IDFC First Bank Limited — Q4 FY26

IDFC First Bank Ltd Q4 FY2025-26 Earnings Conference Call https://www.youtube.com/watch?v=190hMVse0J8 Published: 2 weeks ago

0:01 1 second Ladies and gentlemen, good day and welcome to IDFC First Bank Q4 and FI26 0:08 8 seconds conference call. As a reminder, all participant line will be in the listenon only mode and there will be an opportunity for you to ask question 0:16 16 seconds after the presentation conclude. Should you need assistant during the conference call, please signal an operator by pressing star when zero on your touchdown phone. 0:27 27 seconds Please note that this conference is being recorded. I now hand the conference over to Mr. Saphashi Babri, 0:34 34 seconds head of investor election and ESG. Thank you and over to you sir. 0:39 39 seconds Thanks Danish. Thanks a lot for the call and thanks everyone for joining the call. Uh we have today with us Vya our 0:47 47 seconds MBN CEO and Sudan Shu our CFO. So [clears throat] we'll start the call with uh a brief uh quote about the 0:55 55 seconds financials for the period ending 31st March 2026 by Sudanchu. After that uh we'll have some uh some words from Vya 1:04 1 minute, 4 seconds and then we can open the call for the participants for the questions. Okay. So now we I'll hand over the call to Sudanchu. 1:14 1 minute, 14 seconds Yeah. Thanks SATA. Uh good evening everyone. Thank you for participating on Saturday. uh what I will do is I will quickly outline some key financial 1:22 1 minute, 22 seconds numbers for the quarter and my sequence would be to start with assets then I'll talk about liabilities and then asset quality and finally some numbers around profitability and capital. 1:33 1 minute, 33 seconds Uh so let me go first with loans and advances. We saw an healthy growth in in loans and advances including credit substitutes during the quarter. It has 1:42 1 minute, 42 seconds grown by 20% on a Y basis and it has now reached about rupees 2.9 lakh crores. We 1:50 1 minute, 50 seconds saw an healthy traction across mortgages, vehicle loans, consumer loans, uh wholesale loans, business 1:57 1 minute, 57 seconds matching loans. Collectively these segments accounted for almost about 87% of the total growth. Uh MFI we all have 2:06 2 minutes, 6 seconds been talking. Uh so there the good part is for the after many quarters we have seen that the decline has got arrested 2:13 2 minutes, 13 seconds MFI book is about rupees 6,662 crores at March 26 and now 89% of the 2:21 2 minutes, 21 seconds book is covered through CGFMU we saw also an increase in MFI loan disbursements that was higher by almost 2:28 2 minutes, 28 seconds 27% on a sequential basis and even into the next year we see MFI book now again starting contributing to the overall growth P&L of the bank. 2:39 2 minutes, 39 seconds Another I think milestone I would want to call out is credit cards have now crossed 4.5 million during the quarter and that book has grown strongly at 2:48 2 minutes, 48 seconds about 21% on a Y basis. On wealth management side uh AON continues to grow at a steady pace. It has increased by 2:56 2 minutes, 56 seconds about 23% to about rupees 57 57,000 crores. 3:02 3 minutes, 2 seconds Now I have to call out few numbers on the deposit side. uh we saw an increase in total deposits by about 16.8% on a Y 3:10 3 minutes, 10 seconds basis to rupes 2.94 lakh cr if I within that if I talk of customer deposits then that stood at about 2 lak 84,000 crores and there the growth was about 17%. 3:23 3 minutes, 23 seconds The growth was uh a mortgage of 1% during the quarter but that is on account of various factors which played 3:31 3 minutes, 31 seconds out during the quarter. uh uh if I have to call out about two of the factors there we did reduce our interest on 3:38 3 minutes, 38 seconds saving accounts by in in certain buckets there was also an impact of the one-off fraud incident which uh occurred during 3:47 3 minutes, 47 seconds the quarter there has was also a tight liquidity which prevailed through the quarter there was advanced tax outflows 3:54 3 minutes, 54 seconds and also of course the west Asia crisis all I think in conjunction had some impact on the deposit flows 4:02 4 minutes, 2 seconds Having said that, I want to again state that uh the start of Q1, we are seeing strong traction in deposit growth and 4:11 4 minutes, 11 seconds hence we feel that we will have a normalized growth or a better growth going forward. 4:17 4 minutes, 17 seconds If I talk of the Kasa ratio, the Kasa ratio was at 49.8% which itself is quite strong for the quarter. On an EOP basis, 4:25 4 minutes, 25 seconds we saw an outflow of about 3,700 crores for some factors which I just mentioned before. But on an average Visa ratio 4:34 4 minutes, 34 seconds increased from 50.0% in the previous quarter to 50.4%. 4:42 4 minutes, 42 seconds Very quickly if we I move to the asset quality we I think had a good set of numbers across various parameters to 4:50 4 minutes, 50 seconds start with the gross NPA ratio of the bank improved by eight basis points from 1.69% to 1.61%. 4:58 4 minutes, 58 seconds Similarly the net NPA ratio of the bank improved from 0.53% to 0.48% in the current quarter. If I talk of the 5:07 5 minutes, 7 seconds retail, rural and the MSME segment here also the gross NP ratio improved by eight basis points to 1.47%. 5:15 5 minutes, 15 seconds Similarly, net NPA improved by 7 basis points to 0.56%. 5:21 5 minutes, 21 seconds Then if I talk about gross slippages, uh here the decline has been about 15% on a Q basis. And if you look at net 5:29 5 minutes, 29 seconds slippages that declined by about 27% on a sequential basis even for MFI slippages that came down to I would say 5:38 5 minutes, 38 seconds sub 100 crores. It was in 96 crores from rupees 153 crores in the previous quarter. The gross slippage ratio XMFI 5:46 5 minutes, 46 seconds for the quarter was lower with 49 basis points at 2.6%. 5:52 5 minutes, 52 seconds Moving on, if I talk about collection efficiency that for Ali bucket that was quite strong X of MFI at 99.6% previous quarter this was 99.5%. 6:03 6 minutes, 3 seconds For MFI we saw considerable improvement collection efficiency improved from 99.4% to 99.7%. 6:11 6 minutes, 11 seconds This is now almost touching the pre-crisis levels what we used to see. 6:18 6 minutes, 18 seconds As a con as a result of all of this the SMA 1 and two across the retail, rural and MSMA portfolio can improve by 10 basis points from 0.88% to 0.78%. 6:30 6 minutes, 30 seconds We have given fair more deep far more detail in the presentation uh which sort of highlights that we have seen a stable to improving trend across all the key 6:39 6 minutes, 39 seconds products in micro finance portfolio itself the SMA came down by 70 basis points and it stood at 0.79%. 6:50 6 minutes, 50 seconds Now if I move on to the profitability for the quarter we have reported profit after tax of rups 319 crores which 6:57 6 minutes, 57 seconds includes certain one line one time items which we have called out in the presentation. 7:03 7 minutes, 3 seconds Let me first tell what are few of these one line items which I meant. One is we have taken an upfront impact of the fraud incident which has happened in Q4. 7:16 7 minutes, 16 seconds uh and that that on uh we have paid claims of about 646 crores of principle and on a post tax basis that impact is 7:24 7 minutes, 24 seconds about 480 crores. If I just graph up for the fraud impact then the pad for the quarter would be about 800 kores. 7:32 7 minutes, 32 seconds However to further add we had two more impacts which we are saying are one time or not on the core basis. One is we had 7:42 7 minutes, 42 seconds a trading loss of about rupees 159 crores on a pre-tax basis which on a post tax translates to about rupees 118 7:50 7 minutes, 50 seconds crores. The loss here was largely because of the widening of yields which we saw during the current quarter like for instance the 5year GX widened by 7:59 7 minutes, 59 seconds about 40 basis points. The 10ear GX also widened by about 32 basis points and so on. So we while for the full year if you 8:09 8 minutes, 9 seconds see the treasury gains have been quite uh strong this quarter of course we ended up having some loss. We also took a small loss on account of the 8:17 8 minutes, 17 seconds guidelines which came around the NOP uh u uh policy. 8:25 8 minutes, 25 seconds If the another one time which I want to call out which is in fact a positive to the P&L is is we we got uh some income 8:34 8 minutes, 34 seconds tax order uh which uh gave us a tax refund of about rupees 173 kores and so 8:42 8 minutes, 42 seconds that has contributed to the positive side of the P&L. So if we take into account all three aspects which is the 8:49 8 minutes, 49 seconds fraud incident which is the treasury uh income or or the loss which we posted and third is 8:57 8 minutes, 57 seconds this gain on income tax. Then if you exclude all these three then the normalized profit after tax was about 9:04 9 minutes, 4 seconds rupees 746 crores with the 319 crores which we have reported taking those 9:11 9 minutes, 11 seconds impacts. This 746 crores translates to about a 145% increase in bio in pat 9:18 9 minutes, 18 seconds growth on a bowy basis for the full year. Uh taking into all the all the impacts uh which is includes 9:26 9 minutes, 26 seconds the fraud incident the reported part is rupees 1636 crores and if it adjust for the fraud incident then on a post tax 9:34 9 minutes, 34 seconds basis this went up by 39% to rupees 2,119 crores. 9:42 9 minutes, 42 seconds We saw an improvement across all operating metrices like for example NI growth further improved during the 9:49 9 minutes, 49 seconds quarter to 15.7% on a YI basis. This was about 12% in the previous quarter and you would have 9:56 9 minutes, 56 seconds noted that that trend for last no many quarters where this has started inching up. We had guided the market for a name 10:04 10 minutes, 4 seconds of 5.85% 85% for Q4 but happy to state that we have come with a n of 5.93% on an AUM basis. 10:13 10 minutes, 13 seconds This of course includes some benefit because of a day convention uh largely because February has lesser number of days and also because we took some 10:22 10 minutes, 22 seconds cautious approach on investments and we brought down the average investment book which also gave some lift. NIM for the full year was at 5.75%. 10:33 10 minutes, 33 seconds And that is expected to be stable into the next year. Fee and other income for the 10:40 10 minutes, 40 seconds quarter again grew strongly by 21.3% compared to 15.5% in in Q3. 10:48 10 minutes, 48 seconds Trading gains I already spoke about that there was a loss of about 159 crores. 10:54 10 minutes, 54 seconds Opex for the quarter stood at rupees 6249 crores. This in includes the impact of the fraud in incident of rups 646 11:03 11 minutes, 3 seconds crores on the principal side. If we adjust for this then the then the opex for the quarter was rups 5,603 crores 11:12 11 minutes, 12 seconds and which was a modest increase of 0.3% sequentially and about 12.3% on a y 11:19 11 minutes, 19 seconds basis. For the full year the opex growth was at 12.3% if we exclude the fraud incident. 11:27 11 minutes, 27 seconds Moving on to provisions, this has reduced Q by 18% from rupees 1398 crores 11:34 11 minutes, 34 seconds to rupees 1143 crores. Overall credit cost for the quarter came at 1.63% which is an improvement about 42 basis points from the previous quarter. 11:45 11 minutes, 45 seconds Excluding micro finance, the credit cost for the overall loan book was at 1.61% in the quarter and roughly 38 bits better than Q3. 11:56 11 minutes, 56 seconds What this has meant is for the full year the credit cost has come at 213 basis points. We had guided the market for 2.10%. 12:06 12 minutes, 6 seconds But another data point to note here is that we have not fully utilized the contingency provision on MFI. After 12:14 12 minutes, 14 seconds usage of rupees 35 crores in the current quarter, we are carrying forward rupees 130 crores into the next year. If we 12:20 12 minutes, 20 seconds were to adjust all of it of including that 130 crores then the credit cost would have been 2.08% 12:29 12 minutes, 29 seconds instead of 2.13% which are the uh reported numbers. 12:37 12 minutes, 37 seconds Uh I'll quickly talk about my last section which is on capital adequacy and liquidity. The capital adequacy ratio at 12:45 12 minutes, 45 seconds is at 15.60% 60% with C1 ratio at 13.73%. 12:50 12 minutes, 50 seconds This has been calculated after considering dividend of 0.25 rupees per share. Of course, this is subject to approval of the shareholders. 13:01 13 minutes, 1 second Average LCR deposits we have maintained at 114% for the quarter. As you would have noted that we generally maintain 13:08 13 minutes, 8 seconds this along the trajectory of 114 to 115%. 13:13 13 minutes, 13 seconds With this I have broadly outlined the key financial numbers. Maybe I will refer it to Vya for his opening comments. 13:22 13 minutes, 22 seconds Uh good afternoon rather good evening everybody. U first of all very happy to speak to all of you this Saturday 13:28 13 minutes, 28 seconds evening. Now u in this uh uh presentation this time we have actually shared with you the broad strategy of 13:37 13 minutes, 37 seconds the uh bank uh which becomes important which eventually the strategy translates to the uh numbers. So if you if you see 13:44 13 minutes, 44 seconds the you know page n the first opening slide we have actually shared with you that uh you know initially this bank's 13:52 13 minutes, 52 seconds strategy was to borrow money at maybe 12 13% and lend at maybe 20 22%. 13:59 13 minutes, 59 seconds Now that is a very unique specialization the bank built over a long period of time. It's like 15 years we've been you know we've been in that business and we 14:08 14 minutes, 8 seconds have developed specialization in terms of within that which segments to go after what is the credit performance of 14:15 14 minutes, 15 seconds each micro segment uh within segments for example we don't say msme is too blunt a term for example we we have a 14:22 14 minutes, 22 seconds defined program for salons for chemists and so on so forth and and uh and kana stores and all that so that is a unique 14:31 14 minutes, 31 seconds model built by the bank and that you know the lend ending is anywhere about maybe 20 to 22% and that credit cost could be four or 5%. You come up the 14:39 14 minutes, 39 seconds curve you know you that is where we started but over a period of time of course our cost of funds came down at NBSC itself came down to about maybe 9 14:47 14 minutes, 47 seconds and a half% and then we started uh you know from and then we started lending to more uh you know products which are medium yield medium credit cost you 14:55 14 minutes, 55 seconds lended about let me say 13 14% and credit cost of 2 or 3%. Now uh now over time of course now we are a bank uh our 15:04 15 minutes, 4 seconds cost of funds have further come down to 6%. So we are now able to give prime home loan prime car loan and uh prime 15:11 15 minutes, 11 seconds loan property prime business banking. So the transition of the bank has moved from the the first category I talked 15:19 15 minutes, 19 seconds about lending at high yield and high credit cost to medium yield medium credit cost to now low yield low credit cost. But the important thing is that 15:27 15 minutes, 27 seconds the bank has not let go of the uh original capabilities. It's very important 15:33 15 minutes, 33 seconds [clears throat] 15:33 15 minutes, 33 seconds uh because it's been honed and built over 15 years. We have no intention of let letting go of that. And that is one of the reason why our yield at of the book at the bank level is uh 13% plus. 15:45 15 minutes, 45 seconds That includes even corporate banking 13% plus. But you'll be surprised to know that the credit cost of the book is only 2%. In fact, you know, I I don't exactly 15:54 15 minutes, 54 seconds remember if Sasan, she called out the number for fourth quarter of this year or not. It's come down to below 2%. So, in fact, if you taken a five year 16:03 16 minutes, 3 seconds through the period like this five year like 22, 23, 24, 25, 26 or maybe a block of 5 years I think one one one year 16:12 16 minutes, 12 seconds prior to that you'll find that credit cost of the bank is only 1.95 that includes co that include micro finance everything. So this number when we say 16:19 16 minutes, 19 seconds that we'll keep a credit cost less than 2% is not academic. We have been delivering it for the last five years. 16:24 16 minutes, 24 seconds Of course last year was higher because of micro finance but that's you know that that is already talked about enough earlier. So the point is that our 16:32 16 minutes, 32 seconds ability to to have a book that yields uh the 13% plus uh and having credit cost less than two which is gives a risk 16:40 16 minutes, 40 seconds adjusted yield of 11% plus is a very unique specialization. So we as far as 16:47 16 minutes, 47 seconds we are concerned the by the way it al you have to also add 2% as a fee income. 16:52 16 minutes, 52 seconds So you can see how profitable that business is. So what the bank has been doing for the last seven years or say five years is that using this business 17:00 17 minutes which makes just a lot of money and and then using it to uh invest uh in the deposit side of the bank which is the 17:08 17 minutes, 8 seconds the uh the technology the people uh the branches the ATMs uh m many products on 17:16 17 minutes, 16 seconds the corporate banking side like cash management uh products like like fast tag uh wealth management uh NRA businesses um let me Even on the lending 17:25 17 minutes, 25 seconds side uh we our product source is not entirely complete in the sense we're still building a rural banking business uh because we started as a micro as as a 17:33 17 minutes, 33 seconds DFI and we did not have any priority sector capability in this bank for the last 7 years we've been building that and as you know 40% of the book needs to be priority sector we're building all 17:41 17 minutes, 41 seconds that it's a new bank you're going to build all that so the point I'm trying to just leave with you is that the lending machine makes all the money the 17:49 17 minutes, 49 seconds deposit side money is as of today it's loss making but uh it will come it'll come to profitability So uh the other thing is that uh so 17:57 17 minutes, 57 seconds therefore um we believe that the bank is coming along very very very strong. Most of you will probably add it all up and 18:05 18 minutes, 5 seconds say hey guys end of the day bank is making return on assets only.5%. That's true it's only.5 but 5 is not.5 18:13 18 minutes, 13 seconds something is making 1% plus which is the asset side and the lending money side is deposit side is taking away 5%. So the day you properly sit and disagregate 18:21 18 minutes, 21 seconds this and then understand that the deposit side is not going to make a loss forever. It's a time it takes 10 years to build a deposit side of a bank to 18:30 18 minutes, 30 seconds scale. [clears throat] So you think give it maybe three or four more maybe I can't say three or four let me say four or five just to be safe you give that amount of time and then that deposit 18:38 18 minutes, 38 seconds side loss will become zero after by the time we'll keep compounding at 20% plus is our opinion and profit should compound faster than that. So you can 18:46 18 minutes, 46 seconds see where the path of the bank will head. So honestly I feel that the bank is perfectly on track. Uh it's it's coming along very nicely. Uh this micro 18:54 18 minutes, 54 seconds finance incident you know of course um disturbed the optics of the trajectory of the bank. uh but uh you know this 19:02 19 minutes, 2 seconds quarter also we feel very good about the results but for the incident that happened but that um but that we factored in the quarter's results but 19:09 19 minutes, 9 seconds you will see for most of you who will observe the result quarter two quarter 3 quarter four you will get to see that the trajectory is back uh strong in this 19:17 19 minutes, 17 seconds bank that's that's a broad belief you you can see as it plays out now the other thing about the bank is that we've been consistent with one story you know 19:26 19 minutes, 26 seconds we we started with 94 crores in 2010 today it's 2.32 lakh crores straight in 15 years straight we've got we've been 19:33 19 minutes, 33 seconds consistent on one business model which is the the the the model we you know the lending side 2.32 well I don't see any doubt why 3.2 should not become 5 lakh 19:41 19 minutes, 41 seconds cr should not become 10 lakh cr it's a well set machine by now we only have to get the deposit side right and once you get that right then the machine will 19:48 19 minutes, 48 seconds move uh the good thing is also in corporate banking side frankly the bank is uh doing well now uh and uh you know 19:55 19 minutes, 55 seconds after initial phase and we slowed down the book uh now we started growing it again not slowed down actually we grew the book to be to be fair we brought it 20:03 20 minutes, 3 seconds down from 68,000 crores to bank to 36,000 crores we grew it by 22,000 crores we took out all the uh project 20:11 20 minutes, 11 seconds financing infrastructure loans. Uh but now all that is done. There's no more reform to be done there. It's on a growth path and that will grow as well 20:18 20 minutes, 18 seconds and you know we have found our own niche. Last seven years no no no no no meaningful credit loss in fact if if anything at all. So we are quite happy with the way that book is coming along. 20:29 20 minutes, 29 seconds Now the overall loan book of the bank is not touched about 2.9 lakh cr or three lakh cr I think so 2.9 lakh cr and uh 20:36 20 minutes, 36 seconds that story is also playing itself really quite well it's quite diversified across 25 lines of businesses so really no 20:44 20 minutes, 44 seconds concern there the on the um on the uh deposit side uh if you uh notice the uh 20:53 20 minutes, 53 seconds the deposit growth of this quarter was flat uh but but really the um it's kind of you know mixed up with three or four signals that came together like Sansa 21:02 21 minutes, 2 seconds said you know we dropped the rates the incident happened it's hard to pick what what affected what but in the end I just 21:09 21 minutes, 9 seconds want to say that when this incident happened not that we want it to happen to us uh we we we do 21:18 21 minutes, 18 seconds we do want to make sure this never happens again to us but I can just tell you that the positive of this is that that the bank has also happened to 21:26 21 minutes, 26 seconds identify the specific issues has already implemented at very quick pace the necessary system changes to be done for 21:34 21 minutes, 34 seconds fixing those issues so that they don't happen again. Uh you know we kick the tires around and figure out anywhere any other part of the system with an issue 21:42 21 minutes, 42 seconds for example even a retail customers and there's no issue also we went and tightened some extra norms. So we've done those things. So maybe these kind of tightening at fixes we've done will 21:50 21 minutes, 50 seconds probably not probably will certainly do us good in the uh longer run now and therefore when we grow the deposit base 21:58 21 minutes, 58 seconds which is currently touching like 2.9 lakh crores when this goes to you know 5 lakh cr 6 lakh cr 10 lakh cr we will 22:05 22 minutes, 5 seconds feel that it'll come on even stronger god raise and uh we just look forward to that now uh on the um in fact I remember 22:15 22 minutes, 15 seconds uh in in you know in 2122 uh the that time also we dropped the rates once in the first time and it 22:22 22 minutes, 22 seconds dropped the rates from 7%. So for one year there was a slight you know the flat it was a flat year if you see FI22 22:29 22 minutes, 29 seconds it was a flat year in terms of deposits but then it starts going again like that this quarter was flat um we it'll it'll 22:37 22 minutes, 37 seconds it'll come back we feel quite confident of that uh I want to finally say that the kind of goodwill we got uh during 22:44 22 minutes, 44 seconds this crisis u you know there was just so much of bad news uh overnight in a flash 22:51 22 minutes, 51 seconds uh across you know social media channels and uh YouTubers and u Twitter and all over the place. But really something 23:01 23 minutes, 1 second amazing I must point at all of you for all the you know for all that happened uh as as investors you should really 23:08 23 minutes, 8 seconds take note of this that you know we have like 7 to 8 million customers leaving deposits with us. You should really in 23:14 23 minutes, 14 seconds fact we are also um quite let me say uh happy to note or pleased to note that money did not leave the bank. you know 23:22 23 minutes, 22 seconds some marginal customers at the very high ticket size who are with with high interest rates some of them left and frankly when we dropped the rate from 7 to 6.5 people with high interest rates 23:31 23 minutes, 31 seconds were expected to leave uh but or who had come to us for high interest rates are expected to leave but barring that you know we got like thousands of emails if 23:39 23 minutes, 39 seconds you go and see LinkedIn and see you know either see my LinkedIn account or you go and see maybe IDC bank LinkedIn account you will see the number of people who 23:47 23 minutes, 47 seconds have posted their videos and reports saying that look we trust this bank and we support this bank I really think that some good brand the bank has built good 23:55 23 minutes, 55 seconds trust the bank has built in people's you know uh minds and hearts somewhere it has helped us we just want to take this opportunity of this investor call to say 24:04 24 minutes, 4 seconds very very very u you know very sincerely uh to say thank you to every person who helped us and you and said some good 24:11 24 minutes, 11 seconds motivating words to our employees and it kept us happy and going and of course it is a culture of the bank to move very fast we moved very very quick uh you 24:20 24 minutes, 20 seconds know you know This incident happened on Saturday uh afternoon is when I was I happened to be in Delhi and I someone called me and told me that you know this incident is is is this and this is quite 24:29 24 minutes, 29 seconds big. You know that night we reported the exchange straight on. Monday morning we took the investor call. Monday afternoon we we we called up the other party and said we're going to pay you right now. 24:39 24 minutes, 39 seconds And then Monday night we paid them. Tuesday morning we met them in person. 24:42 24 minutes, 42 seconds Tuesday night we uh Tuesday afternoon we called up the you know the newspapers and said we want a front page ad. That day we prepared the ad. Next morning it 24:49 24 minutes, 49 seconds is out. We just moved like blinding fast with very quick decisive way saying it's customer's money customer should get it. 24:56 24 minutes, 56 seconds That's the end of the matter. We did not apply any of the principles to it. We did not think of litigation. We didn't think of anything. We didn't even think that your your employees are also involved. Yours your responsibility, my 25:05 25 minutes, 5 seconds responsibility. We didn't think anything. We just said it's customers money payback. And I think that our it's in our DNA to move in proc customer to 25:14 25 minutes, 14 seconds be decisive and just move. And I think it did help us somewhere along the way. 25:18 25 minutes, 18 seconds you know customers did trust us and we want to thank them for that and I also want to again I want to close that point by saying I want to thank everybody for that and to all of all of you who helped 25:26 25 minutes, 26 seconds us in that very crucial moment and there are many and I want to just quickly move to cost of funds I'm happy to share that cost of funds have come down to 6% in 25:34 25 minutes, 34 seconds the last one year cost of funds have come down by over 50 basis points I'm sure 50 basis points and uh we are now down 25:42 25 minutes, 42 seconds to 6% and honestly I don't think any of you would have guessed when we started this bank and when we took over this bank in 2019 19 at 7.8% that we're going 25:50 25 minutes, 50 seconds to cut it down by 180 basis points cost of funds and bring it down to the line of our peer banks. Uh you know at that time we were paying 150 basis points 25:59 25 minutes, 59 seconds over mid-tier peer banks 150 basis points. We bridge that cap and brought it down and grew deposits despite this cut of it. So just want to say that that 26:07 26 minutes, 7 seconds deposit finances is coming well for the bank. Um you know as I always say I don't tell the market whether I will increase it I will reduce it. I I you 26:16 26 minutes, 16 seconds know I just say that we it's unlikely we will touch the rates uh you know but still I keep all my options open depending on what the market conditions 26:23 26 minutes, 23 seconds are. Uh but chances are that rates will probably be somewhere in the zone uh as the year progresses. Um you know could be 10 business points up also. I I can't 26:32 26 minutes, 32 seconds tell for sure. Uh depends how the market plays out. Now um let me just say that on the asset quality front I'm happy to share. If you notice all of you may 26:40 26 minutes, 40 seconds remember that every single quarter for now like uh you know um let me say uh 26:48 26 minutes, 48 seconds five seven years and particularly last two years when the micro finance crisis was raging uh and credit cost numbers 26:56 26 minutes, 56 seconds are going up uh we kept insisting and sharing with you uh product by product 27:03 27 minutes, 3 seconds uh vintage by vintage uh SMA one and uh SMA uh you know NPA credit cost 27:12 27 minutes, 12 seconds everything so we shared everything with you and we always maintain to you that except micr finance this book is super clean I'm happy to say that we are it is 27:21 27 minutes, 21 seconds turned out to be so because in the micr finance crisis is gone suddenly a credit cost has come down to 1.6% 6% to 1.7% of the average loan book which is probably 27:29 27 minutes, 29 seconds the lowest we've seen in a long long time and anyway Roth NP is always less and net is always low. So I'm just happy to share that we give a lot of 27:37 27 minutes, 37 seconds disclosure. If you notice we give the um the the collection efficiency of the overall book uh excluding micr finance. 27:46 27 minutes, 46 seconds Uh we give it uh including micr finance. 27:48 27 minutes, 48 seconds Then we also show the you know the the uh the SMA1 and SMA2 for the whole book. 27:53 27 minutes, 53 seconds We show the uh you know the gross NPA and net NPA for the whole book. And frankly every one of these numbers are 28:00 28 minutes stable. So really I can tell you as of now the last it's been seven years now as a bank avatar and it's been eight 28:08 28 minutes, 8 seconds years before that as capital trust avatar our gross NPA net NPA credit cost is is just fine it is behaving very stable no issue at all well micro 28:17 28 minutes, 17 seconds finance came micro finance went that did cause it trouble but that is I have called it out openly all the time and let me share with you there was never 28:25 28 minutes, 25 seconds any acquisition against the bank that we ever touched the books we never greened anything we just played clean if it was the delinquency we took it and that was the end of the matter but there was only 28:32 28 minutes, 32 seconds for micro finance so u so anyway that that that stands for reiterated and on the corporate side of course I'm happy to tell you that they will be cleaned 28:40 28 minutes, 40 seconds out so as I speak to you you know I just uh stumbled upon this page where we talked about credit cost I'm happy to tell you that credit cost for the full 28:48 28 minutes, 48 seconds year uh uh is uh is uh has actually is what is the number here 2.13 it's 2.13 28:55 28 minutes, 55 seconds for FY 26 uh which is basically 1.5% of the assets but that 2.13 is broken up as 29:04 29 minutes, 4 seconds follows. It's the 2.69% for Q1 FI26 2.24% for Q for Q2 2.05 for Q3 and 1.63 29:14 29 minutes, 14 seconds for Q4. So you can see that our credit coming down. We're rather happy about that and that actually gave us a space and frankly the beginning of the quarter 29:21 29 minutes, 21 seconds we knew it's going to be low. So we even when the crisis came if you remember I came out to the press uh and and I gave public interviews uh including to with 29:30 29 minutes, 30 seconds the leading channels like CNBC and I came and said that this we expect this to be a profitable quarter because we knew that credit cost of the quarter is going to be quite low uh because the 29:37 29 minutes, 37 seconds book is turning out so well. So uh so that's that I'm happy to share that overall the bank is doing well. 29:44 29 minutes, 44 seconds expecting growth uh from now on. We expecting deposit to grow, loans to grow uh you know and uh Q1 you know should uh 29:51 29 minutes, 51 seconds expect the bank to do report reasonably good numbers and uh back to the the opening point that I started I must say 30:00 30 minutes that please always book this book uh you know all of you are investors you might say look why there are we going to just to it up and say we have one number 30:09 30 minutes, 9 seconds that's what's your ro what's somebody else's ro and you want to compare well well you could do that but I can tell you that a bank which is running for 30 30:16 30 minutes, 16 seconds years or 40 years. Uh you know for them everything is amotized and everything is booked built 15 20 years ago and they're 30:25 30 minutes, 25 seconds only running on marginal costing. Our bank is not running on marginal costing our bank is running on full costing. So and that's a big difference. So 30:32 30 minutes, 32 seconds therefore when you look at this bank think clearly that this bank is borrowing money at 6% is lending money at 13%. So that gives a spread of 5% and 30:41 30 minutes, 41 seconds then you have a credit cost on top of two only 2% and then the fees of 2%. You can see for yourself it's profitable. So just split up the two. See assets is 30:51 30 minutes, 51 seconds assets. It's a going machine. You see liabilities are something that will is a lossm. I don't deny credit card is lossmaking. I don't deny. Gold loans is 30:59 30 minutes, 59 seconds lossmaking. I don't deny. Home loans new book is prime book is lossmaking. I don't deny. These are things which are building for the future. And some of the 31:07 31 minutes, 7 seconds rural book we're also building is also lossmaking. I don't deny. And this is all toast of life. But frankly, anybody who's going to build a bank someday in 31:14 31 minutes, 14 seconds life, someone has to sit and build these things. And uh eventually when these all become profitable with scale, then you will see the true bloom of the bank's 31:22 31 minutes, 22 seconds profitability come about. And you watch out 27, watch 28, watch 29. Many of you have doubts today. I'm 100% sure your 31:30 31 minutes, 30 seconds doubts will blow away. It's just a matter of time. So thanks so much everybody. And we welcome to questions. 31:37 31 minutes, 37 seconds M please open the uh forum for the questions. 31:40 31 minutes, 40 seconds Sure. Thank you so much sir. Ladies and gentlemen, we will now begin with the question and answer session. Anyone who wishes to ask a question may press star and one on their touchstone telephone. 31:51 31 minutes, 51 seconds If you wish to remove yourself from the question queue, you may press star and two. Participants are request to use handsets while asking a question. 32:01 32 minutes, 1 second Ladies and gentlemen, we'll wait for a moment while the question Q assembles. 32:08 32 minutes, 8 seconds The first question comes from the line of Pam Subramanyan from Investic. Please go ahead. 32:15 32 minutes, 15 seconds Yeah. Hi sir, thanks for taking my question and congrats on a resilient performance in a in what would have been a tough quarter. Um sir uh if you could 32:25 32 minutes, 25 seconds comment a bit about the monthly deposit accretion since it's been two months since the you know we had that event and 32:32 32 minutes, 32 seconds of course uh you know we've also cut down our SAR rates. So how are we looking in terms of our monthly deposit 32:40 32 minutes, 40 seconds accretion uh customer additions etc uh and are we back to a normal run rate and do you think we will get back to our 32:47 32 minutes, 47 seconds normal growth pace from say first half of next year on deposits? Yeah. 32:52 32 minutes, 52 seconds See we have generally seen that when people go through this kind of crisis etc it takes about a year or so for for things to stabilize. Uh you might have 32:59 32 minutes, 59 seconds seen uh seen it elsewhere. Uh but we are quite confident that this matter is behind us. Uh Q1 FY27 itself you will 33:08 33 minutes, 8 seconds see a strong growth in the bank. the the year that went by we already described it as being flat but uh but plat also is 33:16 33 minutes, 16 seconds good news you know for the quarter that went by for you know like I said we also cut the rates but you should see I mean we're already seeing last year for last 33:24 33 minutes, 24 seconds quarter last month you know that's quite amazing I already talked of goodwill of customers to us and I don't know where they're getting such goodwill from but 33:30 33 minutes, 30 seconds thanks to everybody we uh if you see the uh if you see the last year al last month also in the month of March when 33:38 33 minutes, 38 seconds crisis already when the news has broken out uh you know fe Feb end the news broke so all of March's news was hot number of 33:47 33 minutes, 47 seconds accounts opened was as high as the previous month of February was equal to January so new accounts opening is coming perfectly strong 33:56 33 minutes, 56 seconds and [clears throat] u you know once the customers who took out money because of the high interest rates uh you know uh when we cut the rates uh this quart 34:04 34 minutes, 4 seconds onwards you should see growth right right now itself so sir we should get back to are say normal 20% 34:12 34 minutes, 12 seconds 5% yeah 5% you know 5% yeah 5% Q that kind of 34:20 34 minutes, 20 seconds okay sir uh fair enough um so on LCR uh 114% it's a bit low so from next year onward we will be looking at say max 34:28 34 minutes, 28 seconds loan and deposit growth or or will this no no we comfortable we always maintain the com no we always maintain comfortable with that kind of uh numbers 34:36 34 minutes, 36 seconds because then you know LCR of 100 itself is a conservative number you know on top of it we we don't need to keep too much a margin on top of it it's a good number it's quite stable. 34:46 34 minutes, 46 seconds Okay. Okay. 34:46 34 minutes, 46 seconds And frankly even during the crisis it stayed strong. 34:50 34 minutes, 50 seconds Yeah. Yeah. So and how do you think about margins going into next year? 34:54 34 minutes, 54 seconds There is an uptick going in into this quarter but should it likely be steady at these levels? 35:01 35 minutes, 1 second Yeah. Pam thanks for the question. So margins for the full year is at was at 5.75% and going into the next year also we 35:09 35 minutes, 9 seconds expected to be stable around these levels. 35:14 35 minutes, 14 seconds Okay. 593 is what we reported this quarter. 35:17 35 minutes, 17 seconds No no for the full year I said was 5.75%. I also mentioned earlier that Q4 also had certain uh impact because of 35:26 35 minutes, 26 seconds technical reasons like I spoke about the take convention logic and so on. But for the full year the margin was at 5.7% 75% 35:34 35 minutes, 34 seconds and into the next year we feel we will broadly able to hold around those levels. 35:40 35 minutes, 40 seconds Okay thanks and uh on opex we are still holding on to what we've talked about 13 to 14% for next year. 35:47 35 minutes, 47 seconds Yeah they that's that stays in terms of guidance but though please note that Q1 could be a little higher and then Q2 Q3 35:55 35 minutes, 55 seconds onwards it should come down. So for the full year is that but Q1 could be a bit higher because of a couple of reasons because we have put out some branches you would have noted about 80 branches 36:04 36 minutes, 4 seconds in Q4. Q1 also has impact of increments and so on. So these could these are some of those factors which could play out. 36:10 36 minutes, 10 seconds So but so when you see Q1 you see compared to Q1 of last year you'll see a little higher than 134 that we're talking about but by Q2 Q3 Q4 should 36:18 36 minutes, 18 seconds come down and by year end we should be land the same way we landed this year. 36:22 36 minutes, 22 seconds Got it. Very useful. Uh so that's why I think I heard you mention initially that you know the profit for the quarter adjusted for the treasury loss and the 36:32 36 minutes, 32 seconds fraud impact uh was 750 cr that comes to about 75 basis point of ro in this quarter. Uh again I want to check with 36:41 36 minutes, 41 seconds uh you know you all is there any say timeline one should look at for say broadly reaching 1% ROA because clearly your core ROA is improving. 36:52 36 minutes, 52 seconds Definitely the core performance is improving. If as you rightly said if we isolate some of these one-time impacts within Q4 uh so I don't want to sort of 37:01 37 minutes, 1 second put out a number as such. We all know right there is this West Asia crisis which is still going on. There's still some moving parts right. So I would not 37:09 37 minutes, 9 seconds want to guide on a particular number at the moment but definitely from an operational parameter we were noted that the performance is improving quarter and 37:18 37 minutes, 18 seconds quarter and even on the credit cost we feel that the credit cost would be uh lower than the current year. 37:28 37 minutes, 28 seconds Yeah. So what credit cost should we broadly work with? Yeah, that's my last question. Thank you all for for next year. 37:34 37 minutes, 34 seconds Yeah. So I feel that it could be in the range of 170 to 180 basis points. Uh we may also this includes some benefit 37:43 37 minutes, 43 seconds which we may get because of the CGFM cover which we have taken for MSI. 37:49 37 minutes, 49 seconds Perfect. Very useful. Uh thank you so much. Congratulations once again on the quarter. Okay. Thanks. 37:56 37 minutes, 56 seconds Thank you so much. Our next question come from the line of Ak Jan from Autonomous. Please go ahead. 38:02 38 minutes, 2 seconds Thank you sir for the opportunity. Uh so I have three questions. So one on asset quality. So what is driving the strength 38:10 38 minutes, 10 seconds this quarter? So while we have utilized contingent provisions the write offs are significantly lower. Any other factor you'd like to highlight? And uh again on 38:18 38 minutes, 18 seconds write offs uh they are down to like around 1200 levels like what is the sustainability of these levels going and 38:26 38 minutes, 26 seconds related question on acquality. So it's been like almost 2 months since the war started and we keep getting news on you 38:33 38 minutes, 33 seconds know supply chain disruptions, raw material cost increases. So while March was still fine, how are you seeing 38:40 38 minutes, 40 seconds trends playing in April especially on the MSN front and how are you thinking you know on growth and asset quality in 38:48 38 minutes, 48 seconds the light of these disruption and maybe the last yeah I yeah sorry go ahead 38:56 38 minutes, 56 seconds and maybe the last question on so you have changed star this week uh so can you know let us know the impact on you 39:04 39 minutes, 4 seconds know your cost of SA due to this You meant the recent change. Yeah, the recent change 21st. 39:13 39 minutes, 13 seconds Yeah. So that change would not translate over too much of an uh from the current levels. Maybe a few very few few basis points. 39:23 39 minutes, 23 seconds That's on SA. Moving on to asset quality. Uh in in this quarter of course many things have played out. I have told that SMA 1 and two numbers improved by 39:31 39 minutes, 31 seconds 10 basis points. uh then then the slippage which also led to a lower translation into slippages. Of course, 39:39 39 minutes, 39 seconds MFI drag has been coming down. The slippages have been coming down there. 39:43 39 minutes, 43 seconds The collection efficiency was quite strong in Q4 which typically happens every year. Uh the collection comes in 39:50 39 minutes, 50 seconds quite uh strongly at the end of the year for some reason I think across the banking system. So all of these trends 39:58 39 minutes, 58 seconds have been quite healthy. uh I finally all of this has to translate into a credit cost which I just answered in to 40:05 40 minutes, 5 seconds the previous speaker. So netn net we feel that the asset quality tense would be quite stable. Now if I talk about the crisis the west Asia crisis which is 40:14 40 minutes, 14 seconds currently going on. Uh what we have done is we have undertaken a comprehensive review our portfolio to assess exposure to potentially impacted sectors 40:22 40 minutes, 22 seconds including demand disruption, fuel related risk and supply chain challenges and and so on. We have clearly 40:30 40 minutes, 30 seconds identified some sectors where we could slightly be more conservative. We don't intend to stop anything but we are adopting a cautious a cautious approach. 40:40 40 minutes, 40 seconds Accordingly, the immediate impact on the overall portfolio expected to remain limited at current levels. However, if there's any escalation which could lead 40:47 40 minutes, 47 seconds to further material supply disruptions, we will continue to monitor. So, we need to see how this plays out. 40:57 40 minutes, 57 seconds Thank you, sir. And just a follow up on the margin points. So even if I adjust uh your margins for the Q4 seasonality, it is still uh around 5.85 odd levels. 41:10 41 minutes, 10 seconds So why are you giving the guidance of you know 5.75 for the full year like uh why should margins come down from these? 41:18 41 minutes, 18 seconds See we we continue to grow certain portions of the portfolio at a faster pace right like you have noted wholesale banking book is growing at a fast pace 41:27 41 minutes, 27 seconds right the business banking is growing so some of these are diluted from a margin point of view but we ultimately want to 41:34 41 minutes, 34 seconds see what is the contribution to profitability so even a 5.75% for that matter is quite a healthy number right it's it's one of the highest in the 41:43 41 minutes, 43 seconds banking system so you can assume that it's it's it's quite rangebound in that sense Understood sir. Thank you. Thank you for the answer. 41:55 41 minutes, 55 seconds Thank you. 41:56 41 minutes, 56 seconds Our next question come from the line of Piran Engineer from CLSA. Please go ahead. 42:04 42 minutes, 4 seconds Yeah. Uh hi team. Uh congrats on the quarter. Um couple of my questions have been asked and answered. Uh but need some clarification. Firstly, this uh treasury impact the loss of 160 crores. 42:16 42 minutes, 16 seconds Now if I adjust for the uh stake sale in that stressed power company uh we would have actually made a profit of 115 crores. Is that correct? 42:26 42 minutes, 26 seconds No that's not the way. In fact in the investor presentation we have clarified that we have sold certain equity in a particular group that gave us a loss of 42:35 42 minutes, 35 seconds 274 crores but at the same time we were holding provision against that. So while when we have reported uh the annual 42:44 42 minutes, 44 seconds financials we have reported a 274 crores loss on top of one 59 cr in treasury line item we have also reported 42:52 42 minutes, 52 seconds a lower provisions however for right comparison what we have done in the investor presentation is we have grossed up this impact so the actual loss for 43:00 43 minutes treasury for the quarter is about 159 crores and this this is an old case legacy case where I said that this was fully 43:08 43 minutes, 8 seconds provided so this has no impact to the P&L. So for a right comparison we did this. 43:14 43 minutes, 14 seconds So then the real credit cost for the quarter is 870 crores or 870 plus this 270 43:22 43 minutes, 22 seconds plus plus this 274 and that's how when we have quoted credit cost numbers it 43:28 43 minutes, 28 seconds has been baked in. So this case was I'm saying as I said is was a much older case pre merger related to the pre- merger time and this was fully provided. 43:39 43 minutes, 39 seconds This was in fact one of the infra exposure which we had. 43:43 43 minutes, 43 seconds Okay. Okay. Okay. Fair enough. I think I might uh I'll reach out separately. 43:49 43 minutes, 49 seconds Did you answer the question or I'm hap I will be happy to further clarify. 43:52 43 minutes, 52 seconds I I I'll I I'll get back to you separately. I was a bit uh confused on my numbers but this clarifies it. Uh 43:59 43 minutes, 59 seconds just secondly if you if you refer if you refer to the investor presentation you'll get the clarity on that on the P. 44:07 44 minutes, 7 seconds Okay fair enough. Uh just secondly on uh is there any further TD repricing left or are we done with most of it? 44:16 44 minutes, 16 seconds We may get some residual impact in Q1 but it's largely done. 44:21 44 minutes, 21 seconds Got it. And just thirdly uh in terms of castaration now we cut SAR rates last quarter. uh we've not seen any impact on 44:29 44 minutes, 29 seconds CASA in fact our CASA ratios improved 40 bits uh do we take this as a more steady 44:36 44 minutes, 36 seconds state Kasa number like CASA ratio number we'll wait and see because you know even term deposits are also coming strong 44:45 44 minutes, 45 seconds so we we'll wait and see because the the S rate cut is quite heavy it's bit raw 44:51 44 minutes, 51 seconds you know just just 3 months so um let me just uh just wait it out. 45:00 45 minutes Got it. Got it. Okay. Yeah, that that's it from my end. Uh thanks and all the best. Yeah. Thank you. 45:08 45 minutes, 8 seconds Thank you. 45:11 45 minutes, 11 seconds Next question come from the line of Jant Karoti from Access Capital. Please go ahead. 45:16 45 minutes, 16 seconds Uh thank you for the opportunity. My question is also similar to I think what Pam was asking uh on the ROA for the 45:23 45 minutes, 23 seconds next year. If I understand correctly at these name levels and at 1.8 90th credit 45:29 45 minutes, 29 seconds cost uh at 5.7 finance uh it adds up to uh maybe around 75 80 bits correct me if 45:36 45 minutes, 36 seconds I'm wrong which means we're expecting uh almost 20 basis points of uh operating leverage uh translating to ROA through 45:45 45 minutes, 45 seconds the next year but also simultaneously that Jaw is slightly slower which it seems that our growth is now going to be 45:52 45 minutes, 52 seconds around 20 not 22 or 21 um so I and even even if I keep stretching this beyond one or two years if 20% is the growth 46:00 46 minutes range. Um is is this numbers are these numbers sounding correct or am I off by anything which means that we'll have to extract 20 25 bits on operating leverage 46:09 46 minutes, 9 seconds this year. Uh Sansu no definitely operating leverage improves into the next year. I'm saying as we would have mentioned I think in 46:16 46 minutes, 16 seconds the last call also next year we expect the top line to be much better than what we saw in this year. Like this year topline grew by just 11.2%. 46:26 46 minutes, 26 seconds And now if you see Q4 the NI grew by about 16%, free has grown at 21%. So 46:33 46 minutes, 33 seconds into the next year we feel that now the MFI drag is over. The MFI book is expected to grow and positively 46:40 46 minutes, 40 seconds contribute to the top line. So on the top line itself I see it growing at about 18 to 18 and a half%. And OPEC as 46:47 46 minutes, 47 seconds we have guided for 13 to 14% still the jaw would sizably look better. Right? So which definitely contributes to the ROA. 46:58 46 minutes, 58 seconds On top of it, I also sort of elucidated on that even credit cost is expected to come down from 213 basis points in this year to about 170 to 180 basis points. 47:08 47 minutes, 8 seconds So all of this in conjunction is expected to positively contribute to the ROA. So it's across all the parameters I would say we we are expecting some 47:17 47 minutes, 17 seconds improvement. One important insight which many may have missed actually is the how the ROA of the asset side is and liability side is. Okay, it's I I made 47:25 47 minutes, 25 seconds this point in my earlier talk but I'll just say it again. Now by our own internal estimates we feel that the ROA 47:31 47 minutes, 31 seconds of the um lending business uh for the next year will look quite strong and Sansa mentioned the reason we expect 47:38 47 minutes, 38 seconds cost to be lower than this year even in absolute terms uh and you know name to grow naturally uh not percentage right 47:47 47 minutes, 47 seconds in absolute terms uh NI sorry NI to grow and you see how it'll come now 47:54 47 minutes, 54 seconds so bas basically uh we expect the profitability of the lending business to further improve next year. When we do our internal estimates, we look like 48:03 48 minutes, 3 seconds it'll be like 1.5 1.6% of the loans. Uh that is the ROA of the lending business to be somewhere in the zone like 1.5 48:11 48 minutes, 11 seconds 1.6% of the loans. Now uh but of course the liability side will still be a drag. 48:17 48 minutes, 17 seconds Uh uh but the good news is that the loan side is like rock solid. Even if you make 1.5% at the stage of the bank 48:25 48 minutes, 25 seconds itself of loans, it's pretty good. And uh and the and obviously in the next three four years after that, we still 48:33 48 minutes, 33 seconds get operating leverage. Uh so we should just watch out the liability drag to go away and liability drag for information 48:40 48 minutes, 40 seconds has come down to 1% now. Uh you know last year was how much I'm sure 1.2. 48:45 48 minutes, 45 seconds No. So 1.2 has come down to one and you prior year was even higher. The trend line is clean clear so that you know 48:54 48 minutes, 54 seconds that that 1% should become like8 28 64.2 that that direction should play out 49:02 49 minutes, 2 seconds properly. I mean we have we see no doubt in the liability track coming down to zero in the next two years. It is just playing out exactly to plan. 49:11 49 minutes, 11 seconds Actually I was compare thank you for that. Actually I was comparing with the 4Q numbers 4Q credit cost and 4Q NIMS 49:20 49 minutes, 20 seconds are better than what we are guiding for next full year credit cost and next full year NIMS right 49:29 49 minutes, 29 seconds 4Q credit cost is at 1.63% 60% right our guidance is slightly higher for the full year into the next year on credit cost 49:37 49 minutes, 37 seconds and is also higher than what you're guiding for the next Q no Q4 NIMS is higher but I said for the full year it's 49:46 49 minutes, 46 seconds at 5.75% and next year the name should stay put broadly right Q4 NIM is not the right comparison because of the day 49:54 49 minutes, 54 seconds convention and some of these things I mentioned earlier just so from an ROA you may assume NIM broadly stays table fee we could see 50:03 50 minutes, 3 seconds some improvement because the action has been there in terms of P2 average total assets of course the larger break is expected to come out from the operating 50:11 50 minutes, 11 seconds leverage itself and then on top of it the credit cost improvement so all of this should come up 50:19 50 minutes, 19 seconds I think you not answered this specific question even the prior gentleman asked that why your we currently running even adjusting for the this quarter you're 50:27 50 minutes, 27 seconds like 280 or something for this quarter which one sorry uh 580 you reported 590 580 yeah adjusted for the 50:35 50 minutes, 35 seconds Yeah but I'm guiding for 575 exactly and you should explain why that's basically because you're coming to a little more safer segment which I did 50:43 50 minutes, 43 seconds okay um maybe I'll take this offline Sansu but just just sort of to cover it you guys are still uh confident on 50:51 50 minutes, 51 seconds hitting 1% ROA by the end of this year is is that a takeaway we can uh work with and as I said J I don't know to guide to 50:58 50 minutes, 58 seconds a particular number currently because uh there is this crisis of the there are few moving parts right but definitely the operating trajectory is 51:06 51 minutes, 6 seconds improving quarter and quarter and we expect that to that Q4 trend broadly to continue into the next in terms of an improvement in top line 51:14 51 minutes, 14 seconds maybe a kissing distance if you have to call it so we'll we'll go to we'll get to try to be the kissing distance kissing distance of that and but I can tell you that you know many people ask 51:23 51 minutes, 23 seconds us about this ROA of 1% and many have said that look this uh this is a benchmark we must cost and we we must 51:30 51 minutes, 30 seconds but I can only say that our bank will not stop at one just watch it play out because from there on also the full juice is yet to be taken out in I mean 51:39 51 minutes, 39 seconds the full value is yet to come out because our particular leverage will improve for the next four five years at a stretch now so it will not stop at one 51:46 51 minutes, 46 seconds that's what I can tell you whenever it comes definitely uh one last question register to you on the capital given that our growth trajectory I mean 51:56 51 minutes, 56 seconds clearly the liability side is not going to stop with this event and and we're going to start growing again. Uh so how does the capital adequacy look like and 52:04 52 minutes, 4 seconds you think you will need more uh capital by the end of this year starting next year? 52:10 52 minutes, 10 seconds Yes. Yes, we definitely think so and uh we will we will raise it. 52:15 52 minutes, 15 seconds Great. All the best and congratulations for holding up during the very tough quarter. 52:19 52 minutes, 19 seconds Thank you very much. Thank you. Our next question come from the line of Ankit Bihani from Namura Holdings. Please go ahead. 52:30 52 minutes, 30 seconds Yeah. Hi. Uh thank you for the opportunity and congrats on the quarter. 52:33 52 minutes, 33 seconds So most of my questions have been answered. I just wanted to ask uh how do you see you know deposit competition uh playing out going ahead. So while we did 52:42 52 minutes, 42 seconds cut our S rates uh at the start of the fourth quarter but we have raised our TD rates also round about by 25 odds right 52:50 52 minutes, 50 seconds TD rates. So do we see the competition going ahead becoming more intense given that even PSU banks uh even the large 52:58 52 minutes, 58 seconds private banks would have to fight for deposits to you know sustain the credit growth momentum. 53:03 53 minutes, 3 seconds Yeah maybe I'll ask Vaia to answer that question. No I I think uh I said that before so I'll 53:10 53 minutes, 10 seconds not take much time. I think that uh our bank has developed a good u you know uh technology capabilities good app uh our 53:19 53 minutes, 19 seconds branches have tails up uh you know there's a lot of hyper personalization is happening so there are there's a lot of tech involved in raising deposits 53:27 53 minutes, 27 seconds which is our which is a strength for us so those strengths we really believe are like you 53:35 53 minutes, 35 seconds know they're invisible strengths you don't see them because what you see is rates and you see branches this is a very conventional way of you know most 53:43 53 minutes, 43 seconds people talk that there is a third factor which we are running behind the scene which is culture and technology which has invisibles and we are strong on 53:50 53 minutes, 50 seconds those invisibles. So we think that um you know not to worry much our deposit will grow strong this quarter this this quarter 53:58 53 minutes, 58 seconds also this year also uh we'll we'll we'll be very strong I can only tell you that our um this month has started off very 54:06 54 minutes, 6 seconds well April has started off well so uh we're not disturbed 54:18 54 minutes, 18 seconds thank you our next question comes from on the line of J Mundra from ICA securities. Please go ahead. 54:26 54 minutes, 26 seconds Yeah. Hi, good evening and thanks for taking my questions. Uh sir, first a small clarification this uh u uh you 54:36 54 minutes, 36 seconds mentioned that 17180 credit cost is uh including the CVMU recovery if any. Uh would you have a number uh as to how 54:44 54 minutes, 44 seconds much you are going to uh claim uh for this financial year? 54:49 54 minutes, 49 seconds No. So we don't want to call out that number as we noted we have taken losses on MFI in last one or two years. So we 54:56 54 minutes, 56 seconds expect a reasonable recovery to happen on that front in in in the next year. 55:02 55 minutes, 2 seconds Okay. Sure. And uh secondly on uh MFI book now now this quarter the book has 55:09 55 minutes, 9 seconds uh has been flattish and if I were to maybe include the write off then it may have grown. uh how how are you looking 55:16 55 minutes, 16 seconds at this uh uh book incrementally? Uh I mean would it be uh I mean when do you think it will hit double digit and maybe 55:24 55 minutes, 24 seconds similar to overall bank or how how are you looking at this book? So definitely we want to grow this book. 55:30 55 minutes, 30 seconds We like this book. It contributes to PFL comes with a good yield and so on. Now with the infant guidelines coming in I 55:38 55 minutes, 38 seconds think some of those uh guard drills have also been put into place. So and of course we are adopting a cautious 55:45 55 minutes, 45 seconds approach. Uh on the ground also however the collection efficiency trends have improved disbburments are picking up. So we would certainly of course it's coming 55:52 55 minutes, 52 seconds from a lower base. Uh we would certainly want to grow this by 15 to 20% into the next year. So we will see how how sort 56:01 56 minutes, 1 second of the trend sort of pans out. So we want to grow this book. 56:06 56 minutes, 6 seconds Sure. And any thoughts on uh creating uh ECL transitional provisioning? Uh I mean so far the asset quality has been 56:15 56 minutes, 15 seconds holding up very well. I mean it has been holding up very well for the last 5 years. Uh but any thoughts on uh we have 56:22 56 minutes, 22 seconds small 130 crores of contingent provisions. Uh but any uh uh I mean any working rough working that you can share 56:29 56 minutes, 29 seconds as to you know what could be the transitional uh provision required if at all? 56:36 56 minutes, 36 seconds So we still await the final guidelines and this was expected to come in from April 27 but the final guidelines have 56:44 56 minutes, 44 seconds not yet come while most of the banks gave comment somewhere in November December last year. uh as I had talked 56:51 56 minutes, 51 seconds about it in in my earlier calls. Uh definitely as when the final guidelines comes, it could mean that we need to 56:59 56 minutes, 59 seconds park some more capital on the ECL front itself on transition. But we may also get some benefit on account of the ER 57:06 57 minutes, 6 seconds approach because today the sourcing opex is more than the processing piece. Plus there are also announcements around the 57:13 57 minutes, 13 seconds change in the credit risk guidelines which come in from April 127. There is also guideline awaited in operational risk. I think taking all of this 57:22 57 minutes, 22 seconds together of course contingent on the guideline itself which comes we feel that transition capital should be 57:29 57 minutes, 29 seconds largely uh taken care of should be largely taken care of. So we'll see how some of these this ECL guideline itself sort of comes out. 57:40 57 minutes, 40 seconds Okay. Sure. Last question while was there any impact of this CLM transition coending model you know RBA 57:50 57 minutes, 50 seconds had introduced from January 1st um the broad breakup does not suggest anything but just wanted to check did you had any 57:58 57 minutes, 58 seconds uh changes in your IT or the way you partner with partners uh for co- lending 58:05 58 minutes, 5 seconds or was it in material sort of an event I think we we don't have we have a very small book here. In fact, if I recolct, 58:13 58 minutes, 13 seconds we I think have this arrangement with only one counterparty and number is very insignificant. 58:20 58 minutes, 20 seconds Thanks and all the very best. Thank you. Thank you so much. 58:26 58 minutes, 26 seconds Ladies and gentlemen, due to the time constraint, that was the last question for today. I would now like to hand the conference over to Mr. Vinatan for 58:35 58 minutes, 35 seconds closing comments. Thank you and over to you sir. 58:38 58 minutes, 38 seconds Thank you. Uh since we closed shop exactly 1 hour, let me say that uh in case uh let's just uh if anybody has any 58:47 58 minutes, 47 seconds last question to to sneak in, we just want to give it last opportunity 58:55 58 minutes, 55 seconds in just in case we can take a last question. 58:59 58 minutes, 59 seconds In case in case there's none I don't want to hold it up. 59:04 59 minutes, 4 seconds There are sir, we'll take the last question from Mr. Surd from Sundaram Mutual Fund. Please go ahead. 59:09 59 minutes, 9 seconds Just take one or two more just just to be fair to everybody. Yeah. Yeah. Yeah. Hi. Am I audible? Yes, please. 59:17 59 minutes, 17 seconds Yeah. I just one I think data. 59:27 59 minutes, 27 seconds Please proceed ahead with your question. 59:31 59 minutes, 31 seconds Okay. We'll take the next question from Vikas Kasuri from Focus Capital. Please go ahead. 59:39 59 minutes, 39 seconds Uh good evening sir. Um so I'm also a shareholder of the company and a longtime listener and a first time 59:46 59 minutes, 46 seconds speaker here. Uh so please pardon my nervousness. Sir uh so I just wanted to ask you a question which I've been wanting to ask for last few years maybe. 59:57 59 minutes, 57 seconds So one is about this uh uh you know uh financialization of savings because of which lot of money is going towards 1:00:06 1 hour, 6 seconds legislating mutual funds and uh so in such a scenario how does the bank plan to continue raising ASA this is my only 1:00:14 1 hour, 14 seconds question sir thanks we uh I'll keep it first of all welcome to talk to any of us in the bank 1:00:22 1 hour, 22 seconds so feel comfortable now we understand the financial savings and people moment investments you know that's a well-known 1:00:29 1 hour, 29 seconds theme uh we think that you know this is a very large market we are relatively a younger 1:00:37 1 hour, 37 seconds bank uh and uh we uh are are uh our book is relatively 1:00:44 1 hour, 44 seconds small and uh we like I said to one of the earlier questions we we had bank uh good 1:00:53 1 hour, 53 seconds capabilities good digital capabilities good brand good culture Our employees are very motivated. You can go to any branch and talk to our staff. You'll get 1:01:00 1 hour, 1 minute a sense. So there are many things in our favor. Well, no doubt the markets are tight. Uh you know uh end of the day we 1:01:08 1 hour, 1 minute, 8 seconds are part of the system. We are not outside the system. So anything any any broad tightness of industry affects everybody affect us also. But overall 1:01:16 1 hour, 1 minute, 16 seconds we're confident uh with things will be fine. I mean we we'll do strong on this front. We we have no doubt on that front. you if you're a individual 1:01:25 1 hour, 1 minute, 25 seconds shareholder let me tell you that uh you should assume the bank will grow well on deposits yi bank will grow loans y bank 1:01:32 1 hour, 1 minute, 32 seconds has good margin on an incremental basis you have to only count on one thing you have to only look out for one thing uh 1:01:38 1 hour, 1 minute, 38 seconds that our uh our cost income ratio should come down because our liability side cost income should come down our liability side cost income ratio is 1:01:47 1 hour, 1 minute, 47 seconds 145%. uh it should uh uh that is what is bringing up overall to 70 uh 37 70 70 374ish types. So uh that will come down. 1:01:58 1 hour, 1 minute, 58 seconds Uh you you can take it from me. It will come down 145 to 100 over the next few years. And when that comes down, bank cost will come down. Bank cost will come 1:02:05 1 hour, 2 minutes, 5 seconds down. P will go up. Things will all play out to plan. It's playing out to plan even now. So don't that's the thing to watch out for. Don't worry too much about liabilities. It's coming well. 1:02:14 1 hour, 2 minutes, 14 seconds Sure sir. I've been an investor since 2019. Nothing can scare me. 1:02:20 1 hour, 2 minutes, 20 seconds Thank you. Really really grateful to you for that kind of confidence in us. We won't let you down. 1:02:25 1 hour, 2 minutes, 25 seconds Yes sir. Thank you. Wish you all the best. Thank Thank you and everybody and uh thanks all the investors for participating with in this call today and from from Sudan 1:02:33 1 hour, 2 minutes, 33 seconds Shu Sapa myself and everybody in the bank uh thanks a lot for your help and support. Thank you. Thank you everyone. Thanks everyone for joining the call. Thanks. 1:02:42 1 hour, 2 minutes, 42 seconds Thank you so much sir. Ladies and gentlemen on behalf of IDFC First Bank Limited that conclude this conference. 1:02:48 1 hour, 2 minutes, 48 seconds Thank you for joining us and you may now disconnect your lines. Thank you.