A very warm welcome to PB Fintech Limited earnings call for quarter one, financial year FY 2023-2024. We have today, Yashish Dahiya, Chairman and Group CEO, PB Fintech. Alok Bansal, Chief Executive Vice Chairman, PB Fintech. Sarbvir Singh, Joint Group CEO, PB Fintech. Naveen Kukreja, Co-founder and CEO, Paisabazaar. Mandeep Mehta, Group CFO, PB Fintech. Now I hand over the call to Mr. Yashish Dahiya. Thanks very much, Vaslin. Very good evening or morning, wherever you're joining us from. Policybazaar and Paisabazaar, which are jointly classified as our core online businesses, both India's leading marketplaces for insurance credit. For the last 5 quarters, adjusted EBITDA has kept on consistently improving by an annual run rate of about INR 200 crore. It's actually a little more than that. If you recollect, about 4, 5 quarters ago, I had clarified that this would keep happening. We would keep increasing by about INR 150 crore a year. This has, like, come out to be slightly higher, just explaining. Q4 is traditionally the strongest quarter, and we've never had a situation where our Q1 has caught up with Q4. This is the first time when Q4 has beaten. Sorry, Q1 has beaten Q4. Out of the INR 516 crore of revenue that the core business made, credit linked revenue is INR 134. Just to put in perspective, even the insurance business alone is flat over Q4, which those who follow the insurance industry would appreciate, does not usually happen. We're also very pleased that our core engines of value and, you know, our prime focus, health and term, grew at approximately 40%. I'm very glad that after almost a period of 2 years, you know, these primary protection engines have started to grow, and, month-on-month, we have seen increasing growth. Very pleased about that. Our total insurance premium for the quarter was INR 3,000 crore, INR 3,011. Savings has been subdued, just wanted to mention that, over the last quarter, and over the last year. Our renewal or trail revenue as an ARR is now INR 418 crore, which is up from INR 273 crore at the same quarter last year. Just to put that into perspective, again, that's about a delta of INR 145 crore, and most of this comes at 85% margin, this is a significant source of profit growth. That is where if you look at the INR 200 crore and you look at this, it all starts to kind of make sense. Our consolidated adjusted EBITDA was a positive INR 23 crore for Q1, an improvement from -INR 66 crore the same quarter last year. That's a delta of INR 89 crore for one quarter. The core online business adjusted EBITDA increased by INR 64 crore. Our CSAC continues to be at 88%. It's actually 88.4%, and it was, in the last quarter, was 87.9%, but I think let's just stay with 88% for now, and it's doing quite okay. Credit business growth continues to grow well. We now are at an annualized run rate of INR 16,000 crore, and it's been EBITDA positive since December 2022. I think Naveen just got confused whether we are in 2023 or 2024 already, but that's fine. It happens. INR 16,000 crore dispersal at 5.8 lakh credit card issuance on an annualized basis. This is a July 2023 basis. About 36.9 million consumers who have accessed the credit score platform. 75% of cards issued and 44% of unsecured lending is now happening end-to-end digital. This is a change, and that's what's helping Paisabazaar continuously improve its margins. 75% of disbursements are from existing customers, which is also demonstrating good repeat behavior. The trail revenue is now at 14% of the total credit business revenue. Now, new initiatives. PB Partners, which is the agent aggregator platform, continues to lead the market in scale and efficiency of operations. We have made some changes in focusing towards higher quality advisors. We are operational in 15,400 PIN codes across the country, covering 80% of the PIN codes. For those of you who may have seen the numbers and got slightly worried, just don't worry, we stay totally convinced and focused on this part of the business and totally committed to winning it. Our UAE business has grown 2.6x year-on-year. We've become more confident than we were when I reported to you 3 months ago about delivering the, you know, first full year of being PAT positive this year. Happy to take questions now. Thank you. We'll wait for a minute. Please raise your hand, post which you will be asked to unmute. ... Hi, Srinath. Please ask your question. Hi. Hi, Yashish. Just wanted to understand from a contribution perspective, our renewals ARR have been growing faster than the top line, as this mix change happened, one would assume that contribution margins would start going north. Wanted to understand, what are the moving parts in contribution? You know, how sticky is the pricing and performance marketing? What has been the growth in performance marketing, both in Paisa and Policy? How do you see the path to contributions margins going north towards maybe to 47 or 48, over a period of time? If you could just help us out with that, that would be great. Sure. Let me just take the core business for a second. Let's leave out the new initiatives, because there are way too many moving parts there. Talking about the core businesses, our total acquisition plus brand spend, year-on-year, has increased from about INR 152 crore last year, Q1, to INR 169 crore in the Q1 this year. That's about an increase of 11%. With this, what I'm also clarifying is that INR 159 crore of the, you know, acquisition and brand spend that you see last year, would have been on account of new initiatives, and this year that's about INR 126 crore. Let's again park that aside. It's been about 11% increase in the acquisition marketing cost. Overall, you've seen that the revenue has grown by about 32%, so there's obviously been some efficiency gain on this front. As far as the operating costs are concerned, which is the contact center, et cetera, that has stayed flat with respect to revenue. When I look at the core business, there is... It's pretty much the same, so that percentage has not changed. On the marketing side, there's been further efficiency, which has been gained. The renewals have, of course, kept increasing. As I explained, the renewal run rate this quarter at a ARR basis was about INR 418 crore, and last year, same quarter was INR 273 crore. You are seeing somewhere around, whatever, 40%-ish growth in that. That is the same, so you will, you will see it across the board, which obviously helps us, have better margins every year. Yeah, that's, that's true, and nothing changes in that year. The renewal growth rate is a very steady growth rate over the previous year. Of course, calculating it is complicated, because sometimes there are multi-year policies, et cetera, et cetera. At the heart of it, for our core businesses, renewal on renewal is between 95%-100% on a premium basis, and we, continue to have higher renewal rates than the rest of the industry. Feel, feel good about all of that, yeah. I, I don't know if I've answered the question, but. Yes. Just, just a quick follow-up on that. You know, if renewals have been doing well and our performance marketing cost has, has been growing slower, so how does one reconcile the fact that year-on-year contribution percentage, ma- contribution margin expanded, you know, just 0.3% in the core business? Is, is Paisabazaar in the mix, got to do with something in this? Just finding it difficult. One would assume that if ARRs of renewals are growing this fast and some of the direct costs are cooling off, that contribution margins would actually, you know, move northwards. See, if you look at the insurance business, the renewals is about somewhere between 20%-35% of the total business. You're right, that comes at almost 85% contribution margin compared to the new business. Since it's very small percentage, and that percentage improves, but it takes time. You know, every year you will see that it's improved by a few percentage points. Obviously, if it improves by, say, roughly 4-5 percentage points in a year, the impact will be 2%-3% out of it. Yeah, that is definitely contributing. Apart from that, you do have efficiency, which are coming because of efficiency on marketing and the whole revenue per lead or revenue per inquiry perspective. No, we, it, it's moved from about 42% to about 45%. That's a 3% delta. I don't think our renewal revenue would have moved by 3% delta on the overall revenue piece. Yeah, I think what Alok is saying is these are steady changes. They don't have a dramatic change. I think we gave some odd guidance on this, that, you know, over a 4-5 year period, you should see 5%-10% delta coming because of these factors. It's a, it's a slow move, and, you're seeing 3% of it show up within, within a year, right? Three percentage points. Three percentage points is very significant in that, yeah. Across both brands. Yeah, that's across both brands, Policy and Paisa. Got it. Got it. Thanks, thanks, guys, and congratulations that on, the Y-o, the quarter-on-quarter numbers in the core business have, have surely been a pleasant surprise. Thanks a lot. I'll get back to the question. Thank you. Thank you, Srinath. Hi, Pujen, please ask your question. Yeah, hi, sir. Just one of the bookkeeping question would be, that if we look at the segregation of our revenue. We have splitted into many verticals. There are a few verticals like insurance commission, then outsourcing services, and third is online marketing and consulting, which is a significant impact on our, like, have a significant share of our revenue. I just wanted to know what is, what is included in each of these three things. Firstly, I would like to know that the insurance commission, I understand very well, but just wanted to know on the outsourcing services and online marketing and consulting. What type of services we provide, and how we earn the revenue and how we are being like, if, if we are like, has it been an annuity stream revenue or like it's been a lumpy thing? Just wanted to know that, sir. Sure. I will clarify one thing which is actually quite material, and you should have some clarification on that, which is the advertising and promotion expenses. I'm just breaking this out so that everybody can see it very clearly and just note it down for your, you know, interest. Of the INR 456 crore of total advertising and promotion expenses that you see in March 31 quarter, INR 298 crore or almost INR 300 crore was towards new initiatives, right? INR 158 crore was towards core business. In the current INR 198 crore of total advertising and promotion expenses, only 34 is towards new initiative and 164 is towards core business. What I wanted to explain was, and if you go back to last year, of the INR 289 crore in the same quarter of advertising and marketing expenses, as per the statutory results, 146 was towards new initiatives and INR 143 crore was towards core business. Once more, I say statutory results are statutory results. Eventually, we have given a management view of things. They will both consolidate at the same level. I think this clarity was much needed because there is a classification change in some of the advertising and marketing expenses which were being undertaken for new initiatives, and that change is essentially appearing in what we know as other expenses. To give you an example, year-on-year, if the new initiatives, marketing, and advertising promotion costs moved from INR 146 crore to INR 34 crore, clearly there is about INR 90 crore of this or INR 80 crore of this, which has moved from here into other expenses. I would leave it at that. Other than that, quite honestly, maybe Mandeep gets into it. I actually don't even get into what these stat level things are, as long as they consolidate at the same level with the management view. Hello. Sir, my question won't, would not be on the advertisement expenses. I am talking about specifically on the revenue segregation, what we have been presenting in the annual reports, and we have also presented in the DRHP. If you look at the- Yeah. Hi, this is Mandeep. Your question is regarding the segmentation of revenue. If you look at our annual repo accounts, the revenue is essentially split into insurance and non-insurance kind of revenue. Within insurance, you will see commissions, rewards and outsourcing revenue that comes to us in an insurance segment. Non-insurance segment is largely for credit related revenue, that's basically PaisaBazaar revenue. It used to include all advertisement and marketing that we were able to, you know, garner in PaisaBazaar as well. That's the primary breakup of the segments of revenue that we have in our annual reports. Yeah, got it, sir. One of the things is, if we are looking for the outsourcing services, what are the specific services we provide so that we get that specific revenue generated via outsourcing? What is the specific? We do not, we do not get into that level of clarification, please. ond question would be just bookkeeping. If you look at page number 14, our renewal or trail revenue as an ARR is showing at 340. While somewhere the other way I look at it, it is showing at 480. So, revenue rate is 480 ARR. I think there's a split between policy and... It's total in 18. Yeah. the INR 418 number that you see is a total ARR, and INR 340 is related to the specific business, and you will see a balancing number in the later part of the presentation as well. Okay, okay. Got it, sir. Thank you so much. Thank you, Pujen. Next question. Sachin, please ask your question. Hello? Yeah, hi, this is Sachin. Quickly, I mean, on the INR 1,000 crore PAT guidance that we have had for some time now, right? I wanted to check your confidence level there. Looks like it's easily achievable now. Do you feel that number is, can be postponed, can be increased, or how does your confidence level on that look like now? ... It's the same, yeah, nothing's changed there. Everything is the same. nothing in our mind has changed. only for this year we are a little more confident because, yeah, that's all. I think, as far as the 2026-2027 guidance is concerned, we are just as confident as we were. Nothing has changed in our business dramatically that makes us think more positively or less positively about the future, about the medium-term future. Sure, sir. Another question on the corporate insurance piece. Now, this is more like a housekeeping question. That segment used to appear earlier, now we do not see it in the, in the presentations anymore. Are you, like, tuning it down? How, how- No, no, nothing of the sort. It's INR 222 crore of premium came from the corporate business last quarter. Nothing of that sort. It's just we didn't have anything special to say, so we just didn't say it, otherwise, yeah, that's it. Understood. What will be the premium from PB Partners business, if we can ask that? I think the total between PB Partners corporate and Dubai is about INR 750 crore. Okay. Yeah, and INR 220 is corporate, INR 100+ is- Seven. Dubai. 713. 713. Sorry, INR 713 crore exactly. INR 220 crore, which is, you know, corporate, and the rest is between PB Partners and Dubai. Understood. Looks like that means PB Partners has declined very, very sharply. Is that the reading that you are getting as well? No, no. I think if you look at it from Q4 into Q1, it has declined, and that is to be expected. Even. Q1 to Q1, it is roughly at the same level on the overall business, but on the... as I think was said in the opening remarks, the nature of the business has changed quite dramatically. Business coming from retail agents is up 90% year-on-year, whereas retail that was coming, business that was coming from larger agents has gone down significantly. Mm-hmm. Got it. It's a mix shift between the, in the business, which makes the overall business look flat, but within that is a very steep increase in the retail business. Sure. I think the reason for this mix shift is that you find the retail business to be more sticky or sustainable. Exactly. It's more sticky, it's more sustainable, and it comes at better economics. It's much harder to do also, right? Right. That's why it's taken us time to, you know, get, get to this point. Fair enough. Just one final question, if I can squeeze in. The CM for new core business, if I can try to sort of triangulate that, this is your, the contribution margin that you've been sharing, it comes down somewhere around the 15%-20% range. Am I reading that right? I would, usually, we, we haven't done this. We could, we could track it. The point is, usually, I would, I would ask you to desist from focusing on new business margin. It doesn't make sense. If health grows faster than other categories, you will see our margin decline. Health on new business is a zero margin category. If you appreciate what I see, I'm saying. Right. Because obviously it's a high NPV category. I wouldn't go too much into, you know, new business margin and, renewal margin. Overall, there is a business margin which keeps improving as renewals keep growing. Understood, sir. Eventually, the way we look at it internally is an NPV way. Mm-hmm. We don't look at these businesses from what are the new... In fact, let me put it very simply, in, in our internal, in our internal reviews, I desist our team from looking at new business margins, because sometimes makes wrong decisions. Because as you can imagine, whenever we review health, there would be an a sort of, sometimes a desire felt of being positive margin on new business. That actually is not a very healthy thing to do, because obviously the NPV is way, way higher. I would rather that we were at 15%-20% negative margin on the first year, but we're growing much faster. You appreciate what I'm saying, right? Yeah. I think the business mix decides the margins quite a bit. On the whole, we don't, we feel good about our margins on the core business. Nothing has changed. Everything seems to be on track. Fair enough. Thanks so much. The only, the only thing that's happened this year is our core protection businesses have grown faster, and I'm quite happy about that part. Great. Great. Congratulations and all the best for the rest of the year. Thank you. Thank you, Sachin. Madhukar, please ask the next question. Hello, am I audible? Yes. Yes. Yeah. Hi, congratulations on a, a good set of numbers. One data keeping question, can you share, actually two, one, your credit revenues, and second, your renewal premium number? Third, you know, your total premium growth, seems to me, a little bit on the lower side at, you know, 24% growth. Is it obviously, part of it is because POSP has not grown that much? Even if I exclude that, it's probably at about, 25%, if I'm not wrong. So your comments around, that will be helpful. I will leave to Sarbvir to comment very specifically, but I will give you the base data, so you have it. First of all, Paisabazaar credit revenue, let's call it credit revenue. Let's not get confused by Paisabazaar revenue or Policybazaar revenue. Credit revenue is INR 134 crore for the quarter. Leaving that aside, you're absolutely right. On POSP, in terms of premium, A -6% is not significant, but it's -6%. Please appreciate this is a business which we can grow very rapidly and control, and we, we'll keep doing things as we progress, and there's been a big shift in quality. Also, the savings business did not grow. If you really think about it, savings was a little below last year, same quarter, that was a big part of the business. Savings was almost, you know, as big-- new savings alone was almost as big as health and term, or, or even bigger at times. I think that does play a role. You know, the protection businesses have kind of grown well. You're right, on the core Policybazaar business, your numbers are about right. The 25% would be about the right number. The new to renewal split across the board, since you asked that particular question, we are equally split at about INR 1,500 crore renewal, INR 1,500 crore, a little, little more towards renewals, about INR 1,600 crore, INR 1,400 crore. Sorry, Sarvesh, if you had any specific comments on any of the business lines. No, I think Yashish covered the whole point. The savings business in the first quarter was somewhat weaker than it's been historically. If you see last year, we've been always talking about savings being a big driver of growth. This year, because of March, I think there was a big external event in March when the tax changes happened, because of which the entire market has been bit subdued. That impacted us as well. Other than that, I think the businesses actually continue to grow very well. Right. Thank you for the answers. I will get back in the queue. Thank you, Madhukar. We'll take the next question from Mr. Sachin Salgaonkar. Sachin, please ask. Hi, thank you for the opportunity. Yeah, just following up on the question which ended. You know, guys, just wanted to understand, you know, what kind of a premium growth ideally we could look going ahead. One gets a sense that, you know, savings is a bit, you know, muted, but, you know, clearly other businesses like health and others are doing well. Can one look that, you know, for this year, 24% is more like a bottom growth, and from these levels, you know, growth, you know, premium should increase? Sarvesh and me are both smiling. I think we are very, very comfortable where we sit. We've had a tough quarter, no doubt about it, but we are very comfortable where we sit. As we review our numbers, everything seems to be surprising us positively. I'll, I'll hand over to Sarvesh. He's the more moderated one in such answers, but yeah. No, I think, Sachin, we would not like to, you know, give any kind of- I told you. Yeah, any kind of forward-looking guidance. I, I agree with Yashish. I think based on where we sit, we do hope and we expect that the industry will do better than it did in the first quarter. I think if the industry does better, then we'll also do better, is how I would put it. We are finally a function of the industry. Got it. second question, you know, just wanted to understand, you know, when I optically look, calculate the commission rate, which is, you know, your premium and revenue divide. On a, you know, quarter-on-quarter basis, it does show an improvement of 12.4%-16.8%. I presume this is a bit on the back of reclassifications on a, you know, apples-to-apples basis, possible to understand, you know, how the take rate has improved? Our take rates have not changed in any material way. We have nothing much to report. There will be some business, you know, mix changes, because obviously protection business does usually have a slightly higher take rate, but nothing material. I also, you know, last quarter I mentioned that, you know, sometimes there is quarter-to-quarter shift of INR 5 crore-INR 10 crore, of which is, you know, if you think about it, on 500 crore of revenue, that's roughly 2%-3% here or there, because you can't have everything exact, right? Just some extra issuance may happen one month, some extra, some low. I would say just expect that. Maybe INR 10 crore here or there, and look at this shifting over quarter rather than one quarter. There could be some billing arrangement that means that, you know, there's some incentive mark or some award mark you hit earlier, various things. Don't get. The base answer is no, there has not been any material shift in any of our take rates. Would that be right, Sarbvir? Yeah, absolutely. I think the only change in first quarter this year versus last year is the improvement in mix for the protection business. Protection is a larger portion of our mix this year, so that's why you see a small delta in the take rate. Got it. You know, if we think about the renewal mix, you know, any broad understanding of, you know, how much is between your own and POSP? POSP is almost insignificant as a part of renewals. Like, last quarter, our POSP renewal, like, I shouldn't-- I, we usually don't give these numbers, but it's, like, meaningless. It's, like, a few INR tens of crores at most. Okay, very clear on that. Yashish, as we speak, you know, no significant or, you know, absolutely no updates on Bima Sugam, right? It's a great platform. I think it'll do really, really well. You know, it's obviously initiated by the government and by all the insurance companies. We, as part of the IBA, are also part of it, and we think it's a phenomenal platform, yeah. Yeah, that's, that's where we are. Sorry, I wanted to understand from about the launch time and date, you know, any updates perhaps from that perspective? Look, I'm not the right person to comment on that, yeah. Please appreciate it's a regulated initiative platform. We are a regulated entity. For us to comment on an initiative of the regulator, you're putting us in a very difficult position. A fair point. One last question, general thoughts on competition? We have seen PhonePe getting a bit more aggressive into insurance. Media articles indicate Jio Financial Services is also looking at that. Any broad thoughts? ... Our view stays exactly the same, and we're not being kind of cocky about it. The second largest player in the market is none of the names you took. We will not name them, but they are following pretty much our model. We think our model is a good model. We are very confident of it, and almost nobody's even heard of their name. But they follow exactly our model, and yeah, they're the second largest player. You know, I think platforms having almost half the country's traffic on them are also not able to get as much volume as somebody who's almost unknown. I think the model is very clear. This is a customer support model. Whoever has to compete eventually has to build exactly what Policybazaar has, is, is my opinion, because health and life is like that. I would refrain from commenting more. Yeah, we don't want to. Yeah. Yeah. Got it. Thank you- I just want to add, one thing to this. Yeah. I think the best way to think about this is that there is a huge insurance market opportunity, right? One is here and now, one is the growth in that opportunity. I think the, the idea is to get more and more customers to, you know, first come to Policybazaar and then buy from us. I, I don't think it's just a platform versus platform game. It's actually a very big market opportunity, and we are one of the players in that market opportunity. I, I personally feel that one should not look at it in a narrow way in terms of digital or something like that. It's a, it's a very broad set of people who sell insurance, and we are one of them. We did, I just, I just, put a little more color on this. You know, we were talking to, our agents recently. We do that, like, Sarvesh do that all, does that all the time. I was doing it quite once in a while. I asked them: "What is the common trait between customers who come to you?" Almost all of them said that somewhere their query was initiated by an incident. That incident could be the death of a colleague, friend, friend, family member, or a big disease, or a big medical bill. These are incidents. When that incident happens is pretty much the only time a person thinks about purchasing one of these products, right? Where the customer has no immediate benefit, nothing whatsoever, but when that event happens, the reality of it gets triggered to them, and they decide to buy this. When they do that, it seems like the most trusted name out there, or the most obvious name out there seems to be Policybazaar, at least from a digital search perspective, and so bulk of them come here. Then they need a huge amount of hand-holding in purchasing this product, because it's not that straightforward. You know, it's very easy to say that buy health insurance, et cetera. It's actually a hard product, and you have to manage two sides of the risk. You have to manage the information that the customer is disclosing, and you have to manage, make sure that the customer doesn't get mis-sold a product. Sometimes you almost have what you call false starts. A false start means you could get volume, but that could blow up at the other end in terms of claims ratios. We've seen lots and lots of those in the industry, and, and people are aware of those, right? You have a lot of false starts, but. For a while, you could sustain a false start, but you can't sustain them at scale. I, I kind of conclude there, that's the, that's the kind of thought through, you know, deep analysis of the situation here. I'll just add one more thing here. See, when you talk about competition, technically anyone who is selling insurance is a competition, whether it's a bank or agent or any platform. At a very high level, the way we need to look at industry is, is the customer thinking about insurance or not? So, you know, if someone wakes up in the morning and thinks insurance, what really happened? Do they come to Policybazaar or do they go to someone else? On the other hand, there are a lot of people who are able to sell insurance to a customer base who is not thinking insurance. So pulls versus pushes in a way, right? From that perspective, as Yashish said and Sarvesh said, there are people who are trying to do a bit of what we are doing, but, yes, there are lots and lots of people in India obviously, who are selling insurance, and there are a lot of banks who are selling insurance, have got huge amount of volumes. From competition perspective, technically everyone is a competition, but our whole, you know, effort over last so many years has been to first make customer aware that you need to have insurance as a core part of your financial planning. Second, once you think of insurance, come to Policybazaar. Third, once you come to Policybazaar, you buy through Policybazaar. We are sort of in the third phase now, where a lot of people have already sort of have a brand recall of Policybazaar. Thank you, Sachin. Next question, Mr. Yash Nandi. Yash, can you please ask the question? Hi, Yash, we can't hear you. Is the call on? Yes, the call is on. Move to next. Okay, we'll move to the next person. Ankush, please ask your question. Yeah. Thank you for taking my question. Just a small clarification. In our result release, we have taken board approvals for some infusion of capital in both Policybazaar and Paisabazaar. Can you verify what's the reason for this? Any specific reason? Because since now the subsidiaries are profitable, I think they should be throwing cash back to the holding company rather than we infusing cash. Any specific reason? Yeah, I mean, if you look at our RHP file during, at the time of IPO, we have clarified that this money is raised for five objectives, which have been mentioned in RHP. Those objectives are delivered through our subsidiaries and to enable spend and allocation of funds as per the plan, we are transferring, every year we transfer set of money to those subsidiaries, which will be incurring for the objective mentioned in IPO. Accordingly, we are transferring about INR 700 crore in Policybazaar, INR 200 crore in Paisabazaar and INR 200 crore in Dubai. This will be infused over a period of time, as and when the funds are required in subsidiaries. This is as per what we have filed with SEBI in our IPO documents. Okay. This is purely to meet what we had disclosed at the time of RHP and had got nothing to do with the capital requirements as such, right? Yeah. Okay. You're right. As a group, right now, we are generating cash. Last quarter also there was a positive cash generation of INR 18 crore. Yeah. -overall- Yeah. -compared to margin. Yeah, I think, we hope to generate cash of almost INR 400+ crore this year. Got it. That was helpful. Thank you. Thank you. Next question will be from Mr. Rishabh Parekh. Rishabh, please ask the question. Hi, guys, congratulations on a very strong quarter. I just had a similar question to the last question. What would be... You know, we are generating INR 400 crore this year, what would be the overall use of our proceeds? Have we, you know, thought through this further, you know, some clarity on how we will deploy our cash? You know, of course, the IPO proceeds are being utilized as per the RHP. However, you are absolutely right. We have more than INR 5,000 crore of cash on our books right now, and we are adding to it every quarter, and we keep adding to it. Yes, in the next, you know, my expectation is that by 2026, 2027, we should have maybe close to INR 7,000 crore or so of cash, which is an interesting dynamic, and we need to think about utilization of these proceeds. We will, with the board, deliberate beyond March 2024, what we do with these funds, but we have no specific plans as of now, in terms of, you know, usage of that excess capital. At this point, we don't have anything to report on that. We are, we do have ideas, but they are not mature enough to be, you know, disclosed as a public company. They're just, they're just management ideas as of now. We've not even gone to the board with them. It's unlikely to be acquisitions, just clarifying. Very unlikely to be any major acquisitions. Yeah, because, you know. Understood. Understood. Thank you. Thank you, Rishabh. We'll take the next question from Bhavya Sanghi. Bhavya, please unmute yourself. Hello, thank you for the opportunity, sir. My question is related to the physical expansion, the store expansion that the company is doing. It's been some time that, you know, the stores have actually been, you know, developed, and wanted to understand the things that are, you know, improving the metrics. Basically, premium per inquiry that you, you know, fulfill through the physical store, where the inquiry is online or the walk-ins. How the, you know, size of the policies or premium per policy is different from the online business? Do you see material improvement or deterioration in the margins from the business done through these stores? Thank you. Our physical business, you know, as, as you know, has, we have almost 1,000 people deployed on that. We sell life insurance and health insurance, where we offer to meet, consumers in their homes and offices. Right now, since it's a, you know, it's something that we started about 18 months ago, it's, you know, continues to improve in terms of productivity. Just to give you a sense, in our savings business, the ticket size, when you meet somebody, is almost 45%-50% higher than it is on the phone. In health and term, it is higher, but by a smaller amount, because as you can imagine, you know, things don't change that much, for the family or for the person, whether you meet them or you don't. I think overall, it has added to our conversion rates, it has added to our efficiency and productivity, and it continues to do that sort of quarter after quarter. You know, we are very, very happy, and we are adding to our capacity as we go along. This year we will add to that capacity. We'll open new cities as well as new locations where we'll be present. I think this is now a leg that is there, and I think it will continue to grow in importance as we go along. Thank you. Yash was not able to speak because his mic is not working, so I'm reading out his question, which he sent to us on the chat. Question number one, any impact on take rates due to EOM, and any guidance on that going ahead? As we said, EOM has come into place as of 1st of April this year. We have not seen any impact from EOM in any of our product lines, on the overall take rates of our business. We don't expect to either. That's... Yeah, that's, that's right, sir? Yes, absolutely. The second question is, what% of POSP business was retail versus corporate last year, and where are we this year? ... You want one specific? No, I, I would not want to go into exact specifics, but as I explained, our retail business is now a very significant portion of our overall business, and last year it wasn't. I think we'd like to leave it at that. It's a competitive market, and I think this is a bit of detail which we can avoid. The third question is, contribution margins are at 45% despite annualized run rate going higher, and this quarter's savings was also subdued. Any comments on the same? I think savings being subdued, hopefully, was a quarter matter. Hopefully, by the time the year is over, we, we may have a different story to tell. The margin at 45% is what we would have expected if you asked us, you know, it, although we never say these things, but if you had asked us last year what we think our margins will be about now, it would have been in a similar ballpark. Yeah, I, I think no surprises at all. As I said, it's a pretty boring business. It's just, you know, yeah. I would just say that 300 basis points improvement year-on-year is a significant improvement, and I think we-. Yeah, we should be. Yeah, I'm not sure we can be too defensive about it. Thank you, Yash. Next set of questions, will be from Sanskar Singhal. Sanskar, please ask your question. Yeah, hi. Am I audible? Yes. Yeah. Thank you for taking my question. Just had a curiosity question, like, what% of premium must be coming from the offline segment that we ventured into the non-POSP business like? Roughly 20% of our life and health fresh premium comes from our offline from our offline visit capability. This is the non-POSP one, right? Yes, absolutely. We're talking about core online business. If in life and health we do INR 100 of fresh premium, INR 20 comes from the FOS capability that is available. Just to explain, this just means the closure happens or the last meeting happens offline. The customer still comes to the online, to the website or the app, and he probably spends a lot of time talking to the person in the contact center. It is just, yeah, somebody also meets him. Yeah, got it. Also, another medium-term to long-term question, like, I know it's certainly, it's have been repeated in the past calls, but just to get a more clarity as to what. According to you, what are the main drivers of medium-term or long-term growth, and how you are planning to outgrow, how much, in what sense, the industry? And, within that, if you can share some color on the segmental growth of each of the products that you provide. Sure. See, there are 2 parts. One is the revenue growth, and the other is the EBITDA growth. Revenue growth, as Sarbvir had mentioned earlier, we are not decoupled from the industry, but the way we have been executing over the last so many years, we believe that we should be able to grow 2-3x in life and health. You know, that's been sort of a guidance we have been maintaining for some time now. If industry grows at 10%-15%, that automatically means that we are looking at a number which is near to 30% growth for life and health put together. On the EBITDA part, it's actually quite a simple business to understand. There are 3 operating and 2 non-operating pieces that you will need to just track. On the operating piece, there is fresh, new, whatever you want to call it, the core business growth on the new side. The second is the renewal growth on the new side, on the core side. The third is the new initiative and how much we want to invest in those initiatives. On the non-operating side, there's an ESOP charge and there's other income. If you just think through renewals, ESOP and other income are almost automatic. They just happen, because of, you know, the base. That sort of explains 80% of the delta from last year, full year EBITDA to what we are projecting for this year or what we want to achieve this year or in FY 2027. You just need to have clarity around these five pieces on how they move, which will just explain the whole EBITDA story. Growth, I already mentioned that hopefully, 2 times or more of the industry for health and life. What we noticed is, look, we, as Alok mentioned, and I think I mentioned in the last call as well, you know, Tapan Singhel, sir, from Bajaj Allianz, said it very well to me once. He said, "The industry always grows together." It is not like one player will grow and the rest of the industry will go into the dumps. That never happens. Usually, usually, right? You may have player to player shift a little bit. That's what we've noticed, right? Last year was a tough year for protection, and so we also struggled last year. This year, protection is somewhat coming back, although, you know, health growth is still somewhat complicated for the industry. For us, you know, we are, we are definitely seeing the benefit of being 2 to 3x of that growth rate. you know, this year, broadly, except for certain push channels, savings has been a bit challenged. For us also, savings has been a bit challenged. It's, it's not like we can decouple from the rest of the industry. Yes, we will, in, in most situations, get better growth than the industry, and thus keep taking market share. We are still a very small market share. We are, you know. Plus, the area we focus in will hopefully grow faster than, than the rest of the, you know, industry, because protection is what we are focusing on. Thus, health in turn, we expect to grow in a long-term basis, faster than the rest of the industry. ... Right. Additionally, actually I might have joined the call a bit, I'm not sure if you have repeated. What are the headwinds you might have faced in the POSP business, in this quarter? Just if you just set 1,000 in particular. Yeah, I think the, the guidance we've given you is on new initiatives. We will spend somewhere between INR 150 crore-INR 250 crore every year. That's, that's the broad range we'll be in, right? At some point, we'll reduce it. Beyond that, it's not too material to get into exactly what is happening in one particular quarter. I'll give you a very simple example. You know, if you think about cycling races, sometimes, and if you think about all of them, they are almost all decided at the last 1 kilometer. The person who's leading the race almost till the end, is the one who actually loses. Because it's the others who are... Just reducing volume or increasing volume, actually in the POSP business does not mean too much. We can, as you saw, we could have last year there was almost 600%-700% growth or maybe even 1,000% growth over the previous year. This year you will see maybe 10% plus, 10% minus. Next quarter, you may be surprised by it totally. Even we might be surprised, because we will keep changing our tack from quarter to quarter on this, and that is the competitive nature of the dynamic here. Now, the question is, you may trust us or you may not trust us. If you trust us, you will believe eventually we'll win. If you don't trust us, you can believe we will actually lose. Either way, it's not a very material outcome to the overall organization. That's, I think, the point you have to take home, because, the core business profitability will grow enough to dwarf any profit or loss coming from new initiatives. Just give us a bit of time. I think, you will, you will see that happen. Okay. Okay. Thank you so much. Thank you, good. Thank you. We'll take the next question from Nidesh Jain. Hi, Nidesh, please unmute yourself. Hi, hi. A couple of questions. Firstly, can you break up the EBITDA for Paisabazaar and Policybazaar for the quarter? We don't break up EBITDA for the quarter by by kind of business lines that way. Overall, the core business has made about INR 69 crore of EBITDA, adjusted EBITDA, INR 69 crore. Was it core business? In this, we, we don't really break it out, a bulk of it would be insurance and a small amount would be credit. I'd leave it there. We, we don't give the break up, we're not giving the break up there, that's all. Sometimes it's down to allocations, right? Where some cost gets allocated, et cetera, et cetera. We just, we just leave it there. Okay, sure. Secondly, what is the growth in the new business, new premium health insurance side? Because I think health insurance is the most important piece of business for us. On the retail insurance, what is the new, new premium growth by in this quarter? Nidesh, we have mentioned that somewhere between 2-3 after the lifting growth rates, let's leave it at that. Nidesh, it's a sensitive item because we, we live and work in the industry. We've given enough guidance with protection being at whatever rate, the. It's not extremely different from protection element. It's, it's not like term is growing at 80% and health is growing at 0. You know, if we said about 40, they are in the, in the same ballpark, but we don't want to be very specific. In fact, yeah, I didn't even want to be that specific, because that also has issues with our, with our declarations. Sure, sure. Lastly, the NPV to direct cost ratio that we have been talking about, how that is trending? That stays at the same, at about 2.8x as of now, NPV. But again, that's an internal calculation. Broadly, our NPV to direct cost ratio is at, is at about 2.8x, so that includes acquisition marketing. We hope to take it to 3x at some point in the future. That's the objective, so the target is 3x. Thank you, Nidesh. We'll take the next question from Sehaj. Sehaj, please unmute yourself. Yeah. Hi, team. Congratulations on a good set of numbers. Harping back on, on the POSP business, just one clarification. If I look at the contribution margins, the margins have been quite volatile in this business. I mean, when you are doing this POSP business, what is your sort of objective of doing this business? Because at the end of the day, I mean, if you look at, from, from, look at it from a 3 to 4-year point of view, where do you see the contribution margins trending? Because the delta can be huge, right? From -10% to even a 0.5% or 1% contribution, positive contribution margin. The delta to our profits can be huge. That is one. The second one is on the renewals business. I mean, why would the POSP business not have any renewals? Generally, that is how your contribution margins tend to improve right on the renewals business. Yeah. No, so I'll take the second one first. The POSP business will have renewals. It's just that because it was a new business for us, the renewals will come over a period of time. Secondly, the renewal rates in the POSP business tend to be much lower than the renewal rates in a direct online business. There will be rollover, so those people will move to, you know, buying fresh policies of other companies. Those are kind of, that is the nature of that, that business, right? In terms of the first question as to... At least the way we look at it, you know, last quarter where you're referring to was +1, and this quarter overall is -10, right? For all the three businesses put together. -- to my mind, it's not such a big change. I think these are corridors of, you know, how businesses operate. Last quarter, fourth quarter was very special in terms of the life business being a very, very large portion of the overall pie, et cetera. I think it's in a very good range, and if you see, it's consistently moving in the right direction when you look at it year-on-year and even sort of sequentially. I think the, you know, the reason to do the business is very, very clear. I think there is a large portion of the business that is done by agents in the country that will always remain there. Agents need an efficient platform from which they can serve their customers. I think that is the platform that we have built, that we are building. As our platform become more and more sophisticated and more advanced, I think the economics will also keep improving, and, you know, you will, you will see that, the numbers will go in the right direction. It's something that one need not, you know, move too quickly on, because the shape of the business should be correct. We are happy to invest in that business for the next few years. As I think Yashish and Alok have said, INR 150 crore-INR 250 crore a year on the outside is what we are willing to do. I think, in that we'll be able to build a very, very nice business, and you'll see that as we, as we go along. you know, get a bit more specific, but I'm, I'm eager to kind of, you know, answer this, although it may be kind of giving out too much. See, our fixed costs in that business, in the whole POSP business, if you would, are broadly about, let's say, INR 35 crore-INR 40 crore a quarter. That's our fixed cost of technology, product, manpower, et cetera, et cetera. After this, essentially what you have is payouts. you know, one quarter you might do 2% more payout, one quarter you might do... there are we are figuring out quality, we are figuring out things. You would expect someone like us to be fairly mature about how to play this out, and at the same time play to win. There will be, you know, moments of weakness and moments of strength and various things. I think leave it at that. I think what you will find is, as we build out our overall, you know, volume in this area, it will not have a material impact on profitability either way, either way. It, like, Samir would agree, it can't, it can't be more than 10% of our profits or losses either way in 2026, 2027. You know, both ways it won't be. It's not only a material impact, it gives us huge volume credibility. Let's, let's get this right, right? There are, there is physical distribution is a big part of the industry, and enabling it through technology is going to be a big win point. The final winners will be the ones who are able to get the technology right, but also the data right, and all the analytics right. We have a huge amount of experience and a huge amount of understanding of this. It will also require operating profit strength, which our core business provides. I think the final victory. If you really think about it, imagine if you did not have the core business and you were running only the POSP, then that question which you're asking would be quite valid, that why exactly are you doing that? Especially when there is somebody there who can support this POSP business for a very long period through core business profits. That's, that's a very valid question, right? I think these are all cycles. For us, we have to just wait out the cycle, and that's it. Got it. Thanks for the detailed answer. I mean, just one on the GST issue, which is floating around in the insurance industry. Obviously, we haven't provided for any of those liabilities, but do we anticipate a big amount hitting our PNL if in case, hypothetically, it comes through? Well, I mean, just to provide you an update on what's happening on the GST side. We have provided all information, all clarification, which have been asked by authority relating to various, you know, discussion they are having with insurer, with insurance industry. We haven't heard from the authorities after that. We are not expecting any hit, any significant date or any hit on us as of now. Let's see how it evolves, because the issue is complex for the industry. Let's see how it evolves. Got it. Thanks for answering these questions, and all the best. Thank you, Sehaj. We'll take the last question from Nischin. Nischin, please unmute yourself. Hi, am I audible? Yeah. Am I audible? Yes. Yeah. Sorry, sorry about this. you know, my question actually pertains to, you know, Paisabazaar. you know, we've kind of crossed almost, like, INR 1,000 crore of disbursements a month, and probably around INR 40-50 crore of revenues. Just trying to understand, you know, what is the point in which we sort of see the J-curve of profitability? Nischin, thanks for asking. Like, we are at about INR 1,300+ crore of disbursements, like you said. Yes. You are starting to see the profitability improvement. Like we mentioned, this is the seventh month now, eighth month, that we are profitable since December 2022. Our focus is to continue to now increase the EBITDA, revenue, EBITDA to revenue ratio. We would be operating at about 6%-7% already, and you will continue to see improvement in that metric, and hence the curve is moving in the right direction. We are seeing. That also is evident from the fact that when you see the contribution margin-Q on Q is staying broadly in the 40%-45% range as we grow the top line by about 50% odd or plus. In terms of absolute amount, if we are generating about 45% or so margin, a reasonable part of that starts to add to the profitability. What size of revenue or, you know, disbursements per month, do we really see, you know, to achieve the optimal, maybe, I don't know, 30%-35% kind of an EBITDA margin? I mean, are we like 1 year away, 2 years away, assuming that we are able to maintain this leverage? We, we don't want to talk about that, kind of far out in terms of the, the projections. But like I said, we, were, we reached 0% in terms of breakeven in December. We already are about 7%, and we have an internal plan to keep moving forward on the EBITDA margins. With the growth of top line, the absolute numbers start to look attractive enough. I'd say that we are currently, our first goal would be to hit, get towards 20% in a reasonable timeframe, EBITDA to revenue ratio over the next few quarters. Once we get there, of course, we'll talk about the 20%-30% journey. This is very tough to say a lot of these things, RJ. We have moved from -13% to very near to double digits right now in last 1 year. That's a very big change which has happened. As we mentioned, the contingent number are very, very healthy, above 40%. As the business grows, a lot of it will slow down because of opportunity spots and others are not going to grow as fast. At what time we get to 30% is very difficult, whether it take 2 years, whether it take 5 years. Obviously the effort is to grow as fast as possible in a reasonable, efficient manner. If it happens faster, we'll be happy. You know, definitely we want to do it, but right now, we are very, very laser focused on delivering a fat budget of year in FY 2024, and an INR 1,000 crore fat budget in FY 2025. Just to kind of give you a bit of color on this Paisa story. Last year, our renewal revenue was approximately what? Twenty. About INR 20 something crores. Yeah. This year, our expectation, again, you know, we don't give guidance and all, but expectation clearly is maybe 4 times that. Now what you're seeing is a INR 75 crore delta come within 1 year. Let's see, right? Let's see. See, Paisa has... Since the very beginning, Paisa has been always a strategic question mark and an operational positive surprise from, for the last 8, 9 years. For our pre-IPO investors also, for post-IPO investors also. Strategically, everybody always asks us, "Why are you doing Paisabazaar? Why are you doing?" Paisabazaar, every quarter, just keeps executing and keeps doing better every quarter. I expect the same. You know, obviously, 2020 was 2021 was a special year when we had, you know, the, the COVID, and of course, credit had a difficult time. We are also exploring if we can get a higher share of the revenue, because today Paisa is operating at a certain percentage, which I believe, you know, could, could potentially be higher. I, I, I see lots of potential upsides on the Paisabazaar side. Let's see. Let's, let's, let's wait it out. I think it's going to be the, the positive surprise on that INR 1,000 crore number will be the Paisabazaar profitability. That was the last question for the call. I now request Yashish to please close the- I'll open it. Okay. Thanks, everyone, for attending the call.