PNB Housing Finance Ltd — Q4 FY26

PNB Housing Finance Ltd Q4 FY2025-26 Earnings Conference Call https://www.youtube.com/watch?v=TvkjuDoHsag Published: 3 weeks ago

0:01 1 second Ladies and gentlemen, good day and welcome to PNB Housing Financial Ninja Q4 and F5 202526 earnings conference 0:10 10 seconds call. As a reminder, all participant lines should be in the listen only mode and there will be an opportunity for you to ask questions after the presentation 0:17 17 seconds concludes. Should you need assistance during the conference call, please signal an operator by pressing star then zero on your touchstone phone. Please 0:25 25 seconds note that this conference is being recorded. I now have the conference over to Mr. Chetami Yadav, National Head, corporate planning and investor relations. Thank you and over to you Mr. 0:38 38 seconds Thank you Renju. Uh good morning and welcome everyone. We are here to discuss PNB housing finance Q4 and FYI 2526 0:45 45 seconds results. You must have seen our business and financial numbers in the presentation and the press release shared with the Indian stock exchanges and are also available on our website. 0:56 56 seconds With me we have our management team led by Mr. Rajesh Kumar Shukla, managing director and CEO of the company. We will 1:04 1 minute, 4 seconds begin this call with the performance update by the management team followed by an interactive Q&A session. Please 1:11 1 minute, 11 seconds note these this call may contain forward-looking statements which exemplify our judgment and future expectations concerning the development 1:19 1 minute, 19 seconds of our business. These forward-looking statements involve risk and uncertainties that may cause actual developments and results to differ 1:28 1 minute, 28 seconds materially from our expectations. PNB Housing Finance undertakes no obligation to uh publicly revise any 1:35 1 minute, 35 seconds forward-looking statements to reflect future events or circumstances. 1:40 1 minute, 40 seconds A detailed disclaimer is on slide 46 of the investor presentation. With this, I will now hand over the call to our MDNCE Mr. AJ Kumar Shukla. Over to you sir. 1:51 1 minute, 51 seconds Good morning everyone. 1:54 1 minute, 54 seconds So it's a pleasure to address you today as we reflect on the significant developments shaping India's housing 2:00 2 minutes finance landscape and share our performance for the quarter and the full year. 2:07 2 minutes, 7 seconds FY26 has been a pivotal year for the housing finance industry. The sector continued to benefit from strong 2:15 2 minutes, 15 seconds structural drivers, rising urbanization, improving affordability and a clear shift toward home ownership across 2:24 2 minutes, 24 seconds income categories. Tier 2 and electricity in particular remained strong demand centers supported by 2:31 2 minutes, 31 seconds improved infrastructure and increasing economic activity. 2:36 2 minutes, 36 seconds Government initiatives and supportive regulatory measures have further strengthened the environment for affordable housing. A softening interest 2:44 2 minutes, 44 seconds rate cycle supported by ste economic activity has helped sustain healthy credit growth across the sector. 2:53 2 minutes, 53 seconds It may also be a worth noting that the ongoing geopolitical conflict may have an impact on growth projections for all 3:01 3 minutes, 1 second sectors including housing finance sector. The crude oil process may keep inflation and interest rates elevated 3:08 3 minutes, 8 seconds and may also marginally impact asset quality. However, if the situation remains uncontained, the overall impact 3:16 3 minutes, 16 seconds is likely to be moderate and transient with underlying housing demand remaining structurally resilient. 3:23 3 minutes, 23 seconds Overall the industry is an on a strong growth trajectory with particularly high potential in the affordable and emerging 3:30 3 minutes, 30 seconds market segments areas where we have built strong capabilities and remain strategically well positioned. Now talking about the 3:39 3 minutes, 39 seconds PNB housing finance despite the pricing pressure in the market the company has shown a strong and balanced growth 3:46 3 minutes, 46 seconds during the year. The retail loan book grew by 16% yi to 86,946 3:55 3 minutes, 55 seconds cr as on 31st March 2026. The total loan loan book of company is stood at 87,347 4:03 4 minutes, 3 seconds cr as on March 26. The affordable and emerging market segment continue to increase their share in retail loan 4:11 4 minutes, 11 seconds estate and is at 40% as on 31st March 26 compared to 37% as on 30 1st March 25. 4:21 4 minutes, 21 seconds the disinvestment during Q4 view by 36% YI and 50% quarter and quarter to 9,355 4:32 4 minutes, 32 seconds cr during the quarter overall segment dispersment grew by 32% y to 9,20 cr 4:41 4 minutes, 41 seconds within this the affordable rebounded and grew by 69% quarteron quarter to 1,249 4:49 4 minutes, 49 seconds cr which is largely flat As Q425, we are back on growth path for 4:55 4 minutes, 55 seconds affordable segment and expect to deliver similar performance going forward. 5:01 5 minutes, 1 second The emerging market segment continue to outperform delivering a strong 34% YUI growth in this bustment. The prime 5:11 5 minutes, 11 seconds segment delivered 43% YUI growth despite the broader pressure on Eid voluntary rate cuts. 5:18 5 minutes, 18 seconds Overall disustment growth for full year came in at 19%. 5:23 5 minutes, 23 seconds Happy to share that we have facilitated 5,000 subsidiary subsidies under PMA 5:31 5 minutes, 31 seconds while marking a significant milestone in our journey towards enabling affordable housing and supporting the government of 5:38 5 minutes, 38 seconds India housing for our mission supported by national housing bank. The company restarted corporate segment with disbburment of 335 cr in Q426. 5:50 5 minutes, 50 seconds The corporate loan book stood at 41 cr as on March 26. 5:56 5 minutes, 56 seconds Presently our digital channels generate nearly 15% of our overall leads. With focus digital transformation, we further 6:05 6 minutes, 5 seconds enhance our onboarding process with the launch of infinity application which is in-house developed by our team. 6:13 6 minutes, 13 seconds This fully digitized paperless workflow is now fully adopted by our in-house sales team and is helping us materially 6:20 6 minutes, 20 seconds reduce turnaround times and operating costs while significantly improving customer experience. We are also in the 6:28 6 minutes, 28 seconds process of onboarding all our direct selling agent to the platform. In addition, we deployed an AI enabled 6:35 6 minutes, 35 seconds calling solution for sanctioned but not disbburused cases engaging 70% of our 6:42 6 minutes, 42 seconds identified pool and securing disbburusment confirmation from 50% through intelligent outreach and targeted WhatsApp follow-ups. 6:53 6 minutes, 53 seconds We continue to embedded AI ready initiatives across the end to end loan processing life cycle. During the quarter, multiple use cases were on 7:01 7 minutes, 1 second pilot run including AIdriven calling for REKYC pre- delinquency management uh topup offering and fresh sales lead 7:09 7 minutes, 9 seconds conversion. As far as geographical uh presence is concerned as planned we opened 35 branches taking the total 7:18 7 minutes, 18 seconds network to 393 branches including 22 229 in affordable segment 87 in emerging market segment. Our extensive pan India 7:26 7 minutes, 26 seconds footprint enable us to effectively capitalize on the growing opportunities in the affordable and emerging market segment particularly across high 7:35 7 minutes, 35 seconds potential tier 2 and tier three locations. In future also we'll keep on focusing on increasing distribution but 7:43 7 minutes, 43 seconds uh priority is to bring existing distribution of branches uh more productive asset quality. I'm pleased to 7:51 7 minutes, 51 seconds share that we achieved a significant milestone during the year. Our G&P continues to improve and is now below 1% 8:00 8 minutes March standing at 0.93% as of March 26. This improvement is a direct result of our strengthen the 8:08 8 minutes, 8 seconds collection infrastructure and continue to emphasize on portfolio quality across both retail and corporate 8:16 8 minutes, 16 seconds segment. Recoveries remain strong driven by focus collection and resolution efforts. In Q426 8:24 8 minutes, 24 seconds we recover 24 cr from retail return of pool and 143 cr from the corporate return of pool. For the full year 26, 8:33 8 minutes, 33 seconds total recoveries from return of pool accounts stood at 332 cr resulting in a negative rate cost of 45 bits. 8:41 8 minutes, 41 seconds Operationally, momentum strengthened further with the sale of 689 retail properties during the year compared to 8:49 8 minutes, 49 seconds 537 and 25 underscoring import execution across recoveries. The company has a remaining return off pool of around 500 8:57 8 minutes, 57 seconds cr in corporate and around 325 cr in retail. 9:02 9 minutes, 2 seconds As far as margin is concerned, it spread reduced by 10 pips quarter on quarter from 2.2 to 22 2.12 due to lower 9:10 9 minutes, 10 seconds incremental yield and BD pressure in prime business. In our view, the yield have bottomed out and should start improving from Q127. 9:19 9 minutes, 19 seconds Net interest margin improved by six bills quarteron quarter in Q426 to 3.69%. 9:26 9 minutes, 26 seconds As far as profitability in financial year 26, profit after tax increased by 9:32 9 minutes, 32 seconds 18% YI to 2291 cr leading to a ROI of 2.66% and ROE of 12.73%. 9:42 9 minutes, 42 seconds The capital education ratio is 27.26% and tier 1 is 26.89% as on March 26. 9:50 9 minutes, 50 seconds Glad to share the board of directors recommend recommended a dividend of 8 rupees per equity share having face 9:57 9 minutes, 57 seconds value of rupees 10 for 26 subject to the shareholder approval during next AGM. 10:04 10 minutes, 4 seconds I would like to present the guidance for 26 to 27 given the industry outlook and our business performance so far. The 10:11 10 minutes, 11 seconds guidance would be we are looking for loan book to cross more than a lakh cr uh in 27 retail loan book projected to 10:21 10 minutes, 21 seconds grow between 18 to 20%. NIM would be in the range of 3.55 to 3.65%. 10:27 10 minutes, 27 seconds Credit cost continue to deny due to recoveries from Apur and RO would be in the range of 2.4 to 2.5%. With this I 10:35 10 minutes, 35 seconds would like to hand over the call back to Chhattan. Thank you so much. Thank you sir. I will now request Mr. 10:42 10 minutes, 42 seconds Vinagupta, our CFO to talk about the financials. 10:46 10 minutes, 46 seconds Good morning everyone and very warm welcome to our earnings call. I am pleased to share our strong Q4 and FY 10:53 10 minutes, 53 seconds 2526 financial performance reflecting continued focus on execution and the underlying resilience of our operating fundamentals. 11:01 11 minutes, 1 second Let me begin with business growth. As highlighted by MDR during his opening remarks, Q4 FY26 has been one of the 11:08 11 minutes, 8 seconds best quarters in terms of dispersements as we achieve 36% growth year on year in the current quarter. Similarly, our loan 11:17 11 minutes, 17 seconds book also grew 15% yearonear including retail disbursements growth of 16% yearon year. 11:24 11 minutes, 24 seconds Moving to key financial parameters. So you would have seen net interest income has 11:30 11 minutes, 30 seconds grown 11% during Q4 FI26 and 13% for the full year FY26. 11:38 11 minutes, 38 seconds Yields moderated this quarter by 25 bits to 9.47% in Qo. This is largely due to lower 11:46 11 minutes, 46 seconds incremental yield versus book lead and higher runoff. It seems that yield has now bottomed out and now it should start 11:53 11 minutes, 53 seconds improving from Q1 with higher mix of emerging and affordable business. 11:59 11 minutes, 59 seconds On the liability side, cost of borrowing improved by 15 bits sequentially to 7.35% supported by gradual repricing with 12:08 12 minutes, 8 seconds banks and transmission of policy rate cuts for the full year. Cost of borrowing improved by 29 whips to 7.57% in FY26 compared to 7.86 86 in FY25. 12:20 12 minutes, 20 seconds However, the incremental cost of borrowing edged up slightly to 7.23 in Q4 from 7.2 during previous quarter in 12:30 12 minutes, 30 seconds line with the current prevailing liquidity and market conditions. As a result, spread moderated by 10 bits to 12:36 12 minutes, 36 seconds 2.12% in Q4 compared to 2.22 in Q3 while remaining broadly stable at 2.2% for fullear FY 26. 12:47 12 minutes, 47 seconds Net interest margin improved by six pips in Q4 FIR 26 to 3.69% compared to 3.63% during previous 12:55 12 minutes, 55 seconds quarter. This one-off inverse relationship between spread and NIM is due to difference in methodology. The 13:02 13 minutes, 2 seconds spread is measured on a daily interest convention whereas NIM benefits from monthly aaging which should uh uh smoothen out from the next quarter onwards. 13:14 13 minutes, 14 seconds Operating expenses grew by 13% yearon year to 920 crores compared to 813 crores in FY25. This was largely driven 13:23 13 minutes, 23 seconds by branch additions that we did in the later part of FY25 and one-time impact of implementation of new labor code. 13:31 13 minutes, 31 seconds Uh we added 35 branches in Q4 the full cost of which will be visible from next financial year onwards. However, we 13:39 13 minutes, 39 seconds expect operating leverage and scale benefits uh to kick in from existing business to partially offset these 13:45 13 minutes, 45 seconds costs. A ROPEX 28A is uh for Q4 is at 1.08 and full year is at 1.05. We expect 13:53 13 minutes, 53 seconds it to remain rangebound between 1 to 1.1%. 13:58 13 minutes, 58 seconds pleased to report a successful recovery of around 157 crores in Q4 and around 330 crores during full year FY26 which 14:07 14 minutes, 7 seconds translated into a negative credit cost of 78 bips in Q4 and 45 bips for the full year FY26. 14:16 14 minutes, 16 seconds RG&P improved further crossing the milestone of sub 1% level and now stands at 93. 14:24 14 minutes, 24 seconds Further there is marked improvement across all segments in 30 plus and 90 plus metrics. Affordable business is 14:31 14 minutes, 31 seconds also now showing signs of stabilization across all the liquidy metrics. 14:37 14 minutes, 37 seconds Profitability remains strong. The reported fat for Q4 is 656 cr 14:45 14 minutes, 45 seconds 19% year-on-year growth and 26% sequential growth. For full year, our net profit grew 18% to 20 uh 2,291 cr. 14:56 14 minutes, 56 seconds ROA improved to 2.66% for FY26 compared to 2.55% in FY25. 15:04 15 minutes, 4 seconds ROE stands at 12.73 in FY26. Our total CR stands at 27.26 with tier 1 at 26.9%. 15:15 15 minutes, 15 seconds As of March, our net worth stood at 19,219 crores and our book value increased to 15:22 15 minutes, 22 seconds 738 rupees per share. Thank you for your continued support and then I now hand over the call back to ch. 15:31 15 minutes, 31 seconds Thank you V. Uh range we can now open the call for a Q&A please. 15:37 15 minutes, 37 seconds Thank you. We will now begin the question and answer session. Anyone who wishes to ask a question may press star and one on a touchstone telephone. If 15:45 15 minutes, 45 seconds you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use handsets while asking a question. Ladies 15:52 15 minutes, 52 seconds and gentlemen, we will wait for a moment while the question queue assembles. 15:59 15 minutes, 59 seconds The first question comes from the line of sukrit. Partil with eyesight trade private limited. Please go ahead. 16:06 16 minutes, 6 seconds Good morning to the team. I have two questions. My first question to Mr. 16:10 16 minutes, 10 seconds Shukla is what are your key priorities for PNB housing uh in the year ahead or 16:17 16 minutes, 17 seconds in the quarters ahead to be very specific. Uh specifically, how do you plan to expand lending reach, improve 16:25 16 minutes, 25 seconds customer service and use digital platforms to make housing finance more accessible and uh trans uh transparent 16:33 16 minutes, 33 seconds to all. That's my first question. I'll ask my second question after this. Thank you. 16:39 16 minutes, 39 seconds Yes, thank you so much. Uh you know I think partly answer was in your question itself that you know how can we improve 16:47 16 minutes, 47 seconds our footprint and you know uh increase the uh business. So uh first of all this uh use of digital and automation I think 16:56 16 minutes, 56 seconds is the key uh would be the key success mantra. uh as I uh explained in my you 17:03 17 minutes, 3 seconds know uh talk that uh we have started using uh infinity app which is a onboarding app which is end to end my digital app which will save a lot of 17:12 17 minutes, 12 seconds time of field on force uh force on field and at the same time my uh the loss which is alone you know operating system 17:21 17 minutes, 21 seconds oration system will also help fast processing so uh we are now in uh you know introduce end to end uh from 17:30 17 minutes, 30 seconds sourcing to uh processing to dispersement and to digital then there will be no paperwork which will be involved which will save a lot of time 17:39 17 minutes, 39 seconds of u my field force uh so that they are more on the field and generate more number of links in fact they need not to 17:48 17 minutes, 48 seconds visit the office for deposit of files for processing from so it means whenever they are meeting with the customer they 17:55 17 minutes, 55 seconds can go and meet to the other customer by completing the work at one place uh where they are sitting with the customer 18:02 18 minutes, 2 seconds and then they can move to the other customer. So that will give the efficiency not only in terms of s 18:09 18 minutes, 9 seconds sourcing but processing also. Uh the key priorities would be definitely you know as we said that we are looking for the 18:16 18 minutes, 16 seconds growth of 18 to 20% uh uh growth in uh the the the mantra 18:24 18 minutes, 24 seconds would be growth with quality. So quality should impact uh we have reduced our G&PA from 1% to 0.93%. 18:32 18 minutes, 32 seconds We'll we'll put a more focus on to improve it further. And also uh the key priority the third key priority would be 18:40 18 minutes, 40 seconds to make our existing branches and distribution more productive because we have almost 393 branches of now and we 18:48 18 minutes, 48 seconds we we can easily you know uh scale up our business by using this current infrastructure. 18:57 18 minutes, 57 seconds Thank you. My second question to Mr. Gupta is again a forward-looking one. 19:02 19 minutes, 2 seconds How are you approaching risks such as uh rising funding cost uh regulatory uh uh 19:10 19 minutes, 10 seconds uh regulatory compliances that keeps on uh changing over the time and uh credit defaults while ensuring profitability 19:18 19 minutes, 18 seconds remains steady and growth uh remains constant for the company. Thank you. Thank you. 19:25 19 minutes, 25 seconds So see uh thank you for the question. Uh see in Q4 you would have seen you know that we were able to still reduce our uh 19:32 19 minutes, 32 seconds borrowing cost by around 15 bits and it now stands at around 7.35. 19:38 19 minutes, 38 seconds We still have some scope as our incremental cost is still lower than the overall portfolio cost. So there is still some scope. We are also working 19:47 19 minutes, 47 seconds with credit rating agencies uh you know to see based on the performances you know there is an opportunity for uh 19:55 19 minutes, 55 seconds improvement in the credit rating as well that will further help on the uh cost of borrowing. uh at the same time we are 20:02 20 minutes, 2 seconds keeping adequate liquidity buffers and you know keeping the adequate LCR to ensure uh that the company has adequate 20:10 20 minutes, 10 seconds uh you know liquidity cover in the times of need and at the same time we are also working with enhancing our distribution 20:18 20 minutes, 18 seconds and our uh resource profile by adding more banks and you know going more towards that market and you know diversifying our funding. 20:29 20 minutes, 29 seconds Thank you and bet. Thank you. 20:38 20 minutes, 38 seconds Thank you. Next question comes from the line of Viral Sha with Capital. Please go ahead. 20:46 20 minutes, 46 seconds Yeah. Hi. Uh congratulations on a good set of numbers and thank you for this opportunity. AJ, I had uh two questions. 20:53 20 minutes, 53 seconds Uh one is uh can you uh give say more details of your growth guidance uh at a segment level uh specifically how you 21:01 21 minutes, 1 second are thinking about say the affordable and the uh emerging segment uh and also the disbburment uh growth kind of 21:09 21 minutes, 9 seconds outlook uh over there and the second question is uh if you can give some more color on the corporate disbburments that 21:16 21 minutes, 16 seconds we did of 335 crores this quarter like what is uh is this just one single account or multiple ones yields which 21:24 21 minutes, 24 seconds kind of geography is the builder in or the project is in. Thank you. 21:29 21 minutes, 29 seconds Yeah. So uh thank you V. Uh uh thank you so much. Uh growth if I talk about 21:36 21 minutes, 36 seconds segment wise we will grow uh almost you know uh 50% uh in affordable segment that's what we 21:45 21 minutes, 45 seconds are targeting. uh so like we did almost 3,800 cr approximately displacement in last year 26 we are expecting to grow by 21:54 21 minutes, 54 seconds 50%. Our overall composition of affordable plus uh emerging currently we are at 40% we grew from 37 to 40% down 22:04 22 minutes, 4 seconds the line two years we are expecting that we should be having composition of 50%. 22:09 22 minutes, 9 seconds So growth in uh emerging plus affordable affordable would be high more particularly more so the affordable growth will be much higher than 22:17 22 minutes, 17 seconds emerging. If I talk about sequencially the growth in prime uh would be lesser the growth in further the emerging would 22:25 22 minutes, 25 seconds be high and affordable would be the highest growth uh and that is that not only but also uh you know uh in terms of 22:34 22 minutes, 34 seconds disbbursement. If I talk about corporate uh dispersal last uh year, we dispersed one one ticket one one case of almost 22:43 22 minutes, 43 seconds 300 63 70 cr uh which is primarily of Mumbai. So our focus would be more on uh 22:52 22 minutes, 52 seconds you know reputed good builders of the cities. We will be targeting almost seven to eight top category cities where 23:01 23 minutes, 1 second the market is good, celebrity is high and the quality of uh developer is is also uh you know good. So if I talk 23:10 23 minutes, 10 seconds about geographical presence, we will be having presence in Pune, Bombay, Bangalore, Chennai, Hyderabad, Delhi. Uh these are the typical cities where we 23:19 23 minutes, 19 seconds will be focusing as far as our corporate business concerned. But still our focus on retail segment may be much high even 23:27 23 minutes, 27 seconds if we uh we have entered into corporate finance business our corporate finance business will not be this year 27 will 23:33 23 minutes, 33 seconds not be more than 3% of my overall book right and uh can you just also mention 23:43 23 minutes, 43 seconds uh the yield at which this uh loan was given the corporate one see the corporate business the the idea 23:51 23 minutes, 51 seconds of Our is to maintain the overall lead of almost uh 1175 to 12%, because we 23:57 23 minutes, 57 seconds don't want to you know go beyond that uh you know uh price band uh because then if we go beyond price band then that 24:06 24 minutes, 6 seconds means we have to focus on more tier tier C and tier B kind of builders which we don't want. So it would be in the range of 11.5 to 12% range only. 24:17 24 minutes, 17 seconds Got it. And uh if I may uh can I ask one more question? Yeah, please. 24:23 24 minutes, 23 seconds uh when I uh so basically on the margin front uh just wanted to check uh uh how are you thinking first of all a given 24:31 24 minutes, 31 seconds how the market rates are uh the uh bond markets uh first of all on cost of funds and secondly given how now the bookmix 24:40 24 minutes, 40 seconds uh probably will be changing uh especially with the uh re-entry into the corporate finance uh segment uh is there 24:48 24 minutes, 48 seconds a scope for say uh some higher margins versus what uh was guided 24:55 24 minutes, 55 seconds Yeah. Uh we will so as we mentioned uh on the yield front we expect you know 25:02 25 minutes, 2 seconds that uh the yield has now bottomed out and it should start improving from here because now our incremental yield and 25:09 25 minutes, 9 seconds book yield has coincided with the higher mix coming in from affordable emerging and corporate now. So I should see our 25:18 25 minutes, 18 seconds ED improving going forward. On the cost of borrowing uh front, there are certain headwinds right now considering the 25:26 25 minutes, 26 seconds current liquidity conditions and most of the benefits uh that uh we were supposed to get we have realized uh from the rate 25:34 25 minutes, 34 seconds cut cycle. So going forward you know that is where uh you know it is going to remain stable or maybe you know 5 to 10 25:43 25 minutes, 43 seconds dips improvement. So hence overall there are upsides which are expected. Uh so 25:50 25 minutes, 50 seconds you know it all depends on the current economic geopolitical situations. If that stabilizes there is definitely a 25:56 25 minutes, 56 seconds scope to do better but otherwise it should remain rainfor. 26:02 26 minutes, 2 seconds Got it. Thank you so much and congratulations. All the best. Thank you. Thank you. 26:09 26 minutes, 9 seconds Thank you. Next question comes from the line of Kunal Sha with City Group. Please go ahead. 26:21 26 minutes, 21 seconds Mr. Sha, please go ahead. 26:26 26 minutes, 26 seconds Mr. Sha, please unmute yourself and go ahead with the question. 26:30 26 minutes, 30 seconds Uh, sorry. Yeah, thanks for taking the question. Uh, so firstly on the 26:39 26 minutes, 39 seconds we have lost the line of the participant. We'll promote the next that is gor to nanal please go ahead. 26:46 26 minutes, 46 seconds Hello. Yeah. 26:49 26 minutes, 49 seconds Yeah. Hi sir. This is here from IPCI. Uh just two things. So one on this uh disjustment pick up you know in Q4. Uh 26:59 26 minutes, 59 seconds so you did highlighted about you know the whole transformation helping us getting better volumes. uh but when we 27:06 27 minutes, 6 seconds are guiding for 18 to 20% growth in retail assets I'm sure uh the improvement which we saw in Q4 uh you 27:14 27 minutes, 14 seconds know sort of has to sustain in 27 so can you just briefly tell us let us say two 27:21 27 minutes, 21 seconds three major changes you might have done at ground level uh which is helping us getting this volumes and which is you know sustainable going forward. 27:32 27 minutes, 32 seconds Yeah. So uh again that correct? Goro Kashmi sir Reish from Reish. 27:41 27 minutes, 41 seconds Yeah. Yeah. Yeah. 27:42 27 minutes, 42 seconds Hi Reish. Thank you so much. So Ran you know I think uh largely I would say the idea was to engage more on the field uh 27:51 27 minutes, 51 seconds you know uh uh so we did some events which were related to our distribution and partners uh in some uh top uh four 28:00 28 minutes five cities of the country wherein we invited even surrounding cities uh distribution also. So the idea was to 28:07 28 minutes, 7 seconds engage more with the uh partners who are doing housing finance business in the market. They might be doing lesser volume of business with us but with the 28:15 28 minutes, 15 seconds engagement I think the commitment was high or they might not be doing also. So overall what happened it helped us to 28:22 28 minutes, 22 seconds you know grow this volume by way of engaging the partners. Uh entire team was also fully engaged with visiting the 28:30 28 minutes, 30 seconds branches understand the challenges of the market and getting them solved at very high pace. So uh that was one thing 28:38 28 minutes, 38 seconds uh uh you know I think that has helped really us very well and we'll keep on focusing on that distribution engagement 28:45 28 minutes, 45 seconds uh from uh April itself I would say going forward for the full year uh so engagement will always be and this is 28:53 28 minutes, 53 seconds this is the success mantra of the retail business you keep on engaging with the people and you will keep on getting business from the market I think that's the only new thing which has happened 29:01 29 minutes, 1 second otherwise uh you know uh the focus want to shut out the challenge The team was facing at the ground uh with a speed with a speed I would say. 29:13 29 minutes, 13 seconds Got it. Got it. So basically what you're trying to say sir is that there is no big bank changes we have done but it is just that more engagement with the 29:22 29 minutes, 22 seconds ground is sort of motivating them and helping us to get better volumes that the market yeah because market is there you 29:29 29 minutes, 29 seconds see because we we we we are I think uh third largest player in this industry. 29:35 29 minutes, 35 seconds uh market is very large, fun industry is very large. It's growing by pace of 12 to 13%. And you know there's a 29:42 29 minutes, 42 seconds opportunity if you keep on engaging with the market and the people I think business will definitely flow into your city. 29:49 29 minutes, 49 seconds Got it. Got it. And sir just last clarification on the uh green side. Uh so you did mention about retail asset 29:56 29 minutes, 56 seconds growth uh you know being at 18 20%. But since we have also entered uh you know corporate business uh in Q4 and obviously we'll do uh some more in Q27. 30:08 30 minutes, 8 seconds Uh so does that mean the overall book growth could be touching 20%. 30:14 30 minutes, 14 seconds Yeah. So it will be in the range of 18 to 20%. I think overall growth should come while corporate finance you know composition will be 3% of my book but 30:22 30 minutes, 22 seconds the focus will be remain on emerging and affordable. 30:27 30 minutes, 27 seconds Got it. But it will still help us uh uh do better numbers on the blended basis. 30:34 30 minutes, 34 seconds Definitely. Definitely because my emerging plus you know affordable would be higher than my prime business. 30:42 30 minutes, 42 seconds So that is how I'm improving my margin. Yeah. 30:46 30 minutes, 46 seconds Okay. Got it sir. Thank you so much and best of luck sir. Thank you. 30:54 30 minutes, 54 seconds Thank you. Next question comes from the line of Kunal Sha with City Group. Please go ahead. Yeah. Uh thanks for taking the question. 31:01 31 minutes, 1 second So am I audible now? Yeah. 31:05 31 minutes, 5 seconds Yeah. Uh so uh firstly with respect to uh the yields on the affordable housing side uh that seems to be down almost 75 31:14 31 minutes, 14 seconds basis points quarteron quarter when the dispersements have actually picked up. 31:18 31 minutes, 18 seconds Uh so was this uh maybe what uh uh V was also indicating in terms of uh catching up with the lower incremental yields or 31:26 31 minutes, 26 seconds there would be more repricing and maybe we will continue to operate at this uh level of ills in the affordable housing that has come down to as low as 11.35. 31:36 31 minutes, 36 seconds Uh so just wanted to check is that the level which we will operate in affordable housing. 31:42 31 minutes, 42 seconds So uh I think it it's a combination of both I would say but largely what happened by the uh see in fact while 31:51 31 minutes, 51 seconds while the overall yield is looking low but if you see the name we are able to maintain our name uh because we also got 31:58 31 minutes, 58 seconds the benefit of cost okay so uh when the report had gone down by almost 1.25% 25% 32:05 32 minutes, 5 seconds last year. Uh you know the yield gone down in in this business and so is true with the market. Okay. But we were able to 32:14 32 minutes, 14 seconds compensate by way of cost of fund which has also given us benefit. Uh and uh you 32:20 32 minutes, 20 seconds know there was you know uh uh intense I would say competition in terms of pricing especially in the last quarter 32:28 32 minutes, 28 seconds in the market and that is how you deal deal with that you know. uh but I think you know uh since we are able to 32:36 32 minutes, 36 seconds maintain our limbs uh it will not uh it is not impacting much to us 32:46 32 minutes, 46 seconds uh this is this is on affordable I'm talking about this sure sure yeah so the question was also on affordable broad yeah when we look at 32:55 32 minutes, 55 seconds terms of u uh the recoveries which we anticipate getting into FI27 if you can quantify that you indicated 33:03 33 minutes, 3 seconds that that will help the overall credit cost. But uh how much is the recovery we are expecting? 33:11 33 minutes, 11 seconds Uh you know 27 I think when I would even if you can give the number. Yeah, for uh 33:17 33 minutes, 17 seconds uh 27 kunal we are expecting around uh 200 to 250 cr total 33:28 33 minutes, 28 seconds this year and uh any any reason for increase in 30 plus in prime it has gone up almost 30 33:38 33 minutes, 38 seconds basis points to 3.31 33:48 33 minutes, 48 seconds no specific uh reason if you see year on year it is stable it was 3.4 last year 33:54 33 minutes, 54 seconds and it is still 3.3 the Q3 numbers were aation actually no even 30 plus I think has gone down 34:01 34 minutes, 1 second from 3.4 4 to 2.72 uh 30 plus that is overall overall yeah for prime it has gone 34:11 34 minutes, 11 seconds even prime is also so it is uh in line it's rangebound 34:21 34 minutes, 21 seconds kunal there is no specific movement Q3 was an aberration Sure. 34:31 34 minutes, 31 seconds Q3. Yeah. 34:35 34 minutes, 35 seconds Overall is I think for for the equal year basis it is it has improved. Yeah. 34:45 34 minutes, 45 seconds Thank you. 34:50 34 minutes, 50 seconds Thank you. Next question comes from the line of Bit Raj Patil with in Mist. Please go ahead. 34:58 34 minutes, 58 seconds Yes. So I have a couple of questions. So the first question is on the NIM. Uh in the opening questions they uh like the we mentioned 35:07 35 minutes, 7 seconds that the NIM would converge with the spread. So the ROA that looks higher this quarter it's largely because of 35:14 35 minutes, 14 seconds accountings and that will uh sort of move lower next quarter or like how do we look at the NIS going forward and the 35:21 35 minutes, 21 seconds second question is on the SR sale that's mentioned in one of the footnotes in our financial statement so what is the fair 35:28 35 minutes, 28 seconds value gain that we have booked on sale of these SR uh see actually on the SR bit this is 35:37 35 minutes, 37 seconds one account which we have fully realized Right. So this is like it's not a fair value gain. It is a cash receipt that 35:44 35 minutes, 44 seconds has happened and hence SR is closed fully. So that is the recovery which has come that is on the corporate side and 35:53 35 minutes, 53 seconds uh on the NIM as I mentioned it is more of aation or the accounting uh which has 36:00 36 minutes led to this change. it will normalize next quarter but at the same time next quarter as I mentioned we should see you 36:07 36 minutes, 7 seconds know some uh benefit on the overall heat trajectory and hence we should be able to maintain uh the current limit 36:16 36 minutes, 16 seconds trajectory that we have with a gap of between 5 to 10 basis. 36:23 36 minutes, 23 seconds Oh, thank you Mr. Pel. Are you done with the question? 36:34 36 minutes, 34 seconds Yes. Yes. Thank you. Thank you. 36:38 36 minutes, 38 seconds Next question comes from the line of AA Singh with MK Global Financial Services Limited. Please go ahead. 36:45 36 minutes, 45 seconds Hi. Uh good morning. Uh thanks for the opportunity. A couple of question. The first one uh when you are guiding kind 36:52 36 minutes, 52 seconds of a you know or 2.4 to 2.5% ROA for next year what kind of a credit cost is 37:00 37 minutes being built in to this assumption. The my question is basically that okay if I were to look at say last year's R 2.66 37:08 37 minutes, 8 seconds of course that has a kind of a 35 basis point negative uh credit cost. So if uh 37:14 37 minutes, 14 seconds uh if we were to build a normalized case uh possibly uh you know the ROAS are 37:21 37 minutes, 21 seconds more into a 2 full year I mean for the last quarter it will come closer to maybe 2.1 odd percent. And if we were kind of a 37:30 37 minutes, 30 seconds looking in a normalized uh case uh you know 30 40 basis point uh improvement in ROA that heavy lifting has to be done by 37:38 37 minutes, 38 seconds eels and maybe some bit on the cost of funds if you were to see a rating upgrade. So in this context just wanted 37:45 37 minutes, 45 seconds because opex is where optimal uh level already. So just if you can help us with what kind of a credit cost assumption 37:53 37 minutes, 53 seconds here is the 2.4 four to 2.5% kind of hardway and I mean going forward beyond if 27 when the recovery kind of nearly 38:01 38 minutes, 1 second goes away and you swing to more like a 20 30 basis point whatever the ideal trade cost you would build I mean how 38:08 38 minutes, 8 seconds are you going to sort of deliver 2.4 42 2.5% that's one second one on the product front are there some products I 38:15 38 minutes, 15 seconds mean now you are there into you know the uh affordable uh emerging uh as well as you know the developer side of you know 38:24 38 minutes, 24 seconds uh this uh loans uh are there some product offering yet to be launched or you see I mean particularly in the 38:31 38 minutes, 31 seconds non-housing side will you be looking for kind of to go into say a a microlap in a category say a 8 10 the legs or or something in near future. 38:42 38 minutes, 42 seconds Thanks. 38:44 38 minutes, 44 seconds Uh so so uh I will answer the second question first then will take over. Uh as far as this product development is concerned uh we are already in the segment of uh emerging and affordable. 38:54 38 minutes, 54 seconds Yes, you are right. We are looking uh the segment of which is between 14 to 16% segment which we are going to start operation 39:02 39 minutes, 2 seconds uh in in the branches where my affordable business is already present. 39:07 39 minutes, 7 seconds So uh it would be not only micro lab it would be micro housing also. Uh so the range would be around 14 to 16 + 10 39:14 39 minutes, 14 seconds range. Uh that introduction uh will happen uh in in Q1 itself. Uh on the financial aspect may 39:22 39 minutes, 22 seconds yeah on the uh overall ROA tree as you mentioned so the guidance is around 2.4 39:29 39 minutes, 29 seconds 4 to 2.5 and uh even for next year we expect you know the benefits on the recoveries from the return of pool to 39:37 39 minutes, 37 seconds continue. So we still expect the trade cost to remain negative next year in the range of around 15 to 20 bits. So this 39:45 39 minutes, 45 seconds is what is factored in and uh overall improvement uh and you know ensuring that it remains sustainable. So as you 39:54 39 minutes, 54 seconds also rightly mentioned in your uh query itself that it has to be picked up through the higher mix of emerging 40:02 40 minutes, 2 seconds affordable and corporate. So this is where you know we are working on currently we are at 40 we expect in the next two to three years this mix to move 40:09 40 minutes, 9 seconds towards 50 plus and with higher mix of corporate as well. So the benefit is going to come on the name over a period 40:17 40 minutes, 17 seconds of next two to three years to cover up the gap which we have on the credit cost and it should ensure you know that we uh maintain the similar trajectory on a longer run. 40:29 40 minutes, 29 seconds Okay. Thanks. Thanks. 40:35 40 minutes, 35 seconds Thank you. Next question comes from the line of Goro Kandelwal with JP Morgan. Please go ahead. 40:42 40 minutes, 42 seconds Yeah. Hi, good morning. Thanks for taking my questions. I've got a couple I'll ask those one by one. First, if I can just understand uh that our focus is 40:51 40 minutes, 51 seconds to grow affordable but if I look at the dispersements on affordable side it was quite weak uh in FI26 uh 4Q in fact affordable disbbursements came down 93%. 41:03 41 minutes, 3 seconds Visa v prime uh which is not our key focus area but we still see high disbursements. Is this something to do 41:11 41 minutes, 11 seconds with the uh ongoing rates in the market or is this more to do with asset quality? 41:19 41 minutes, 19 seconds So uh uh Goro uh uh affordable has started shaping up now. 41:27 41 minutes, 27 seconds We in last quarter we discussed almost similar what we discussed last year. uh as far as prime business basically prime 41:35 41 minutes, 35 seconds business is nothing but the replacement of what book you uh lost during the year if you so see my uh growth on prime 41:43 41 minutes, 43 seconds business is only 9%. While affordable growth is very high also the focus will continue on because you have to grow 41:51 41 minutes, 51 seconds overall book also. So whatever book you lose in the prime segment during the year you don't plan that that is why the growth looks high in the affordable in 42:00 42 minutes terms of business but actually the growth is not very high. Uh so focus will remain on affordable business. It 42:08 42 minutes, 8 seconds is not related or any you know significant relevance with the uh quality because quality you see uh in 42:17 42 minutes, 17 seconds affordable is good. we we we are now below uh you know 6% in our GMPA uh our balancing is under control our 30 plus 42:26 42 minutes, 26 seconds is under control now in all the parameters of quality infot 42:35 42 minutes, 35 seconds in in that case sir is it fair to say that because the incremental yields have been uh so low and minus 75 bits QQQ 42:42 42 minutes, 42 seconds that was one of the key reasons of uh uh dispersing affordable at a slower pace. 42:51 42 minutes, 51 seconds No, I think you know uh uh this bustle was not in slow pace. I would say that uh there were some challenges which we 43:00 43 minutes faced during mid of the year which we corrected and that is why uh you know deliberately we wanted to uh check those market first and then we wanted to grow. 43:09 43 minutes, 9 seconds Now we have checked those market and we found that you know those were uh those issues were temporary issue temporary issue which you overcome. Now the yield 43:18 43 minutes, 18 seconds dip is not because of you know as I said in my earlier conversation also yield dip was because of drop in the repo 43:26 43 minutes, 26 seconds rate. Okay and that is how now going forward when we are entering into segment of micro housing and microlab we 43:33 43 minutes, 33 seconds will overcome with that and we will will try to improve overall yield of affordable business. 43:41 43 minutes, 41 seconds Got it. Okay. Okay. Thanks for that. Uh my other question is uh can you share some 43:49 43 minutes, 49 seconds s can I just take one quick one is your voice can come again. 43:56 43 minutes, 56 seconds Yeah u my other question is can you share some early indicators of how the bounce rates are shaping up in the first half of April. 44:07 44 minutes, 7 seconds First half of April. April. I think the bounce in in April is more or less similar to what it was in uh you know uh 44:16 44 minutes, 16 seconds March. Uh so there is no significant uh jump in the bounce. Uh this year uh 44:23 44 minutes, 23 seconds there was one set of customer which we identified uh by way of doing some data science analysis that uh some customer 44:31 44 minutes, 31 seconds of government's employee segment got their bounds because maybe and that got even paid the very next day. uh when we 44:38 44 minutes, 38 seconds deep dive into that we we found that because March is generally a month of uh you know taxation because people have to 44:46 44 minutes, 46 seconds clear that their taxes uh within March itself. So might be their planning was not as per the uh you know their 44:53 44 minutes, 53 seconds requirement and that is why there could be some shortfall in their banking. Uh and but very next day next to next day 45:00 45 minutes they most of them paid. So that was the only one indicator which came and since they paid very next day so uh I think 45:08 45 minutes, 8 seconds other than that there's nothing which we found significant uh you know change in the bouncing. 45:15 45 minutes, 15 seconds Got it. So effectively no early signs of asset quality stress due to the ongoing geopolitical issues. 45:22 45 minutes, 22 seconds I don't I don't think so as of now. 45:26 45 minutes, 26 seconds Got it. All right. Those are all my questions. Thank you very much. Yeah. 45:33 45 minutes, 33 seconds Thank you. A reminder to all the participants, please restrict yourself to two questions. Next question comes on the line of Mr. Jawat with Kotak. Please go ahead. 45:43 45 minutes, 43 seconds Uh yeah, thanks for taking my uh taking my questions. Uh you know, one was uh on the yield side, you know, when you mentioned that we expect that yields 45:50 45 minutes, 50 seconds have bottomed out and will go up from here on. Uh what gives you that confidence, you know, given the fact that your incremental yields are going down? 46:00 46 minutes you know I I understand the book composition but apart from that so I think you know uh Michelle uh why 46:08 46 minutes, 8 seconds I'm I'm saying that it is uh seems to be bottom down because one is that there's no change in reporate in last uh few months one is that uh because whenever 46:17 46 minutes, 17 seconds there's change in reporate you know uh the tendency of people is to do the BT out from your portfolio 46:24 46 minutes, 24 seconds uh rather I would say that they I think there is some upside in the market in the rate of addressed. So the charges 46:30 46 minutes, 30 seconds are going dro it doesn't seems to be you know there and that is why the the BT uh 46:38 46 minutes, 38 seconds out will be restricted when BT out will be restricted uh you know uh your your overall will maintain uh that's how I 46:47 46 minutes, 47 seconds think uh sure any any color you could give as to how the BT out ratios have trended over the last four quarters 46:54 46 minutes, 54 seconds uh I think overall if I talk about BT out of my entire portfolio is almost uh I would say for the full year I'm 47:00 47 minutes talking about is 8% and the quarter 4 was 8.6 so on it is 8.1 on quarter 4 it 47:08 47 minutes, 8 seconds is 8.6 six. So it's a hardly a half% difference between quarter 4 and overall 47:16 47 minutes, 16 seconds and and just to add Mr. Q4 has actually improved from Q3. Q3 was 8.95. 47:23 47 minutes, 23 seconds So so it means we have acquired more new customers than balance transfer. 47:29 47 minutes, 29 seconds So I think basically you're saying that balance transfer trends are on an improvement and which kind of gives you this confidence from Q3 Q4 has improved. 47:38 47 minutes, 38 seconds Sure. And I just missed your guidance on the overall loan growth. Uh you know I think you mentioned something like one lakh crus but uh I mean what is the what 47:47 47 minutes, 47 seconds what exactly are you really looking at 18 to 18 to 20% growth as I said in my earlier conversation there we are 47:54 47 minutes, 54 seconds looking at 18 to 20% growth in loan book. Got it. Got it. Thank you very much. 48:03 48 minutes, 3 seconds Thank you. 48:07 48 minutes, 7 seconds Thank you. Next question comes from the line of Hardik Sha with MLP. Please go ahead. 48:17 48 minutes, 17 seconds Mr. Sha, please go ahead with your question. 48:23 48 minutes, 23 seconds Next question comes from the line of Videsh with Invest. Please go ahead. 48:28 48 minutes, 28 seconds Uh thanks for the opportunity. So my question is on uh on the loan growth and loan mix. If you look at this quarter, there is a sharp increase in 48:36 48 minutes, 36 seconds non-individual uh home loans and uh I think it grew some 12% Q on Q as per our calculation while housing loan growth 48:43 48 minutes, 43 seconds was still soft at 3% Q on Q. So what is happening here and what is our strategy in terms of loan mix going forward. 48:52 48 minutes, 52 seconds So loan mix I think while it could be more in non-home loan in in quarter but overall the non-housing versus housing would be around the range of 38 to 40%. 49:03 49 minutes, 3 seconds uh overall at at uh you know uh I would say vertical level it will be in the range of same non-housing versus housing 49:10 49 minutes, 10 seconds will remain that uh you know uh uh in Q4 uh our uh non-housing loan grew from Q3 49:19 49 minutes, 19 seconds I would say 32.4% from 30.6%. So while there is a uh increase but increase is 49:26 49 minutes, 26 seconds not very large I would say it is 32% growth which is which has uh you know uh written on overall basis yearly basis I 49:35 49 minutes, 35 seconds would say that we grew by almost 3.5% and it was you know uh uh to keep in mind that we have to improve our NIM 49:43 49 minutes, 43 seconds also uh you know keeping under consideration the regulatory norms are also met. So that is how we are we are 49:51 49 minutes, 51 seconds focusing on because uh we have a scope to do more uh non-housing loan uh but we we are also keeping our u you know watch 50:00 50 minutes on that there should not be any breach on regulation uh which will help us uh in longer term to improve our uh you know margin. 50:10 50 minutes, 10 seconds So from PDC criteria what is the share of uh retain home loans uh at what what percentage we are operating at right now? 50:18 50 minutes, 18 seconds Yeah. We we are at 65%. 50:22 50 minutes, 22 seconds Okay. So there's significant room to reduce it. And the last question is on corporate loans. How do you see growth and share of corporate loans let's say 50:30 50 minutes, 30 seconds 12 months down the line and two 24 months down the line in overall loan mix. 50:35 50 minutes, 35 seconds So this year I think we will be having as I said that we'll be having almost 3% of our uh book would be corporate loan book. We'll be very moderate on that. we 50:44 50 minutes, 44 seconds will not be very very focusing very high on corporate book because we want to be very go into into this business in very 50:52 50 minutes, 52 seconds calibrated way and uh sustainable way I would say uh so if I talk about first year it would be around 3% second year 51:00 51 minutes would be around 5 to 6% of my overall book uh maybe down the line 3 year would be in the range of 8 to 9% of my overall 51:08 51 minutes, 8 seconds book which will be my corporate book and what is the incremental yield on corporate Uh it would 51:16 51 minutes, 16 seconds 11 and a half to uh it will be in the range of 11 and a half to 12%. 12% almost. 51:23 51 minutes, 23 seconds Sure. Sure. Uh thank you sir. That's it from my side. Yeah. 51:30 51 minutes, 30 seconds Thank you ladies and gentlemen. Due to time constraints we have reached the end of question and answer session. I now hand the conference over to Chattanu for closing comments. 51:41 51 minutes, 41 seconds Thank you everyone for joining us on the call. If you have any questions unanswered, please feel free to get in touch with investor relations. The 51:48 51 minutes, 48 seconds transcript of this call will be uploaded on our website that is www.pnbhousing.com. 51:55 51 minutes, 55 seconds Thank you everyone. 51:58 51 minutes, 58 seconds Thank you on behalf of PNB Housing Finance Limited. That concludes this conference. Thank you for joining us. You may now disconnect your lines.