Ladies and gentlemen, good day, and welcome to SBI Cards and Payment Services Limited Q2 FY2024 earnings conference call. As a reminder, all participant lines will be in the listen-only mode, and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during this conference call, please signal an operator by pressing star, then zero on your touchtone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Abhijit Chakravorty, MD and CEO, SBI Cards. Thank you, and over to you, sir. Thank you, Neerav. Good evening, everyone. I'm pleased to welcome you to the quarter two of financial year 2024 earnings call, along with my senior management team at SBI Card. While the world's economic recovery remains uneven and uncertain, Indian economy broadly continues to stay resilient. India's GDP growth year-on-year in Q1 FY 2024 was 7.8%. RBI estimates India's GDP growth in FY 2024 to be 6.5%. As per latest RBI survey, consumer confidence is also at a four-year high. India's digital economy is playing a critical role in enabling this growth. Digital payments have grown at the rate of 58% year-on-year in FY 2023. With Indian government estimating the share of digital economy to be over 20% of country's GDP by 2076, the quantum of digital payments is expected to increase significantly. Amidst this growth, credit card continues to be one of the popular digital payment instruments, having grown at 30% year-on-year in last fiscal year. September 2023 has seen number of credit cards in circulation increasing to around 93 million. Card spends reached a new high of INR 1.48 trillion in August 2023. While the growth has been strong, the industry also needs to sustain this with care. Credit card balances have gone up by 30% year-on-year to INR 2.1 lakh crore as of August 2023. Amidst this strong growth, the regulator has been highlighting the need for prudent risk management. The industry data from Credit Bureau TU suggests some deterioration in delinquency in credit cards and personal loans. The regulator continues to focus on customer-centric approach, and the recent circular on arrangements with card networks for issue of debit, credit, and prepaid cards is another step in that direction. We have built an intensive and extensive reach when it comes to card and merchant network and continue to enhance it, offering our customers easy access and opportunity to use their SBI credit cards for varied transactions. In line, we already have partnerships with all major card network platforms, Visa, Mastercard, RuPay, and American Express. Let us now look at SBI Card's business overview in Q2 FY 2024. In Q2 FY 2024, SBI Card registered a strong business growth in business performance while underlining the strength of its business model. The business continues to exhibit resilience even amidst a dynamic environment. During the quarter, we added net 553,000 cards. The growth rate- Sir, sorry to interrupt you. There is a slight distortion coming from the line. Is it okay now? Yes, sir. Good. But it's still some more. Yes, sir. So let me disconnect and reconnect your line. Participants, please stay connected while we rejoin the management back to the call. Ladies and gentlemen, thank you for your patience. We have the line for the management reconnected. Sir, you may go ahead. Sorry for a bit of a glitch here. So, we were stating that during the quarter, we added net 5.3 lakh cards. On a gross basis, we added 11.42 lakh new accounts. Our total attrition for Q2 FY 2024 has come down on year-on-year basis, but slightly increased on quarter-on-quarter basis, owing to KYC-related attrition. Our cards in force reached 1.79 crore in September 2023, showcasing a 21% year-on-year growth. SBI Card's market share in cards in force stands at 19.2%. Q2 FY 2024 has seen very strong growth in card spends, with SBI Card achieving the highest ever quarterly spends, which stands at over INR 79,000 crore. Card spends have seen a growth of 27% year-on-year. Notably, our overall average spend per card has also grown year-on-year from INR 171,000 in Q2 FY 2023 to INR 180,000 in Q2 FY 2024. With around 18% market share in Q2 FY 2024, SBI Card continues to be the second largest credit card issuer in terms of card spends for the quarter. During the quarter, our retail spends have seen a strong growth, reaching INR 61,446 crore, while witnessing a 21% year-on-year growth. Corporate spends, too, witnessed healthy growth, registering 55% year-on-year increase to reach INR 17,718 crore. During the first half of year, first half of FY 2024, we have seen good growth in both POS and online spends across various spend categories that include departmental stores, health, utilities, education, travel, entertainment, and restaurant, among others. In fact, POS spends across all key categories, including consumer durables, furnishings and hardware, apparel and jewelry, et cetera, have increased significantly, indicating consumers' strong preference for offline shopping experiences as well. Online spends continue to be strong and contributed 57% of total retail spends in Q2 FY 2024. I'm happy to share with you that during Q2 FY 2024, we introduced the functionality of UPI on SBI Card issued RuPay credit cards, which enables SBI Card users with RuPay cards to make transactions using UPI-enabled apps. It has been one of the key initiatives for SBI Card and is aimed at enhancing our customers' convenience through ease of payments, seamless transactions, and increased accessibility. We have received an excellent response within a few weeks of its introduction. Already, 9% of our RuPay cardholder basis have enrolled for the UPI usage. As expected, department stores and grocery, utilities, and fuel have been among the top categories for UPI spends. Interestingly, restaurants and consumer durables also feature among top spend categories. Our monthly average UPI spend per account has already reached INR 11,000. With 19% year-on-year growth, our receivables have grown to INR 45,078 crore as of September 2023. I would like to highlight that our share of interest earning receivables has been stable at 62% quarter-on-quarter in Q2 FY 2024, while increasing from 59% in Q2 FY 2023. Our receivables per card are stable at INR 25,220 in Q2 FY 2024, versus 25,445 in Q2 FY 2023. Besides UPI functionality, we rolled out various new initiatives during the quarter, too. We introduced new features on our super premium card, Aurum. The card now extends enhanced benefits to card users and offers more rewarding and richer experience. Another key initiative has been the launch of SimplySAVE Merchant SBI Card on RuPay platform that is curated for MSMEs. The card has been designed to cater to short-term credit requirements of MSME merchants, while also offering them various benefits. We continue to bolster our digital customer acquisition capability. We have extended the SBI Card end-to-end digital acquisition platform Sprint on YONO platform of SBI. The access is currently in CUG for testing, and we expect it to be rolled out during this quarter. This will enable the SBI bank customers to digitally apply and get a new SBI card on successful approvals and KYC verification digitally. As you are aware, in July 2023, SBI Card ESOP Scheme 2023 was approved by shareholders. The core objective of the scheme is to enhance the culture of ownership and performance in the organization, along with retention of key talent. We plan to make grants to identified employees during this quarter. Coming to financial performance in Q2 FY 2024, we continue to see healthy revenue and profit growth. Our total revenue in Q2 FY 2024 has been at INR 4,221 crore, registering a 22% year-on-year growth. In first half year, first half of financial year 2024, our total revenue stood at INR 8,267 crore, with 23% year-on-year increase. In Q2 FY 2024, our revenue from operations was INR 4,087 crore, with 24% year-on-year growth, while in H1 FY 2024, revenue from operations has been at INR 7,999 crore, with 25% year-on-year growth. Interest income has also grown to 47% of overall revenue from operations. Our PAT for Q2 FY 2024 is INR 603 crore, with 15% year-on-year growth. Our cost of funds have been stable at 7.1% versus previous quarter. We benefited from the increased long-term borrowings taken in previous two quarters, limiting our repricing risk this quarter, hence, had a stable cost of fund at 7.1%. However, with short-term rates again experiencing volatility, we expect cost of fund for new, for next few quarters to be marginally higher. The yield has grown marginally by 14 basis points in the quarter, owing to a large share of short-term interest bearing term receivables in the overall IBA. The quarter has seen NIM being slightly compressed by around 10 basis points. On asset quality, as of Q2 FY 2024, GNPA is at 2.43%. Our gross credit cost is at 6.7% in Q2 FY 2024, lower as a result of actions taken at portfolio level and collection strategy. While we will continue to grow, we will continue to take portfolio actions to mitigate the risk. Collections intensity has also been re-strategized with different swim lanes. Our newer sourcing vintages do continue to perform better, and going forward, we will continue to take appropriate measures. Our credit cost has reduced quarter-over-quarter, although industry data is showing stress. Our cost to income for Q2 FY 2024 stood at seven- Sir, sorry to interrupt you. Again, there is slight static from the line. Can I continue? Yes, sir. Can you try all the others to be on mute while - Sir, all the lines are on mute. Only your line is on talk, sir. Okay. Can I continue? Yes, sir. Our cost to income for Q2 FY 2024 stood at 57.1%. The marginal increase is owing to higher corporate spends, passback, and cashback costs. In Q2 FY 2024, our ROA has been 4.9%. In conclusion, India's economy continues to be resilient and has been at a steady growth path while domestic consumption remains robust. And with the current festive season period, we are confident of witnessing a healthy volume of spends across categories, including discretionary. It is encouraging to see that we have been able to maintain the momentum of strong performance across most key business parameters since the start of this fiscal year. Keeping all current and foreseeable macroeconomic dynamics in mind, we continue to take a balanced approach with a focus on sustainable and profitable growth. While doing so, we are committed to create value for all our stakeholders. Now we are open for questions. Thank you very much. We will now begin the question and answer session. Anyone who wishes to ask a question may press star and one on their touchtone telephone. If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use handsets while asking a question. I request to all the participants, please restrict to two questions per participant. If time permits, please come back in the question queue for a follow-up question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question is from the line of Gaurav Kochar from Mirae Asset. Please go ahead. Yeah. Hi, good evening. Am I audible? Yes, sir. Yeah, three questions from my side. Firstly, you mentioned about RuPay cards. You said about 9% of your card base, RuPay card base, has enrolled for credit on UPI. I just wanted to understand, what would be the proportion of RuPay, RuPay cards in your total cards? And if you can give what would be your market share in RuPay cards? So the portion of RuPay cards in our portfolio is close to 10% as of now. It is increasing with every new month acquisition that we do. We wouldn't be aware of the market share because the data is not available or, or is there in the public domain. But we are- we know for sure that we are one of the larger players of RuPay issuers. Sure, sure. And in terms of, let's say right now, the enrollment is 9%, but have you identified set of customers who would be enrolling? And by, let's say, year-end, can this number be, you know, 30-40% of the total card base? Do you see that as possible? So this number is as of, September end, because that is what we have declared. Every passing day, we see more number of people, getting their RuPay cards attached or as a source of fund, for doing UPI payments. This number is growing rapidly. Where it finally lands up at the end of Q3, we will declare, we will declare in the next call, but we see that rapidly increasing. Okay. And in terms of spend, as a percentage of total spend, is this meaningful? Not maybe as of now, but going forward, do you believe this could be meaningful? Well, that is the intent. Because as of now, it is just a start, but it is a good start. It's a good start. Okay. Okay, sure. And my second question is with respect to the credit cost. You know, gross credit cost, you mentioned around 6.7% in this quarter. Write-offs were elevated even sequentially. And despite all this, the stage three still remains at 2.4. So just wanted to get some sense on where are these slippages coming from? Is it essentially the 2019 cohort, which is causing the pain, or is it beyond that? And secondly, if that pain is largely behind and incrementally, one could see probably lower slippages. And in that context, I mean, your credit cost guidance for the remaining half. So, 2019 cohort, I think we have sort of controlled, and we had in our earlier calls, we have stated that what kind of steps we have taken over there. And, those portfolio-level actions have done us good. And, we were expecting good results out of that during the quarter. The trajectory should have been lower. But where we find ourselves in the present credit cost scenario is somewhere the unsecured loan environment prevailing in the ecosystem. Somewhere we are finding that we are not untouched from the sentiments on unsecured loan scenario. While we were expecting better trajectory, downward trajectory from where we were in Q1, we are finding slight stress in not any particular cohort, but generally, there are customers who are under stress, are not able to pay in the, during the period. This somehow has offset whatever gains we would have got, not only on the 2019 cohort, because somewhere we found that those type of cohorts would have prevailed during the subsequent years also. The portfolio actions were uniform, and we were expecting better results out of those portfolios. Somewhere we are not untouched out of the overall unsecured loan scenario prevailing, which is quite prevalent and well-known. Okay. So what would you attribute this to? Oh, sorry, just to add to more color to what MD sir mentioned. In terms of the composition of the NPA, the 2019 cohort has actually come down in weightage in terms of our NPA. It used to be 16% last quarter, it's 14 odd% right now. And the newer vintages, that is, 2021, 2022, 2023, they now together account for more than 50% of our NPA. That's also moving up in the right direction, and the early delinquency numbers for these new vintages are more benign, and we on the, on the back of that, we are quite hopeful that that will improve the quality of the asset mix. Okay. So in the second half, can we expect moderation in credit cost and overall stress loans? Difficult to say entirely for the second half, but Q3, we expect the levels to remain elevated. Okay. Okay. If I were to just ask a little more on this, I mean, what has led to this? Is it the open source underwriting, the open source, so, open market sourcing that we did, or, you know, the share of self-employed that were increased, post-COVID? Is it... I mean, can you give some color as to, you know, any particular pockets where this stress is coming from? As I said, we are not attributing this to any particular cohort or any particular segment. We are seeing individuals, certain individuals are under stress. And we believe it is part of the overall ecosystem. It's not particular to any specific sourcing or any specific cohort or any specific vintage. We are not really seeing that. But as we stated in our earlier during our speech, that the new- ... Onboarding, there has been good. We see better quality over that, but then there is no specific indication of any vintage or cohort. It's somewhere we are finding that certain individuals, certain customers may be under stress, and we believe it is due to overall ecosystem behavior. Thank you. Gaurav, sorry to interrupt you. I'll request you to come back in the question queue for a follow-up question. A request to all the participants, please restrict to two questions per participant and join the queue again for a follow-up question. Next question is from the line of Nitin Aggarwal from Motilal Oswal. Please go ahead. Yeah, hi, good evening. I have two questions. One is like, why you are saying that the stress is with certain customers, but why is it- Nitin, sorry, but we are losing your audio. Your voice is breaking. Can you please come in a better reception area? Is it any better now? Slightly. Okay. So I'll, so, the first question that I have is on, like, the stress, which you're indicating that is, is there in certain segments and customers, you, you can see that. But, then how would you look at the, really, the revolver rate and, and the, mix of overall, like, EMI customers? And, should that not also move higher in line with the stress and, and the, overall, delinquencies that you're witnessing? Nitin, I'll first talk about the revolve rates. You have seen the revolve rates have been fortunately stable for the last four, five quarters, so we are at 20, around 24% or so. There has been a, we have worked towards getting the EMI balances up, so that the overall interest-bearing asset is up to around 62% or so. Okay? Now, what is being mentioned is, while there is in a overall sense, if you look at a long-term scenario, there will be people who will go into X, 30, and further buckets, will initially be looked at as a revolver, but after 90, it is they are not looked at as a revolver, okay? That is not a condition which is there. Second, and that number has been fairly stable. If we have been declaring that number, that number has been fairly stable at 24%, while your credit costs have been moving up and down. So you can't exactly say that if one goes up by 10 base, the other will also go up by 20 base. That kind of thing does not exist as a, in this scenario. What MD sir has been reiterating is that, the overall portfolio at this point of time, while we have done a lot of actions to get this whole thing, credit costs, to come down, there is, what we see is that there is a generic sense in the environment also, which is, working as a headwind also at this point of time, and not any specific cohort-related. When it was a cohort-related stuff, that was also declared in the last quarter. As Shantanu mentioned, the action and weightage, because of the actioning, the weightage of those cohorts have already come down. Right. And, the second question that I have is on the margins. We are seeing a very calibrated fall this quarter, again, a 12 basis point fall. So how are we looking at this to trend going on? Are we expecting more decline from there? And has there been any change in the interest rate to our EMI customers to accommodate for higher risk that we are witnessing? On the margins, you have seen that the overall change in the margin is around 14 basis points or so. While I think some amount has been contributed by cost of funds, cost of funds has been stable, okay? Whatever we have seen on the yield side of it is essentially because interest-bearing asset was 62% last quarter also, it is 62% this quarter also. There is the marginal movement in some because all the asset, term assets, books, have different rates. Our Flexi pay has a different rate compared to what we get in the subvention, versus what we get on the personal loan or Encash kind of a portfolio, okay? The mix can change in a quarter, on a certain way, because in the... For example, in the month of August, we did a lot of, we did an Amazon sale, so you get a lot of subvention. It might show as a lesser amount in the, yield, because it is at a slightly lower rate, but you also get interchange income because of the incremental sale volume, which is not showing here. So, there is no change in the rate of interest that we have done with any products in the last quarter. It has been just around the mix which has led to this. Thank you. Sorry to interrupt you, Nitin. I'll request you to come back in the question queue for a follow-up question. The next question is from the line of Mahrukh Adajania from Nuvama Wealth. Please go ahead. Yeah, hello, sir. So my first question is on margins again, and then I have a follow-up question on credit cost. We've seen the list of festive offers from SBI Cards. It's well highlighted, and the scale this time in this festival looks much higher than in the previous years. So how would that impact, if at all, your margins or OpEx in the coming quarter? The coming quarter. So, you are right, and we, this we have been stating earlier also, because the cashback cost, when it goes up, your OpEx to revenue or OpEx to CV, whatever you look at, will also go up, and that has been the trend and seasonality, which is seen in every festival quarter. Last year, this was over two quarters because it started in the last week of September. This time it will be only in the Q2, or it will all be in the Q3, okay? On the margin side, we won't be able to give you a guidance as of now, because now we see a very strong pickup at the point of sale. When people are purchasing consumer durables from the e-commerce website, we see a lot of tendency to convert them into installment lending products. But the overall mix as how it will land us, we will-- because there are other things in the play here also, we would be able to, tell you only later. Only thing I can say is that we have not changed the interest rates for any product, not reduced it. They are all at the same rates as they were earlier. And may I add, yeah, Mahrukh, that we've already stated in, and you, sir, said it in the speech as well, that we do expect the cost of funds to go up, marginally over the next one or two quarters, and that could impact the NIM a little. As Girish mentioned that on the asset side, while we haven't changed the rates, the mix could impact the overall yield. Got it. And, you did mention about, you know, credit card delinquencies rising, you know, in addition to other unsecured loans. So is that an industry-wide thing? Because we heard only about unsecured loans, BNPL. No, I don't think we said anything about credit card delinquencies increasing. What we are saying is, in specific query to our credit cards, we are saying that, we, all of us have, read what is being stated in the domain, what is happening in unsecured loan scenario. So what we are saying is we are not untouched. We are not saying that industry-wide there is... We won't be able to comment on that. Got it, sir. Thank you so much. Thank you. Next question is from Bhavik Dave, from Nippon India Mutual Fund. Please go ahead. Yeah, hi. Am I audible? Yes. Yeah, hi. Hi, sir, thank you for the opportunity. Sir, two questions. One is on, when you see the mix being quite stable, like you mentioned, the earning assets are 62%. Just want to understand, with the kind of delinquencies or the customer behavior that we are seeing, is it worthwhile to re-look on the pricing front, considering the EMIs where that they have come this time around? So, are we pricing the product price in terms of the EMI as well, considering revolvers are not going up and we are maintaining at 24%? On the EMI side, is it worthwhile to maybe look at the pricing? And second question is on the write-offs. The write-offs seem to be quite elevated at INR 650 crore plus, like almost INR 630-670 crores, that we've clocked for two quarters in a row, on a 1,000 crore kind of GNPA group. So just want to understand the trajectory that we are in terms of writing off loans. I understand that it has to be written off within 120 days to 180 days, but just that this number seems to be quite high. And what are the risk management practices that we are taking to maybe control incremental business that we are doing? And like the previous participant asked, we are being reasonably aggressive this time around in the festive season. So how do we risk manage our book to ensure that things don't go out of proportion? Thank you. So on your, the first question, which is about driving the term loans, term loan book. Yes, you are right. The term loan book, typically because the product Encash, we give it to people after we have seen their behavior for at least nine months on book. And even the, Flexip ay or subvention products or the conversion of spends into EMI, is within the already approved credit line of the customer. So we see a, better behavior on the installment products on, from a, credit perspective, it obviously better because customer is showing his intention, his or her intention to pay, pay us back, from the installment, by booking the amount into installments. So that's a lower rate, which is there, and we want to push that. The second part of pushing that is also, we also want to keep our interest bearing assets above a certain percentage, because the revenue profile is also very, very critical. So that is the second part we, on which we work at. But it is not, on the revolver front, there is no we are not looking at that. That is, there's no actioning from a portfolio that we are doing to push the customer to become a revolver. That as of now, we are not doing any of those things, activities. Correct. So just my question was on pricing the Encash and the Flexi. I'll answer that. I'll answer that. On the pricing front, there are two triggers that will help, you know, that will make us change the pricing on the EMI products. Which is one, of course, is we have to always keep the industry in mind. We can't be out of the industry, so you can't, you know, have a very high pricing or a lower pricing as well. And second, we are also driven by, as a trigger, cost of funds. So there has to be a rationale for us to be increasing the pricing to the customer as well. So we keep all, both of these things in mind as we look at the pricing to the end customer on the EMI loans. And as required, we have been taking actions. We've shared that with you in the past as well. As and when it warranted us to change the pricing, we have done that in the past. Sure. On the risk management front, considering we are aggressive this time around and the write-offs have been quite high. If you could just throw some light on what have you done? Add some color to what MD, sir, mentioned earlier. So write-offs can't be viewed in isolation. You have to view write-offs in relation to recoveries also, and to the other element of credit cost, which is changes in your provisions. The net effect of all of that is what finally feeds into what is called credit cost, and that number has trended positively for us. It's come down in the sense by 13 basis points in the quarter. So you can't look at write-offs just in isolation. Also, in terms of actions that are being taken, they travel the entire continuum of the customer lifecycle management. So that includes underwriting standards, it includes portfolio management actions, it includes marketing decisions and marketing campaign-related decisions, and of course, collection strategy. So all four elements are being worked upon, and we've given color to you on this subject in the previous call. These include things like, for example, using the analytics and insights that we have around figuring out which customers to exclude from certain types of campaigns, tightening our customer selection filters on the underwriting side, getting aggressive with line decreases and declines to manage the exposures on customers. Figuring out which types of customers to be exposed to which type of collection strategy, whether calling or whether field visits or whether a combination of the two. Decentralizing our collection efforts, using digital ledgers to get customers to pay us more frequently and more on time. Those are types of actions that we've been taking in the past, and we will continue taking them based on the insights that we get from our portfolio analytics. Thank you. Bhavik Dave, I'll request you to come back in the question queue. Requesting all the participants, please stick to two questions per participant. Next question is from the line of Abhishek from HSBC. Please go ahead. Yeah, hi, good evening. So, my question is on the repricing of your book of Flexipay and Encash, which, you know, last quarter also we discussed that it would, it's a continuous affair. So how much of the book, sort of, you know, remains to be repriced? And obviously, when you look at the yield and it has not really moved up, Q2, it's actually gone down. So this means that there is some offset to the repricing that would have happened this quarter in the EMI book. So can you just talk about that part? So most of the subvention book has been repriced because it is around a 9-month, 8-9-month kind of thing. Flexipay is still because it's a 12-month tenor, 11-12-month tenor, that is, some part of it still would be pending for repricing. Okay? However, it is... you should also note that on Flexipay, we used to earlier charge higher rates because it was... and then we moved to risk-based pricing on to- on, on that. So the rates were higher, so there is, there was a, there was some contra movement there also. Encash, because the average ticket si- average tenor there is 36 months or so, 33 months or so, so that is, most of it is i- is still to be priced as of now. This is how the movement is. So what was the rate on Flexipay earlier versus now? And what's the rate on Encash now? So, Encash rates are broadly similar. They have not changed. Okay. Subvention rates have gone up. We have taken that up by 100 to 200 bips higher. Flexipay rates, actually, Flexipay had a, if I would say, a U-shaped curve on that one. I have... It came down when we changed the methodology of pricing, which was before the cost of funds- Quarter. started to go up. Quarter two. Quarter two or quarter one, I think. So it, so there, there was a downward trend there, and then after that there has been, after one downward trend, then it has been a constant upward trend to the, to almost, I think, 200 to 250 basis higher. So that's how the trend line has been. I thought you said the Flexipay rates have come down. No. So Flexipay rates came down around nine months back. Q, Q2? July, August of last year. July, August of last year. Okay. They came down, and after that, they have been going up. Yeah. So how much is that increase? That's what I'm asking. So from July, August to now, what is the- July, August till now, it is almost 200, 200 basis points plus. Got it. Got it. We have done that in... You should also note that it's not one time increase. It happened in three tranches. So it, as the cost of funds kept on going up, we started passing on the interest rate to those guys. Yeah. Full Flexipay book has not yet been repriced. Thank you. Next question is on the line of Dhaval from DSP Mutual Fund. Please go ahead. Yeah, thanks for the opportunity. I just had one question relating to the portfolio insights slide. So it seems like the open market tier one category A customer base is the problem based on the past delinquency and the indexed numbers right now. I just wanted to understand what course correction are we taking in specifically in these you know filters. And also when you think about the sort of elevated delinquency that you're seeing, if you were to sort of map the you know bureau check of these set of customers, this cohort of customers, which is giving extra problem, is there any common pattern related to leverage or you know multiple carding, et cetera? I mean, any insight that you could provide on this cohort customers? Thank you. So just to go back to the point you made about what we mentioned earlier. So self-employed sourcing, as we mentioned last time, has been increasing, so the indexed values we shared last time, so compared to Q3 of 2020, we were doing 1.64 more in terms of self-employed. That trend continues. We're doing even more self-employed. And at the same time, the delinquency of segment is coming down, so that's a positive development. Similarly, we also mentioned last time, tier three, tier four locations. There also, the sourcing in that geography had been increasing. That's somewhat plateaued out, so relative to Q3 of 2020, for example, we were doing 1.67 times more in Q1 FY24. That has remained flat at about 1.67 times only. So, in that sense, the trend from the last quarter has continued, in both in terms of sourcing and in terms of delinquency for both of these segments. Dhaval, you said that open market tier one, you see it higher. Can you point out to the... Because it's, I am sure you are reading this from Slide 14, so how are you looking at that? Dhaval, can you hear us? Dhaval, may I request you to unmute your line. Yeah, sorry. Yeah, yeah, sorry. I was on mute. Sorry. So Giri, I was just looking at March 2023 data, because last two quarters, the elevated credit cost has been a problem. So if you look at March 2023, the similar slide and where we are today, the biggest delta is basically in the tier one category A, open market. It's, that's where, you know, the index levels have gone up to every... So that's the reason I was trying to- So, Dhaval, I think what you're looking at is three separate points. And while from an indexing perspective, because if the overall index goes up, then you will see that. But from a trend line perspective, what we see in various markets is, yes, tier one, which used to be. And in fact, the number is given here. Tier at this point of time, I think tier one is, or no, overall CIF is 0.99. I don't remember the March number, but March number was? So we'll check that. But what we had done was initially, tier three, tier four, we were seeing some problems, so we cut down certain set of cities. And in fact, we declared that last to last quarter, that certain cities we exited out. And we said we will not source in some of these cities, and that led to tier three, tier four now improving. Okay? And that is why from an indexation perspective, you will see something there, because if tier one was 0.997, and it is now 0.99. So that marginal change are happening because of that only. And if you look at, I think, tier three was around 1.078. No, tier three was one point zero two, and it was 1.05. So it has come down, because we have stopped sourcing in some of those cities, some markets, taken actions. So all that has happened. While we should also recognize, we have always been saying that open market will be giving you higher revenue. It will have slightly higher losses, and Banca will give us slightly lesser revenue because the spends per account is lower, revolve rates are lower, and hence, lesser at that same point of time, lower delinquency. So it is a good mix of these two, is how we have been operating our strategy. Importantly, the indexation values are relative to the mean of that time period. They are not indexed to history. Yeah, yeah. No, no, I, I appreciate that. So maybe I'll just simplify the question by asking that: If, from March to now, we, is it correct to assume that we've not made any major changes to our risk, filters and the strategy that we've continued, we've just continued that, in the last six, seven months, and so there's no change, and, the outcome that you're seeing is in line with what you're expecting? Is that the way I should read it? No, on the contrary, we have made specific changes to the way we are sourcing. We have cut sourcing in the areas that we were finding problems in, and we reported that in the last quarter itself. In fact, we were taking those actions way back in December as well. So those actions take time to show up, and they are showing up now. Okay. Could you give some synergy about the cohort of customers, this extra pain that is coming through? Is there any common point from a bureau data perspective that you've been able to identify if there is any extra over leverage or any other, you know, behavior, small ticket personal loan being in excess? Any pattern that you could provide here? No, as we said, we have not noticed any cohort. Ah. We have earlier on also stated we have not noticed any cohort. But yes, how we look at and, as we stated, that we have improved our collection strategies based on the early warning signals. So how we look at it, we do compare our, the card performance in our books, as well as with the, information available in the bureau. So we do compare, and we do find that how the movement is taking place, and, that's how we, redirect our collection strategies on that account. But then, as I said, that we are not noticing any specific cohorts. Thank you. A request to all the participants, please restrict to one question per participant, and please join the queue again for a follow-up question. Next question is from the line of MB Mahesh from Kotak Securities. Please go ahead. Sir, hi, just a couple of questions. One, there has been a significant slowdown in the receivables growth this quarter. It used to run at about 30%, and it's come down to 20%. What explains this? So Mahesh, simple. Last year, last September, last 5 days, you had a jump up on the spends. So it's more of a denominator thing, okay? Receivables growth is intact. So if I take, if you take that out, last 4-5 days of spend, which, if you remember, last in that quarter, had also impacted our revolve rates, because the festive season started on 25, I think, 25th of September last year. Yes. Just one clarification on this entire credit cost and the new fresh costs creating a problem. How often do you scrub the data back of your customer base to see what kind of indebtedness do they carry? We do it quarterly. We do it quarterly. After six months on books? After six months, after six months on books, we do it quarterly. But there are segments where we do the scrub monthly as well. So we have a, you know, a defined portfolio strategy, portfolio review strategy, and there are segments where we do a monthly scrub, there are segments we will do a quarterly scrub. Every customer, six months on board. Thank you. Next question is from the line of Hardik Shah from Goldman Sachs. Please go ahead. Yeah, hi, good evening. This is Rahul here. Just had two or three questions. Number one, again, on the portfolio quality, just slightly confused, just wanted to seek some clarity. You know, you said that you've not really noticed any specific consumer cohorts, and yet our write-offs, you know, has been going up for the last few quarters. While of course, there is concern in the market, but that's more about small ticket personal loans. In credit card portfolio, I think we are the only ones who've kind of seen the increase in write-off. So what explains this? I think there's a lot of questions around the consumer cohort or where the problem is coming from. But if you can help us really understand and how do we plan to correct this? Would it have any bearings on the business in the coming quarters? I think I will have to repeat what I have stated earlier. I'll just not repeat. In fact, it will be repetition again and again on the credit cost thing. Let me share some more thought process. We are looking at our credit cost at 6.7%. It was 6.8% in the last quarter. We explained what all measures we have taken, and we have stated that how all of us, you and I, together, are looking at unsecured loan portfolio. All this taken together, what could have been an aspirational credit cost? We ourselves stated that we aspire to be, say, around 6 or 6+ a bit. We are at 6.7%. We don't think it's a runaway scenario. We have taken adequate measures. We have... That, those have given us results. Somewhere, we may see a bit of this scenario prevailing, but we don't see that it is a runaway scenario where we can end up in a huge credit cost escalation. So we are on it. We have been working on it. The results are there for all of us to see. It's on the declining trend, but yes, not the trajectory which we had aspired for. And we are not out of the market. Somewhere, we are impacted in whatever is happening in the ecosystem. Got it. Thank you. That's helpful. The reason why I'm asking this question is because none of these large credit card players have been complaining about their portfolio, so... and even their unsecured portfolio. And hence, this question came about, but I appreciate the answer. The second question, would- Sorry to interrupt you. I'll request to come back in the question queue. Thank you. Requesting participants to stick to one question so the management can answer all the questions in the queue. Next question is from the line of Pankaj Agarwal from Ambit Capital. Please go ahead. Yeah, hello, sir. Sir, can you provide more information on your new ESOP scheme in terms of number of employees covered, people and all those things? Sir, sorry, your voice is not coming clearly at all. Can you please speak through the handset? My question was that, can you give more information on this new ESOP scheme in terms of number of employees covered? So, that is, we have opened the scheme for a certain designation and above in the company, and it's a certain... As of now, how we look at it is a minuscule part of our overall book. And that, what details can I share here? I mean, if you want something, we can, we can always share over later. No, sir, last time it was- We have already disclosed it, and the disclosures are there. We can share the data with you. I don't have it readily available with me. Pankaj, what exactly are you looking for? I mean, the ESOP, the ESOP was approved by the shareholders, and the information was put up on the stock exchange. It's typical to any other organization. Above a certain level, there are identified employees who have been rewarded, through the ESOP program. Is there anything specific you're looking for? Yes. So earlier scheme, I think only 3 employees were covered, only I think 8 or 10 employees. Yeah. So this is a little, this is a little broad-based ESOP scheme, as I said, and as Nandini said earlier, covering, or, you know, a large set of employees above the, above a certain level. It includes middle managers as well this time. Okay, okay. That's what I wanted to know. Okay. Yeah. Thanks. Thank you very much. If I may just add to the response that Nandini gave on the credit card and the subsequent remark that came in about the other players in the industry not reporting. We are the only credit card, you know, standalone credit card company. The others report their credit cards as part of their overall portfolio, which is why you don't see that as standing out. I think the point that Sir has also made earlier is that there is stress building up in the retail consumption consumer loan portfolio, and we are also part of the industry and seeing the same headwinds. Thank you very much. Next question is from the line of Rohan Mandora from Equirus Securities. Please go ahead. Thanks for the opportunity, sir. Sir, just to touch base upon the delinquency part again, in the initial remarks, you indicated that in FY 2021, 2022, 2023 portfolios and the delinquencies are relatively benign. So, if we were to index the overall delinquencies to 100, if you can indicate how is the trends here in the newer cohorts of portfolio? And secondly, the, just touching base on the cohort part, internally, while there may not be any specific cohorts, but if we do an external scrub, are there any trends on the number of products per customer or credit lines per customer, which are elevated, where we are seeing some higher delinquencies? And also on that, portfolio scrub, in case we find some stressed customers, what are the actions that we take even if they are currently behaving on the portfolio? What kind of exit strategy do we follow? Thanks. I'll take the first part of the question. Yeah, you're right. The FY 2021, 2022, 2023 sourcing vintages are indeed showing benign early delinquency. We don't disclose the number by vintage, but we are quite satisfied with the progress that we're making, and that is giving us comfort that our newer sourcing is indeed behaving in line with expectations. And it is increasing in value as a percentage of our ENR. I think I mentioned that earlier. And relative to the overall, it is certainly showing us lower delinquency levels than the overall average. Sir, is it meaningfully different or just marginally different? No, in fact, if you look at our last quarter declaration, where we had shown the vintage chart, you could see the, at the same point of time, the newer vintages are at around 60%-65% of what the earlier 2019 vintages were. Okay? So that trend continues. So that, that is the... and that is why we showed those vintage charts last quarter. And just to complete the picture, the problem cohorts of 2019, which we were saying showed elevated levels of delinquency, though that cohort is behaving better now and normally now and is trending downwards as per expectations. Likewise, for 2018. If I may just respond to the second part of your question, which, where you asked us as to what are we seeing in the bureau. Obviously, when we pick up the bureau data, typical to any portfolio review that we do, we do look at what is their behavior of first with the other lenders, how many trade lines have they added, incrementally, what are the, what is the trend happening on their, on the repayments, in the scrub, so it's in the bureau. So all of that data is picked up by us, and based on whatever we pick up, there are differentiated actions that are decided. Some of that data is also passed on to the collection team, for them to focus more and keep a watch on those collections. There are differentiated steps that are what we pick up from the bureau. And not just trade lines, but also inquiries. So- Yeah. Very important, yeah, they're, they're indicator of credit hunger. Yeah. Thank you very much. Ladies and gentlemen, we will take that as the last question. I will now hand the conference over to Mr. Abhijit Chakravorty for closing comments. Thank you. I must thank you for joining us with us and looking at some insights with our numbers. So we will continue to be watchful of our portfolio. While being watchful, we are bullish on our numbers. We are doing the metrics, the other parameters and metrics are looking good. The profit was higher than profit is on an increasing trajectory. So all taken together, we will be continuing to do good business. Thank you. Thank you very much. On behalf of SBI Cards and Payment Services Limited, that concludes this conference. Thank you for joining us. You may now disconnect your lines. Thank you. Thank you, Neerav. Thank you.