Nuvama Wealth Management Ltd — Q4 FY26

Nuvama Wealth Management Ltd Q4 FY2025-26 Earnings Conference Call https://www.youtube.com/watch?v=c1KFu8_ygrU Published: 1 day ago

0:03 3 seconds Ladies and gentlemen, good day and welcome to the Noama Wealth Management Limited Q4 and FY26 earnings conference call. As a reminder, all participant lines will be in the listenonly mode. 0:14 14 seconds And there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during this conference, please signal an 0:22 22 seconds operator by pressing star then zero on your touchtone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. 0:31 31 seconds Ashish Kaher, MD and CEO for his opening remarks. Thank you and over to you sir. 0:38 38 seconds Uh thank you. Uh good afternoon everyone and thank you once again for joining this call. It's a pleasure uh to speak 0:46 46 seconds with you all again. Uh as usual I'm joined by Barat our good CFO uh SGA team 0:53 53 seconds and our investor relations advisor. Uh we'll quickly cover the company performance for the quarter and the 1:00 1 minute financial year and share some uh key updates uh and the progress around our priorities and then uh following both 1:09 1 minute, 9 seconds mine and Bat's uh remarks we can jump into FAQ. 1:15 1 minute, 15 seconds Just summarizing the results, I think uh it was really an interesting year for everyone. It started uh with the whole 1:22 1 minute, 22 seconds tariff drama and ended with a war and I think many things happened in between. 1:27 1 minute, 27 seconds Uh for us it was a complete test of resilience this year. Uh we navigated multiple uh moving parts including 1:35 1 minute, 35 seconds something specific for us and overall macro uncertainty. I think before we go into details, I'd like to take this 1:42 1 minute, 42 seconds opportunity to thank the entire Noama team and our clients for helping us navigate this time and you know emerge 1:49 1 minute, 49 seconds uh with a growth year even in these times. Uh looking at our specific businesses, uh wealth management continues to grow overall wealth 1:58 1 minute, 58 seconds management is a cluster uh by I think both the segments are showing a very very healthy momentum. Asset management 2:06 2 minutes, 6 seconds buildout is progressing steadily. I don't think that business uh one should rush in because uh one bad performance 2:13 2 minutes, 13 seconds year can have years of negative impact and I think we are building out steadily. Asset services was an important monitorable for us this year 2:22 2 minutes, 22 seconds uh specifically after what happened at the end of Q1 and I'm pleased to state that business has recovered fully and 2:29 2 minutes, 29 seconds performed ahead of our expectations. uh capital market remained broadly aligned and witnessed some moderation. uh this year 2:37 2 minutes, 37 seconds overall revenue for the year was closer to 3100 and operating profit uh after tax is about,50 2:45 2 minutes, 45 seconds uh more importantly as I said profits from wealth so composition of profits changed profits from wealth grew by about 23% and despite challenges profit 2:54 2 minutes, 54 seconds from asset services was around 14% year on year uh bit on market outlook and uh 3:01 3 minutes, 1 second some industry trends um I think we've always maintained that we continue to maintain that uh organized wealth management represents a 3:10 3 minutes, 10 seconds multi-year structural opportunity. Uh we still believe that the industry is in early stages. Some consolidation of course will happen because large number 3:19 3 minutes, 19 seconds of players are coming in uh like what happened with let's say private banking or NBSC uh over the last three decades. 3:27 3 minutes, 27 seconds But I think over time few scale players with fully diversified uh multi-product platforms uh will scale uh as long-term 3:36 3 minutes, 36 seconds leaders and there'll be a long tail and this is representative of what happens in wealth management globally also a few 3:44 3 minutes, 44 seconds themes which are emerging uh across the industry I think private equity interest uh in the industry's all-time high there 3:52 3 minutes, 52 seconds is early signs of consolidation within asset management specifically in mutual funds We are seeing some transactions that are happening in the market uh 4:01 4 minutes, 1 second where the smaller AMC's which have spent some time and is not fitting into the strategic priorities of the promoters 4:07 4 minutes, 7 seconds are you know moving into stronger hands and there is a growing preference uh for fullstack platforms. So u there will be 4:16 4 minutes, 16 seconds few niche single product or you know uh dual product platforms which will remain but I think their scale will remain a 4:24 4 minutes, 24 seconds challenge. Multi product which has wealth, asset management, banking, research, custody all put in together 4:31 4 minutes, 31 seconds has a far more stronger client value proposition, resilience and and I think compelling opportunity for investor 4:40 4 minutes, 40 seconds industry models will evolve I think over the next five seven years as the sector matures. uh several global platforms 4:47 4 minutes, 47 seconds which we've seen in the past have transitioned from a stage of infancy to this mature multi-product stage and I think India will move much faster than that. 4:58 4 minutes, 58 seconds Uh coming to our uh business highlights uh starting with Noama wealth uh our focus area managed products and 5:06 5 minutes, 6 seconds investment solutions or NPIs as we call it. It continues to be core growth engine for Noama. Almost full revenue 5:14 5 minutes, 14 seconds growth uh for this year has been contributed by this product subsegment. 5:19 5 minutes, 19 seconds Uh the revenue stream as I have alluded in the past is a combination of managed products which is AIS, PMSF which are 5:27 5 minutes, 27 seconds all uh annuality bearing and other investment products uh which is fixed income, MLDDS, insurance etc. uh which 5:34 5 minutes, 34 seconds are non-anuity bearing. uh total NPS revenue for the quarter now stands around 150 crores uh which you know 5:43 5 minutes, 43 seconds about two three years back was the full revenue of this business on a quarterly basis uh this year NPS revenue has grown by 5:50 5 minutes, 50 seconds about 38% on a full year basis assets have grown by 32% net flows have grown 5:57 5 minutes, 57 seconds by 38% representing about 30% over the opening assets I think it's a very very robust and healthy growth we've been 6:05 6 minutes, 5 seconds we've been able uh lending uh if you recolct uh over the past two three quarters we've been 6:12 6 minutes, 12 seconds talking about this that we will increase focus and it's now visible in the loan book. Uh the loan book has grown by 6:20 6 minutes, 20 seconds about 27% for the fullear basis and closing books was at about 4,900 almost,000 crores higher than the 6:28 6 minutes, 28 seconds average book and NI continues to contribute about 20 22% of the revenue. 6:34 6 minutes, 34 seconds there is some upside still there in this uh net interest income for the year did not grow in line with the loan book and 6:42 6 minutes, 42 seconds that is very very specific uh because once uh whichever quarter or whichever time your loan book suddenly increases 6:50 6 minutes, 50 seconds there is a ECL provisioning that comes in which is basis RBI and uh in the next quarter onwards that gets normalized and 6:58 6 minutes, 58 seconds the NI picks up and second in Q4 there was a specific phenomena there was extreme extreme volatility in the market 7:05 7 minutes, 5 seconds uh because of the West Asia crisis uh which basically leads to a behavior in our eop where people don't sell they 7:14 7 minutes, 14 seconds exercise but they don't sell because they wait for the prices to come back and what happens to us is when they sell 7:22 7 minutes, 22 seconds our processing fees uh recognition gets uh accelerated uh because otherwise the processing fees is over the life of the 7:30 7 minutes, 30 seconds loan which theoretically is one year but behaviorally these loans those don't last more than 3 months. So I think once the markets are now back so in Q1 we 7:38 7 minutes, 38 seconds should see some acceleration of processing fees. So there could be a quarter or uh you know lag between the loan growth and NI growth but eventually 7:47 7 minutes, 47 seconds if you look at 12 months rolling it'll catch up. 7:51 7 minutes, 51 seconds Uh coming to the RM franchise uh uh I I think mandate here was uh what we are calling seniorization of the team. Uh 8:00 8 minutes because the quality of clients also are gradually improving. Uh last one one and a half years we spent on that. Uh 8:08 8 minutes, 8 seconds significant part of the team has been uh uh you know now become senior as compared to what we were about two years 8:15 8 minutes, 15 seconds back. uh on a net basis we added about 80 relationship managers in this cohort uh and uh when I talk about productivity 8:24 8 minutes, 24 seconds later uh you'll actually see the impact of this happening uh lot of work is happening on technology and AI front 8:32 8 minutes, 32 seconds here uh foundational work is done uh we are now uh implementing implemented uh 8:39 8 minutes, 39 seconds solutions for relationship managers across their value chain uh which is acquisition portfolio advisory rebalancing 8:46 8 minutes, 46 seconds tax loss harvesting uh the whole value chain or interaction value chain between an RM and a client and we've seen the 8:55 8 minutes, 55 seconds productivity improvement which is flowing through because of usage of these tools. Earlier we were restricting the tools only to 9:04 9 minutes, 4 seconds training which is now fully functional rolled out. Uh now we've moved into advisory also. So we've seen about a 25% per RM revenue jump uh in this segment. 9:17 9 minutes, 17 seconds Uh and I think a a large portion also comes through the usage of AI uh which which to my mind will continue in 9:25 9 minutes, 25 seconds future. Uh on the solution side uh we've added uh something unique in this segment. We've launched a service called Vasa. 9:36 9 minutes, 36 seconds uh this is nothing but a but a full-fledged estate and legacy planning tool for the clients in this segment. uh 9:44 9 minutes, 44 seconds earlier this was you know thought to be uh a a product which is needed more in 9:52 9 minutes, 52 seconds the ultra high network segment but I think even clients in the HNI segments are are now not only uh you know they've 9:59 9 minutes, 59 seconds come to money but they've also have reasonable amount of complexity because most of them will have children studying 10:05 10 minutes, 5 seconds overseas planning to settle overseas so you need to now have a structure which helps them transition the assets uh in a 10:15 10 minutes, 15 seconds most tax efficient manner. Uh considering that now there is offshore exposure also. I think Vasas is launched and we are very very uh we are very very excited about this product. 10:26 10 minutes, 26 seconds Uh moving on to Noama private uh this segment also continues to witness a solid healthy growth momentum. uh 10:34 10 minutes, 34 seconds starting with again product AR uh the revenue stream here uh consistently has grown by about 25 30% 10:42 10 minutes, 42 seconds over the past few years and now um I mean now steadily contributes about 60% of our revenues uh AR assets about 10:52 10 minutes, 52 seconds 54,000 and yields are uh nearly between 85 basis points to 1% this quarter being 10:59 10 minutes, 59 seconds 1%. So I' I've always maintained that quarter to quarter 10 15 basis points can move but on an average we should end up somewhere around 90 95 basis points. 11:09 11 minutes, 9 seconds Uh net flows continue to remain strong about 22% of opening assets uh in line with our full year guidance. uh even 11:17 11 minutes, 17 seconds year on year if I remove the one chunky flow that came last year which was related to an M&A deal we've grown the 11:24 11 minutes, 24 seconds absolute value 20% YI alongside uh growth in distribution assets we've also seen uh expansion in 11:33 11 minutes, 33 seconds our in-house uh advisory solutions we now have a full-fledged non-discretionary discretionary PMS uh 11:40 11 minutes, 40 seconds we have advisory we have structuring siting that will all give an impetus to growth in the future 11:47 11 minutes, 47 seconds uh coming to lending here also uh lending has been uh in focus uh but even now it only contributes 10 to 12% of the 11:56 11 minutes, 56 seconds revenue there is hope to go up to 20 25% over the next few years uh on the RM side here uh just to give 12:05 12 minutes, 5 seconds you a brief snapshot over the last four years uh amidst this entire competition noise multiple players coming in we've 12:14 12 minutes, 14 seconds been able to add about 60% of our capacity. We moved from 90 to about 150 now. Uh we will continue to onboard 12:23 12 minutes, 23 seconds talent selectively. Uh and we we we have a stated compensation philosophy that is not only performanceoriented, it it 12:32 12 minutes, 32 seconds rewards on merit, progressively increases as people perform better, but it's extremely transparent and aligned 12:39 12 minutes, 39 seconds with long-term value creation. I think I wanted to leave a word of caution here for people that we witnessed over the 12:46 12 minutes, 46 seconds last 12 15 months. Large number of new players are you know making lofty 12:52 12 minutes, 52 seconds promises to RMS of future valuations which seem extremely stratospheric to us and no visible monetization sign. 13:02 13 minutes, 2 seconds I just want everybody to be you know thorough in their diligence before making any such plunge because in the last decade we've seen only two three 13:10 13 minutes, 10 seconds platforms where people have actually realized value rest have either remained on paper or never realized and in the process unfortunately many careers have been damaged. 13:21 13 minutes, 21 seconds Uh I think here also we continue to uh in in Noama private also I think we continue to invest a lot in our tech and 13:30 13 minutes, 30 seconds AI. uh we've launched aentic AI uh which basically works alongside the RMS in doing uh again portfolio analytics 13:38 13 minutes, 38 seconds performance tracking product insights and again here we've seen a productivity jump about 10 to 15% uh revenue per RM 13:48 13 minutes, 48 seconds we've also launched industry first uh multicurrency module and portfolio reporting uh basically we maintained in 13:54 13 minutes, 54 seconds the past that clients are increasingly allocating to offshore And if the Indian 14:01 14 minutes, 1 second markets uh you know give one or two years of uh somewhat epic performance which has happened recently uh that 14:10 14 minutes, 10 seconds phenomena will only accelerate and with that happening you will need technology to support a multi-country multicurrency 14:19 14 minutes, 19 seconds portfolio for clients to review rebalance uh and and basically over a period of time have control over the process. 14:28 14 minutes, 28 seconds uh moving to asset management as I said uh in the beginning that we continue to steadily build uh capabilities around 14:37 14 minutes, 37 seconds asset classes here I'll start with commercial real estate commercial real estate has been extremely successful this year we've uh closed I think right 14:47 14 minutes, 47 seconds now the full fund is closed at about 4,000 crores but as of end of quarter 4 we were about 3800 14:54 14 minutes, 54 seconds uh we finished acquisition of three marquee assets about 3.8 million square ft. Uh about 40 to 50% of our funds are 15:03 15 minutes, 3 seconds deployed. Once we start touching 70%, we will launch a new fund. We are working on the thesis of the new fund. Uh I 15:12 15 minutes, 12 seconds think second half of this year is where we should look to launch. Again the target should be anywhere between three 15:20 15 minutes, 20 seconds three and a half thousand crores part of which of course will come in this year. 15:25 15 minutes, 25 seconds uh pre IPO private equity which is our oldest uh strategy in some sense uh we've started to exit our first fund uh 15:33 15 minutes, 33 seconds uh crossover three uh and we've launched a new fund crossover 4 uh which basically should be alive the fund raise 15:42 15 minutes, 42 seconds should be alive for the next maybe 6 to 10 months and we should target to raise,500 crores there we've 15:51 15 minutes, 51 seconds strengthened the leadership team here we've hired u Uh Aditya Aurora is the CIO. He has more than two decades of 15:58 15 minutes, 58 seconds experience in uh private market investing uh across forms. Uh I've been talking about private credit as a 16:05 16 minutes, 5 seconds strategy. Uh happy to state that we now have the CIO in play Amit Kal. Uh he joins us uh from Adita Bullah. That was 16:15 16 minutes, 15 seconds his last assignment. has 25 years of experience in credit uh across across 16:22 16 minutes, 22 seconds the risk spectrum from performing to specialists to distress. 16:27 16 minutes, 27 seconds uh we are right now building the team and we expect to launch our first fund I 16:33 16 minutes, 33 seconds think by end of Q2 again uh uh maybe target about,200 crores or 1,500 crores 16:41 16 minutes, 41 seconds in the first fund some part of it will come in this year this credit I think is an important expansion of the platform 16:48 16 minutes, 48 seconds because not only does it augment asset management and uh you know takes us towards more uh more exhaustive is 16:57 16 minutes, 57 seconds bouquet but it also helps a lot in um in giving syndication transaction uh for our wealth clients and wealth business. 17:07 17 minutes, 7 seconds Uh coming to public markets, public market I think the year was extremely volatile. It was in line with what 17:14 17 minutes, 14 seconds industry saw at least in the HNI segment incremental allocation to equities did 17:21 17 minutes, 21 seconds not come. Uh we got gross flows but we also saw redemption. So on a net basis we are nearly flat. Uh hopefully now uh 17:29 17 minutes, 29 seconds once the market bottoms and if there is recovery we should be able to see that. 17:33 17 minutes, 33 seconds The key element here is we are we we are in the process of getting the MF license. 17:40 17 minutes, 40 seconds Our final inspection has happened and hopefully if we get the license in another two months uh maybe plus a 17:49 17 minutes, 49 seconds couple of months from there we should launch our SIS in which over a period of time we will migrate our longshot 17:56 17 minutes, 56 seconds strategy which is now has a fiveyear track record uh with a quartile one performance. uh in this business we've 18:04 18 minutes, 4 seconds also uh strengthened our distribution team. Uh we've added uh we've recently onboarded Nimsh Meta as the chief uh 18:12 18 minutes, 12 seconds business officer. He comes with 27 years of distribution experience across firms like Motal and ASK asset management and 18:20 18 minutes, 20 seconds will play a key role in building and scaling our distribution capabilities. 18:25 18 minutes, 25 seconds Coming to asset services, I'm really happy to state that business is back on its growth trajectory uh 18:33 18 minutes, 33 seconds following the loss of decline that happened in Q1 and we had we we saw a drop of interest rates by 50 basis 18:41 18 minutes, 41 seconds points. So we've been able to overcome both of that. Q4 revenues exceeded Q1 and full year revenues grew by about 18:48 18 minutes, 48 seconds 12%. Uh it's important to note uh you know many a times we've been asked this question that is this business 18:56 18 minutes, 56 seconds completely aligned to what happens to the markets or the flows of the market. 19:02 19 minutes, 2 seconds Now if you look at the current year uh despite the headwinds index not doing anything uh volatility in the market 19:12 19 minutes, 12 seconds yield compression loss of big client yet there is a near 15% profit growth it 19:18 19 minutes, 18 seconds basically signifies that this business characteristic is different from your core capital markets business volatility 19:26 19 minutes, 26 seconds is far lesser uh the drivers are very different so we should not end up equating the same in terms of what will 19:34 19 minutes, 34 seconds drive this and uh those businesses uh has needs to be kept addressed. This is more market infrastructure like business. 19:44 19 minutes, 44 seconds Our focus here remains uh around increasing our market share and productive product value enhancements. 19:50 19 minutes, 50 seconds On the international side, we are aggressively working with what is called GCLC, global custodian, local custodian 19:58 19 minutes, 58 seconds and we are on the verge of signing uh one of them uh globally. Uh on the domestic segment, I have highlighted before that we are building out the RTA 20:07 20 minutes, 7 seconds and trusteeship services. Uh these offerings are expected to go live by middle of Q3 and this will help us further increase our market share in the 20:15 20 minutes, 15 seconds domestic clients. We are currently at 22% of our chosen segments. 20:20 20 minutes, 20 seconds Lastly coming to capital markets uh I think secondary market uh activity moderated 20:28 20 minutes, 28 seconds through most of FI26 uh equity cash uh AD declining by about 6% and futures AD 20:35 20 minutes, 35 seconds declining 14 options although remain strong at 8% by growth uh Q4 witnessed a rebound of activity but that I think was 20:44 20 minutes, 44 seconds mostly led because of the because of the volatility of West Asia Uh coming to the primary market 20:51 20 minutes, 51 seconds activity, I think the year uh was still okay. Uh record IPO mobilization across more than 100 mainboard IPOs. Uh despite 20:59 20 minutes, 59 seconds market conditions, although in H2, I think uh the story changed a bit. Retail participation went down. Uh the the the 21:08 21 minutes, 8 seconds quality of IPOs changed. There were certain large IPOs where the fee pool was smaller. uh so overall I think we 21:15 21 minutes, 15 seconds were able to maintain our market share or slightly inch our market share up from 18% to 19% uh in terms of value and 21:24 21 minutes, 24 seconds we were 15% in terms of deal uh but I think the market saw saw a reduction uh overall in the QIP volumes 21:33 21 minutes, 33 seconds which had an impact on this business uh coming to fixed income uh within capital markets uh we had a healthy growth about 21:40 21 minutes, 40 seconds 35% yearonear uh we maintained number one ranking in public issues and in private segments we are between three or 21:49 21 minutes, 49 seconds four uh given I mean in one quarter we could end up three in the other quarter we could end up at fourth position uh 21:57 21 minutes, 57 seconds most of the others who are above us are our large banks with balance sheet uh I think that sums up uh from my side I 22:06 22 minutes, 6 seconds will now like to hand over the call to bur to take you through the financial numbers in detail and then we can cover the questions which you which you have. 22:16 22 minutes, 16 seconds Uh thank you over to you B. 22:18 22 minutes, 18 seconds Thank you Ashish. Uh good afternoon everyone and a warm welcome to all the participants on the call. Ashish anyway has covered the broader uh business 22:27 22 minutes, 27 seconds environment as well as our own strategic initiative and the market context. I will now jump on directly to the main numbers of the for the firm. I'm pleased 22:35 22 minutes, 35 seconds to share our quarter 4 and FI26 results uh where we have seen almost like a steady growth across all our key businesses. Ashish did alluded to the 22:44 22 minutes, 44 seconds fact that our IBNI was subdued in this quarter but otherwise all key businesses whether it was wealth private or SS 22:52 22 minutes, 52 seconds services saw a decent and a stable growth year on year and quarteron quarter as well. uh if you look at from 22:59 22 minutes, 59 seconds a uh headline number uh we have actually crossed the operating profit margin uh number of thousand cr in this year this 23:06 23 minutes, 6 seconds is a big achievement for us and similarly if you look at that on our dividend side we have again declared a dividend of rupes 14 for our H2FI 26 23:15 23 minutes, 15 seconds that takes to roughly 50% of our profit being paid as dividend which is consistent with our dividend distribution policy uh having said that 23:23 23 minutes, 23 seconds if you look at on the overall client asset basis our total firm level client assets were at 4.5 lakh which was held by the flows across the businesses 23:31 23 minutes, 31 seconds including asset services wealth and private but there was a marktomarket impact on the headline number that's where the impact on the client asset 23:39 23 minutes, 39 seconds reflected on in terms of the revenue the quarter core revenue was around 825 cr which is a 7% y but if we remove I and 23:48 23 minutes, 48 seconds IB businesses for the quarter our actual revenue x of IB and I grew by 13% in quarter 4 and if you look at on a full 23:56 23 minutes, 56 seconds year basis excluding I and IB our revenue actually grew by 17% which is where wealth and private has actually shown a 20% growth and now wealth and 24:04 24 minutes, 4 seconds private put together contributes 55% of the firm revenue which was almost 49% last year so the share of wealth and 24:13 24 minutes, 13 seconds private has actually gone up even if I go further down if you add wealth asset management and asset services now they contribute roughly 80% of the revenue for the firm which was 74%. 24:24 24 minutes, 24 seconds Why I'm highlighting these numbers are because these it gives you that predictability of the earnings in the coming quarters and years because these business are more recurring in nature 24:32 24 minutes, 32 seconds compared to maybe I and IB which can have a cyclical impact on a year-on-year basis or on a quarteronquarter basis. Uh 24:40 24 minutes, 40 seconds even if you look at the total cost for the firm for the quarter the total cost when I say total cost it's employee plus opex has actually gone up by 9% and on a 24:48 24 minutes, 48 seconds fullear basis it has gone up by 10% only. The reason of falling out is that that that reflects the variability in 24:55 24 minutes, 55 seconds our cost that in a year when the revenue growth is lower our cost can be uh controlled or can be uh can be reflective of the overall performance. 25:04 25 minutes, 4 seconds Maybe as a reference to the fact that if you look at our FI25 our revenue went up by 41% and our cost was up by 24%. And 25:12 25 minutes, 12 seconds in this year as the revenue has slowed down so is our cost has been controlled to that extent. Multiple reasons for the revenue slowdown growth was discussed 25:21 25 minutes, 21 seconds during Ash's opening remarks but that's where the cost part comes in and if you look at from a Q4 cost versus Q3 you will see a growth in the number but 25:30 25 minutes, 30 seconds that's a typically a seasonality impact which happens in Q4 I would say you compare Q4 FI 26 with Q4 FI 25 you will 25:38 25 minutes, 38 seconds see that the cost has only gone up by 8 to 10% uh opex is up by 7% and the employee cost is up by 10 11% that's 25:46 25 minutes, 46 seconds where the number is It's a seasonality which plays in Q4 if compared with Q3. 25:51 25 minutes, 51 seconds Uh within cost if you look at that our opex is around 27% of the cost that is quarter on quarter would see a growth of 25:58 25 minutes, 58 seconds 27%. But if you compare it with previous year quarter four the growth is only 7%. 26:04 26 minutes, 4 seconds This is just about the seasonality of the cost. Uh similar trend you will see it on the employee side also employee cost side. So to that extent we are comfortable with what is happening on 26:12 26 minutes, 12 seconds the cost side. uh just a word of upfront uh disclaimer that maybe in FI27 we'll have some incremental cost coming in our 26:21 26 minutes, 21 seconds asset management business as Ash's also alluded to the fact that we are launching the new strategies and obviously for our mutual fund license as 26:28 26 minutes, 28 seconds we are moving towards the SI business there'll be an incremental cost which will come but that's more like an investment not really a so-called a cost 26:36 26 minutes, 36 seconds and isolation to be seen in terms of the overall happy to share that the wealth management segment when I Wealth management segment wealth and private 26:45 26 minutes, 45 seconds put together the cost to income ratios actually come down by 80 basis point compared to previous year and even if I look at asset services and INIB the cost 26:53 26 minutes, 53 seconds to income ratios are actually improved by 100 basis point just because wealth and private composition has gone up in 27:00 27 minutes the overall firm uh contribution that is you will see that the cost to uh income at a firm level has moved from 55 to 56% 27:08 27 minutes, 8 seconds but this is just a composition issue otherwise the operating leverage in both the business is being reflected in the cost income ratio being uh lower than 27:17 27 minutes, 17 seconds previous year. Operating P again if you look at for the quarter four it was 269 cr which is a 5% YI growth but within 27:25 27 minutes, 25 seconds wealth within the segment within the profit growth well segment actually grew by 23% and asset services grew by 12 13% 27:32 27 minutes, 32 seconds in quarter 4 even on a full year basis is the similar trend where wealth and private has actually gone up by 23 24% 27:39 27 minutes, 39 seconds and asset services is up by 13 14% in that range our ROE has been healthy at 28% for FI26 27:48 27 minutes, 48 seconds Ashish covered a lot of details in terms of the individual businesses but if I had to take headline numbers on the noama wealth the client's assets are at 27:55 27 minutes, 55 seconds around 1.1 lakh which is a 14% yi growth despite the marktomarket impact uh coming in the last quarter our NPS 28:03 28 minutes, 3 seconds assets now stood at around 39,000 cr uh and we have registered our net new money of around 8,900 cr during the year which 28:11 28 minutes, 11 seconds is a 30% growth on the opening NPS which is where we've been steadily communicating that the wealth should 28:18 28 minutes, 18 seconds have anything upward of 25 to 30% as an opening net new money on the opening NPS. So we've been maintaining that the 28:26 28 minutes, 26 seconds revenue was at 960 cr which is a growth of 18% and uh the the retention level retention remains stable at 90 basis 28:34 28 minutes, 34 seconds point or so. Again if you look at the data book you will find that the uh cost to income ratio for business has actually improved by 135 basis point 28:43 28 minutes, 43 seconds compared to previous year. Now it is running at whatever 65.7%. 28:47 28 minutes, 47 seconds But the operating leverages started playing in this is where reflected in the cost to income and the operating PBT went up by 22% for wealth. In terms of 28:56 28 minutes, 56 seconds the private again the numbers across uh the key parameters whether it is the overall client assets whether it is the AR asset which has actually gone up by 29:04 29 minutes, 4 seconds 22% the net new money which is again up by 22% or uh the revenue has actually gone up by 24%. 29:14 29 minutes, 14 seconds uh AR revenue as of now have now touched 60% of the total revenue for private which is where we actually we feel 29:21 29 minutes, 21 seconds comfortable at 60 65% of the revenue coming from AR side. So I think we are on the right trajectory overall 29:28 29 minutes, 28 seconds retention again remain in our guided uh range of 85 to 90 basis points. So nothing to nothing to call out there. 29:35 29 minutes, 35 seconds Anyways we deliberated on the RM expansion how we have actually added the people over the four years and in this year particularly the PV for for this business also was up by 24%. 29:46 29 minutes, 46 seconds Asset management uh we discussed and Ashish actually leaded to the leadership hiring which we have done in the businesses both for our uh private uh 29:55 29 minutes, 55 seconds private business for our private credit as well as on the business side. So I think that that piece is both at least taking the right shape. Otherwise if you 30:03 30 minutes, 3 seconds look at our management fees income is actually up by 31% on a Y basis. So I think this is where we are heading. In terms of asset services we did around 30:12 30 minutes, 12 seconds 209 cr in Q4 and we did around 193 cr in Q1. Uh this business has actually done better than what we expected for quarter 30:21 30 minutes, 21 seconds 4. Despite that the interest rates has actually come down and our earnings is basically uh fixed deposit earnings on the on the margin money given by the 30:29 30 minutes, 29 seconds clients. Despite of that the business has actually came up well on the INIB side uh the revenue if you look at 30:37 30 minutes, 37 seconds compared to quarter 3 it is broadly there 138 versus 135 cr and we did discuss about how the market in the quarter 4 has actually played in more 30:46 30 minutes, 46 seconds specifically on the ECM side. uh one more thing which I want to highlight which uh in terms of the fixed income which is part of the IB business that 30:54 30 minutes, 54 seconds has actually grown 34% on a Y basis and now it contributes almost 50% of the IB top line and this business is more 31:03 31 minutes, 3 seconds structural in nature can see a compounding growth of 20 25% in the it has seen it and it can continue to see a growth of 20 25% compounding in the 31:12 31 minutes, 12 seconds years to come. ETM is obviously you guys understand this is more linked to the market activity that is where the volatility or a quarteronquarter 31:20 31 minutes, 20 seconds seasonality can play in but otherwise this business has been doing uh decent for us overall PBT for asset services 31:27 31 minutes, 27 seconds and capital market was around 830 cr uh this is where we are and I think if principally we look at a businesses it 31:36 31 minutes, 36 seconds seems that businesses are on the right track and our focus businesses are performing relatively much better than what we uh initially 31:45 31 minutes, 45 seconds uh planned for and I think that's where we are. I hand over to the moderator in terms of the Q&A now. 31:54 31 minutes, 54 seconds Thank you very much. We will now begin the question and answer session. 31:59 31 minutes, 59 seconds Anyone who wishes to ask a question may press star and one on their touched on telephone. If you wish to remove yourself from the question, you may 32:06 32 minutes, 6 seconds press star and two. Participants are requested to please use handsets while asking a question. Ladies and gentlemen, we will now wait for a moment while the question queue assembles. 32:18 32 minutes, 18 seconds Our first question comes from the line of Manas Saval from Bernstein. Please go ahead. 32:24 32 minutes, 24 seconds Hi, thanks for the opportunity. I have a couple of questions. I'll start with the relatively easy ones. Uh ECM, there are a couple of large IPOs that are coming. 32:35 32 minutes, 35 seconds Uh how should we think about our market share on revenue for the year? Are we present in those active in those 32:42 32 minutes, 42 seconds briefings or not? And second from a regulation perspective 1st of April uh mutual funds have cut commissions. So 32:50 32 minutes, 50 seconds what is the impact for the business or the console from that perspective? So that is on uh 32:57 32 minutes, 57 seconds uh on the asset services business wanted to just understand a on trajectory 33:04 33 minutes, 4 seconds because I understand we were elevated and now rates have come down. So you've seen some amount of contraction going ahead. How do we think about that? Uh 33:12 33 minutes, 12 seconds the last question is on wealth. Uh you talked about a 25% increase in revenue per RM. Um is that all AI productivity? 33:21 33 minutes, 21 seconds Is that including MTM flows etc. How to think about number of clients per RM in a steady state? Those are the questions. 33:31 33 minutes, 31 seconds So let's start with uh asset services first. Uh I think broadly when we do the 33:38 33 minutes, 38 seconds numbers on yield uh unless and until we have a client you know which becomes 33:45 33 minutes, 45 seconds uh extremely large and the ratio of uh ratio of collateral uh shifts. I think the yield should 33:53 33 minutes, 53 seconds remain at this level. I don't think the yield will compress uh because we've seen a decline in the overall interest 34:00 34 minutes rates happen and that flow through has uh largely happened. uh maybe in the next 12 to 15 months oneups we'll see a 34:08 34 minutes, 8 seconds reverse of this happening uh if if the inflation stickiness is there uh because the fuel 34:16 34 minutes, 16 seconds prices or uh the war situation being there and if the central bank is forced 34:22 34 minutes, 22 seconds to increase the rates then uh I think we will see further upward trend in ease that will play out as and when our 34:30 34 minutes, 30 seconds deposits get repriced uh on ECM side uh I think our overall 34:37 34 minutes, 37 seconds pipeline right now uh we have about 40 to 45 live mandates uh across uh largely 34:46 34 minutes, 46 seconds across ECM and some in advisory uh so the pipeline remains healthy uh I think Q4 was when things got uh pushed a bit 34:56 34 minutes, 56 seconds uh and uh uh which we should see the recovery happen uh in the coming quarters and even in advis We have 35:04 35 minutes, 4 seconds certain large deals which are there. So hopefully we will have a good year in investment banking this year. Uh fixed 35:11 35 minutes, 11 seconds income anyways continues to uh move at a very very rapid pace there. Uh on on the 35:17 35 minutes, 17 seconds wealth side uh 25% increase in productivity is a combination of actually two things. Uh one is the 35:26 35 minutes, 26 seconds seasoning of the vintage of the RL. uh if you see last year uh our less than one year cohort was around 40 45%. This 35:35 35 minutes, 35 seconds year it's fallen to about 33%. So which means that the RMS of higher vintage have increased in terms of cohort. So 35:43 35 minutes, 43 seconds that contributes uh some increase in productivity. Uh and second of course uh the contribution comes from the various 35:52 35 minutes, 52 seconds initiatives you take in improving the learnability and improving the efficiency of people which is where AI 35:58 35 minutes, 58 seconds plays a role. Uh net new money itself doesn't lead to increase. It's an outcome. It's not the cause. The causes 36:06 36 minutes, 6 seconds are actually these net new money and productivity increase is basically the outcome of that. 36:12 36 minutes, 12 seconds Understood. Any any uh indication on the mutual fund commission cut impact? 36:18 36 minutes, 18 seconds I don't think we will go through that. I think it's not a topic which got discussed very frankly internally. So I'm not sure how important it is for us 36:26 36 minutes, 26 seconds because anyways in I revenues for us mutual fund is less than 20%. and the pass through that happened because 36:34 36 minutes, 34 seconds whatever initially that was proposed and what finally came through and the net margins which we get uh I think is 36:42 36 minutes, 42 seconds similar to what came through so there is hardly any impact on us. Understood. Thank you. 36:50 36 minutes, 50 seconds Thank you. Our next question comes from the line of Deepan Go from city. Please go ahead. 36:58 36 minutes, 58 seconds Uh hi uh good um good afternoon everyone. Uh so few questions uh first uh you know if I were to think of FI27 37:07 37 minutes, 7 seconds uh now also there's a lot of uh geopolitical uncertainty that still persists now on that backdrop uh if you 37:15 37 minutes, 15 seconds were to think of the transactional revenues uh x of broking uh majorly in uh nuama private and maybe to a certain 37:23 37 minutes, 23 seconds extent in nama wealth also just wanted to get some sense of the deal pipeline uh that you envisaged or in terms of 37:30 37 minutes, 30 seconds market activity see uh what is the sense that you're getting in terms of the transactional revenues because FI26 was a a relatively good year uh for the 37:39 37 minutes, 39 seconds company on that front. Uh my second question is on the Obama wealth business. Uh now if I look at the 4Q 37:47 37 minutes, 47 seconds uh normally it tends to be a little bit affected on the managed products and investment solutions because of the insurance revenues. Uh but if I look at 37:55 37 minutes, 55 seconds 4Q to 4Q I mean they each have held up held up fairly well. uh despite the backdrop that one was expecting maybe 38:03 38 minutes, 3 seconds some moderation post the ITC changes. So just wanted to get some sense of your insurance commissions I mean how have that really held up or was it or was 38:12 38 minutes, 12 seconds there some upfronting of uh CAT 1 CAT 2 uh AI if commissions out there uh and 38:19 38 minutes, 19 seconds the third question uh is on the overall wealth piece. Um basically you know if you were to look at the new incoming 38:27 38 minutes, 27 seconds customers uh that you are getting um maybe more uh for from the perspective of Noama private and to a certain extent 38:35 38 minutes, 35 seconds maybe the high quality customers in Nama wealth uh would they see it more from smaller cities u low ticket size generational wealth or first generation 38:44 38 minutes, 44 seconds customers or this would be like posting from uh earth soil bank service customers. I mean if you can give some color on the customer quality or 38:51 38 minutes, 51 seconds demographics out there and I have two data keeping questions which maybe I can ask at the end. 38:58 38 minutes, 58 seconds So uh dependent transactional revenue overall in FI26 uh for private uh the jump was about 39:07 39 minutes, 7 seconds 14%. So it was significantly lower than actually the AR revenue AR revenue was 32%. 39:16 39 minutes, 16 seconds Uh I think uh if you look at both the businesses and if you look at the decomposition of the transactional 39:24 39 minutes, 24 seconds revenue for us uh like you said broking is a large component 39:30 39 minutes, 30 seconds uh and then there is fixed income uh which is again a flow business uh which actually improves uh in times when geopolitics uh goes through this zone. 39:43 39 minutes, 43 seconds uh third so I think between these two if we add uh in noa wealth at least this 39:51 39 minutes, 51 seconds would constitute about 90 95% and 5% would be some uh transactions or deals 39:58 39 minutes, 58 seconds and that also uh I mean unlisted for us is reasonably small and hopefully with n 40:05 40 minutes, 5 seconds listing uh for everybody it becomes small because we've considerably reduced the exposure to unlisted uh over the last two three years. It's not a large 40:13 40 minutes, 13 seconds sum for us. So whatever deals happen they will happen more in uh high credit transactions where we are co-investing 40:22 40 minutes, 22 seconds with some fund or in commercial real estate if any. So those are really not impacted by the geopolitics. So for us 40:30 40 minutes, 30 seconds actually except broking which is more linked to market market volumes rest everything is reasonably insulated and 40:38 40 minutes, 38 seconds actually works better when the equity markets don't do well. So both for private and wealth we don't see that as 40:45 40 minutes, 45 seconds an impact playing through. I think it could only benefit. Uh for from from a yield perspective uh I think right now 40:54 40 minutes, 54 seconds the insurance field impacts have been negligible for us. Uh it it has not led to that impact. In fact the overall 41:01 41 minutes, 1 second volume of insurance growth uh was also not like you know like historically we would grow by 50 50%. I think it 41:08 41 minutes, 8 seconds stabilized more to 25 30%. But the yield impact is not there. Yes, a bit of category 2 may be higher this year 41:16 41 minutes, 16 seconds because again a reason being that if equity markets don't do well then more money flow will happen in yield based 41:25 41 minutes, 25 seconds products which actually sit in category 2. So there's some amount of uh uh firstear commission which is about 30% 41:32 41 minutes, 32 seconds of the life commission. Uh so about 10% extra is what you make which can insulate the yield a bit. uh new 41:39 41 minutes, 39 seconds customers actually remain the same. I don't think there is any change in demographic. Uh migration from banks is 41:47 41 minutes, 47 seconds a continued phenomena and that will continue to happen. Uh in Noama wealth tier 2 is uh I mean beyond tier 1, tier 2 actually is 3540% of our uh business. 42:00 42 minutes In private still I would say the top eight 10 cities constitute about 80 85% 42:06 42 minutes, 6 seconds 15% would be below that because uh the density of the this thing is still lower I mean there are people there but if you 42:15 42 minutes, 15 seconds compare it to let's say Bombay Delhi Bangalore Hyderabad Chennai Bangalore the density of wealth is far far far 42:22 42 minutes, 22 seconds higher uh maybe in another two three years time that 15 20 could reach to a 30% level uh got Just the two data keeping questions. One is for FI26 and 4Q uh 26. 42:34 42 minutes, 34 seconds If you can break up the IB, IE between IB and IE. And the second question is uh what your distributed mutual fund within 42:42 42 minutes, 42 seconds the overall cohort of distributed MF, PMS, AIF, I mean whether you put the overall wealth together or private and 42:50 42 minutes, 50 seconds well segregated uh out there about uh 8 to 9,000 crores. 42:59 42 minutes, 59 seconds Sorry. So this would be your u uh overall distributed MF right? 43:04 43 minutes, 4 seconds Distributed MF. Yeah. Borderline 9 to 10,000. Correct. 43:07 43 minutes, 7 seconds And if I can get the data on IBI IB and I broadly broadly uh right now 43:15 43 minutes, 15 seconds the split would be uh 3070 30 I 70. 43:22 43 minutes, 22 seconds Uh thank you and all the best. 43:28 43 minutes, 28 seconds Thank you. Our next question is from the line of Lalit Moanddev from Equest Securities. Please go ahead. 43:36 43 minutes, 36 seconds Yeah. Hi, good afternoon sir. 43:40 43 minutes, 40 seconds I have two questions. So firstly uh if you look at the cost uh cost income ratio for both the world segments for F26 it's still uh it remains around in 43:49 43 minutes, 49 seconds the range of around 56 to 67%. So how should we look at this number for the next two years uh incrementally given 43:56 43 minutes, 56 seconds that we are seeing improvement in the RM productivity as well and secondly uh uh on the uh on the clearing service asset 44:04 44 minutes, 4 seconds services uh if you just do a back bank backup calculation it suggests that uh the cash collateral within the assets 44:12 44 minutes, 12 seconds under custody assets under clearing has increased to more than 40% over the last two three quarters. um just wanted to understand what would have driven those 44:19 44 minutes, 19 seconds things and how should we um and is that the will that be one of the reasons why we are seeing some pick up in the also 44:28 44 minutes, 28 seconds uh and just one data heating question is like within the NPI revenue and the novel we pay sements of for 26 what would be the split between recurring and 44:37 44 minutes, 37 seconds the transaction revenues uh so income um just quickly covering 44:44 44 minutes, 44 seconds that noa wealth we've seen 30 actually 150 basis points compression this year. 44:53 44 minutes, 53 seconds uh and that is that always will remain I mean a you know a toggle between productivity improvement and how much we 45:02 45 minutes, 2 seconds want to reinvest back in adding capacity uh because if we get growth uh and we could have spent that entire 150 basis 45:10 45 minutes, 10 seconds points in adding more RMS which we chose not to uh but I'm saying productivity improvement growth is 150 basis points 45:18 45 minutes, 18 seconds in one year in private on the other hand whatever productivity improvement happened. We reinvested in adding capacity. So this will keep moving but 45:28 45 minutes, 28 seconds broadly like we keep saying in over a 3 four year period you can see a 100 basis point reduction uh every year. Uh 45:35 45 minutes, 35 seconds obviously we can choose to change if you want to add capacity at a more aggressive pace because there is growth to be had. uh you know when many such 45:44 45 minutes, 44 seconds players are coming into the market and operating at a loss making business I think we don't want to let uh let the 45:52 45 minutes, 52 seconds field get captured by others so we will continue to grow uh and we will continue to toggle between how much of the productivity gains which we will 46:00 46 minutes reinvest back into adding capacity because that gives us future growth uh I think second question was on the 46:08 46 minutes, 8 seconds ease of asset services yes the cash component would have gone up. That is the reason why the yield has gone up and 46:14 46 minutes, 14 seconds that is because uh we when we lost that large client their cash component used to be lower given the size of their 46:22 46 minutes, 22 seconds collateral then that got replaced with uh large number of smaller clients so their ratios would be different as I 46:30 46 minutes, 30 seconds keep saying as the client collateral size goes up uh your your ratio could change and cash could come down but 46:37 46 minutes, 37 seconds broadly you'll either be at 7030 or 7525 type at a portfolio level the main uh 46:44 46 minutes, 44 seconds trend or the impact on yield going forward could be how the interest rates move if the inflation remains sticky. If 46:52 46 minutes, 52 seconds there is a if you can if you think that there is a 50% upside uh in in let's say 46:59 46 minutes, 59 seconds RBI will hike rates over the next 12 months then a flow through of that will happen in deposit pricing and we will see the yields uh go up if that happens. 47:09 47 minutes, 9 seconds uh in MPS about 70% uh 60 to 70% would be uh maybe 60% annuality and 40% transaction. 47:23 47 minutes, 23 seconds Sure. Thank you. 47:28 47 minutes, 28 seconds Thank you. Our next question is from the line of Abijit Takare from Kotak Securities. Please go ahead. 47:42 47 minutes, 42 seconds your line is extremely uh uh disturbed. 47:47 47 minutes, 47 seconds Uh just one hello. Is this better? 47:56 47 minutes, 56 seconds Yeah, this is better. 47:58 47 minutes, 58 seconds Okay. So uh this was an industry question uh you know taking the lead from your uh opening remarks uh you know for incumbents when we think about the 48:06 48 minutes, 6 seconds uh SNI business uh it it's obviously a compensation problem you know but at the same time like you all say you know new 48:13 48 minutes, 13 seconds entrance do not have a large platform as such you know but from a client's point of view how are they uh looking at all 48:20 48 minutes, 20 seconds of these new uh entrance uh are they starting to kind of uh give away part of the wallet there and that's why the industry is kind of getting more fragmented. 48:32 48 minutes, 32 seconds Uh so part of it I think will happen uh that fragmentation if you look at wealth management is a global phenomena. I mean 48:40 48 minutes, 40 seconds even if you look at players like uh you know maybe a UBS and all which are world leaders uh they have a 2% market share in the global uh wealth management area. 48:50 48 minutes, 50 seconds Uh I think India will be more skewed in that sense. There will be maybe three four large players but there will always 48:58 48 minutes, 58 seconds be a long tail and uh what happens if you have a large platform or a multi-product platform that you will be 49:06 49 minutes, 6 seconds able to retain or you'll be able to get a significant proportion of the client portfolio uh because they also don't 49:14 49 minutes, 14 seconds want to go through the hassle of you know having multiple advisors unless there is some genuine value ad and genuine value ad in in in client and 49:23 49 minutes, 23 seconds size could be an access to a transaction or access to a product which let's say you cannot provide but somebody else is 49:30 49 minutes, 30 seconds providing. So typically the way industry structure will evolve that large clients will have let's say one or two core wealth managers where bulk of their portfolio sits. 49:41 49 minutes, 41 seconds So most of the annuality income and most of the transa large part of the transactional income will sit there. uh 49:48 49 minutes, 48 seconds and then there will be smaller players who will have uh access to some deals transactions uh where there will be a 49:56 49 minutes, 56 seconds long tail. Obviously in these smaller platforms also there will be certain exceptional RMS who will move they will 50:04 50 minutes, 4 seconds be able to move some relationships there is no question about it but I think it will be a struggle because uh every 50:11 50 minutes, 11 seconds large clients want a want a lending line for example. Now let's say if you already have a lending line with an 50:18 50 minutes, 18 seconds institution where you have products which are not so easily marginable AI illquid products it's difficult for a 50:27 50 minutes, 27 seconds smaller platform to extend there are single borrower limits there are group borrower limits then to be able to set up a vehicle 50:35 50 minutes, 35 seconds offshore to move money so I mean there are significant number of investments in the platform that will be required to be 50:43 50 minutes, 43 seconds done capital investment that will be required to be done for some player to start becoming meaningful in this 50:50 50 minutes, 50 seconds process 10 20 30,000 cr aum few RM uh few initial client successes one odd 50:58 50 minutes, 58 seconds unlisted deal one odd credit transaction all this will continue to happen and create a lot of noise but on a 51:05 51 minutes, 5 seconds systematic basis to attract flows attract people the kind of platform and infrastructure that is needed to invest 51:13 51 minutes, 13 seconds and maintain. I find it very difficult to see that all these new incumbents will be able to do it easily. 51:21 51 minutes, 21 seconds Uh got it s helpful. Uh the second question uh was um if you could clarify 51:28 51 minutes, 28 seconds on the point that you made u on the GLP tie up I mean how does it play out and you know what are the benefits? 51:35 51 minutes, 35 seconds Uh so basically you know when um FBI are investing globally uh there are certain 51:44 51 minutes, 44 seconds categories of investors which are like long large large long only funds who then work with uh large global custodians which are multi-country 51:53 51 minutes, 53 seconds presence. Uh so somebody like a state street or somebody like a city will have a multi-country custodian presence. So 52:01 52 minutes, 1 second they will be able to offer their relationship. uh but somebody like us who's a single country single currency custodian uh does not have appeal for such clients. So how do we counter that? 52:12 52 minutes, 12 seconds uh we counter that by uh having a you know a strategic tie up with a global custodian which does not have presence 52:19 52 minutes, 19 seconds in India. So it adds for them a new service or a new client segment which they can go after and for us we get 52:28 52 minutes, 28 seconds access to clients which we would have otherwise don't have. So this is something which exists globally uh and we are aggressively pursuing. Uh so we 52:37 52 minutes, 37 seconds have one or two tabs which are in the works once we are able to close that basically open up a new set of clients which we were not able to access earlier. 52:48 52 minutes, 48 seconds Got it. And just one last data question uh in the uh ultra business around you know 4 and a half thousand families that 52:54 52 minutes, 54 seconds we have if you could give some further color on um what is the distribution in terms of let's say more than 5 cr or 10 53:02 53 minutes, 2 seconds cr relationships uh I think more than 53:09 53 minutes, 9 seconds 10 cr which is if you see the vintage and intersection aum 53:16 53 minutes, 16 seconds more than 10 cr would basically be I think a third of the clients which 53:23 53 minutes, 23 seconds contribute more than 70 75% of their and this phenomena is consistent across the top two three leading players in the 53:32 53 minutes, 32 seconds market as per our study of data people so families which have spent more than 3 53:38 53 minutes, 38 seconds to four years uh start graduating towards higher AUF per family and then that becomes a larger proportion and 53:46 53 minutes, 46 seconds test would be WIP. Uh so I think about a third to 40% would fall more than 104. 53:54 53 minutes, 54 seconds Got it sir. This is very helpful. Thank you so much. 53:59 53 minutes, 59 seconds Thank you. Our next question is from the line of Moit Mangal from Centrum. Please go ahead. Yeah. Yeah. Good afternoon and thanks for the opportunity. My first 54:07 54 minutes, 7 seconds question is to the asset management business now. Now if I look at 26 you know we had about 1,800 K of net inflows uh obviously distorted by public 54:15 54 minutes, 15 seconds markets. Now in 27 you have cr of net inflows 54:22 54 minutes, 22 seconds uh 1,800 all right no 1,000 crores of net inflow okay okay uh now understood now if I 54:30 54 minutes, 30 seconds look in terms of you know 27 where where uh you know uh your fif and private credit is expected to be launched uh so 54:38 54 minutes, 38 seconds I just wanted to know uh basically how do you see 27 what what are the uh uh you know reasonable estimates that we can expect from this segment 54:46 54 minutes, 46 seconds Let's go strategy by strategy. Uh private equity, we've launched our uh fourth fund. Uh we are currently sitting 54:54 54 minutes, 54 seconds at about 250 275 crores. Uh we target to do maybe anywhere between,000 to,500. Uh 55:04 55 minutes, 4 seconds let's take the conservative side if you end up at,200. 55:08 55 minutes, 8 seconds So that adds up about 1,000 crores there. uh private credit again as I said the launch will be somewhere around uh 55:16 55 minutes, 16 seconds H2 and the first fund could target maybe 1500 crores part of it which come will come this year I can't certainly say how 55:25 55 minutes, 25 seconds much but you know maybe half of it comes this year uh commercial real estate our next fund also gets launched this year 55:33 55 minutes, 33 seconds that would be a 3 to 4,000 crores uh again maybe 30 40% starts coming in this year and uh on the SIF and public market 55:42 55 minutes, 42 seconds side. Uh maybe once we launch and we start seeing the flows happen uh next quarter we could discuss the number uh 55:50 55 minutes, 50 seconds and by that time maybe the volatility levels of the market also should settle down. 55:56 55 minutes, 56 seconds Understood. This is the real my second question is towards you know the wealth division. I mean if I look at the uh external wealth managers I think we have 56:05 56 minutes, 5 seconds added about thousand over the last 12 to 15 months. Now we have about 8,000 external wealth managers and our own RMS are pretty stable at about 1100. So so 56:13 56 minutes, 13 seconds do you see this kind of business model evolving more towards EWM uh rather than your own RM although I understand the economics kind of remain the same. Uh 56:22 56 minutes, 22 seconds but just wanted to understand the business model here. 56:25 56 minutes, 25 seconds No not really. We will grow both and even own RM. So what has happened in the own arms uh right now is that uh uh 56:34 56 minutes, 34 seconds though the number may look steady but as I said in my initial remarks that we are doing the process of seniorization. 56:42 56 minutes, 42 seconds So your individual RM that is going out and the one that is coming in the one that is coming in we are getting more 56:50 56 minutes, 50 seconds senior variety higher uh fixed pay variety. So even if the productivity level in terms of X time salary. So the 56:59 56 minutes, 59 seconds way industry looks at productivity is very simple. If I give somebody a salary of 100 rupees, what multiple of that 57:08 57 minutes, 8 seconds comes in as a revenue. So let's say if you were having an RM of 100 rupees and that person was generating 3x 300 of 57:16 57 minutes, 16 seconds revenue. Now we have an RM of 500 200 rupees and he's also generating 3x which is 600 rupees of revenue. The 57:24 57 minutes, 24 seconds contribution to the company increases substantially because your other costs per RM do not increase at the same pace. 57:32 57 minutes, 32 seconds You understood? So that phenomena also adds to productivity and operating leverage. 57:39 57 minutes, 39 seconds Understood. Just lastly on attrition I mean have we had any kind of a regret attrition or you know during the year and any loss of RM because any loss of 57:47 57 minutes, 47 seconds AM because of that you don't typically lose lots of AUM because the number of hooks are large 57:55 57 minutes, 55 seconds regret attrition in private maybe you know range of 1 2% and in wealth maybe maybe 3 to 4%. 58:04 58 minutes, 4 seconds Okay understood thanks and wish you all the best organization quickly sir. Thank you. 58:10 58 minutes, 10 seconds Thank you. Our next question is from the line of Sabb Dole with fires assets. Please go ahead. 58:17 58 minutes, 17 seconds Yeah, good afternoon. I just have two questions. Uh first is on your uh private private assets front. Uh what 58:26 58 minutes, 26 seconds exactly is causing the yields to kind of you know be sourced? Uh I understand there is a mix component here where 58:34 58 minutes, 34 seconds transactional assets uh versus AR is absorbing but is there any other color that you can provide uh for the use? 58:42 58 minutes, 42 seconds That is question number one. The second one is when you look at your ARR uh composition or AR share improving uh to 58:50 58 minutes, 50 seconds what extent do you think this is happening because some of the transactional assets are moving to AR? 58:56 58 minutes, 56 seconds Thank you. Actually for us this second element has still not started playing out. This is a huge opportunity which we 59:03 59 minutes, 3 seconds discuss internally uh and we are yet to crack it where we basically have this uh 59:11 59 minutes, 11 seconds uh you know mechanism of moving transactional to ARR which will happen in somewhere around next 12 15 months because now we have the 59:18 59 minutes, 18 seconds non-discretionary PMS the discretionary PMS all the enabling vehicles are in place we need to orient the team and 59:27 59 minutes, 27 seconds start going out and uh you know demonstrating the benefits to the client so that migration will happen. Right now 59:33 59 minutes, 33 seconds that's not happening. It's purely basis fresh flows that are coming into ARR. Uh actually when we look at the yield the 59:42 59 minutes, 42 seconds product wise is there is no change. It's basically composition led. So as I said between 80 basis points to 1% it'll 59:50 59 minutes, 50 seconds range depending on the composition change on a quarter to quarter basis. Uh we've looked at it multiple times. There is nothing more to lead into that. 59:59 59 minutes, 59 seconds So given the fact that AR is growing much faster than transactional does it mean that there is more headroom to yield from here? 1:00:08 1 hour, 8 seconds Uh actually our yield which we publish here is only yield. Okay. Okay. Yeah. 1:00:16 1 hour, 16 seconds It's not it's not a composite. Oh okay. Okay. Thank you. Yeah. 1:00:23 1 hour, 23 seconds Thank you. Our next question is from the line of Sanadia Agarwal from Unicorn Assets. Please go ahead. 1:00:30 1 hour, 30 seconds Hi team, good sir. Uh so first question is on the SAS services business. Uh so given the RBA anger in key norms would 1:00:38 1 hour, 38 seconds kick in do we see any impact on the uh yields from the SS services business 1:00:45 1 hour, 45 seconds perspective and like do we see any changes on the ROC basis of Nama's net 1:00:51 1 hour, 51 seconds worth or uh capital employed. Second is on the uh so we are seeing on the capital 1:00:59 1 hour, 59 seconds market or you can asset services combined business. So we are seeing a upurge in the uh FBI derivatives turnover on BSC and the HFT contribution 1:01:08 1 hour, 1 minute, 8 seconds in terms of participation on the BSC particularly. So how do we see it as a as a trend for our business going 1:01:16 1 hour, 1 minute, 16 seconds forward given the incremental client edition that we are also seeing in our book and also on the uh exchange uh side we are seeing a good uh momentum there. 1:01:27 1 hour, 1 minute, 27 seconds And uh lastly just if you could highlight anything any updates on the PG side that would be thank you. 1:01:36 1 hour, 1 minute, 36 seconds So the bank guarantee thing we've done the incremental borrowing and all uh 1:01:43 1 hour, 1 minute, 43 seconds basically for us uh we did the maths that has an impact net of deposit cost 1:01:51 1 hour, 1 minute, 51 seconds of maybe some 10 15 crores a year. So not much should get covered in uh in 1:01:57 1 hour, 1 minute, 57 seconds terms of uh increase in volume. Uh that of course will have a uh you know 1:02:05 1 hour, 2 minutes, 5 seconds positive rub off on the asset services business because if the volumes increase I'm assuming that the profit pool for 1:02:12 1 hour, 2 minutes, 12 seconds players will increase and they will deploy more capital. deployment of more capital basically means more collateral and therefore more earnings that will 1:02:20 1 hour, 2 minutes, 20 seconds come to us. uh on the PG side uh as we have maintained that you know they've spent about now 5 years with the asset 1:02:29 1 hour, 2 minutes, 29 seconds they've seen reasonable results uh at and they are a private equity fund so they will exit at some point in time 1:02:37 1 hour, 2 minutes, 37 seconds right now there is no process that is on uh whenever something happens I mean we will also come to know uh right now uh I 1:02:45 1 hour, 2 minutes, 45 seconds think it's the status quo okay any impact of ROC basis we are seeing from the Not really for with 15 20 crores of Yeah, that would be negligible. 1:02:56 1 hour, 2 minutes, 56 seconds Yeah. 1:02:58 1 hour, 2 minutes, 58 seconds Great. Good said. All the best to the future. Thank you. Thank you. 1:03:03 1 hour, 3 minutes, 3 seconds Thank you, ladies and gentlemen. We have no further questions at this time. I would now like to hand the conference over to the management for closing comments. Over to you. 1:03:13 1 hour, 3 minutes, 13 seconds Uh thank you. Uh thank you all for coming again. Uh uh I think we'll see you again after the end of Q2. Hopefully 1:03:21 1 hour, 3 minutes, 21 seconds by then uh the geopolitical situation would have resolved and we will we'll have something to cheer about. Uh thank you. 1:03:30 1 hour, 3 minutes, 30 seconds Thank you so much. Thank you. 1:03:34 1 hour, 3 minutes, 34 seconds Thank you on behalf of Noama Wealth Management Limited. That concludes this conference. Thank you all for joining us. You may now disconnect your lines. 1:03:42 1 hour, 3 minutes, 42 seconds Thank you.