Geojit Financial Services Ltd — Q4 FY26

Geojit Financial Services Ltd Q4 FY2025-26 Earnings Conference Call https://www.youtube.com/watch?v=N-uxoZGxoS0 Published: 13 days ago

0:00 Ladies and gentlemen, good day and welcome to the Giojit Financial Services Limited earnings conference call. As a 0:08 8 seconds reminder, all participant lines will be in the listenonly mode and there will be an opportunity for you to ask questions 0:16 16 seconds after the presentation concludes. Should you need assistance during this conference call, please signal an 0:23 23 seconds operator by pressing star then zero on your touchtone phone. Please note that this conference is being recorded. I now 0:31 31 seconds hand the conference over to Mr. Satish Menan, the executive director from Geojit Financial Services. Thank you and over to you sir. 0:43 43 seconds Thank you very much. 0:46 46 seconds Good morning everyone and thank you for joining us today. This is Satish Manin from Giojit. 0:54 54 seconds On the call with me we have Mr. Mr. CJ George chairman and managing director Mr. Jones George executive director Miss 1:04 1 minute, 4 seconds Mini Nay CFO Mr. Jay Shashidaran CIO and Mr. Rahul Roy Chri, CEO of private wealth along with Lij Johnson, company secretary. 1:17 1 minute, 17 seconds Let me start by stepping back for a moment and talking about how we see Giojit today and when and where we are headed. 1:27 1 minute, 27 seconds At its core, Giojit is trusted advised we well platform 1:34 1 minute, 34 seconds built on long-term client relationship supported by technology with a strong onground distribution network. 1:44 1 minute, 44 seconds And what differentiates us is quite simple. 1:47 1 minute, 47 seconds For most brokers, a transaction is the end. For Giojit, a transaction is just 1:54 1 minute, 54 seconds the beginning, the starting point of a long-term wealth relationship. 2:01 2 minutes, 1 second That philosophy continues to shape how we built our business. 2:07 2 minutes, 7 seconds Over the last few years, it actually started in 2016, we have been consciously transforming 2:15 2 minutes, 15 seconds the business from a transaction-led broking model to a more stable, scalable and annuities. 2:25 2 minutes, 25 seconds Now, it is time for a bit more thrust. 2:29 2 minutes, 29 seconds This transformation, what we call Giojit 2.0, is not a shift of the direction. It is a structural evolution of the business. 2:39 2 minutes, 39 seconds There are three clear pillars to this. 2:42 2 minutes, 42 seconds First, continuing the shift in our revenue mix a little more aggressively towards the recurring income stream such 2:49 2 minutes, 49 seconds as mutual fund distribution, advisory, PMS and insurance distribution which brings greater viability, visibility and 2:58 2 minutes, 58 seconds stability to the business. Second, our global NRI franchise. We have of course built long-standing relationship across 3:07 3 minutes, 7 seconds GCC and this gives us unique ability to connect global wealth flows back to India especially with the added 3:16 3 minutes, 16 seconds opportunity of DIFC gift city and asset management business in UAE and third [clears throat] 3:24 3 minutes, 24 seconds investing and using it to reach this about two objectives. 3:31 3 minutes, 31 seconds This is fundamentally a relationshipdriven model. Our sales feet on street don't just execute transactions. 3:39 3 minutes, 39 seconds They guide clients through their investment journey. 3:43 3 minutes, 43 seconds With our strong presence in tire two and tier three markets where the need of advice is the highest, we believe we are 3:52 3 minutes, 52 seconds well positioned for the next phase of growth. 3:56 3 minutes, 56 seconds And with that context, FI26 has been a year where we have actively accelerated this transformation. 4:05 4 minutes, 5 seconds Our focus through the year has been on building scale, expanding our distribution footprint and investing in 4:12 4 minutes, 12 seconds capabilities that position us well for the next phase of growth. 4:17 4 minutes, 17 seconds We have consciously prioritized strengthening our core across people, technology and brand to ensure that we 4:26 4 minutes, 26 seconds are building a more scalable and future ready business. 4:31 4 minutes, 31 seconds Profitability for the year reflects the strategic and plan investments. 4:37 4 minutes, 37 seconds We initiated the first phase of our IT transformation with an investment spent of around 10 crores in the last financial year which will enable better 4:46 4 minutes, 46 seconds integration, improved client experience and stronger data decision making over time. At the same time, we significantly 4:56 4 minutes, 56 seconds strengthen our distribution engine with an addition of around 700 employees during the year of which 650 people in 5:05 5 minutes, 5 seconds sales. Our employee base now stands at 3,768 employees giving us the scale and capacity to support future growth. 5:17 5 minutes, 17 seconds This 20% expansion in our sales force uh has an added cost of 29 crores for the year and is a deliberate step 5:25 5 minutes, 25 seconds towards deepening our reach especially in under penetrated markets building a strong pipeline for sustained growth. 5:35 5 minutes, 35 seconds We also stepped up our brand building efforts with an in with an incremental spend of around 15 crores in advertising 5:43 5 minutes, 43 seconds and marketing in FI26 compared to FI25 with a clear focus on improving visibility, trust and recall. 5:53 5 minutes, 53 seconds Just to note, FI26 also includes a provision of around 9 crores toward the implementation of the new labor code which is in line with the regulatory requirements. 6:04 6 minutes, 4 seconds What is particularly encouraging is that these investments are already translating into stronger operating traction. 6:12 6 minutes, 12 seconds Distribution income grew 10% during the year. 6:16 6 minutes, 16 seconds Our net inflow market share in equities for mutual fund improved from.33 to 40 reflecting an improving competitiveness 6:24 6 minutes, 24 seconds and deeper client engagement. Our SIP book continues to build steadily with a monthly collection reaching 151 crores 6:33 6 minutes, 33 seconds in March which reflects retail sustained retail participation in a long-term approach to investing by our clients. 6:43 6 minutes, 43 seconds As on 31st March, our AEM uh stood around 23,230 crores and uh total customer assets were 97,000 crores. 6:54 6 minutes, 54 seconds To conclude, while FI26 profitability reflects the impact of plan investments, we are seeing a strong traction in our 7:02 7 minutes, 2 seconds distributionled business and improving client metrics. 7:06 7 minutes, 6 seconds These investments are aligned with long-term opportunity arising from the financialization of savings in India and 7:13 7 minutes, 13 seconds as they scale, we expect operating leverage to support improved growth and profitability over the medium term. With 7:21 7 minutes, 21 seconds that, I would like to open the floor for questions. Thank you very much. 7:28 7 minutes, 28 seconds Thank you. We will now begin the question and answer session. Anyone who wishes to ask a question may press star and one on their touchstone telephone. 7:39 7 minutes, 39 seconds If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use 7:46 7 minutes, 46 seconds handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question Q assembles. 8:02 8 minutes, 2 seconds Our first question comes from the line of Yogesh Shro from Magnus Hathway Investments. Please go ahead. 8:11 8 minutes, 11 seconds Uh hi, thank you so much for the opportunity and congratulations on a big set of numbers. uh what I can see is I 8:18 8 minutes, 18 seconds think LA this quarter is when our DIC business also gets activated. uh so my question was how how is the traction 8:27 8 minutes, 27 seconds initial traction been and what do you think the current situ do you call the situation there how does how has it impacted the business or it has actually 8:36 8 minutes, 36 seconds accelerated the traction of people shifting their wealth from the Middle East to India. So first question is that 8:45 8 minutes, 45 seconds and the second question is we already have existing entities there. So quickly wanted to check in how uh how are they different because I believe that we 8:53 8 minutes, 53 seconds already doing some wealth management uh through our existing entities and what is the AUM for that and how is it how is 9:00 9 minutes the new DIFC entity different so yes yeah so uh 9:07 9 minutes, 7 seconds uh am I yes um so this is uh Jones George I'm the 9:15 9 minutes, 15 seconds executive director of the company um So uh with regard to DIC we have uh 9:22 9 minutes, 22 seconds received all the licenses and we had uh started operations in the month of February. Uh this is a uh largely a 9:30 9 minutes, 30 seconds private banking business. We are external asset managers to private banks. So the onboarding with the private banks uh are uh in progress. Uh 9:40 9 minutes, 40 seconds client onboarding hasn't yet started. uh which will take uh by the end of uh this month is when we'll start client uh 9:47 9 minutes, 47 seconds onboarding uh that is when we'll start seeing uh revenue come in as well. Uh and to your second question on the 9:55 9 minutes, 55 seconds existing entities in uh Middle East these are uh largely catering to the retail segment. While there are a 10:02 10 minutes, 2 seconds portion of uh you know or or or good number of uh wealth prospects also that are managed by these companies uh these are largely in the retail segment. 10:12 10 minutes, 12 seconds That's the kind of products that they offer. So there is a differentiation between the DFC entity and the joint venture entities that we have uh in the 10:20 10 minutes, 20 seconds Middle East at the moment. uh to give you numbers on uh NASA as a whole we 10:26 10 minutes, 26 seconds have uh about uh um 12 to 13,000 crores of uh assets uh that we manage for NRIs 10:37 10 minutes, 37 seconds uh and all together we'd have made an income of about 90 crores in the last financial year. 10:45 10 minutes, 45 seconds Got it. This was super helpful. And this last question on the new salespeople edition. I think I believe we have added 10:52 10 minutes, 52 seconds almost 800 to 900 new employees uh this year. So uh if you can give a bif bifocation between uh the new employee 11:01 11 minutes, 1 second hires in our DIC entity versus the India entity or the entire uh entire is in India only the entire new addition 11:09 11 minutes, 9 seconds capacity is in India only uh so most of the addition has been in 11:16 11 minutes, 16 seconds India entity only. So di like press Jones just said we are in the initial 11:24 11 minutes, 24 seconds stages of starting. So we have hired net 700 people in the last financial year of 11:31 11 minutes, 31 seconds which 650 is in pure sales and most of it is for the India entity only. You 11:38 11 minutes, 38 seconds want to add anything Jones? Yeah. So, uh on the uh DIC side, we have uh three 11:44 11 minutes, 44 seconds employees there. Um uh but they are not into sales at the moment. Um and the JVS uh the other entities in the Middle East 11:53 11 minutes, 53 seconds have also done a little bit of recruitment. But all put together we're talking about 10 people. Uh not not a significant number at this time. 12:02 12 minutes, 2 seconds So uh I think in the earlier calls you had mentioned that our target is to gather almost $20,000 of asset and 12:10 12 minutes, 10 seconds advisory within the DIC entity and I think the currently we just have three employees. If you can if you can give us 12:17 12 minutes, 17 seconds the game plan for DIC entity how are we planning to ramp that up over the next two to three years then that will be 12:24 12 minutes, 24 seconds super super helpful. And uh additionally if you can just help us uh with some uh understanding on what the minimum uh 12:32 12 minutes, 32 seconds ticket size is for a client in terms of to onboard with us in the private banking business. Uh like some is is it something like a kota private banking 12:40 12 minutes, 40 seconds where minimum ticket size uh is minimum business size would be around 10 crores 20 cr or it's it's it's something different than that. 12:49 12 minutes, 49 seconds Yeah. So uh the current three employees that we have hired one is in the IFC one is of course the CEO the second is the 12:57 12 minutes, 57 seconds investment advisor and the third is a service manager the relationship manager or the salespeople uh are in the uh 13:04 13 minutes, 4 seconds process of recruitment. The minimum ticket size that uh generally private banks uh require in the in DIC is about 13:13 13 minutes, 13 seconds a million dollars. So that is where we will start the relationship. uh and uh we will be uh driving this business of 13:21 13 minutes, 21 seconds course through um uh recruitment of uh uh you know relationship managers. Uh I must tell you that the West Asia 13:30 13 minutes, 30 seconds conflict has um has had uh uh you know uh little bit of uh apprehensions 13:38 13 minutes, 38 seconds because clients have uh while we are not seeing across the NRI client base that we have. We are not seeing panic 13:46 13 minutes, 46 seconds redemptions but clients are choosing not to make any financial decision at this time until they are clear about uh or 13:54 13 minutes, 54 seconds they have some certainty about the future. So uh the next couple of months I believe will be a little tricky 14:02 14 minutes, 2 seconds because of the West Asia conflict but uh the long-term outlook of uh DFC as well as the Middle East continues to be very strong. 14:12 14 minutes, 12 seconds Got it. Thank you so much for being so patient. Uh look forward. Thank you. Thank you. 14:19 14 minutes, 19 seconds The next question comes from the line of Chandanda Batia from Sears Fund Management. Please go ahead. 14:28 14 minutes, 28 seconds Yeah, good morning everyone and thanks for taking my question. And second thing is uh the detailed 14:35 14 minutes, 35 seconds presentation is extremely good in terms of helping to know how AR is doing and how insurance distribution vertical is doing. 14:44 14 minutes, 44 seconds So I have couple of questions. 14:47 14 minutes, 47 seconds So my first question is what is the plan for current year for hiring and capex plus extra opex if you are planning for the year. 15:02 15 minutes, 2 seconds Uh good morning good [clears throat] morning. 15:05 15 minutes, 5 seconds Good morning. Yeah. Uh see at the moment what we have done is we have uh stopped 15:12 15 minutes, 12 seconds uh uh hiring for the field. Uh this is uh a move on account of the vestation 15:22 15 minutes, 22 seconds crisis which is uh uh creating a shadow in India also. So it might take a few 15:29 15 minutes, 29 seconds more months for us to you know have some clarity on this year's uh larger recruitment. So at the moment we we have 15:38 15 minutes, 38 seconds stopped recruiting. We are focusing on training the people we have had last year and putting them into uh you know 15:46 15 minutes, 46 seconds practice through various branch offices etc. So this might uh uh for the current 15:53 15 minutes, 53 seconds uh number uh we may not be hiring incremental uh people but we will uh 16:01 16 minutes, 1 second replace uh if there are vacancies arising. So that is our plan for uh current year. With regard to opeds uh on 16:10 16 minutes, 10 seconds the IT side my colleague uh J Shutaran executive director is here. I'm u requesting him to address that question. 16:24 16 minutes, 24 seconds Thank you. So this is J. Shashitaran and uh from an IT perspective we are in the midst of a transformation initiative and 16:32 16 minutes, 32 seconds uh we are gearing up our systems to uh cater to the increased business that we are uh projecting for as part of the 16:41 16 minutes, 41 seconds initiatives that Sadish u Mr. Sadish talked about in the beginning. So uh we have an aggressive plan to leverage uh 16:49 16 minutes, 49 seconds digital. We have an aggressive plan to leverage data. Uh we have plan to uh leverage uh customer experience and 16:57 16 minutes, 57 seconds improving our uh front-end systems that engage with our customers. So towards that we we have uh lined up about 30 17:06 17 minutes, 6 seconds crores for the next three years to come in into the business. So that's where we are focusing on from an investment perspective. 17:17 17 minutes, 17 seconds Yeah, this is helpful. So my next question is about lending book. So what do you plan uh to grow this lending book 17:26 17 minutes, 26 seconds uh for the current year and any plan to launch new EIF or new PM scheme? 17:36 17 minutes, 36 seconds On the lending side, of course, uh most of the money what we have lent is on the margin funding side and we intend to 17:45 17 minutes, 45 seconds grow the book also. Uh the market is active. um on the schemes of new PMS AF. 17:55 17 minutes, 55 seconds Um we are uh launching one which will take uh it is an application stage and 18:03 18 minutes, 3 seconds AF uh through the gift city route that is what is there in the pipeline. 18:10 18 minutes, 10 seconds uh we have built the BMS team and uh my feeling is uh maybe for this financial 18:18 18 minutes, 18 seconds year maybe one or two more schemes in PMS also. Thank you. 18:25 18 minutes, 25 seconds Yeah. Okay sir. And sir uh one more question about uh uh regarding what is the cash in the book as on 31st March 18:33 18 minutes, 33 seconds and uh what is the plan for private wealth team to grow this year? 18:40 18 minutes, 40 seconds Okay, the first question on the cash will be answered by Minina as CFO and private wealth. We have Rahul Roy Chowi 18:47 18 minutes, 47 seconds is the CEO of private wealth. He can take up the questions on private wealth. Over to you Mini. 18:54 18 minutes, 54 seconds Uh thank you Satish. So I'm Mini Nay CFO of the company. So the cash uh available in the balance sheet of the company is 19:02 19 minutes, 2 seconds 1,00 1,115 crores. Out of this uh around u 700 800 19:10 19 minutes, 10 seconds to already used for uh funding the MTF book then we have a lab the NBSC and then we have uh the client funding 19:18 19 minutes, 18 seconds whenever required. Uh the cash available liquid cash available is around 375 crores as on 31st March 2026. 19:27 19 minutes, 27 seconds Thank you. On private wealth uh Rahul can explain. Yeah. Hi hi good morning Mr. Chandra. 19:36 19 minutes, 36 seconds This is Aari. I'm the CEO for private drug business. Uh so uh we grew approximately around 40% uh last year as 19:44 19 minutes, 44 seconds far as our aians are concerned and we have strengthened the sales team also. 19:49 19 minutes, 49 seconds Uh so now we approximately have around 55 odd RMs on the ground with a total staff of around 90 people. We intend to 19:58 19 minutes, 58 seconds hire around 25 to 30 uh relationship manager in this uh financial year. uh slowly steadily the brand is getting 20:06 20 minutes, 6 seconds recognized from a private world standpoint and from a wealth management standpoint. So hiring has become slightly easier uh and we are getting 20:14 20 minutes, 14 seconds decent talent who are willing to discuss with us. So I think from a next year standpoint uh we will keep focusing on 20:20 20 minutes, 20 seconds hiring the right talent uh increasing the productivity of the relationship managers on a month-on-month basis and working towards creating highquality trailbearing uh assets under management. 20:32 20 minutes, 32 seconds So that's that's the specific plan as far as private business is concerned. 20:38 20 minutes, 38 seconds Okay. And can you elaborate uh in terms of AUM what it was as on 31st March and number of branches in the private wealth 20:47 20 minutes, 47 seconds and if you have any plan to open new branches in private wealth. 20:52 20 minutes, 52 seconds Okay. So uh uh a 31st March was approximately 2,400 odd uh close. uh as 21:00 21 minutes of now uh the number of uh branches so we have approximately uh five branches in Kerala uh Chennai, Hyderabad, 21:08 21 minutes, 8 seconds Bangalore, uh Bombay, uh Pune, we have just recently started, Delhi and Kolkata. uh uh we don't uh we don't 21:17 21 minutes, 17 seconds intend to expand more cities as of now but we want to go deeper as far as these cities are only concerned because there's immense potential as far as 21:25 21 minutes, 25 seconds these cities are concerned and lot of these cities have a hub and spoke model so for example from a puna market I can 21:32 21 minutes, 32 seconds cater to a lot of internal territories of Maharashtra uh from a Hyderabad I can take care of a lot of Andra situation 21:39 21 minutes, 39 seconds and Bangalore and Chennai also similarly so that's that's the intent so we would uh make these branch these branches 21:47 21 minutes, 47 seconds stronger hire hire more talent in these particular locations and go deeper as well these markets from an FI27 21:57 21 minutes, 57 seconds okay thank you so much and all the best and I'm happy to see the aggression in gojit which it was missing thank you 22:05 22 minutes, 5 seconds thank you thank you pat thank you the next question comes from the line of yog from magnus investments. 22:14 22 minutes, 14 seconds Please go ahead. 22:17 22 minutes, 17 seconds Uh hi, thank you so much for taking the follow-up question. Uh so my uh so my I think as you mentioned that the current 22:25 22 minutes, 25 seconds cash on books is around 1,00 crores which is a very significant part of our market cap as well. So uh do we have any 22:34 22 minutes, 34 seconds plans to actually uh do any kind of a buyback or any kind of a capital restructuring? Uh and that is one and 22:43 22 minutes, 43 seconds just another thing is uh I think a lot of other companies in the in the industry that we operate in for the MTF book we usually uh lend money from the 22:52 22 minutes, 52 seconds market given that it's a it's a safe kind of a lending we can we can borrow money at 8 7 8% and then give it for MTF 23:00 23 minutes at 11 12%. Right? So uh do we have any plans to use uh borrowed money for MTF or we'll continue using our own cash on 23:07 23 minutes, 7 seconds the books because that uh that I believe can be a little bit inefficient in terms of the funding point of it. Just wanted your views on it. Thank you so much. 23:17 23 minutes, 17 seconds Agree with your uh observation. We intend to borrow and finance the future requirements with regards to the MDF 23:25 23 minutes, 25 seconds book and the loaning and share book and the NBFC. With regard to buyback, uh we will uh wait for the uh seia regulations 23:34 23 minutes, 34 seconds to uh come out. Uh there is a discussion uh paper out it seems. So after that we 23:43 23 minutes, 43 seconds will take a view. We will be open to the idea at the appropriate time. Thank you. 23:50 23 minutes, 50 seconds And thank you. I also want to know how has the uh client the domestic client reaction been. So uh obviously for for a 23:59 23 minutes, 59 seconds couple of other players in the industry what we saw was clients were actually uh putting in more money they were topping up the account in terms of equity mutual 24:07 24 minutes, 7 seconds fund. So how has the client reaction for us been in March and also uh how has the traction been uh in April since since 24:15 24 minutes, 15 seconds FC's fire and all freeze fire and everything was announced. Just some insights on that. 24:22 24 minutes, 22 seconds So on the mutual fund side um I the client traction is uh fantastic. Uh of 24:29 24 minutes, 29 seconds course uh like I said in the beginning uh beginning of FI26 was uh uh transformation for us. we were 24:37 24 minutes, 37 seconds aggressively pushing uh uh to get mutual fund AEM and that is why we are very 24:44 24 minutes, 44 seconds happy to report uh when the industry saw close to minus 20% in the net inflows 24:52 24 minutes, 52 seconds for equity mutual fund the industry gojit has been able to do what it did last year it is primarily because of our 25:00 25 minutes reach to our clients and the ability of gojit staff to convince the client that u should not panic in such situation and 25:08 25 minutes, 8 seconds you should hold on and invest more. You have seen the SAP book also growing. So I think all those things uh is clear to 25:17 25 minutes, 17 seconds state that uh the handholding of clients with Giojit has been quite good and people are actually increasing their 25:25 25 minutes, 25 seconds investment amount at least compared to the market. 25:30 25 minutes, 30 seconds So uh uh in the presentation also we have given uh you know mutual fund income by client vageage. Most of our 25:38 25 minutes, 38 seconds income actually 58% of our income comes from the clients who have been with us for more than seven years. So we have 25:45 25 minutes, 45 seconds been um uh like I said in my beginning we handhold our clients and participate with them throughout their wealth 25:54 25 minutes, 54 seconds creation journey and that is what being seen in the question of April too early to say nothing much has happened in 26:01 26 minutes, 1 second April I think uh uh uh ceasefire no ceasefire I'm still not clear I think 26:08 26 minutes, 8 seconds that is the apprehension which most of the retail clients also has it'll take maybe another couple of months for us to 26:15 26 minutes, 15 seconds get a clarity on on the long-term nature. Having said that uh uh this could be some apprehension for the short 26:23 26 minutes, 23 seconds term uh for the long term I don't know 2 years 3 years 5 years this industry as everybody expect we also expect is 26:32 26 minutes, 32 seconds expected to grow at uh at least double digit percentages. Thank you. Thank you so much. 26:40 26 minutes, 40 seconds Thank you. The next question comes from the line of Sana from Ezek Advisory. Please go ahead. 26:50 26 minutes, 50 seconds Hi team, good morning. Am I audible to you? Yes, you are. 26:55 26 minutes, 55 seconds Uh, hi sir. I have few questions on the operations. My first question is what initiatives are currently underway to improve our operational efficiency 27:03 27 minutes, 3 seconds especially across our uh sales productivity and client servicing? 27:11 27 minutes, 11 seconds Okay, on the operational side, okay, I will split this questions question into two portion. Uh I will talk about uh the 27:19 27 minutes, 19 seconds feet on street productivity and I'll request my colleague Jay to speak about how it is being used to improve the 27:27 27 minutes, 27 seconds productivity on the feet on street productivity. Of course um um I we always say that we 27:36 27 minutes, 36 seconds have to train people since 800 uh 700 800 people are new in the system. The first job for us is to train them. We 27:44 27 minutes, 44 seconds use inhouse we we use u out of uh uh specialized uh agencies also to train. 27:52 27 minutes, 52 seconds We give these [clears throat] employees uh clients also to start their start 27:59 27 minutes, 59 seconds their sales uh process and we come out with different different incentive schemes uh to encourage them. 28:07 28 minutes, 7 seconds So we have I don't know uh whether to get into details you know for a fresher we have targets which are lower than uh 28:14 28 minutes, 14 seconds experienced people all sort of those things and what we have seen is that uh the productivity of employees uh is 28:22 28 minutes, 22 seconds increasing like I said uh uh the mutual funded flow in spite of the market being negative we are we are we are at least 28:31 28 minutes, 31 seconds not negative we you have seen in the last year the penetration of insurance and especially health insurance which we 28:38 28 minutes, 38 seconds started actually doing last year we did uh close to 22 crores of premium and health insurance. Uh previous to that we 28:45 28 minutes, 45 seconds were doing only life. So all those people when the market the stock market is not so good have been looking at products other than stock market for us 28:54 28 minutes, 54 seconds which is uh insurance. So we are very happy with u what we have invested. Of course um new people uh uh it takes time 29:03 29 minutes, 3 seconds for them to blossom and uh the idea is to handhold them they stay with us for a couple of years post that the attrition 29:11 29 minutes, 11 seconds rates come down I would give this to Jay to explain how it is helping us in productivity. 29:18 29 minutes, 18 seconds Thank you Mr. Sadeshman. So uh I will answer this in uh two levels. one at a strategic level how we are thinking 29:26 29 minutes, 26 seconds about this is that we need to get into a lot more integrated systems um to to 29:34 29 minutes, 34 seconds reduce the manual interventions that need that happen within the organization. So that's one strategic initiative that we are driving. The 29:42 29 minutes, 42 seconds second one is in terms of how do we leverage a lot more automation uh to enable our customer service, customer 29:51 29 minutes, 51 seconds support and everybody who engages with customers to be a lot more efficient. So at that if I leave it there and then look at what are we doing on the ground 29:59 29 minutes, 59 seconds on our systems for example when we onboard our customers uh when they get on to goj systems we are ensuring that 30:09 30 minutes, 9 seconds we minimize everything from a manual perspective. So we want to have a way where customers can smoothly get 30:17 30 minutes, 17 seconds onboarded where internal support from a manual support perspective is reduced. 30:21 30 minutes, 21 seconds So that's one example of of how we are bringing automation in front of customers and even within our operations. The second is in terms of we 30:31 30 minutes, 31 seconds have quite a few emails that come in from uh customers in terms of support 30:36 30 minutes, 36 seconds and um and and then um and and as we uh look at these emails we need to 30:43 30 minutes, 43 seconds prioritize we need to respond to them quite quickly and uh we have brought in some AI technology to ensure that this is done efficiently and and and quickly. 30:53 30 minutes, 53 seconds So those are some of those um technologies and solutions that we have brought in at various levels um and and we are looking at almost every aspect of 31:02 31 minutes, 2 seconds our business in terms of reducing these manual interventions. So those are few examples um and happy to talk about it 31:10 31 minutes, 10 seconds um in more if there are additional questions. Thank you. 31:18 31 minutes, 18 seconds Also my second question is how will ROE evolve over next few years and how will client growth and EUM expansion will support it? 31:31 31 minutes, 31 seconds Um sorry we will not give any uh future statements. Uh 31:38 31 minutes, 38 seconds I can only say uh what I again said in the beginning. We are consciously and 31:46 31 minutes, 46 seconds aggressively looking at building our trailbearing area. Um and that will be our focus. 31:55 31 minutes, 55 seconds Unfortunately, we cannot answer more than that in terms of future numbers. 32:00 32 minutes Okay sir, no problem. Thank you so much and all the best. Thank you. 32:06 32 minutes, 6 seconds The next question comes from the line of Mahish Kumar from Microton Technology. Please go ahead. 32:14 32 minutes, 14 seconds Hi sir, good morning and thanks for the opportunity. So I just had one question on the PMS growth. So our PMS division 32:24 32 minutes, 24 seconds growth appears a bit modest despite you know industry tailwinds. So what are the key bottlenecks that we are facing and how do we plan to scale uh in in the HNI and UHNI segment? 32:37 32 minutes, 37 seconds uh actually uh to just to put it um correctly 32:45 32 minutes, 45 seconds uh we have grown around 8% in PMS year on year and if I remember right report 32:55 32 minutes, 55 seconds said that the top 100 PMS providers they were down 10%. 33:01 33 minutes, 1 second Uh okay. So I am I am little unsure about the question asked because of 33:08 33 minutes, 8 seconds course the size is very small but uh we have grown 8% our aspiration is to go 33:15 33 minutes, 15 seconds much higher also and if you would see this uh though we had PMS from 2003 33:21 33 minutes, 21 seconds onwards we have actually started uh selling PMS only in the last three years. 33:29 33 minutes, 29 seconds uh if you look at the presentation in FI23 our EM was only 450 crores as it 33:36 33 minutes, 36 seconds was in business now it was uh 1,450 crores though of course last year the growth has not been same but when we 33:43 33 minutes, 43 seconds compare it to the industries are slightly better the base is small but 450 in 3 years has become 1450 and we 33:51 33 minutes, 51 seconds intend to invest in those in that asset management business 34:02 34 minutes, 2 seconds Thank you. The next question comes from the line of Tpal. Please go ahead. 34:11 34 minutes, 11 seconds Tpal, please go ahead with your question and unmute your line in case if it's on mute. 34:18 34 minutes, 18 seconds Since there's no response from the participant, we move to the next participant that is Nisha Jen, an individual investor. Please go ahead. 34:31 34 minutes, 31 seconds Nisha, please go ahead with your question and kindly unmute your line. Hello. Yes, please go ahead. 34:39 34 minutes, 39 seconds Uh, good morning sir. 34:42 34 minutes, 42 seconds Uh, sir, I had couple of questions. So, you've added around 1.5 lakh clients during the year. Um so what is the 34:49 34 minutes, 49 seconds revenue per client and uh versus the legacy clients and how does the profitability profile differ from 34:58 34 minutes, 58 seconds clients and the new ones without getting into details of uh the 35:07 35 minutes, 7 seconds costing per client. I can only uh give the details of the legacy clients. uh 35:14 35 minutes, 14 seconds when you look at uh our presentation we have given two metrics one for the stock broking and other for the mutual fund 35:22 35 minutes, 22 seconds where you see the legacy clients which we call seven years and ago contribute in both the cases 58 to 60% of the total 35:30 35 minutes, 30 seconds income in the respective field uh so in our case and you could also see the area per 35:38 35 minutes, 38 seconds client going up in FI22 it was close to three and a half lakhs which is agent per client has gone to five lakh rupees 35:47 35 minutes, 47 seconds uh per client. Uh in terms of client recruitment, yes 1.5 lakhs client uh and 35:54 35 minutes, 54 seconds uh unlike so in our case since we hire clients uh for broking as well as for 36:00 36 minutes mutual funds. Uh idea the idea is to handhold the client and uh let the client remain with us for a longer time 36:10 36 minutes, 10 seconds longer time. So we make uh so we make higher revenue per client compared to the industry and compared to the most other people in the industry because our 36:18 36 minutes, 18 seconds revenue comes from two field broking as well as from mutual funds. I will not get into details about uh cost per new clients or the revenue per new client. 36:29 36 minutes, 29 seconds Sure. 36:30 36 minutes, 30 seconds And uh so you've also added 700 new employees largely on the sales side. Um so what is the expected payback period 36:40 36 minutes, 40 seconds and in terms of revenue and profitability uh contribution? 36:46 36 minutes, 46 seconds We expect the new salespeople to break in within 12 to 18 months. It all 36:55 36 minutes, 55 seconds depends on uh the product mix. uh when the market uh when the stock market especially is not well uh it'll be done 37:03 37 minutes, 3 seconds through insurance otherwise stock market itself can take it. So the contribution comes from brokerage as well as from mutual fund. If it is only mutual fund 37:12 37 minutes, 12 seconds it will take a longer time because it is on trail bearing otherwise the expectation is 12 to 18 months. 37:20 37 minutes, 20 seconds Okay sir. And uh so can you give us a highlight like there's this little strategic shift. Um so how will it not dilute the ROE? 37:33 37 minutes, 33 seconds Uh we we are not looking at raising capital as of now. There is nothing on the 37:41 37 minutes, 41 seconds on the line for discussion also. What we said is we will be investing in people 37:49 37 minutes, 49 seconds and in technology for our strategic shift. That is what you saw in the 37:55 37 minutes, 55 seconds financial year 26 results which has almost 54 crores of expenses which has been 38:03 38 minutes, 3 seconds booked towards this transformation and uh for the next couple of years 38:10 38 minutes, 10 seconds there would be investments similar to this kind both in employees as well as in IT infrastructure and operations for 38:17 38 minutes, 17 seconds completing the strategy shift. What you saw last year uh though the mutual fund insurance income that is the 38:26 38 minutes, 26 seconds distribution income has gone up uh a substantial portion which comes from brokerage went down. So that is why you 38:33 38 minutes, 33 seconds have seen an effect on uh uh roe being reduced. 38:39 38 minutes, 39 seconds Uh this being the case I don't foresee the stock market being as bad as it was 38:47 38 minutes, 47 seconds last year. uh but if the case yes uh there will be cost associated to the transformation for the next two years at 38:55 38 minutes, 55 seconds least for us to reach our objectives uh to add uh to what Mr. Satish man and 39:04 39 minutes, 4 seconds said let me tell you that uh the uh cost for this transformation will be funded 39:11 39 minutes, 11 seconds through internal resources. We have no plan to raise capital. Uh having said this with regard to ROE let me also 39:21 39 minutes, 21 seconds repeat what I said earlier. If uh the regulations uh change appropriately, 39:28 39 minutes, 28 seconds we will look at uh uh buyback uh also at the appropriate time. So this is what I 39:35 39 minutes, 35 seconds would like to say on this point. Thank you. Sure sir. Cheers so much and good luck. 39:43 39 minutes, 43 seconds Thank you ladies and gentlemen. That was the last question for today. I would now like to hand the conference over to Mr. 39:51 39 minutes, 51 seconds Satish Menan for the closing remarks. 39:56 39 minutes, 56 seconds Uh I have nothing more to add. We have uploaded a detailed presentation uh a 40:03 40 minutes, 3 seconds new format in the website of Git is also available with the exchange. It gives you lot of incre in uh uh minute details 40:12 40 minutes, 12 seconds about the business and the business figures. Uh so I I I conclude this thing saying that uh uh transformation is 40:21 40 minutes, 21 seconds happening and we will be looking at increasing our uh recurring revenue base 40:28 40 minutes, 28 seconds uh in the next years to come. That's all. Thank you very much. Have a good day ladies and gentlemen. Thank you. 40:37 40 minutes, 37 seconds Thank you sir. Ladies and gentlemen, on behalf of Gojit Financial Services Limited earnings conference call, that concludes this conference call.