. So I hope I was able to address that question. Upma, the second question? Yeah. On the second question of DA income of INR 100 crores, which is being added into the interest income, that's part of the as per the IR disclosure. In the same page, this is coming under net loss on derecognition of financial instruments. Reason being, the moment we sell the book, the book exits from our books, and that's how it is clubbed under the net loss on derecognition of financial instruments. It shows another negative item there. Yeah. Thanks. That's very clear. Jairam, on the first, your question part, I mean, because where I'm kind of losing track, that there has been a utilization of INR 200-odd crores from your management overlay as well. So the credit cost, I mean, that is coming in the P&L is closer to this INR 548 odd crores because INR 100 crore, of course, the adjustment for this DA fee that I'm doing. The INR 548 crore kind of is coming from this thing. P&L and then INR 200 crore. So management overlays here. What has happened is there was a class of provisions that was created where there were a few assets against which that pool of provisions was created. But उस pool में बाकी सारे assets पहले ही बंद हो चुके हैं. तो एक ही asset बचा हुआ था. तो वो जो pool है जिसके against ये provision रखी हुई थी, उस pool में सिर्फ एक ही asset रह गया था. जब वो asset पे इस quarter, when we made provisions, we essentially used that provision as well, right, into that category. So there is no general overlay for management that was there which has gotten used up. Essentially, because the pool only had one asset, it was effectively a specific asset provisioning that was there. But when we show the specific asset provisioning for stage two, we were not counting that. So that's probably the math that you're talking about. Yeah. I mean, so basically, you are saying that your INR 150 crore provision has reduced in legacy book. And that is in addition, you have used this INR 200 crore that now is part of somewhere here. So INR 350 crore, so that's where I'm kind of losing a bit of a track. That's where this pool is. No, no, your math so far is correct. Your math so far is correct. The specific asset provisions, sorry, maybe what I said is not clear. There are specific asset provisions of about INR 2,000 crores that were there against the legacy assets, right? That INR 2,000 crores is now down to some INR 1,850 crores or something like that, right? So those specific assets, INR 150 crores consumption is there. Then there was this other thing which we were not counting as part of the INR 2,000 crores, right? But that pool of provisions, that pool of provisions only had one asset against it remaining, right? And that was a legacy book provisions only, but it was not getting counted. So only one asset was left. So when we were making provisions against that one asset this time, we ended up converting that to a specific asset provision. So nothing has really changed. We just changed the nomenclature of that from general provision to specific provision. Yeah, yeah. So then you are conjuring INR 200 crores plus INR 150 crores, that's INR 350 crores, and then INR 300 crores in P&L. So that's what I'm saying. There's a INR 650 crores is what you're saying. Yes, correct. Correct, though one of, but usmein pre-existing tha na ek to. It It was just a nomenclature change. It was not new. It was not new consumption. So basically, if I were to see that INR 1,700 crore at INR 13 crore reduction you have seen, what is the sort of a. So now at what value, I mean, including cash, if so that value is now down to INR 1,050 crores? It's about INR 500 crores. It's a little under. It's under 500 crores. It is not 650 crores, if that's the question you're asking. Yeah, yeah, yeah. Okay, okay. 500 crores. Thanks. Thank you. A reminder to all the participants, if you wish to register for a question, please press star and one on your touch-tone phone. Our next question comes from the line of Shubhranshu Mishra from Phillip Capital. Please go ahead. Hi, just one question. Why do we have so many subsidiaries and joint ventures? The sheer number of subsidiaries, when I look at the notes to accounts, the count is close to 20. And the joint ventures, again, we've got like five or six. This creates a whole host of network of so many subsidiaries, one whole core. Whereas when we look at the core business, it's limited, largely limited to lending. So why do we, my question here is that when someone looks at it from an accounting perspective, this doesn't seem right. I just wanted some clarity on so many subsidiaries and joint ventures and associates, thanks. Yeah, no, thanks for the question. See, some of this or a lot of this is an artifact of what our history is. We are a very, very old company. I've been around for decades. Only the last few years have been as a standalone financial services company. For decades, we have existed as a conglomerate with businesses in lots of different areas. So over time, a lot of those subsidiaries have been accumulated. But ever since we became a financial services specialist company, we have been simplifying. If you look at our subsidiaries, number of subsidiaries today versus what they were, let's say, three years ago, you will see a pretty drastic reduction. The same will continue happening. As we now merge Piramal Enterprises with Piramal Capital and Housing Finance and create this new company, Piramal Finance, even more simplification will happen. So we are committed to actually continue to simplify the corporate structure. And we have already done a lot of that over the last couple of years, and you should expect to continue to see that going forward. Your point is absolutely right that it is not common for financial services companies to have this many subsidiaries. But please recall that we are a many-decade-old company which has been in financial services only somewhat recently. So that's the legacy that you're seeing there, but it will all get cleaned up. Right. If I have to push this question just one step forward, is there a deadline to which we can see a clear simplification of this structure? See, we are working with the regulator on this, and the regulator has their own kind of view of what we need to do. And some of the subsidiaries, because they are in other jurisdictions outside of India and they have their own sort of regulatory architecture, it is not possible for me as management to just give a deadline on this. We are working hard towards simplifying it and working with all the various jurisdictional authorities to simplify. Having said this, from a materiality standpoint, as PCHFL and PEL merge, the only real kind of associate that you really need to care about probably is Pramerica and the joint ventures with Bain on the alternative side. That's about it. The rest of the stuff is not at all material. Thanks. Look forward to our simplification of the structure. Thanks. Thanks. Look forward to our simplification of the structure. Thanks. Thanks. Look forward to our simplification of the structure. Thanks. And thank you for the push. Appreciate it. Thank you. The next question comes from Kunal Shah from Citigroup. Please go ahead. Yeah. Hi. So firstly, again, getting on to the provisioning on the wholesale. So when we look at the rundown which has been there on a quarter-on-quarter basis, it seems like the larger proportion is still like almost INR 600 crore out of that is SRs. Okay. So would it be fair to assume that maybe the knock which is being there of almost, say, closer to INR 500 crore, that's because of the composition wherein SRs itself are coming off? Because earlier, you have been indicating that 20% should be the good quantum with respect to the haircut, and we have seen a slightly higher proportion. Now, maybe when we look at it in the next three months, we are again expecting closer to like INR 2,800 odd crores of rundown because it would be at the accelerated pace. Then should we be worried about the more provisioning out there? Right. So if you look at the roughly INR 1,700 crores of reduction this time, Kunal, INR 600 crores of reduction is from SRs. INR 600 crore reduction is in stage one and stage two assets. INR 200 crore reduction is in stage three. And about INR 150 crores each in land and AIF. That's mota mota the INR 1,700 crores. So SRs is roughly a third of what has happened. Your point is right that the haircut percentage in SR has been a little bit higher than in the other categories. That point is correct. But yeah, mix every quarter, the mix will be a little bit different. See, we have now brought the book down from INR 43,000 crores to INR 10,000 crores, and our haircut through this entire process has been 24%-25%. We have been showing the haircut percentage to you all for a few quarters, and you know that FY 2023 and FY 2024 cumulatively, our haircut percentage was about 25%. This year, so far, in the nine months so far, our haircut percentage is 24%. Now, quarter on quarter, it can be a little bit volatile, but mota-mota, it has been about 25%. The haircut has been about 25%. Now, we have INR 10,000 crores remaining of the book. You can apply your assessment on if, let us say, INR 10,000 crores is eventually going to finish over the next, let's say, year or so at about INR 2,000 or INR 3,000 crores, which is the residual book, let us say, the good quality book which we will live with. Then जो भी INR 7,000 crores to INR 8,000 crores का जो delta लेना है, उसमें कितना extra provision लगेगा, आप अपनी तरफ से, you can do some sensitivity analysis on that. We have INR 1,800 crores of provision on the book. Whatever is delta over and above that will need to be funded through some of the other pockets of value that we have mentioned in the past. That's probably the best way to kind of look at it. Yeah. So again, when we look at it this time, it's getting offset from AIF recoveries. Okay. So that's primarily offsetting. So whatever has been the gain on the AIF, that's offsetting the provisioning on the wholesale. And I think that's what you have been indicating as well, that maybe the AIF recoveries or maybe any stake sale gain that would be utilized more towards this kind of an haircut. And at least in P&L, there will not be any further impact. So would that be the right assumption again? That is the right assumption. Yes. 24% does not include AIF. Yeah. Sorry. That's a fair assumption. What you're saying is fair. And this is the way we have seen. That's the way we have played it the last few quarters as well, is that over the last four or five quarters, you've seen us do this, that we have not allowed net worth to get impaired. So net worth has been protected and has continued to increase. You saw our capital adequacy actually improve by 40 basis points during the course of this quarter, even though the book has grown by 16% YoY. So you saw capital adequacy improve. That's because of this angle that we are protecting the net worth by making sure that any incremental kind of haircuts that are coming in are getting offset by any other sort of one-time gains that we have. Sure. And then getting on to the growth businesses. So again, the credit cost has risen by almost like 30 odd basis points. That primarily seems to be MFI. But again, when I look at it, maybe at least there has been uptick on the salaried PEL as well as digital loans. Digital loans, in terms of the disbursements as well, digital loans are up. You have been indicating that you would be getting more comfortable and start to do this business. But the overall operating environment, I think most of the lenders are still suggesting that there is some worry on this segment and even on the business loans. Okay, this is again unsecured. So we would have seen some part of it on the microfinance side wherein we are taking the knock. But again, these three segments continue to grow. So would there be more worry in terms of the overall growth businesses, credit cost also in Singapore? And where would you see the steady state level in this kind of an environment? See, we have stated in the past as well that the business that we are building is kind of roughly a 2% credit cost business. Nothing much has changed there. Nothing that has happened in the last few quarters has changed our mind on that. This quarter, you saw the growth book credit cost go up from 1.6% to 1.9%. Not a big delta. The businesses that you mentioned, you're absolutely right. We will not be. We will try not to be pro-cyclical with respect to these businesses. It is our job to take a call on where we see risk. At this point, I feel comfortable with the profile of risk that we are able to book in the digital side. So we are starting to get a little bit comfortable. I think you and I spoke about this a few months ago where I said that we might start doing more on digital. You see a little bit of that in the third quarter. We saw a tiny bit of increase in that. Business loans, we are not quite there yet. So you saw a big steep fall in business loans in Q3 versus Q2. They're not quite there to where I can assert with any confidence that we are there. So business loans might still take a little bit of time. But salaried personal loans, I continue to feel pretty good. I think the business is holding up very well. And both horizontally and vertically, the risks are holding on quite nicely. If you see our charts on page 20 and 19 and 20, both of them show, one shows vertical and one shows horizontal risk. And you can see kind of the how we are feeling about the various products and salaried personal loans, for example. You can see the very low levels and continuing to stay down. And Q3 was actually even better than Q2 in terms of vintage risk in salaried personal loans. So I continue to feel good about both salaried PEL and digital. Business loans and microfinance, not so much. We are still in a pretty tough territory there. Okay. Okay. And even excluding MFI, the business loan disbursements would have been down? So what we are seeing from, say, INR 1,155 crores to INR 736 crores? Yeah. Yeah. So INR 11 crores fr om us MFI se na, the delta of because of yeah UBL is almost INR 640 crores, yeah, versus INR 650 crores. Delta is probably INR 150 crores. The rest of the delta is all business loans' delta. The total delta is about INR 400 crores, of which about INR 150 crores is MFI delta and the bucket INR 250 crores is business loans' delta. Okay. Okay. Yeah. Thanks and all the best. Yeah. Thank you. Thank you. Before we take the next question, a reminder to all the participants, please press star and one to join the question queue. Our next question comes from the line of Abhijit Tibrewal from Motilal Oswal. Please go ahead. Yeah. Hi. Hi there. Just one question I had. In terms of all the product segments that we have secured or unsecured, I think sometime last quarter, there were conversations happening with regards to spillovers from microfinance in secured segments. So have we seen any such spillovers in our secured segments, or is it like large part of the spillovers that are being seen from microfinance are restricted to only the unsecured segments? Yeah. So I have been, I must say, positively surprised. We have not seen spillovers yet. So I don't want to jinx it. But so far, not really. The secured side seems to be holding very steady. So housing, LAP, everything is just holding up pretty steady. And actually, Q3 was pretty decent as well. December in particular was quite strong. And as we speak, January is looking pretty good as well. So not looking like a spillover thing yet. So no, so far, not so much. It seems pretty contained, at least right now. Got it. And just one last sorry, just one last question that I had was, while we spoke about some hidden pockets of value, we've been utilizing that, I mean, basically the AIF recoveries to ensure that the net worth is not impaired while we are running down the legacy AUM. The other pockets of opportunity that you have spoken about in the past, right, are there any updates on that? I mean, maybe not necessarily a direct update, but directionally, how are we thinking about it? Yeah. So AIF, we already spoke about, and we continue to make progress on that. We'll continue to see more AIF recoveries in Q4 and in FY 2026 as well. Then we have got the stakes in the two Shriram insurance companies, Life and General, where, again, we have been open about our intent to see them as financial investments and exit them at the appropriate time. As these are unlisted entities, it's a little bit more complex, and you need to do some structured transactions to actually get out. There have been some organizational or corporate-level restructurings in those entities, which has helped make things a little bit easier. However, there is no specific update for me to share with you right now. There's no specific deal or conversation that is sort of on the table. But our old guidance on this stands, which is that you should continue to expect us to be available as a potential seller to exit this in the moment the right opportunity presents itself, likely in FY 2026, but we are not setting a particular timeline on that. There is, of course, the incremental sort of item that we had shared recently, which is the $140 million of deferred consideration that's available to us in FY 2026. That's a new pocket of value that has emerged in recent weeks. Again, all these are very different from AIF-type stuff, which we have talked about in the past as potential offsets for legacy asset-side issues. Some of these items are more direct value creation items. So we have that as well. So between that and the stakes in the life insurance entities and, of course, our tax shield that is available to us from the past, those are the pockets of value that continue to remain available to us. Got it. And while you gave a very good color on this, Jairam, just wanted to understand in terms of growth on the retail side, are we still thinking just organic growth? See, you know the Piramal Group has had kind of M&A in its DNA. So we are always happy to consider M&A transactions as and when they present themselves. And our areas of interest where we'd like to see or like to seek M&A transactions also remain the same, which is MFI small business gold. And there is no deal conversation that's going on right now, which we can offer any update on. But yes, we continue to remain interested in those areas. But as of now, the bulk of our strategy is going to remain organic with us opportunistically looking at inorganic transactions if and when something interesting presents itself. Got it. This is useful, Jairam. Thank you so much. I wish you and Nitin the very best. Thank you, Abhijit. Thank you. The next question comes from Rohit Jain from Tara Capital Partners. Please go ahead. Good evening. I have a question on the borrowing mix. I see that the percentage of ECB has gone up quite decently over the last few quarters. Now, given an environment where INR is depreciating, can you help us understand the dynamic of this avenue of borrowing? I mean, what is the hedge cost, and how does it change given the INR depreciation, and is it still better than borrowing in the domestic markets? Right now, Rohit, we are fully hedged. We hedge it at the point when we do the transaction. We don't keep naked exposures. We hedge it at that point. When we did these transactions, our hedging costs were about 2.5%. We entered into the hedge. The rupee depreciation has zero impact on us right now. Of course, as rupee depreciates, the hedge cost itself might change over time. If we were to do a new transaction and enter into a new hedging deal, then the story will be a little bit different. Our old borrowings that we did during the earlier part of this year, nothing changes about them in terms of their impact to us. So, I mean, let's say, as and when they mature, if hypothetically you were to replace them with domestic borrowings in case this becomes slightly more, let's say, expensive, then would it net be a thing we think about that dynamic? Yeah. No. So basically, the way we hedge it is we have hedged for the duration of the loan. So effectively, as far as I'm concerned, it is a rupee borrowing, effectively. So it doesn't matter to us what happens to the USD INR at this point for those loans. Of course, if you want to do a new borrowing transaction, then it does matter. But for those old borrowings, nothing changes. They are locked in at rupee rates. No, I get that. I mean, I'm just trying to understand what's the duration of these tenure of some of these borrowings? Three years. Three years. And so the ones that were borrowed, let's say, in FY 2024 or something, they still have a, let's say, decent couple of years before that becomes an issue for you. Yeah, that's right. Our first significant borrowing was in June of this year. So we have a ways to go. So June 27 is when they will come up, or July 27 is when they will come up. Got it. Thank you. Helpful. Thank you. Thanks a lot. Thank you, Rohit. Thank you. Participants, you may press star and one to ask a question. The next question comes from the line of Vikas Kasturi from Focus Capital. I'm sorry. The next question comes from the line of Rishabh Bajaj from 360 ONE Wealth. Please go ahead. Yeah. Hi. Good evening, everyone. I just wanted to ask, how do you see the credit environment going forward? Do you see incremental steps, or do you feel like it's possible that we could see a peak out in credit risk? Right now, I'm leaning a little bit towards the latter of what you said. Very cautiously, I will say that it looks like Q4 is going to look somewhat similar to Q3. So Q4, you're not going to see a reduction. You're going to see Q4 kind of similar to Q3, but it's not increasing. And even if you see within the quarter, the December trends were actually a lot better than October and November. So if you look at things on a three-month moving average basis, and by the way, January is coming in at similar levels to December or even better. So on a three-month moving average basis, it looks like things have peaked. But these things tend to shift. So I don't want to draw too much from it just now. But I mentioned to an earlier caller that we're not seeing spillover effects into other product lines, and resolution rates seem to be improving within the product lines that were stressed. So putting these two together, it looks like Q4 kind of somewhat similar to Q3, maybe even that higher maybe, but kind of looks more or less the same. And if that ends up being the case, maybe it's looking a little bit more like the peak than not. But I wouldn't assert it with a lot of confidence yet. Let a month or two more go, then we will feel a lot more confident about it. I can just say that December was pretty decent, and January is turning out to be pretty decent. Okay. In terms of the long-term ROA guidance, are we on track to meet that? Anything else? Yeah. Yeah. I must Yeah. Yeah. I must Yeah. Yeah. I must say, guys, on that, our growth book, you saw the pro forma PBT ROA was 1.4%. As the legacy book keeps running down, it becomes irrelevant over the course of the next few quarters. The growth book, the PBT profile will start becoming more and more front page. And you'll see that. You can see that our yields are holding steady, and consolidated yields are even increasing. And you can see that our cost of borrowing has peaked. Fee income is starting to rise. OPEX continues to come down on a regular basis. And if credit costs sort of peak out at around these levels or kind of in Q4, then pretty much secularly, you'll see that all the metrics are favorably aligned. So we feel confident about the medium-term guidance that we have offered, and nothing changes on that front. Okay. Thank you so much. Thank you, Rishabh. Thank you. We'll take the last question from the line of Vikas Kasturi from Focus Capital. Please go ahead. Than k you. Moderator, am I audible? Yes. Yes, Vikas, we can hear you. Okay. Thank you, sir. Sir, I have a couple of questions. So first is our Pramerica holding, what is the strategy there? Is it a long-term strategy? Is it to grow the insurance book aggressively and then maybe list it separately or exit that business? Because I'm sure even the regulator will ask you this question. So some broad guidance on that strategy? Yeah. See, on Pramerica, we are 50% owners and listed as promoters. For IRDA guidelines, promoters need to remain for a five-year period. We have been there for three years now. Your question is a valid one about what in the long term do we see ourselves as strategic owners or not. We continue to have internal conversations on it. We are not asserting long-term strategy at this point on this. All options are open. Having said that, right now, our job is to actually get that company to a certain level of scale and launch the right products, have certain segments in which there is some dominant position so that value is created. How we monetize that value, we will see. But right now, the job is pretty simple and cut out, which is to focus on value generation in that entity. It will remain very small and somewhat irrelevant in the larger scheme of things for us for a little while. But once a little bit of value gets created, then we will figure out the right kind of strategic path for it. Okay, sir. My second question is on your branch strategy, sir. You had mentioned in one of the slides that the rate of addition is kind of slowing down. And so my question to you would be that, sir, given that branches tend to be the engines of growth, so why would you want to slow it down? You would rather want to have more branches because over time, they will mature and help you grow faster. So that is my question, sir. Yeah. So back to that question, Rishabh, see, these things, I mean, you should think of this as sort of a little bit of a caterpillar movement. Sometimes you will see a lot of branch expansion, and sometimes you'll see that slowing down. It tends to happen based on what your primary criterion is. For the next year, year and a half, our focus is going to continue to remain on operating leverage and making sure that we are able to deliver returns from the 200, 250-odd branches that we have opened in the last couple of years, just making sure that they come up to the right productivity levels, that we are able to actually show the returns on that from our continued reduction and OPEX ratios, etc. If we are able to deliver that, we will come back to branch growth as well. Right now, I think the time is for us to actually demonstrate productivity improvements and OPEX improvements on the investments that we have already made rather than continue to make any more investments. This is the strategy for the next few quarters. We will see that it will continue to evolve. Got it, sir. Thank you for your question, and final question, sir. Sir, on your retail to wholesale ratio, which you've given as a sort of a long-term guidance of 75%-25%, and given that retail is growing very fast and wholesale, you're shrinking your legacy book, so we might actually end up with something like maybe 85%-16% or something, sir, given this kind of growth rate, so would you still want to get it back to 75%-25%? Is that kind of my question is, is that kind of set in stone, or is it just like a moving target kind of a thing? I'd say that, I mean, nothing in business is set in stone, but I would say that our desire is for retail proportion to be 75%-80%. It's unlikely that we would want it to be a lot more than that, so yes, it is possible that in the short term, because of continued wind down of the legacy book, in the short term, it is possible that we overshoot the 75-25, but even the sort of medium term, you should expect us to come back to somewhere retail being somewhere between 75 and 80. It's unlikely that we will be too different from that ratio, So you might even slow down the retail then, sir? Is that the kind of thing? I don't think we'll need to slow anything down. I think organically, the numbers will take care of themselves. I think we know what the size of the opportunity is in wholesale for somebody like us with our rating, and we know what the opportunity size is in retail. And we believe that an optimal mix of 75: 25 or 80: 20 will kind of work out. Thank you, sir. Thank you for all your answers. Look forward to speaking with you again. Thanks for your time. Thank you. And on this last point, since the caller asked about growth, I want to reiterate that you've seen the consolidated level growth of PEL increase quarter on quarter over the last multiple quarters. This quarter, we delivered our, if I'm not mistaken, it must be like three-year high of growth at 16% YoY. And we continue to feel optimistic about delivering strong growth, even in an environment in which growth has been relatively slow for the market, and to be able to do that in a way that is fairly risk protected. And you should continue to expect to see fairly contained risk outcomes on the growth book, even as we deliver these growth levels. Thank you for all those questions. Thanks. Ladies and gentlemen, that was the last question for the day. I now hand the conference over to Mr. Jairam Sridharan for his closing comments. Yeah. Thank you, everybody, for listening. I've had one or two questions on messaging platforms. Somebody has asked a question about 24%, the haircut. Sorry, let me just take 30 seconds to clarify. The 24% haircut that we have mentioned for this year, the nine months, is without netting off the AIF impact. Just to be clear, that's the gross level impact. And then we have netted off, or we have set that off against AIF gains that we have done. So this is a gross number, not an ex number, just because one or two people wrote about this on messaging platforms, just clarifying that. Thank you, everybody, for listening to the call patiently. And for any further questions, do reach out to Ravi and team in our investor relations organization. Thank you, and have a great evening. Thank you. On behalf of Piramal Enterprises Limited, that concludes this conference. Thank you for joining us. You may now disconnect your line.