Lionheart Holdings (CUB) Q4 2023 Earnings Report, Transcript and Summary

Ladies and gentlemen, good day, and welcome to Q4 and FY '23 Earnings Conference Call of City Union Bank hosted by AMBIT Capital. [Operator Instructions] Please note that this conference is being recorded. I now hand the conference over to Mr. Prabal Gandhi from AMBIT Capital. Thank you, and over to you.

Thank you, Yashasvi. Hi, good evening, everyone. Thank you for dialing in. On behalf of AMBIT Capital, I welcome you all to fourth quarter earnings call of City Union Bank. We have with us Mr. N. Kamakodi, MD and CEO; and Mr. J. Sadagopan, CFO. Without further ado, I'll hand over the call to N. Kamakodi for his opening remarks, post which we'll open the floor for Q&A. Thank you, and over to you, sir.

Good evening, everyone. Heartly, welcome to all of you for this con call to discuss audited financial results of City Union Bank for the fourth quarter and year ended 31st March 2023. Board approved the results today, and I assume you all have received the copies of the results and the presentation. You might have also seen the announcement of 3-year extension approved for our MD and CEO. The succession planning and all will start maybe about 2, 2.5 years in [ time ]. At the. Beginning of the last year, during the fourth quarter financial year '22 con call, we shared with you all our expectations that growth will be low to middle double-digit and we did not have visibility for brighter growth because of our higher price, macroeconomic stability and things like that. Though we were not bullish during the beginning of the last financial year. The outlook improved during the middle of the year, but unexpected developments affected the progress. And all those things are behind us now. Financial year '23 has been a decent year of progress despite the above challenges we faced. Most of the parameters like PAT growth, reduction in the NPA, ROA growth and all had broadly been in line with our annual basis, while growth has been below the expected level. As you all know, we had tightened the underwriting process even before the COVID, when our approval rate for new customer log-ins, which used to be around 45 to 50 percentage was brought down to around 25 percentage and all. We did not take any change in the composition of the advances. Major segment had been MSME with 43 percentage share will also gold loan, which is presently at about 25 percentage of our advances. Historically, we did not concentrate much on the segments like housing, credit card segment, vehicle loans, personal loans, loan against the properties as well as [ sole ] lending model. Now we could see. [Technical Difficulty]

Sir, we are unable to hear you.

Can you hear now?

Yes.

Yes. Based on our learnings in the last 3, 4 years, we are at the verge of finalizing. So basically, based on our learnings in the past 3, 4 years, we are actually finalizing a tie-up with the Boston Consulting Group as our consultant to upgrade our existing digital lending processes and the approval proportion should also increase as we move forward in the next few quarters. We are aiming for about 12 to 15 percentage growth for the current year which would be skewed towards the year-end. No major changes expected in the composition of advances. And also as discussed in the last quarter con call, we could not recognize interest subvention part of our Agriculture KCC Jewel Loan. We have completed necessary compliance for the scale of finance, whatever we discussed the last time with the required audit process and all. Post con call, we received one installment of payment on that and waiting for the rest. This is actually a good sign. We received the first installment. At the year beginning, we estimated the slippage of our financial year '23 to be in the range of 2.5 to 3 percentage of the closing [ advances ]. In addition to those accounts which are marked as NPA by the system automation, based on our learnings, we have identified and recognized some more accounts as NPAs in Q4 '23, which are showing some signs of sickness, but which are actually not marketed by the system at NPAs and which are beyond the 90-day norms, I mean, which are actually -- the outstanding has not crossed 90-day norms but based on our learning, we have done that. After taking in -- considering all these -- our slippage for financial year '23 was at 3.02 percentage, which is about 2 basis points higher than our expected range. Our gross NPA stood at INR 1920 crores for 31st March 2023 and the gross NPA ratio stood at 4.37 percentage against 4.70 percentage last year. We expect good moderation in the slippage this year. As at the same time, the recovery has improved substantially during financial year '22, '23. We had a total recovery upgradation of INR [ 1,007 ] crores in financial year '23 comprising of INR 813 crores from live accounts and INR 294 crores from technically written off accounts compared to INR 795 crores last year, comprising of INR 607 crores from the live accounts and INR 188 crores from the technically written off accounts in the financial year '22. The NPA addition minus recovery for financial year improved to INR 222 crores from INR 481 crores in the financial year '22, which means there is about INR 260 crores of additional benefit we got in the current year. Net NPA also -- I mean, vis-a-vis last year. Net NPA also improved from 2.89 percentage on financial year '22 to [ 2.3 ] [indiscernible] year '23. It reduced sequentially also from 2.67 percentage in Q3 to 2.36 percentage in the Q4. So we expect further substantial improvement in the recovery in the current year also to get the net NPA back to the pre-COVID level in the next [ 4 , 3 ] quarters. In this process, we also expect that the coverage ratio also to improve with the technical written off over 20 percentage and without technical write-offs over 50 percentage in coming quarters. The overall SMA 2 to total advances now stands at 1.82 percentage. It used to be around 6 percentage during the pre-COVID level. Our standard restructured assets also reduced to 2.83% to of the total advances -- from the peak of 5.91 percentage of advances, whatever we had during September 2021 actually. So all these -- the pool of assets numbers are coming down and also the recovery is showing, let's say, a good positive outlook. As you all know, we had tied up with 6 insurance companies covering life, general and nonlife. They have also started showing results. During financial year 2019, 4, 3 years back, pre-COVID, we had a bank insurance commission of INR 9 crores, which improved to INR 27 crores. That is 3x in the last 4 years. We expect this growth to improve in the coming years. In addition to the cost of deposit increase the nonrecognition of interest subvention amount also reduced our [ IMA ] in the last couple of quarters. And our net interest margin in the current quarter ended up with the 3.65% while the year as a whole, the annual net interest margin had been 3.89 percentage. We expect there will be definitely pressure in the net interest margin because of the deposit repricing has [ swayedly ] repriced in the industry. But our cost-to-income ratio for the financial year '23 is reduced to 38.85% compared to 40.37 percentage in financial year '22. In the absence of treasury profit, the cost to income ratio may be slightly get elevated in the range of maybe [ 40 to 42 ] percentage or some increase will be there for the next financial year. During the, mid financial year '21 at the peak of the COVID, we said that we should be getting back to the pre-COVID level of ROA of 1.5 percentage by the second half of financial year of '23. During the first half of financial '23, actually, we achieved the PAT of INR 500 crores and ROA of 1.59 percentage. And we expected the same thing will repeat in the second half also. But with the unexpected contribution from the first half of INR 500 crore profit actually had, let's say, unexpected contribution from various quarters like treasury profit, write-back from NCLT accounts in the lumpy recoveries. These opportunities are not now available in the first half basically. Those are challenges in the -- in growth, net interest margin reduction lower contribution from other income front and all and also, marking of NPAs in addition to the system mark NPAs. We closed the financial year '23 with ROA of 1.46 percentage which is closer to our long-term average of 1.50 percentage. We hope to close the financial year '24 also with 1.5 percentage plus. NPA recovery will be a major contributor, though there will be challenges in the first half of financial year '24 on PAT to growth. It will be compensated in the second half because of both business growth and also improved NPA recovery. So overall, we are good visibility and confidence for achieving our PAT growth and also the ROA and all for the current year also. So our PAT has registered a growth of 23 percentage and stood at INR 937 crores for the financial year '23 as against INR 760 crores for the financial year '22. This year also, we expect the in proportion to be, let's say, advances growth, 12 to 15 percentage of growth in the annual profit in tune with the, let's say, business growth and also improved recovery. To sum up, despite headwinds in the margins, our best figures or growth or, let's say, the nonavailability of income from other opportunities like Treasury and all. We expect that we should be closing financial year '24 with a decent PAT growth, substantial reduction in the NPA, improved coverage ratio and ROA closer to or even better than our long-term average of 1.5 percentage. So this is the overall outlook, whatever we are having for the financial year '24. So some issues -- I mean there are certain unexpected issues which created some dent in the last year, and those issues are behind us. So going forward, we hope we should be able to achieve overall growth impact while maintaining the ROA and also simultaneously reducing the overall NPA figures is what we expect at this point of time. So with these opening remarks, I open the forum for questions. Over to you all.

[Operator Instructions] We have a first question from the line of Mona Khetan from Dolat Capital. Please go ahead.

So just taking up from your opening remarks, you mentioned that Delhi increased focus towards retail but also you mentioned that loan mix is unlikely to change in FY '24. Is that what I got correctly?

No, I did not say that I will concentrate on the retail and all. What I'm trying to say is that -- like the -- many of our peers have shown greater interest in our greater growth in the retail, but we may be thinking of it maybe for the '24 '25 and all. Currently, we don't expect any major change in our overall loan mix is what I said.

Got it. Got it. And as far as margin trajectory is concerned, even in H1 of next fiscal, do we feel that 3.85% to 4% will be doable? Or would they be relatively muted?

Yes, there will be maybe, let's say, 10 to 15 basis points lower than that, like whatever range we gave in the past. So you had the fourth quarter average of 3.65%. So our margin will be around this range for the current year because you will be having one end, there is some, let's say, interest rate hike has been passed on during the fourth quarter. At the same time, there will be, let's say, on cost of deposit front, some repricing impact and hike will be there. And also, we are having the disadvantages of not able to recognize some part which we have been telling like once we get the final approval from the, let's say the regulators and things like that. So based on that, we are making the expectation with the available data, and this is where we are.

Okay. So full year margins will be closer to what we saw in Q4 of FY '23?

Yes. Plus or minus 10 basis points.

Got it. And just finally on -- in FY '24, if I understand it right, you are also moving to CTC-based salary structure for the employees.

This will -- this year's increment will be the last of the time scale base increment. And the actual impact of the CTC basis will be visible only next year.

Okay. Okay. So is that why you're expecting the cost ratio to be higher this fiscal or just because of the lower top line?

No. Basically, last year, in the first half, we had, let's say, a good amount of profit from the treasury and also lumpy recovery from the NCLT accounts and all, which gave a lot of addition to the other income. Those facilities are not available. I mean if you try to -- and analyze the figure, as I told you, more than INR 200 crores of benefits we have got from the NPA slippage minus recovery front for financial year '23 compared to the financial year '22. So this year, we will be getting, let's say, even improved benefit from that a slippage minus recovery front which will be compensating us for all the dent in the net interest income and nonavailability of other income opportunities from the treasury and all such front. So overall -- because since in the first 2 quarters, since you don't have the opportunities from the treasury and all and also since we had INR 500 crore profit in the first half, profitability growth over and above in the first half will be challenging. And the -- it will be getting compensated in the second half. So despite all these things, we are confident of having whatever PAT growth and ROA, we are expecting for the next year for which we are having the visibility.

We have our next question from the line of Rohan Mandora from Equirus Securities.

When you're guiding for a NIM of around 3.65% as 10 basis points FY '24 and an ROE, which in 4Q was around 1.3% ROA -- so -- and we are guiding for a 1.5% kind of an ROA for FY '24. So just want to understand what will drive the ROA improvement? I mean 1H also we have added for a [indiscernible] [ overall ] profitability, which is the last year 1H.

The major, let's say, agenda, whatever that will be driving is the improved recovery, which we were not having during the, let's say, 2021. So as I told you, we had the addition minus recovery of NPA actually, let's say, you have already seen about INR 250 crore or so difference between the last year and the current year. And from this year to next year, also based on the our analysis of the NPA [indiscernible] that is giving us enough comfort to that, we should be able to maintain our overall ROA number and the PAT growth, simultaneously seeing the reduction in the net NPA number also. Major driver for PAT growth this year, along with the growth in the business in the second half, major driver is going to be the, let's say, improvement in the recovery as we have demonstrated in the -- let's say compare between financial year '23 to financial year '22 in terms of slippage minus recovery.

Sir,what would be the expected credit cost that we are building in for this? For FY '24.

See, the instead of -- actually, if you look into the presentation, the -- if you -- the provision you made net of the recoveries you made in the technical written-off it comes to about 90 basis points or so for the financial year, what you call [ 23 ] per se. So we had about -- the similar number was about 0.82 for '18 and 54 basis points for the financial year '19, which increased about INR 1.5, 1.3 and all in subsequent to quarter. So what I basically want you to, let's say, the way what I want to convey what we see is that you have already seen INR 200 crore increase in the addition minus collection between financial years '22 to '23. We expect a similar jump in the current year also.

So this would be on the net slippages that you're seeing, [indiscernible]

I've seen already, the [ SMA 2 ] numbers have also substantially come down. The restructured standard assets have also started substantially, they have come down. Our incremental, let's say, both in terms of the slippage, we expect a reduction. And also the recovery numbers are also improving, but we have already started seeing. So these items are going to be a major driver for the PAT growth and, let's say, production and improvement of ROA for the financial year, '23, '24.

So sir, a great question fall down to 50, 60 basis points for FY '24.

I don't have an exact number. It will be finally depend upon why are you want to keep your net NPA because that will be a moving target. So that's why I say I will have some flexibility on that, and that's why I give you a broader picture on this. That is that decision will be taking as you move enter into the year.

And sir, secondly was on the loan growth. So for FY '24, like when you're talking about the back-ended growth and the target 12% to 15%. So just wanted to understand, like, are there any new products that we would look to launch or any geographical expansion? Or this is going to be mainly coming from the same geographies and the same products portfolio that we are operating in. And when you're saying the growth will be back ended in the year, so what kind of growth one can expect in the first half on vis-a-vis the period-end number of FY of March '23 a number?

The point is like the current level of growth rate only will be there in the first half. As I told you, our -- we had, in fact, pulled down the approval rate for new customers from about around 50 percentage to 25 percentage just before the COVID and we thought we will be releasing it that in the financial year '22, '23 and keeping that in mind only. I also shared with you all that we will be going for a better growth rate. So a development which you are aware, we had to pull down, we had to revisit the entire processes and put in place, and those things are, let's say, almost completed. And also to ensure for the better measurement of risk and appreciation, we are also in the process of, let's say, as I told you, let's say, they're tying up with BCG so that the our existing digital lending processes, for MSME loans also needs some amount of, let's say, fine-tuning and all. Those things, like maybe the current level of growth will be continuing for the next couple of quarters. These issues will be -- we will take a shape and we will be in a position to see improved growth rate in the second half.

Sure, sir. And lastly, the question I want to ask was that on this approval rate of 25%, so is it a function that the proposals that we are getting from the market right now are not credit worthy enough to be sanctioned? Or is it just that from a process perspective, we continue to remain slightly more conservative and that's where the flow rate is low.

Yes, yes, yes. We, in fact, if you remember, [ some ] -- along with the second quarter results of the financial year '19, '20 before COVID, we are tightening our belt, and we are taking our legs off the growth pedal, at that point of time, we tightened. And I mean the inflow is almost average. Whatever we are getting at that part pre-COVID what we are getting and if aren't we got into this space, probably we would have continued with the same 50 percentage of whatever it is. So we reduced it at other point of time. We were expecting to -- in fact, even at the beginning of the last financial year, we did not have confidence. In the middle of the year, we started getting the confidence we said we will be starting to open that. But unfortunately, we couldn't do that last year. So we are now -- we are starting to open that at the same time creates -- fine tuning the other digital processor and all are also going to happen parallelly. So this is how we see this year will plan out to be.

We have a next question from the line of Prakhar Agarwal from [ Elara ] Capital.

Taking forward from the last question, the growth of the slower growth that we saw as because they were higher.

Yes. Can you slightly get away from the mic or whatever the voice is not clear.

Now is it better, sir?

It's better and talk slowly.

Yes. So in terms of -- just taking forward from last question -- last participant question, in terms of growth that we saw, was it also a function of competitive intensity on the ground or something, how do you look at MSME ecosystem around where in you are dealing with in terms of health of those and that is why our approval rate was low. What was the logic behind not increasing the approval rate from earlier that you talked about the current 25% that we reduced during COVID, why was that net raise in the second half which you anticipated it to increase?

See, the -- as I told you, it has nothing to do with the competitive intensity or anything like that. So the major item, what happened in the second half, particularly on the restructured assets, regulatory inspections, divergence and all, we had to learn some lessons and we had to, let's say ensure that we have to ensure that the internal things are taken care and those things don't happen again. So for which to ensure all the things are in place and all, we decided, like say, we postponed our time taken to push for growth. So we just continue to do with whatever we had done during the pre-COVID and all. Those issues are now by and large behind us at the same time. Some fine-tuning is necessary in our, let's say, which we have found out that in our digital processes, particularly on the measurement of risk revisiting our model and all. We are starting that process and all and it will take 1 or 2 quarters to settle. So keeping all these things into account, I'm giving you the thing. Apart from that, all other -- this is not because of the competitive intensity or this is not because of we are not getting proposals -- so we are -- we have to ensure that, like, say, whatever we take from this point of time, we will be able to, let's say, push for the growth without any hassle for the next 10 years or so. So some amount of internal fine-tuning, we are in the process of doing. We are almost there and some amount of things with this association of BCG once it is complete, all these -- the integration has to happen properly, after which we will be in a position to push growth fully.

Sir, your thoughts on any stress that you probably see on MSME side or how you look at an MSME ecosystem and health around those. So are there any red flags that you are seeing in the segment that you operate in terms of health of those customers?

See, as I have clearly given to you the SMA 2 numbers or historical look. I have not seen these types of low SMA 2 numbers in my life in my total experience. Similarly, even the, let's say, less than 4 percentage of SMA 1 and 2, in my life, I have not at all seen. So the health of the -- what you call the MSME and all are decent. Whatever issues that were there, they had got washed out during the COVID period and things and all by and large, those things are almost over. And that's why I'm -- when I conveyed that going forward for the current year, we will be seeing both reduction in the slippage -- more than that, there will be increase in the recovery. Overall, the addition minus recovery will be, let's say, showing even good improvement like what we have seen between financial year '22 and '23 that is giving me enough confidence to say that both in terms of PAT growth and ROA, we should be in a position to handle it for the whole year. But we will be having issues in the first half because we had a contribution, we had INR 500 crore profit after tax last year, which was supported by treasury profit and also recovery -- lumpy recovery from the NCLT cases and all, which are not available for -- in the first half this year. So in first half growth in the PAT may not be good. But year as a whole, we are able to have visibility to see growth both in terms of PAT and also having a, let's say, lower NPA and ROA at our crossing every historical average.

Sure, sir. Sir, just one more question on margins. So when we say that we'll probably, for the full year next year, we will have [ exact ] ROAs similar to [ exact ROAs ] that we saw for FY '23, which is 3.65% plus minus 10 basis points. And on the other hand, we also say that probably because of deposit costs rising, there might be some pressure points in the initial one. So how exactly we are going to maintain because if the -- we are going to see some value cater in both half and how exactly we are going to maintain exit run rate of 3.65% because there will be some downside which are there.

When I share that number, the impact of all these things are already built in.

Got it. And just one last thing, in terms of recovery from return of accounts, what was that number for the full year FY '23? And how do you think that particular line item place in FY '24.

Basically, the -- we had -- in terms of suit recoveries, we had INR 294 crores for financial year '22, '23, we saw INR 188 crores last year. In fact, that's why when I gave the information, don't just look into the write-off of recovery. If you consider both write-off of recovery of the return of accounts and also the recovery of live accounts together, if you consider it as a recovery, the growth in the financial year, '22 '23 is about INR 250 crores in addition to whatever you had in the financial year '22. So this year, that we expect a further improvement on that line.

We have our next question from the line of Jai Mundhra from ICICI Securities.

Sir, my first question is on agri slippages related subvention loss of net interest income. So I remember, last quarter, there was INR 32 crores loss of net income because of the subvention slippages. Was there any such element in this quarter as well?

There is no reversal like the INR [ 20 to 32 ] crores what we did last year, but we could not recognize about INR 25 crores or so income in this quarter. This quarter.

So sir, the NIM decline this quarter is mainly because of the rise in cost of deposit, right, which is more or less..

About, let's say, around 5 to 6 basis points, the contribution will be from the nonrecovery of what you call the agricultural team and also, -- you might have seen the cost of deposits has increased by about from 4.6% to 5.07%, which is about 45 basis points. While there is about 15 basis points only is the increase of yield on advances. Some passing of rates have happened in this quarter for the advances. So there will be some increase in the yield on advances in the current quarter. So considering both whatever we have, past con and also the expected increase in the cost of deposit, we conveyed the expected net interest margin. Another point, what you also need to see about it not less than 15, 20 basis point impact because of the lowered CD ratio.

Right. And maybe the higher slippages this quarter as well, right? I mean the.

Yes, it is even lower than whatever slippage we recognized in the fourth quarter -- third quarter -- so sequentially, that impact, it is already, let's say, to a greater extent, build in impact, it is advantageous compared to whatever margin we had in the previous quarter.

Right, right. So sir, hypothypically, let's say, I mean this quarter RBI inspection and everything we've done for these agri slippages, we cannot accrue the lost interest or there is a case that you can start accruing from first quarter onwards. I mean you will anyway accrue but can you recoup the lost interest.

See the receipt of the first installment is a very good sign. We don't want to, let's say, commit or overpromise anything. Since it has been found out, we have completed all the, what you call, compliance process, audits and all, we have submitted the what you call papers to them. So one installment, let's say, has already come in. So hopefully, the impact may not be as bad as what we thought originally. But we don't want to take a chance, let's say, we will go for accrual when we feel it is okay to accrual until that point of time, we would like to just leave it as such and wait for the finality on this matter.

So these are standard account, right? They are not [ inclined ]

No, no. These are all standard accounts. Basically, what the logic is -- I mean, maybe for the benefit of everyone, let me repeat. Say, you have what is called as KCC scheme, in which, let's say, it is basically given -- a 2 percentage interest subvention is given by the government to the 1.5 percentage interest subvention is given by the government to the borrower. So normally, what happens is that like for getting that 1.5 percentage interest subvention, a question was asked to us whether we have calculated the let's say, amount eligible for the borrower based on the scale of finance. So we had done a thorough exercise went account-to-account and try to find out what proportion of the -- what proportion of the accounts are fulfilling the norms and what proportion of the accounts are not fulfilling the norms and all by and large, except a very small proposition. Overall, let's say, our audits says that maximum amount of these accounts are fulfilling the criteria of the let's say, scale of finance and things like that. The -- basically, the -- what happens is that government gives about 1.5 percentage to the bank and 3 percentage to the borrower if they repay within 1.5 years and the 4 percentage is what we have to within 1 year or whatever. So basically, this 3.5 percentage is what, like said, we are not able to recognize at this point of time. So the -- we have fulfilled and by account by account, we have taken the through exercise and it is audited by the external charter accountants and all. The final compliance is already submitted for approval. Basically, as I told you, first installment -- I mean, normally, how it happens is that -- so we will be -- the normally the payment by the government may get delayed by 2 years, 3 years and all and do you will get -- and all these things will be in accrued and receivable basis, receipt will happen sometime down the line. So this time, after these issues came also after the, let's say, these things and all are spent. We have received one installment for our past due, which is a very good sign. So we will -- once we, let's say, reach a stage where the backlogs are clear, then we will get the confidence that we can go for recognizing the accural.

Right. No. So what I wanted to check is, this is KCC loans, so the installment is once in a year only, right? Or there are multiple installments?

If they are -- they become NPA, within 15 days, they will get action and will be recurring. I mean it will be finding a part ] in the overall NPA in the Jewel one, that part is not more than, I think, INR 10 crore or so in these total outstanding slippage and the INR 10 crore also will be from the Jewel accounts where the borrower is deceased or he is not available locally and all where we are not able to any court procedures or stay is pending or something like that.

No. So I was saying that if the KCC loan has only one installment annually, and we have already received that, right? Then what is stopping you from recognizing the interest if it is already receiving cash?

In that, the problem is, you will be getting only 4 percentage interest from the borrower. Another 3 percentage will be received from the 4.5 percentage will be received from the government. That 4.5 percentage, let's say, originally, we will be approving even after we give the loan Jewel back to the borrower, the 4.5 percentage income will be recognizing on an accrual basis. And the government may be paying that account in due course. When the objection of scale of finance came -- the doubts were raised, whether we will be getting that 4.5 percentage whether we will be eligible for. We had to demonstrate that we should be eligible for the 4.5 percentage, which we have done now by and large. So once it is approved, we will get the money. First installment has now come sorry, one installment has come after this issue was came [ upto light ].

And how many installments are there, sir? So let's say I mean around.

It depends upon the budgetary approval. So the government will make some approval and send it to the Reserve Bank of India. Reserve Bank of India, FAD department will be distributing this money to all banks between in a proportionate basis. So the actual payment is depending upon how much money that is transferred to basic government to the Reserve Bank of India.

Okay. And let us say, in first quarter, everything is sorted, right? Let us say it becomes very clear that you have the necessary documents to prove that these are eligible agri subvention loan. So do you receive the backlog also or the fourth quarter and third quarter interest just does not come back?

What I'm trying to say is that once I get all installments up to financial year '22 I will start -- now I have received only part of financial year '21. So it will happen with the delay of, let's say, at their own government's own time line. I mean we can't let's say, force anything or in it happens at its own pace. So once we get the -- get for what our demand we have raised, once we get to the dues for financial year '22, I will start recognizing on an accrual basis, the financial year '23.

We'll move to the next question from the line of Darpin Shah from Haitong India.

A couple of questions. First one was on slippages front. [ Did ] you are right, you mentioned that there were some standard accounts but were at borderline and thus you recognized the slippages or NPA during the quarter?

Yes. See, the -- basically, the -- I mean, these accounts were not let's say, your system basically gives based on 90-days overdue means NPA, it will immediately throw that. There are a few accounts which may not have crossed 90 days on 31st March 2023 but are showing continuous strength signals or whatever, like based on the learning whatever we had in the previous years and all. So we had more than what is marketed by the system, some amount of accounts we had added in this quarter.

And sir, what would -- if you can quantify that?

It could be about INR 75 crores to INR 80 crores.

Okay. And was there any interest reversal also in this? Or just because you have stranded out on the business?

All built in. All built in. As like, for other if it is more than 90 days, the reversal could be lower, let's say, since they have their large installment, which would be less than 2 installments also. It will be proportionately lower.

Okay. And sir, second thing is on -- second question is on loan growth. Now your comments indicate that in history or in the lifespan, which you have seen, we have not seen this SMA 2 at such low levels. And still, we are guiding for 12% to 15% growth only. So where is the disconnect, sir?

Disconnect is in like say, when you analyze the growth of most of our peer banks or whatever, the substantial growth had been done by them in terms of retail advances, let's say, home loans, vehicle loans or the, what we call, coal lending and things like that which we will be -- we may not be doing in the financial year '23, '24 also. So this 12% to 14% growth also, let's say, I'm discounting first quarter, as usual, you may not be having weak growth. So for me, all the, let's say, the fine-tuning and all, the projects and all, taking all these things into consideration. And overall growth rate of the system for the current year, you might have also heard about, let's say, even the today's comment from the State Bank of India and all. The overall credit growth of the system for the current year is also -- is expected to be moderated. And we will be taking one step at a time and the non-entry or, let's say, many of our peers who have shown substantial growth in 14%, 15%, 16% and all. Significant growth has come from these retail and other things, which at this point of time, we are not, let's say, entering, which we will consider probably at the end of the current year and all and for future. So I'm not taking those things for my growth projections in the current year.

We have a next question from the line of Bunty Chawla from IDBI.

Just kind of a repetition could be, sorry for that. As you said, for FY '23, there would be a dip in the margin as compared to last year and there could be a chance of cost-to-income ratio, which is around 38%, 39% could increase to 40%, 41%. So maintenance of ROA is completely dependent on the recovery in the asset quality front. So can you guide for the credit cost for the full year FY '24? Because if I see the 33 slide number, credit cost for this year seems to be the lower among last 5 years, equivalent to the last 5 years as such. So what should be the credit cost we should take for the FY '24 as such?

Yes. I answered this question also earlier. So I am not giving you, let's say, any specific number on the credit cost because it depends on where we will be closing the net NPA with. So that's why I am giving you here a broader number, let's say, you can't simultaneously view it this way. The addition -- NPA addition minus NPA recovery between the financial year '22 and financial year '23, it improved by about INR 240 crores or INR 250 crores or something like that. So we expect the similar improvement on that front in the current year also. We expect a good moderation in the slippage. We also expect a good improvement in the recovery. This difference will be, as I told you, the -- about INR 240-odd crores got added, let's say, that was the incremental benefit for me to my P&L between the financial year what you call '22 and '23. So for example, in fact, I told the addition minus recovery for financial year '23 was INR 222 crores. And -- I mean, for financial year '23, it was -- the addition minus recovery was only INR 222 crores, whether it was last year, it was INR 481 crores, which means about INR 260 crores of benefit I received because of this parameter. I expect, let's say, improvement on this particular number this year, which will be helping me both in terms of, let's say, protruding my PAT growth and also improving my net NPA position and also the coverage ratio.

Thank you sir and sorry for this repetition, the credit growth, you said 12% to 15% for FY '24?

Yes, which will be back ended.

We have our next question from the line of Amish Thakkar from Siguler Guff India Advisors.

I just want to understand like what kind of steps are you taking internally, you mentioned about the regulatory challenges and the divergence that we have...

We cannot hear you properly sir.

Can you hear me now?

Yes.

I just want to understand what kind of steps you've taken in terms of your processes and any lapse that we have in terms of processes, which led to the regulatory divergence? And is that completely over? Do you see any like next couple of quarters, you probably will try to perfect it and -- what gives you confidence that those issues will not pop up again and have you press on the growth pattern?

See, let us be honest about it. We had this divergence issue second time and about 7, 8 years back, we had once. When other banks had, let's say, hundreds and thousands of crores in between after the AQR and all, we did not have much issue. What is the fundamental item is when you, let's say, in your IRAC norm and when you automate your, let's say, NPA recognition. So the system, when it throws something, you will not have any issue about it. But there are many items, let's say, which are nonfinancial and which are subjected to a lot of interpretation and all, where there will always be a difference in the judgment, how it is being perceived. And particularly, when you take a call during the audit and subsequently after 3, 4 months during the, let's say, after you will also have the other information of, what you call, the operations in between. Even last year when the divergence happened, you could have clearly seen about 25%, 30% of that had already been marked as NPA in the next subsequent first couple of quarters because they were all recognized by the systems. I don't think anybody will be able to say with 100% conviction that nothing will be there, because all the -- I can definitely say and I can swear anything, let's say, based on the system marking and based on the financial thing and based on the proper, let's say, which are all codified and documented, when system throws something, I can swear that there is absolutely nothing different. But when it comes to the perception, things change. Last year, the perception was basically different on the restructured cases where the issues were given and there were issues in the debt of recognition of the NPA and all, those things are behind us. So taking into consideration all these things, that's why I told even those accounts which are not recognized by the, what you call, like system but we have recognized -- which are, let's say, showing some signs of sickness, though they were not, let's say, strictly coming under the 90-day norm, we applied some extra subjectivity and tried to ensure that we are on the right side of the recognition. So this is the best we could do and we have gone even to the next level. Then rest all we have to leave it to the Almighty. We have done everything possible in our control to do that. And as you know, it's a matter of reputation. No MD or no management will take chances on these things knowingly. But when the perception and when the different views are coming, we are helpless and I mean, there won't be anything in your hand to share that day. So we have -- last year also, we took everything in our care to do that. This year also, we have -- and every quarter and every time we take whatever that is in the best interest. What we feel is that, let's say, the only thing which we have -- the similar thing as I told you but the 6, 7 years back, when it came, it was not the era of automatic NPA recognition and -- I think in 2016 or so, we had to declare one time and it had happened for the second time unexpectedly. So this is the -- and nobody would like to keep their reputation at the stake and all. When we declared the results and also we discussed this point with our statutory central auditors also, both the Board Audit Committee, all members also asked this question multiple times. So we have taken everything in our control to, let's say, even on the gray items, we have taken our best possible items. Beyond which, let's say, it is for the Almighty to take a call.

And I just had a couple of questions on your credit to deposit ratio, you -- credit to deposit ratio has compressed by a couple of 100 basis points in the last -- since COVID and that's putting pressure on your NIM margins. So any guidance on that front? And within deposits, you mentioned in the past that you don't want to give any guidance on CASA factor, you reached 30% CASA ratio. Now you're already there for the last couple of years. So any guidance on CASA going forward?

See, on CASA front, basically, we took a few steps, particularly on the government CASA front in the last 2, 3 years which have been helping us to improve our CASA front. We have been taking our best effort basis. You have started seeing the results and there will be always some fluctuations here and there. I will give you, let's say, very far maybe a few more quarters once I get a total control. I mean you have started seeing the improvement, let it be, let us see how things move forward. And on the other front, what is that you were asking?

Sir, CD ratio used to be 86%, it has come down already 4% now.

Yes. CD ratio is something -- now when you -- though you have -- let's say, we have to take that call depending upon the surplus liquidity in the system, overall credit growth and overall things and all. So we decided not to, let's say, squeeze still the last point and it will be staying over there for maybe a few more months till we see that, let's say, we get a comfort to squeeze it to old average.

Okay. And sir, one last question on gold loan. So it's 25% of your book now, where it used to be less than 20%. So again, was one of the focus areas for loan book growth in the last 2, 3 years. So going forward, any guidance and also your NPAs on gold loans are negligible compared to rest of the book, your system averages 3.5% if you remove gold loan, the NPAs on non-gold part of the book is even higher. So any guidance on gold loan going forward? And also your yields on gold loans are, if I'm not on less than 10% versus the 2 listed NBFCs are close to 20% and there are all sorts of players between that range from both yield side as well as ticket size perspective. So any guidance in terms of how you look at that product going forward?

Yes. As you might have observed, our significant portion of our goal loan is basically for the classification of agriculture, which we have to mandatorily do. And we also, let's say, we were doing it well till we received that -- we got this scale of finance issue and all, so some moderation. Our stand had been that, let's say, we will do it as what you call wherever we require it for the -- to achieve the agricultural target. And also, whenever --wherever we have, let's say, surplus capacity and wherever we are not able to build our SME book, we go for the gold loan is what we have taken a stand. So it has been very favorable to us and we can never come to the listed gold loan NBFCs' average of 20% yield and all. That could be few -- there are fundamental ways of, let's say, the difference in the portfolio itself, particularly the classification of agriculture and all such things. So our -- thing is that when we start seeing the, let's say, the growth rate of MSME increases, so we always have, let's say, higher risk adjusted yield there also. So at that point of time -- I mean, if you had seen over a period of, like say, 15 years or so for our bank, so we started with a single-digit increased that to about 18%. Once again, got it back to -- after 2014 gold price crashed, we got it back to single digits. Then once again, we increased that. We -- whenever we felt we were not comfortable with, let's say, during the COVID period and all, we gave trust to these things. So we will use it as an opportunity to, let's say, grow when we don't have -- let's say, when we feel that the growth opportunity on MSME loan has come back. So broadly, our, let's say, average will be about 12% to 15%. And the fluctuations, the extremes could be about 8% to 27% and 28%, depending upon the requirements -- I mean, in fact, beyond the 25 itself, let's say, it's not -- I mean we are not very gung ho about it. We want to see how we -- how it moves forward.

We have our next question from the line of Rohan Mandora from Equirus Securities.

I am Just trying to understand in terms of the account aggregator and the ONDC, how are we placed right now? Or is it the BCG project that we are doing is with respect to -- getting on board with respect to many of these things? And especially, as we understood many of the large private sector banks are -- have made a significant development and that is helping them gain almost 25% to 30% growth in the loan segment which is our core focus area. So the point which was asked earlier in terms of the competitive pressure, are we seeing competitive pressure emerging from those kind of lending as well by just taking market share from us?

No, not exactly. Those sort of things are basically happening at a level, let's say, lower than our segment of, let's say, the INR 1 crore to INR 5 crores segment or whatever it is, the smaller segment is there. We are already, let's say, getting ourselves ready for ONDC, for which the enrollment process and all has started. And on the account aggregator framework, in fact, we wanted to be sponsored for own account aggregators but we could not get necessary approval when the concept came about 3, 4 years back. We are also in the process of doing that. All these things should be getting completed in the next couple of quarters. We are already on the job.

We have our next question from the line of Rajkumar Vaidyanathan, an Individual Investor.

Just one question. You were saying that you don't expect significant treasury income in the first 2 quarters. So I just saw that the government bonds have come down significantly in this current quarter. So you should be able to get some decent treasury income for the Q1, right? So just [indiscernible]

Yes, you will see appreciation only for those, let's say, government security purchases you made between the yields of the current yield and the peak yield, whatever you saw. That entry had, let's say, you never had surplus liquidity in that period to make maximum entry and all. It can at the best reduce your mark-to-market loss and if you have to book a small profit, you have to sell a big portfolio which is not, let's say, going to help you in a very big way like what we saw in the last year comparative period.

We have a next question from the line of Gaurav Jani from Prabhudas Liladher.

Just firstly, a couple of questions on the margins. So from a full year perspective, we saw about 9 basis points decline in margins in FY '23. So do I understand it correctly, You mentioned you will be somewhere in the 3.65%, 3.7% range on an average basis in entire FY '24?

At this point of time, your -- our expectations are also almost closer to this.

Okay. Okay. Sir, just to take that point forward, I mean, frankly, this year, barring even the one-offs, the yields have not gone substantially higher like we saw in case of other banks despite of we having a higher yield portfolio.

Yes, yes, you are right. Let's say because of the shocks from the multiple -- I mean, what you call unexpected quarters, let's say, and also loss in income because of these things, all multiple factors and all, we were, let's say, a little bit lagging -- we lagged in passing. One reason is that even before that we had passed. If you closely look into even before the, let's say, increase in the external benchmark, we had a -- let's say, we had been getting the yield that substantially at a reasonably higher level. And let's say, we in fact, we were -- since we had other items to look into, some amount of passing has happened in the, let's say, during the current quarter and small, let's say, visibility will be there, let's say, when we see the current quarter's number. But your observation is right. The others increased the rates more than what we had done. But still, let's say, in most of the cases, our current level of yield is almost equal to most of our peers or even slightly more.

So sir, just if I may squeeze on this. So I mean what proportion of our loan portfolio would have been repriced on an average basis till now [indiscernible] rate hikes?

Please repeat the question.

What proportion of our loan book would have been repriced on an average basis in FY '23 post rate hikes?

Almost the entire book. The -- I think except about 11% -- about 10-odd percentage, all have seen a passing of, let's say, transmission of rate hikes. And the transmission of the exact number had been, let's say, depending upon the rating, depending upon the, let's say, quantum and other factors, it could vary. It may not be -- I mean, as you might have seen, when about for 2% to 2.5% increase in the external benchmark rating, overall average yield increase for the system had been reported to be about 1%, 1.5-odd percentage. In the last -- let's say, about 4, 5 months in the last 2 hikes before the year-end, we had been a little bit slower in the transmission. We have tried to compensate it by to whatever extent the possibility. See, the basic difference was that the last part was something which we did not expect.

Understood. And sir, on the deposit side, I mean, so what proportion of deposits are repriced?

Almost about the 40% to 50% got repriced and we had also reduced the peak interest rate, whatever we had been given during the pre-COVID period. So some amount of, let's say, the incremental thing like incremental increase will be, let's say, getting moderated.

Sure. So what I understand is because 50% of deposits are yet to be repriced. That is where you expect the margin decline in FY '24?

Can you repeat the question, please? I lost you in between.

No, what I was asking is sir, because you -- 50% of deposits are yet to be repriced in '24, we expect a margin decline?

No. The margin decline is going to be for everybody. We are also going to have that. So we -- there is still some amount of repricing in the deposit side left. Some amount of increased [Technical Difficulty] basically considering you already have a benchmark during the what you call, fourth quarter are about 3.65% and all. So we have to consider the potential repricing effect. We have to consider a potential increase that could happen in the yield on advances. So considering there could be some, let's say, changes in the CD ratio also positively, taking all these things into consideration only. We said this can be taken as the middle one, plus or minus 10 basis points, it should be what we should be seeing going forward.

Sir, what was coming from the one-offs that you saw in '23 could normalize, right in '24, so that is what...

Yes, already bulk of it has got, let's say, normalized.

Sure. And sir just last bit, did I understand correctly? So FY '23, you saw net slippages of about INR 517 crores. This number, you expect this to be lower because of higher recoveries?

Yes. I mean what I clearly gave is, let's say, consider both recovery from the live and the technical written off together. The NPA addition minus -- the NPA -- let's say, addition minus recovery for financial year '23 is INR 222 crores, which was [Technical Difficulty] so there is a benefit in the P&L for about, I mean INR 260 crores. So we expect that this year there should be moderation in the slippages, there should be improvement in the recovery and there should be expansion in this number is what I'm trying to say. Our improvement in this number is what I'm trying to say.

We have our next question from the line of Rakesh Kumar from B&K Securities.

Sir, firstly, looking at the -- this TWO number, which is close to around INR 1,350 crores or INR 1,400 crores number. So the recovery from TWO would be lower going forward as compared to what we have seen in the past, especially in this year and recovery from NPA would be higher, correct?

No. What I'm trying to say is that it could be -- there could be improvement in both. Basically, but when we recover -- when we go for our recovery procedures, we don't differentiate for a procedure for a live account and for a technically written off account. So, but the -- how it -- you get the response is something which you cannot have a total control.

Got it. And how old this TWO number would be? So what would be the average maturity? Like these are 2 years old, 3 years old. So what is the average blended maturity of this INR 1,300 crores, INR 1,400 crores number?

It will be, let's say, 1 to 3 years will substantially cover about 80% of that, roughly.

1 to 3 years. Okay. And sir, in this quarter, particularly, there is a very sharp movement in the cost of term deposit. So anything specific, like if you see the trend, like there was hardly any movement in Q1. And obviously, now the -- because considering that average maturity of deposit that we have based on the disclosed number of the ALM. This quarter, we have seen a very sharp jump, more than 50 bps jump in the term deposit cost. So anything very particular to read into it? If you can help, sir.

See, in the last quarter of the last financial year, I mean you had even public sector banks getting to even 8% interest for the term deposits and all. And so there was -- we even offered 1.5% and 8% for the term deposits. So normally, you have said 25% repricing happening every quarter. And over the period of time, the deposits which were maturing were at about 6%, 6.5%. And there were about 1%, 1.5% or even 1.75% incremental cost for the deposits which were maturing which resulted in the increasing cost of deposits.

Okay. And sir, though reported number on the yield and advances showing increment of around 15 bps on a reported basis, but on a calculated basis, this number is kind of a bit volatile on a lower side. So any like -- any higher amount of advances that we have taken in the book in the end of the period, something like that?

No, we have not gone for any portfolio buyout or anything. These are absolutely the regular advances. You will have the -- I mean, if the end to end, you will not be in a position to exactly calculate because when it comes to the daily average, there will be fluctuations in terms of the cash credit utilization and things like that. We have not gone for any portfolio buyout in the last year.

All the best to you sir.

We have our next question from the line of Shankar V.S. from Freelance.

Sir, can you kindly expand on the scope for engaging BCG, sir? Any specific to lending or some restructuring [indiscernible] like that?

No, they are going to help us in terms of, let's say, looking into the, let's say, risk measurement modeling of portfolio. And looking into the loan origination to the sanctioned digital lending process basically. We are not looking into changing the organizational structure and all. This is purely for the business process reengineering of the lending processes from the, let's say, customer experience, let's say, renewal from the loading of proposals into the loan origin system to loan sanction and dispersal. This is what we are engaging with them.

So I understand that we'll be having an end-to-end digitally underwritten loan model. So what we are proposing like.

Yes.

Sir, in continuation of that, if we are engaging BCG and investing on this digitally end-to-end platforms and all. So obviously, we'll be incurring an upfront cost, wherein the benefits of the same, we could be realizing or getting it about some quarters after that, maybe next year even. So could that upfront investment make any pressure on the -- additional pressure on the margin, sir? Do we expect it?

The cost is not significant. It will be less than, let's say, 3%, 4% of the annual profit what the bank is making. And it will not be having any significant impact on the overall P&L.

We have our next question from the line of Jai Mundhra from ICICI Securities.

Sir, I just wanted to check, sir, on one of the airline exposure that we had, there was some restructuring by the airline to a lesser, right, which -- wherein they have got the dues converted to equity. Does that necessarily mean that this is a second restructuring and hence, it could become technically NPA for lenders? While I believe we have provided so -- but I wanted to check, can that become NPA?

See, for us -- we don't expect that for us, the reason being, they had given a repayment schedule and they have repaid up to almost 75% of the overall outstanding. And there is only one installment left, which they have to cover it before the -- by June 30. So that is where the things currently stand as of now for us.

Okay. Understood. Sir, if you can refresh sir, what is the provisions that we have against that exposure? And I'm sorry, how much is the exposure now as of March? And I believe we have 100% provision there. So what would be the reduced exposure?

We -- it's about -- the outstanding currently is around INR 25 crores or so.

And that will be 100% provisioned, right?

Yes, yes.

We have our next question from the line of [indiscernible] an Individual Investor.

Sir, can you explain the reasons for not entering into the consumption space lending?

See the -- basically, like as a policy right from the beginning, the bank's original DNA had been to fund the creation of business assets and not for consumption. And also, over a period of time, we had passed through multiple cycles when -- I mean, our experience had been -- I had seen this in the 2003, '04 cycle and multiple cycles when, let's say, people rush for the unsecured segment and some amount of heat comes in the future and all. So we will wait for the -- so far, like our original ethos had not, let's say, supported us taking the decision for the retail and all. But days are changing, we also need to be open. We will -- we are waiting and watching the situation. Once our -- particularly after this digitization and all, after perfecting the model and when we are comfortable and confident that our risk measurement and all, we will be able to price the risk appropriately and identify the risk appropriately. We will think about taking these decisions in the future. At this time, we have not made any major change in our overall policies whatever we have done in the past.

So sir, can you explain which of the sectors we are -- we would not be open to lending apart from the consumption sector?

Nothing like that. Like said, overall, MSME, commercial trading, agriculture together transit so much. We had always restrained ourselves from entering large consortiums and all. In fact, whatever we could do in the last 2 decades, most of the things were -- the credits were not for doing something extraordinary but for not doing many wrong things. So that has, in fact, saved us during the AQRs and other things, even when many of our peers and all went in a big way, we decided not to go for that and we were proved right subsequently. So we see that way.

Sir, and just looking at your last [indiscernible] annual reports, I'm just populating the segmental result numbers. We see that the segment result numbers from treasury to the total segment result numbers is increasing, whereas the wholesale banking and retail banking is slightly decreasing. So is it like there's some structural change in the retail and the wholesale book which -- where the pricing is not getting , we are not able to price in the correct risk so that we are not able to get the required results as far as the core banking is concerned, whereas the treasury has been contributing to the higher segment results, which gets populated in the annual report.

See, the -- don't look at that way. See, when your balance sheet grows, you have more what you call in terms of your treasury portfolio increases. And there is, let's say, income, what you get from the interest income and also the profit what you book in the -- particularly getting into the integrated treasury operations and all, it also improves. And last 2, 3 years, the growth in the core banking segment had been muted because of so many factors. So that probably might have made you to see a pattern like that, but we don't see that way. So once the issues are behind us, things should be getting back to the normalcy. We have not made any conscious effort to change the overall structure as -- in the way you perceive.

Sir, because it is the numbers which have been reported and we -- I can see that in...

I fully agree with you. It is because of the external environment and we don't expect that to continue when the, let's say, when -- in future.

Yes. Sorry sir to push here. Because the numbers have been dropping from 2014 and nothing to do with the -- is this pre-COVID numbers also, I'm seeing that the mix from the wholesale and retail is?

You see the combination of wholesale and retail together and the treasury together, how do you see the numbers contribution?

So sir, if I just look at from '14, so you had from 2011, it was 22% treasury to the mix, 31% wholesale and 43% retail banking, which in '14 fell to -- which increased to 43% to 53% in retail banking and which fell again from 53% to 36% and 44%, and this is again at the same level. So these are pre-COVID numbers, I'm talking, not even...

One minute. What is the treasury number at your beginning? And what is the treasury number? See the -- don't segregate wholesale and retail differently. There are a lot of reclassifications happened in between because of the, let's say, the definitions changed in the MSME Act and things like that. We -- and the contribution of the treasury fluctuates depending upon which side of the interest rate cycle you are in. We don't envisage any major difference over there. The reference point may not be, let's say, a point that should be seen. We don't see that way.

Okay. Okay. And sir, can you also provide for the credit -- in the subsequent annual reports, could you provide also separately the credit cost for retail and wholesale as well the segment analysis which has been reported in the annual report? Not only the way we put it in the presentation but the way we put it in the annual report as far as the segment results, too. Can you provide the...

My suggestion will be look into the wholesale banking and retail banking together as a core banking and further hard splitting, I don't think it is not going to serve any purpose.

All the best.

We have a next question from the line of Rakesh Kumar from B&K Securities.

Just one question with respect to tax rate. So this quarter, it is looking slightly on lower side. So any specific reason that we could not get to know from the disclosures?

See, it is basically -- it depends upon the, let's say, expectations, the expected tax that should be paid. And also, let's say, we -- if you look into the annual basis, by and large, you don't see any difference in that. Anything you want to add Sadagopan on this? Taxation rate for the year, what is the percentage you want to add?

[indiscernible]

So that is there.

[indiscernible]

Okay. See, on annualized basis, you won't see much fluctuation.

The write-off amount which is looking slightly on a higher side, sir. So does that have any impact, the loan write-off amount on tax rate?

Yes, it will definitely have.

Ladies and gentlemen, that was the last question for today. I now hand the conference over to management for closing comments. Over to you, sir.

Thank you all for attending. The last year, despite having shocks overall, the things had ended -- all is well that ended well. This year also, even though we expect the headwinds in multiple parameters like, be it [ Macassa ] funds or other aspects. Overall, we feel on particularly because of the better contribution in terms of slippages and the recovery, whatever improvement we have seen between the financial year '22 to '23, we should be seeing the similar betterment to the year. First half, there could be, let's say, some things. But the year as a whole, we are confident of seeing both ROA growth and also the, let's say, reduction in the net NPA and, let's say, all ROA also in the -- like taking care of our overall long-term average and all. So we are able to see that. At the same time, like you might have also seen other things are also behind us. So hopefully, the financial year '23, '24 also, we should be like say, despite these things, we should be having a overall profitability well in line with whatever we had discussed with you. So let's hope for the best. Thank you.

Thank you. On behalf of Ambit Capital, that concludes this conference. Thank you for joining us and you may now disconnect your lines.