Q1 21/22

Jul 22, 2021

Ladies and gentlemen, good day and welcome to the Dutch Conserve Conference Call Q1 FY 2020 2 Results posted by Jain Financial Institutions Securities Limited. As a reminder, all participant lines will be in the listen only mode and there will be an opportunity to ask questions after the presentation concludes. By pressing star and 0 on your touchtone phone. Please note that this conference is being recorded. I now hand the conference over to Ms. Vani Bhatchi from Jain Financial Institutions Recovery Limited. Thank you, and over to you, ma'am. Thank you. Good morning, everyone, and welcome to Bajaj Finturf's earnings call to discuss the 1st call to FY 'twenty two results. To discuss the team we have on the call, Mr. Srinivas himself, BFC Bajaj Fincher Limited Mr. Kapyr and Singher, CEO of Bajaj Fincher, General Insurance Limited Mr. Talan Chuk, CEO, Bajajal Dalian's Life Insurance Limited Mr. Dalan Jeet Singh Thani, CFO, Bajal Dalian's Consumer Insurance Limited and Mr. Hamed Khalsdi, here for Bajajal and Spice Insurance Services. May I request Mr. Srinivas to take us through the financial highlights, post which you can open the floor for Q and A session. Over to you, sir. Thank you, Dhanvi. Good morning, everybody. Welcome to the conference call to discuss the results of the Gazfin Serv Limited for Q1 FY 22, which is the financial year 2021 2022. As before, in this call, we will largely be concentrating on the consolidated results results. The results of our insurance operations through the Gaziban's under insurance and the Gaziban Life Insurance and where material the standalone results of our company. The Raj Finance Limited, BFL, which is another major subsidiary of ours, has already had its conference call. However, if there are any high level questions on BFL, we would be glad to take that as well. We will not be taking any questions on the status of Allianz's stake in our insurance company, except to state that the status has remained the same as at the end of the previous quarter and there is no change. Any statements that may look like forward looking statements are just estimates and do not constitute an assurance or indication of any future performance result. A few remarks on Indeelis to clean up the hygiene distrosiers. As required by regulation, BFS has adopted Indian Accounting Standards or Ind AS from FY 2019. The insurance companies are not covered under Inderes. They have prepared Inderes financials only for the purpose of consolidation. Accordingly, for Badriq and Baliq, the stand alone numbers reported below are based on non India's accounting standards or Indian GAAP as applicable to insurance companies. Our results, the press release accompanying the results and our investor deck had been uploaded on our website yesterday evening. Let me now give you an update on the performance for Q1 of FY 2022. After a brief recovery in Q4 of FY 2021, conditions, as you are aware, worsened in Q1 FY 2022 as the 2nd wave of COVID spread across the country. This led to localized strict lockdowns in many states. Under these challenging times, our business is focused primarily on managing risk with a calibrated approach to growth. Despite external challenges posed by the in the form of provisions for loan losses and COVID claims affecting health and life insurance claims. We saw many positives as well in this quarter. The FL was able to grow its AUM quarter on quarter and further increased continued its continued the acceleration of its business transformation plan, which was announced paid last year. The bounce rates were significantly lower than Q1 FY 2021 and only 8% higher. Bajaj Housing Finance has called a good growth in its AUM and profit after tax. Bajaj reported an underwriting profit while growing better than market in most preferred segments. Baiduq had an excellent quarter of growth as enabled to increase its new business value year on year. Let me now touch upon each of our businesses. While NetLoop started off reasonably well for the general insurance industry and for Badgic, the 2nd wave of COVID resulted in localized lockdowns in many states across India. This led to slowdown in the economy and in turn lower sales of motor vehicles and creation of assets in the economy. In contrast to the complete lockdown in Q1 of FY 2021, localized lockdown in FY 2022 led to positive growth. However, as compared to Q4 of FY 2021, growth was year 1. That is growth of 9.1% during the was marginally lower than industry, which grew at 11.1%. Excluding government business, which is predominantly crop and health, Bagic's GWP grew by 10.8% as against an industry growth of 11.6%. Bagic continues its approach to calibrated growth, that is seeking to grow in preferred segments, which are private cars, 2 wheelers, commercial lines, which are property engineering and retail health, while remaining cautious on group health. Wagic has done better and grown faster than market on most of these preferred segments. To give some more detail, growth in Q1 was driven by motor 2 wheeler and motor 4 wheeler reporting growth of 23% and 10.3%, respectively, While commercial vehicles continue to be stressed on growth, given the fact that the Insurance Information Bureau or IRB based premium rate hikes for property was started in Q4 of FY 2020. The base for Q1 FY 2022 was already at a higher rate. Notwithstanding this, Bagit's commercial lines growth of 14% was very satisfactory and higher than the industrial growth of 8.2%. Within the commercial lines, property fire grew by 11%, engineering grew by 26.9% and liability insurance grew by 21.3%. The 2 year CAGR, which compares the growth with pre COVID base for commercial lines, was 26.9%. BAGG's wide and deep bank assurance clients, direct corporate, strong broker relationships and dedicated multi line agency force were large contributors in the substantial level of growth. On the retail health insurance then, Bagic continued the momentum from previous year as increased COVID positive G rated in the year to heighten the need for protection. Baidu registered a growth of 30.8%, slightly lower than the overall industry despite lower sales of corona specific products as compared to Q1 of FY2021. During wave 2, COVID cleansed the industry much harder than wave 1. While in wave 1, majority of the mortality and morbidity cases were in the 50 plus segment, In this wave, lower age groups were also severely late. This caused more claims on group health segment and also in the group and individual life segments in addition to retail I will give you some flavor of the impact of wave 2. The 2nd wave resulted in much higher frequency with 27,000 plus claims results reported in Q1 FY 2022 as against a total of 32,000 plus claims reported during the whole of FY 2021. That is to say over 80% of the claims reported in FY 2021 have already been reported in Q1 FY 2022. This has resulted in increase in COVID's claims cost to the tune of INR283 crores in Q1 FY 2022, while in the previous here the same quarter it was just INR 14 crores. However, by June, the cases have started tapering off. Secondly, on the motor OD claims frequency, which was very low in Q1 FY 2022, it had picked up to near pre COVID levels by Q4 of FY 2021. In this quarter, Q1 FY22, the frequencies were much higher than Q1 of FY 2021 since We did not have a complete lockdown, and we had mostly localized our lockdown and vehicle movement has not come to a standstill. Overall, frequencies were slightly below pre COVID levels. Then the impact of clients from 2 cyclones, Topk and Yas, While the amounts were relatively much lower than the other two factors of COVID claims, we still had the modest impact this quarter. As a result, the claim ratio for Q1 FY 'twenty two increased to 75.9% as against 68.1% in Q1 FY Q1 results. On account of higher claim ratio, the combined ratio for the quarter ended slightly above 100% and stood at 103.4%, which we hope will still be among the best in the industry during this challenging quarter. Despite these negative factors affecting the industry, Baggett was able to record an underwriting profit of INR15 crores. Baggett's profit after tax for Q1 FY 'twenty two ended at INR362 crores. And this is a non annualized return on equity of about 5% for the quarter. To summarize, a tough quarter and that did very well. Let me now come to life insurance. During the quarter, on account of lower base and strong growth streams from December 2020, the industry in April continue to show excellent growth. But with day 2 of COVID-nineteen peaking in May and resulted in sick lockdowns, there was a slowdown in May and in early part of June. Despite these challenges, Vale continued to do well both in absolute terms and related to the industry. In Q1 FY 2022, Vale In Q1 FY 2022, Bandwidth with individual rated new business growth of 49% was the fastest growing among the top 10 private players who grew by 26%. As a result, Ballad's market share increased from 5.7% to 6.7% in Q1 FY 2022 on this metric. In addition, Ballix individual rated new business 2 year CAGR, where the basis of pre COVID levels stood at 22% versus private players to we have CAGR of minus 1%, and that is the highest in the industry. The annuity product launched by Bannik in Q4 FY 2021 was very well received by the market. During the quarter, approximately 12% of the individual rated MB was the annuity segment. Demand for retail protection was higher than in Q1 FY 'twenty one was much higher. In Q1 FY 2022, on account of higher prices, the demand had tapered up. It had already started tapering off by second half of last year. The contribution of protection to the mix has sequentially quarter on quarter improved and is better than Q4 of FY 2021. The risk appetite of the retail saver seems to have increased as evidenced by the strong demand for units. BAMIC's unit contribution to product mix was 39% in the quarter. Guaranteed nonpar savings were muted in the quarter with a small degrowth. The Power segment, which had degrown quite substantially in Q1 of FY 'twenty one, has picked up and recorded a year on year growth of 165% and a 2 year CAGR comparing to the pre COVID levels of 24% per annum. All our main channels, the agency, institutional business, which includes Bank Assurance and Barrick Direct recorded excellent growth. Let me come to group business of the life insurance company. As compared to wave 1, group protection business was less impacted in wave as it grew by 2 68 percent in Q1 FY 2022. So it's mainly on account of the lower base. In absolute terms, the business is slightly is still below pre COVID levels and is about 56% lower than Q4 of FY 2021. As a major portion the Group Protection business, as you are aware, is from Group Credit Protection and which is largely dependent on disbursement of loans by banks and NBFCs. Due to the Wave 2, such disbursements had also come down, and therefore, this business will follow that metric. Overall, group new business grew by 92 percent from INR397 crores in Q1 FY 2021 to INR762 crores in Q1 FY 2022, which is above the pre COVID levels. Renewables registered a strong growth of 27%, and as a result of these factors, balanced UWP grew by 48% to INR2500 and 60 crores. I will now cover claims, especially COVID claims that are affecting the life insurance business. As mentioned before, the morbidity and mortality impact of Wave 2 was set across all age groups, more so in the 30 to 50 age group this time. Like the GI Industries Health claims, Baliq and the Life Insurance Industry, too, recorded significantly higher death claims on account of COVID-nineteen in the quarter. On the retail side, Baliq has secured around 1600 claims pertaining to COVID-nineteen. As a result, the overall COVID claim costs Revenue for Bialik in Q1 FY 'twenty two was INR 288 crores versus the near INR 1 crores in Q1 FY 'twenty nine. Dialect has adequately provisioned for probable future claims as things stand today and the best estimates available as of 30th June. And the total reserve as of June 30 stands at INR304 crore. The reserves at the 31st March were INR 98 crore. The INR 304 crores is the net result. As mentioned before, we have declared our new business value in our investor presentation. From now on, we will be making quarterly disclosures of NBV. In addition to the NBV for the quarter, we have also indicated of the NBV for the 12 months ended 30 June 2021. Due to high variations in the seasonality of business across quarters, I would advise investors to exercise Caution while reading into Q1 MBB and the margins. We had mentioned earlier in our calls that quarterly MBBs and MBMs may not reflect the possible herein results. Investors may already be aware that as a significant portion of life insurance business comes in H2 and especially in Q4, Most of the fixed costs borne by the life insurance company during the year gets absorbed in the second half of the year. Please note that NBV on rolling 12 month basis does not indicate a forecast or expectation of FY 2022. The new business value net of expense overruns, The key metric of profitability for Life Business increased to INR 25 crores in Q1 FY 'twenty two from a negative of INR 14 crores in Q1 FY 'twenty one. For the 12 months ended 30 June 2021, the NBV was INR 400 crores as of INR 212 crores for the 12 months ended 30 June 2020 and INR361 crores for financial year 2021. Good news from the life size is that the 13 month persistence, which was somewhat lower in Q1 FY 'twenty one has rebounded and has reached 82%, 5% higher than the previous year. Through initiatives such as driving auto payment, digital payments and collection of high value nonpersistent cases, the persistency has improved not just the 13th, ma'am, but also across all cohorts. And it's back for the Q1 at INR 84 crores was lower than INR 130 Growth of Q1 FY 2021 on the back of higher COVID claims and reserving INRIS RUB 255 crores gross tax is the impact as well as the new business trend that caused the strong growth, which were partially offset by the reversal of income tax provision of INR 161 crores account of favorable assessment order received for assessment years 2012, 2013 and 2013, 2014. These orders were received by us in the last week of June. Overall, an excellent quarter for Barrick, both on the top line and on in busy. Finally, both insurance companies are financially among the most solvent, Bagic to 648 percent and Bagic to 3 40 percent. And then we are well poised to weather any external adversity that might affect solvency. Both Bagic and Bagic continue to utilize their digital properties and continue to emerge stronger through the crisis. We have seen a substantial increase in digital penetration across several parts of the distribution and service chain across both our insurance companies. Further details regarding Badriq and Valid's digital capability are covered in the investor deck uploaded on the website yesterday. Let me now come to BFL. BFL has already had its investor call and NCS will only broadly touch upon the results. Quarter 1 was significantly impacted by the severe second wave. Both business and debt management collection efficiencies were affected due to strict results across many parts of India. Despite this, the AUR grew by 15% y o y to 1,000,000 odd growth. And in the advent of a third wave, the company expects quarterly AUM growth to revert to almost the pre COVID levels. Core AUM accretion in Q1 FY 2022 was approximately INR 4,100 crores. That's the dilute amount of accretion to the AUM as against a reduction by INR 9,000 crores in Q1 FY 2021. The second wave caused a marginal increase in EMI bounce rates in Q1 FY 'twenty two over Q4 FY 'twenty one. Average bounce rates in Q1 FY 'twenty two were approximately 1.08x of Q4 FY 'twenty one. During Q1 of FY 2021, the investors may recall that BFS bounce rates have increased to nearly 2.5x to 3x the pre COVID levels. On the call of regional dropdowns, 4,600,000 loans only were booked by BFR during the quarter, slightly less than 5.47 1,000,000 loans booked in Q4 of FY 'twenty one. However, 1,880,000 new customers were acquired during the quarter, and they are in line with the company's general guidance of new of $7,000,000 to $8,000,000 for the full year. In Q1 FY 2022, BSL recorded a pre provisioning operating profit of INR 3,116 crore and made loan loss provisions including expected losses of INR1750 crores as compared to INR1686 crores. The 2nd wave resulted in significantly subdued collection efficiencies, leading to higher Stage 2 and Stage 3 assets. BFL continues to balance growth visavisrisk and collections, while maintaining strong liquidity and capital adequacy. DFL carries a management overlay of INR 4.83 crores in provision for expected credit loss as against INR 8.40 crores as of 31st March 2021. The gross NPA and net NPA recognized as per extent RBI financial norms and provision applying the expected credit loss method described in the year as of 30 June 2021 stood at 2.96% and 1.46%, respectively, compared to 1.79% and 0.75%. As investors may be aware, BFL and other NBFCs are required to provide for expected credit losses over the life of the loan under Ind AS. We understand Ind AS is not yet applicable to banks. This compares with approximately INR5,900 for the whole of FY 2021. Overall, DxL has pre provision profitability remains strong. And at the moment, based on the available estimates adequate to coverage packet losses. Patch for Q1 FY 2022 increased 4% INR 1,002 crores versus INR 962 crores in Q1 FY21. The capital adequacy ratio as of 30 June 2021 was very strong and stood at 28.5 And the ClearONE capital also has crossed 25%. For Bajaj Housing Finance Limited, The module subsidy of BFL, the capital equity ratio stood at 22%. Finally, BFL's business transformation is on track for Phase 1 to go live by end September or early October 2021. In summary, BSL is well positioned to navigate any temporary stress, and I would request investors wanting Before I close, I'll cover the highlights of our consolidated financial results. We'll chime into that in our press release yesterday. Consolidated total income, INR 13,949 crores for the quarter compared to INR 14,192 crores in the same quarter of last year, marginally lower. Consolidated profit after tax INR 8.33 crores versus INR 12.15 crores. Bajaj Finance consolidated profit after tax INR 1,002 crores versus INR 9.62 crores. General insurance profit after tax INR 3.62 crores versus INR 3.95 crores and Life Insurance shareholders profit after tax INR 84 crores versus INR 130 crores. A point to note that is under India, the insurance subsidiaries are chosen to hold a large part of the equity securities portfolio's fair value through profit and loss account. Therefore, the unrealized mark to market gain on investments, included in consolidated profit was only INR 25 crores for Q1 of FY 'twenty two was INR 330 crores for Q1 of FY 'twenty one. This is one of the reasons for the larger drop in the consolidated profit after tax. But I must emphasize that these are unrealized losses. During Q1 of FY 2021, as you may be aware, equity markets have recorded stellar growth after a steep fall in Q4 of FY 2020. Yes. So year on year, this unrealized gain has reduced INR305 crores on the post tax profit. This does not affect the core operating profits of our businesses as it is market linked. Final comments. With Signs of the 2nd wave ebbing, all our businesses will pursue opportunities to grow while maintaining focus on risk. At the same time, we remain cognizant and vigilant of a possible 3rd wave. Our company is at this spearheading vaccination for all employees. Learning from each wave, our companies have strengthened their digital and touch free offerings to their customers and intermediaries, Backed by strong solvency, well above the required capital, supported by healthy liquidity, continued focus on risk and protections, digitized processes and improved cost structures, we are confident of being able to maneuver through these difficult times. That's all from me from the opening remarks. I will now open the floor for questions and answers. Thank you. Thank you very much. We will now begin the question and answer session. Q results. The first question is from the line of Ravi Mehta from Loop Financial. Please go ahead. Regarding the alignment and talk mode, you can go ahead please. It would be And if there is no response, I have muted the line. The next question is from the line of Prakash Kapadia from Unitiate Portfolio. Please go ahead. Yes. Thanks for the opportunity. A couple of questions. On the Life Insurance side, GP growth has been fairly strong for us. So is it low base of last PR, is it some specific product demand or some specific channel where we are in traction And what kind of momentum can we see for the rest of the year on the high feature side? I'll just briefly give a overview before I pass it on to Tarun. I think this is the last few years we have been engaged in a transformation process. This is a fairly intensive process of planning and execution. And in the process, we have rebuilt our channels. We have expanded our bank card partnerships. We have remodeled our agency force. We are focused on cost. We are significantly digitized, taken a lot of actions. More importantly, we have also launched products and some product lines we were not present have also been launched during this period like term life and And it is. And in all these, I think our products remain among comparable to the best in class. So overall, the growth, Obviously, year on year also reflects the more subdued conditions in that same quarter of last year. Related to market, I think we are growing very strongly on the back of all these factors. Strong performance across all channels, which is we cannot pick any one channel That is the combination of good product mix, strong channel performance and good education. Harun? Yes. I think Srini has Directionally, I think, answered it. Let me just add a little bit more. So you are talking about whether it was Only versus last year or the year prior and how sustainable? Right, right. Right. So, last year, of course, was muted for everybody. And the most insurance companies we do last year same quarter. We actually did not. We had a flat Q1 FY 2021. Last year, we grew by about 28% overall with the company. And this quarter, we've grown at about 49%. The reason is largely on the line for what Srini has talked about. So all channels and particularly I would single out our agency channel has shown some good growth because this year we've We've been able to sustainably good calendar rate. We've been able to hire advisers, which was a little of an issue last year because of the physical lockdown. And I think we've come to a situation as a company where our product mix has largely directionally stabilized, where we had a good sprinkling of par, term and the outlook. To last year, as Srini mentioned, the transformation was massive over a period of time and particularly Showed some signs of stabilization particularly last year, where our product mix and channel mix was changing constantly. So in 2015, we used to be 92% agency, but now we are around 44% 34% to 45% agency. This year, this quarter we were 48% agency. So I think this transformation is over. We are and we are now on a foundation for growth. What will it be like? I can't make any forward looking statement. But I must say that the Culture change, the change around business dynamics and large business calls that we have to take are behind us now. Our product mix is also very well stabilized and we are now into all The buckets of need the buckets that we look at. Our last entry to in need buckets was in the pension space, which was missing till, I would say, last quarter last year, we had Q4 FY 2021 is when we launched it. And this quarter has we've been able to of course use that quite well. And because this product did not have any medical retirement, we have been able to deliver any customers We weren't comfortable going into medicals, take benefit of that. So we'll be moving into tactical in that way in taking benefit of this product. So I think you should see a good growth going forward, but that's all I can tell you, sir. Sure. That's helpful. Secondly, on the PPP side on the gender, when you're on the motor, any Update on pricing by IRF projecting some while this year also you're up once. So any update from the regulator on the pricing? Yes. Prabhupam, would you like to take it? Yes. Thank you for the question. I think is something that you have asked a regulator from industry side. We have been asking for it. I think it is there, and they have to come back on it. We don't have any Information on that is it. Sorry. Lastly, any update on the mutual fund license, which we have applied to Stephanie? It's been some while. No. We have applied their rather portions of sitting with our regulators. Then because of COVID, things are moving a bit slowly. They have conducted their on-site inspection also. We are We are hoping to get the license soon. I'll join back with you, Saphtha. Thank you. All the best. Thank you. Thank you. The next question is from the line of Sanjit Khoda from Parq Capital. Please go ahead. Yes. Thanks for the opportunity. Sir, I have a couple of questions. One is, Mr. Spointing, the wanted to understand That is the reason why Baidu Sintur created 20% stake in Fintur Marketplace to Baidu Seren. So, I wanted to understand the overall logic behind also the deal? That's first question. And the second question is Maybe I can go one by one. If you can answer this, then I have a couple of more questions on where we can validate. Okay. Let me take that question. Yes. But that FinServ is not selling any stake to the Perkad Finance. FinServ Direct, as you know, now as we told last year, we were Fairly clear about the path of FinServ Direct as a neutral open architecture marketplace. However, on the platform side, there is a lot of linkage between BFFD and Badaj Finance. And Badaj FinServe Direct is actually helping the Raj Finance build its platforms as well. We believe there is a lot of advantages there. Raj Finance, While they build this platform, which supports its core lending business, will also require a strong, Stable long term partner who can deliver what they want. Otherwise, it can get diffused in the market. At the same time, as of now, Bajaj's FinServ Markets has already started dealing with others. So from a customer acquisition point of view, Bajaj Finance will be just one more partner for Bajaj Yes, FinServ Direct. And as time goes on, as more partners get added, obviously, their share of the total pipe may come down. On the platform side, Bajaj FinServ Direct will continue to support Bajaj Finance for some more time. And we believe this linkage between the two is very positive for both to deliver their own individual business goals. Therefore, as we go, the incremental capital would be contributed by both FinServ, Bajaj FinServ and Bajaj Finance. By the end of that period, we expect that the stake will come down to 19.9% for the branch finance. Okay, sir. Got it. But the More like a strategic and financial investment, enough significant platform provided. Got it, sir. Got it. Okay. Yes. That is good. And I'm on the And that's why I must I happen to add that over time, maybe 3, 5 years from now. Even this platform, they may offer us a product to other partners. Okay. Okay. So basically other industries or banks can also tie up the sensor marketplace offering the same solutions to them. That's to be your point. Yes, yes, yes. As they build their business and then they get their usual number of customers and more partners in there, they have already started adding partners. And over time, they are continuing to add more partners Because the risk appetite of each lender is different. And as they want and depending on the segment of customers, they could offer differential products. The idea is people come to us and they can also compare products of others through our own ecosystem and they can choose what they want. So eventually, it will become a free marketplace where customers choose. And hopefully, our manufacturing entities, Waz Finance, Bagic, Bagic will end up getting a higher share of profit pool is they complete very well, but they have to compete in this market, yes. Got you. That's fine. The other question is on one is on life and actually 2 on life and 1 on gender. So for life insurance, just wanted to understand The gross impact of INR 288 crores, which we have taken with respect to COVID in the current year, will How much? I mean, it will be the number net of tax will be flown through EV as a negative mobility experience is my understanding, right? And second, just wanted to understand is this 304 crores of auctioning closing with respect to COVID, how much is IDNR And how much is or is it complete? I mean, I do not only for the claim which are completely reported to June expected to be reported to June? You have provided anything beyond June also in this 304 code number. That's the first question on Vadik. And second question, Maru, just wanted to understand the bank account channel mix, if you can provide access and the new banker relationships like Argyle, I guess, with Kiwi, how much they are contributing on incremental basis? I think the first question, I will give it to Tarun. And the second question, probably Bharat can give you a flavor on paid versus the reserving plus how the general approach towards reserving is adopted by Dynamic. Yes. So basically, this 280 a number, the net impact on the part is INR255 crores for the quarter. And as we will be declaring our on a half yearly basis what we have agreed. So that will also flow to the EVA, the network change. With respect to the overall clear outstanding of INR 3 0 the results INR 4 crores. This is the net amount which we are carrying, out of which INR 98 crores as of March 21. And in this quarter, we have created INR 2 the results. So that extend INR 304 crores as a net amount, which broadly in terms of the gross claims and support up to around INR 425 crores to INR 430 crores of claims. So those are the two numbers. In case any specific, I can answer that also. So basically, given you showed around job claims of 117 in the current quarter, so you can say here again that around 3 0.5x to 4x Yes. So basically what we have done, we have looked at our quarter, the past Experience for this quarter, what Shiny also mentioned that during the May June, we saw a 2nd wave impact. So we have kind of looked at our various segment level, whether it is GTL, MFI, and this is our estimate that how much claims can come. So technically, it can cover a claim up to maybe July, August, September, October. But as lot of claims comes with a delay, so there is a projection which we have taken. So to that extent, it is as on date what we think that the potential claims can come. Obviously, it does not include anything on that, way 3, potential way 3, if it comes on. Got it, sir. But sir, can you break down that 1 17 close, if possible on individual business, group business and say maybe credit for that business, if you are okay to give that data. With this, I just wanted to understand the way the pain. So basically, the breakup of the actual claim, that INR117 crores, that's a gross number. On the net basis, net of RI, the number was around INR112 crores. INR 101 crores for retail and the balance was for So total claim is INR112 which has come into the books. And if I remove the par element and the UL fund value option, Then the net impact is INR96 crores for the quarter. So we have INR96 crores of actual claim and another INR192 crores net of for COVID reserve. So hence total number is INR 288 crores of the total number and net of tax is INR255 crores for the quarter. Got it, got it, sir. Perfect. And if you can answer that on our banker relationship with respect to new banks and active banks. Karan, let me just step in on that. Yes, so now we are into a lot more diverse set of relationships. And maybe next time we will maximize these separately and give more details out. But just to mention, Axis is about 18% of our outlined. And after that, we've got a few partnerships actually over the last 3 years, which includes 4 small finance banks, IDFC, RBL, Rural Vaishya Bank. And it was some small some small warehouse growth brands as well. So we've bucketized them in 2 parts, emerging bank assurance and partnership distribution. Put together, this segment has about 10% now with us with Various banks contributing to because they're still at the emerging in terms of the relationship. We just started getting resources in the last two quarters of last year. So they have now started moving in this 3 months decrease. In fact, we do want to move towards the highly diversified distribution. Got it, sir. Okay. So, out of 42 percentage of the total industry business, you're saying 18% is Axis Bank in the current quarter, right, sir? Okay. Perfect. Perfect. All right. That answers my question. Finally, on Baiduq, just one point, wanted to you're failing to understand Why there is such a gap between MPW and NEP in the current quarter given the growth has come back? Maybe if you say a slowing year, I understand, but we reported 9% growth. Still NPE number It seems to be substantially higher compared to NPE number. Is it just to contribute at the 1x365 If I do or on something else which we need to understand the difference between NEP and NEP will do? NABAN, would you like to take that? It's about an EPI growth compared to last quarter. So Sanket, there is no change we've done. It's simply 1 by 3.65. So it's This is what we've written in the past. So no other reason beyond that. But I think business mix also changes some are low retention like Higher corporate business. So as the business mix changes, the earning rate also changes. This is very far for the quarter, maybe across quarters, it will get normalized. Got it, got it. So finally, on the 2 wheelers, we saw a very strong growth. Just wanted to understand the mix of how it is moving to 2 years given that we have probably ended up reporting very strong growth. And related item, what could be the likely advanced premium accretion which has happened because the way we are seeing strong growth in 2 wheeler segment? So the total advanced premium outstanding is about INR1100 crores as we stand today. Okay. And Kunal, if you are okay to share anything? So we've not been disclosing that you know, Sanket. Okay. Okay. Fair enough. Sorry. Thanks. Thank you. The next question is from the line of Nader Shah from ASKING Western Managers Limited. Please go ahead. Yes. Good morning, Jayshir Khalid. I prudent tenant wise approach continues. So those are both Most pleasing aspects in the way insurance business both the businesses are shaping up. My core question is While general insurance, given the nature, it's a shorter term product And especially some segments like Automobile are more closer to commodities. And Therefore, this probably is more pushover in date. But life insurance And some of the segments of the general insurance should be more the pool oriented and life insurance in particular Being a longer term contrary to the solvency, reliability of the insurance are very important issues from the perspective of the customer. Mostly by aggregator, we use the advertisements by some policy reserve and others all the time. So It somehow this is a comment of the industry in Chandra, not just the Jetsim Server. But it gives an impression that aggregator since becoming the brand, while we actually underwriters of the Did it pool sector relationship creating nature of the insurance rather than being pushed as a commodity and where the power came over the period and shifts to the heating Yes. Sumit, I think Yes. Bharat, your point is valid, but we'll see because the world largely Life insurance is a push business. Heavily I mean basically distribution is a very important component. While some segments of non life tend to become full businesses over time, especially in other insurance because it's bundled with and it's strategically required, it gets There is some amount of pull. And health insurance in certain times when there is a scare factor, it becomes a pull business. But in life insurance, it's a long journey. Over time, I think if you compare what general insurance companies are doing now with what is happening 5, 7 years ago, We have made significant improvement in customer experience, significant improvement in disclosures to customers in terms of the Ease of buying, the ease of owning in terms of digital processes. I think it is not comparable at all what was happening 7, 8 years ago and what is happening now. Even if you see the pending complaint, they all have come down quite substantially. So over time, retention is very important. How much you are able to retain in existing contracts. Plus, are you able to get more money from the existing customers because that is the ultimate sign of the results? A full business. I think on all these fronts, for example, our Bandit Direct, which is a channel we set 3 years ago, is working quite hard. Think the persistencies are very high. We are working on portfolio management type of structures there. And we believe that we continue this effort. Over time, we will be able to acquire more customers, feed them and also get more money from them. Unfortunately, in the case of life insurance, the role of bank assurance is very high. People tend to Keep a lot of money with banks in terms of wealth management, PMS and various other things. And therefore, banks are the data edge. We already have customers. We already know about them. They know their spending habits, their saving habits. So they tend to have a net and therefore that channel of distribution It's very important. Having said that, the banks are not going to give it cheap either. They have a choice of 23 odd life insurers, and they Have a chance to play with them. So I think this will evolve. That is my take on this. In terms of the Aggregators in life insurance, I think largely on term life and all, they will do much higher. Their share of the total market is still not very significant. It may be under 3% or 4%. In terms of general insurance, yes, in motor insurance, we have seen in UK and all that aggregators do tend over time to dominate the new car purchases. But in India, it is still dominated by OEMs, and we have a very strong presence there. Tarun Kapal, would you like to add anything to that? Let me just step in. So Bharat, that's an interesting question. And brand building is particularly close to my heart in the life sector. And you are right that it is a very critical component, particularly of the life sector. Because building of a brand requires lots of elements that come in. I think that's where the nuances also play out versus the aggregator and the various manufacturers. So for example, the best way of building a brand is like experience from customer gets to view with the transactions. Now unlike banks, NBFCs and the GI Business, Ally is not very heavy on transactions. So experiences what you see on a lesser action basis. Every interaction, whatever little they have with us is CASPU has to be Speaking span has to be really convenient. And as Srini Gekko said that therefore the investment in marketing platforms becomes critical. The difference between what you're talking about Aggregator and the manufacturers. And I'll answer it for manufacturers in a general way and maybe a little bit for us. Is that The aggregators usually want to go on mass media and their job is comparison, right? So they're just comparing. They just want eyeballs coming the moment the eyeballs coming, then the brand of the manufacturer comes into play. And of course, there is a pricing element given the fact that it's a very narrow product that is at play. The difference between us and the aggregators is that our spends are quite wide into channel marketing, into multimedia, which could be a lot more digital, could be a lot more specific, the segments we want to get into. So for example, in Bailik, we've been we actually have been spending a lot on marketing. It may not be This is in general to everybody, but it is I believe we are making impact in the segments that we want to. As an example, in this quarter, when I talked about this a little bit, we were largely focused on building the brand on the annuity side of the business, which we introduced in the last quarter of as a product, last quarter of last year. And this has really paid off. It's 12% of our this quarter business. So actually we've got a good ROI on that investment. And we've been investing in platforms. We've been building in experiences that customers get. We've been building on the data management behind it. And As a result, in fact, we've been spending a lot on marketing. Whether it is on mass media at all, that usually is the media mix that we intend to play with. Usually for us, it is the Q1 is not the best time to get on to the mass media. Usually, it's not justifiable on the number of transactions you see. While as you know the aggregators may actually be looking for various reasons, they may also be looking for listing. So which may not be the case in us. So the reasons are different. Our overall underlying that when somebody looks at a life insurance product, we should be present at that very moment to the right channel, with the right motivation for the distributor, right knowledge with the distributor and the right offering for the customer. Now that's a 360 degree way of looking at service marketing, which is very different from what you see here in the mass media. So this is classical service marketing. Arun, just like to highlight that a light goals approach that we took years ago and I was asking. Yes. Maybe I can talk about that as well. Like the underlying So we changed our entire stack like those and like those enablers. Now that requires a very systemic investment over a period of time and we're going to be increasing that investment. And what we are we've been focusing on is product marketing, particularly, for various live gold segments. And now we've like I said, we've into all the relevant segments with the annuity business falling in place. And that is what we will intend to do for the next 5 to 7 years. We're very clear about that. And our platforms are going to do this speaking a lot. The other bit, if I might add, is also how we go with pre approved offers To existing customers. That's possibly the most efficient to keep our cost of acquisition low. And that is something if you're not a customer of ours, of course, you need to buy a policy Bharat and then you'll see us more often. So these are very targeted marketing I hope I've answered your question. Sure. But if I take each of those 3 critical elements. The platform is the view of distribution and optimism, Customer Experience and Service, Help and Enhance by Digital Journey And brand building and pull sector. So customer experience part, I understand what you are saying. I also understand the platform building efforts to widen and deepen distribution capability. But I'm seeing soft touch aspect of building the brand, a way Not just the existing customer, but the potential new customer is favorably inclined towards That brand building such an effort that whenever a particular prospective customer is ready, He kind of thinks of first name of recall, let us say is Bajaj Life Insurance Solution. That brand building effect I am seeing seems to be not visible and not just for Balik and portions of the business of battery. In general, for the insurance industry, it seems to be Kind of handed over on flaker to the distribution channel or at least that is the impression I'm giving, maybe wrong So I think there is nothing right around this, Bharat. It's all I would say is if you there is a mix amount of money to be spent and what amount of output to be taken out of that. So we have to balance out over the year and over the life of our offerings, how we play this. So this will vary, but if you are seeing it as a trend for all life insurance and lots of flight insurance companies are sitting with lots of money and they're not making investments. There must be some logic behind it. That's what I will results. Okay. This is Papan here. Given results. Yes. If you look at Bharat, in terms of brand for Bajit and all the brand reports you've watched, that Bajit brand is rated as the best brand in the generation Way above other brands. So by independent reports, whenever you get a hand on that, you'll be watching that. One of our philosophy has been because if you look at the general insurance industry, claims happen. The frequency of claims is high. Our obsession has been that we should be the best claim payers in the Indian market. And if you see over time all the awards that we won or all the rating that we get, we are rated as one of the best claim payers in the Indian market. And that is what our option has been. For us, our product is not that we are selling a policy. I've heard that we've said linked claims in the best possible manner to our customer, the fairest possible manner and the best claim experience should be there. And we've been doing it consistently and that is why our brand has a very strong recall in terms of where we are. And that is the point when you say even if you have aggregators in the market, aggregators can only sell policies and they can do a price comparison. The experience of the policy when a claim happens is up to the manufacturers, and that is where the difference comes in. And that is where as the Bharatyans' results. We have put this very high on that. And if you look at all brand reports and all, you will find that various renovations companies is way above and you will buy in terms of the donation industry. And if you look at our claims settlement and the quality in the market as far as claims update is concerned, and if you look at any kind of survey report, Saudi Canada, you'll find us among the best In terms of doing that, so it's a combination of it because in the initial you have claims, you have experiences and the amount of truth keeps on happening. It is how you focus on that. And that is precisely why it's a good claim settler and do it very fairly. I don't think there's a major threat from a rigorous perspective because they maybe would sell a policy at cheaper at a much cheaper rate. But when an experience of the claim happens, that is where moment of truth happens. And that is where good companies get differentiated from average companies. Sure. No, I appreciate. Just one last small point I'll make. So from all that I heard, what I surmised is That brand building effort is part of our conscious recognition, And it is something that we are focused on. And grant building is not something left as an accidental happenstance, But it will be a long term kind of a conscious strategic choice. And secondly, Well, the brand building Spain's NPE efforts are in sync with the return on investment or ROI equation compliant. Is that a fair way to summarize what we what I heard? Yes. Bharat, I think you're very spot on. Dialik has chosen Life Goals as their main plank on which they will deliver all this. Magic has chosen Care as the main plank on which they will do that. In the short run, customers will take time to appreciate it, but investment into these brands will continue, Not just through the traditional means. I mean, you may not see too much on the above the line TV and other media advertising. It's a very short recall nowadays. But we spent a lot on digital marketing, on mobile apps through multiple channels. So I think it's fair. Can you think I'll add Tarun Kapan on this? Insurance brand building is something that is very interesting. So unlike maybe an FMCG brand building, an insurance brand building requires trust And trust does not happen like in a microsecond. It is led by demonstrations over time of what you have said and how you stood for it. And over time it gets built. So if you look at Power Solutions brand across the world, you'll find most of them have stood the test of time and delivered to customers over time. I think this is where That is relevant. And if you look at what Tarun said or what I spoke about, I think if you try to look at that angle, that comes out very clearly that building long term trust, Staying true to our commitments, delivering on the ground and being with the customer in times of need and ensuring that they have very good experience is what build a long term brand. Alarm is obviously the activity that we do for marketing, which is there. And digital is what we've been focusing on, on a pretty high note simply because if I look at customers today, I think We watch more digital views than on television. I think that is what the research also is showing. And we it's a combination also. We also use television. So we'll keep on building. Admissions brands over time become very, very powerful. The commitment to what they've been promising has been there. Great. So I'll just maybe I think all of us have added significant to that and that's a very interesting question, Bhakral, which is why you see the answers Coming in from everybody. Maybe I'll just close with just two statements here. The services, the number of times your brand is as good as your last interaction. That is one statement, which is where what Papan also made said was very important in the way you play your clothes. The second is the bad debt behind. I think there is enough trust behind that in any case. So I think we're right on both. Sure. The next question is from the line of Ashok Kala from Sunwest Advisors. Please go ahead. Yes. Paolo, thank you very much for giving me the opportunity to ask the question. My question was pertaining to the digital initiative, which are being taken by the group. Now what I see that individual company has done Our call digitizers and automation and things like that. Bali kept them separately, Baigik has done separately, Baigik has done separately, Baigak has done separately, Baigak has done Separately. And now you are, I think, probably trying to put everything in Badakh Finance Direct. That is what I would like to know. Let me get this clear on this aspect. One is, you see, there is a fundamental difference between some of these businesses. If you look at insurance business as compared to, say, the lending business, the lending business is largely, I think, customer comes to bear because they need money. So you buy a house, you take a home loan. And therefore, when the customer comes in, the rest of the entire investment goes into how to keep the customer there, how to make them use the Baidaj Finance and they need money again. And now the new transformation will also ensure that Bharatyayar with our ecosystem, they keep getting engaged through the acceleration the results. The payments and other platforms that they are building. In the case of insurance, it's a journey. Once a customer comes, we can't say that I don't need insurance tomorrow. They have to stay most of the insurance, they have to stay through the through their life, whether it's health insurance, life insurance or even car insurance, as long as they own a car. Therefore, the approach has to be different. Insurance continues to be heavily intermediated businesses, and there's no need to look down upon intermediated business, whether it is agency or bank assurance, we have some fantastic intermediaries who actually deliver substantial value to both the customer and the insurance companies. Therefore, the approach has to be different. At the back end, we do have at the group level, through the efforts of FinServ, Councils were technology partners, where they discuss technologies that are happening, where they also share best practices across the technology teams. So therefore, given that while we allow companies a certain amount I mean a substantial amount of freedom in doing what they want, At the back end, they also collaborate quite a lot in terms of the platforms and the resources that they use. The individual strategies and deliveries obviously led to the companies. FinServ Markets is not a digital platform for the group. Initially, when we set up the company, there was a thinking like that, but it is an open marketplace. To the extent that there is some commonality with Bajaj finance. They are providing that platform to the Jazz Finance. But in terms of insurance, they would just be dealing in the APIs and large I mean, the insurance company's The role is largely to provide the APIs, the risk algorithm, the products And the customer insight will remain with the TajfinServ Direct. So it is not a technology platform for the group. It is the front end Of a digital marketplace. So I hope I got that clear. Yes. Yes. Now we said in our results. Actually, we are contributing INR 342 crores and we got financed INR 284 crores. So all the initiatives to take them to the logical conclusion, How much more capital you will have to provide and whether you will go down below 20% or 19.9%? See that over time, We have to see how this business is still a start up. The next 2 to 3 years are very critical. Whatever numbers we have seen in our Stock exchange communication indicate this is the expected amount of capital that we feel will be required for this year and the next year Got the guts in certain events. Now there are 2 segments to it. In this business, you have to continue to invest in new capabilities, new investments, new partnerships. At the same time, the existing customers who come in, they need to be in the ecosystem and transact with us across the entire marketplace whether they want to. So it is like a supermarket. You can buy and get loans. You can buy credit card. You can get insurance. You can buy investments and even So this is the marketplace. So you'll have existing customers. And so they will look at it more differently. As customers come in, they will increase the engagement customers, offer them greater choices, have campaigns or whatever is needed to do that. And there will be a new investment required in the reaches a scale and what we call a normalized level of growth. So as of now, this amount that we have mentioned should be sufficient for us to for the next 2 years. And once it's because even now it is, I would say, about 50% R and D and 50% business We are seeing that Dream Chutes is acquired substantial and we like this business quite a lot. We will continue to invest. Now in the future, all possibilities are open. Will there be other kind of partners entering this? Maybe. What type of partners, what capability they bring, what purpose they are coming in. We have not taken a decision at all on this, but I think our mind is open. This will remain an internal marketplace, and we will build it up with a claim that we think is good. Obviously, as a business, there are a lot of risks, and we will play it as it goes. You have the manufacturers at the back end. You have this marketplace at the front end. And underlying all this is the Bajaj brand of products and metal banding. Okay, okay. That's fine. But second question is on budget. Do you have any rethinking on crop because we didn't write any crop in this quarter? Yes. Q1, there is no crop growth. Basically, current season starts in July and probably is in January. So I think Saman can give a flavor on that. Yes. So if you look at crop insurance, This quarter, the next one, you will see a pickup here happening. So it depends on how the vendors get done, how the announcement happened At the moment, like Maharashtra came in later this time. Earlier, they were not trying to come in. Obviously, they're not speaking a bit later. So you'll see the booking happen this quarter. Okay, okay, okay. Thank you very much. Thank you. The next question is from the line of Nadeesh Jain from Investec. Please go ahead. Thanks for the opportunity. Firstly, on the life insurance, two questions. One is our margins have improved quite significantly over the last 2 years, around 12%, 13% BNB margin. But some of the companies which are having banked assurance partners are operating at around 25% margin. So do we think that over next 5 3 to 5 years that the bridge between the gap between our margin and given results. Some of the high margin products like protection and NEP has already been forming decent share of our product mix. So do you expect BNB margin gap between I said in last year it's bridging and what could be the drivers of that? This is directionally what we would like. Now we can't compare exactly number to number because part of the margin is highly volatile, especially on the nonpar segment, Where there is an element of interest rate, while a lot of us are hedged and try to reduce the volatility, I think the margins will fluctuate depending on your business mix. Obviously, as part of our first level of transformation, as Parun said earlier, that's more or less complete. But if you continue to grow like this, over time, our due to results. Fixed costs will get absorbed over larger volumes, and we should see that the net margin should improve. At a gross margin level, we are already Very close to the top for 5 players. The pure captive banks with single partnerships definitely has an edge because they are not offering multiple companies and they have an arrangement between their own group companies. But other than that, I think if you compare with any other multi level, multi which do not have a Compassive Partner and who are dealing with independent bank at IS or building up their own agency for the direct channel like we are doing, We think we are already on the right track. Harun? I've been largely answered by Suneet. I'll just maybe Take a minute now to say a few things. Having 3 touched on the fact that as we grow faster, which implies scale, There is still a significant scale at these time fees and that's the gap. Scale also has an underlying Genpro talks about activities getting better, which show up in bottom line. Product mix, we are largely there, but now we have to figure out how can we take more out of this. The other movement is on the customer segments because customer segments do have an impact on persistency and on ability of customers to reinvest and buy more. That is something we still have to work on and we'll continue that So it's a journey. And I think the more and more we get into details, the more we will get better. And every company is working towards strength, and that's all I'd Sure. Secondly, what would be the provision for future Claims from COVID. So the provision that we have provided is entirely IBNR or we are also making provisions for the future Claims after Q1, which may come on a positive note. Yes. As of now, I think Bharat has already clarified in great detail in the earlier question. Maybe you missed that. But it includes a provision for all the actually reported claims. It also has what we believe using our analytical models what we expect from the current wave of COVID. We have not planned for because nobody knows whether there will be a 3rd wave, whether that will be intense, how intense it will be. These are anybody's guess. And therefore, as it evolves, we will be looking into those. Having said that, I think one of the great strengths that we have resolve our surplus solvency. These are difficult times when capital is king, and we have enough of that. And we hope that will help us provide the right sort of cushion for this. Sure. And that's on the General Insurance business, in the Motor segment specifically, if I look from a lumber term perspective over last 7 years data, We have lost a bit of market share in the Motor segment. And within Motor segment, the market share loss is more pronounced in the Motor holding, while I think in Motor third party, we have gained market share. Any particular reason why in that segment we have lost market share over the last 7 to 8 years? There is no specific answer to that question Because motor is not very simple because motor has got many, many segments. There are geographies. There are risk policies of different companies. Smaller players who will get into motor business in a big way because it's the most visible and easier to sell among all others for a start up company. So competition will be more intense there. However, we have been growing in the segments that we like. Yes, last couple of years, commercial vehicles have been a bit slow on the segments that we like, particularly passenger vehicles. But I can add, ask Tapan to actually add flavor to that. So one way to look at it, as if you look at it in the GI business, any company which is start new would start with a motor base. So we look at all the new companies, you see that Motive is significantly very high in their portfolio because as discussed earlier, that's the easier business to acquire and move forward. So if you see as number of players move up in the insurance industry, the motor market share will get distributed over time. Not only for us, across you'll see this happen. The smaller players would gain more market share. And since the limited pool, you'll see a shift in market share. That is not the important thing. The important thing is to see that is the shift happening in businesses which the company prefers to have or not. So look at, Bhajit, we have been a strong four wheeler player over time. And there we have a strength and we'd actually be seeing that over time in the years, Quite a few years you've gained market share. Some you have lost, you mostly would have gained. If you look at this quarter, our private market shares formula we have gained substantially. The other part was that we were pretty good in the commercial retail space in an era in which we are a substantial market share. And obviously, we made good profits there, which The market has observed and so more players have come to that space. So when more players come to the space, the market share will get distributed. So it's a normal phenomena, Which will happen for motor business as you progress and go forward. If the motor the overall motor keeps on moving up, I think the industry would keep on gaining from that perspective. But I don't think that is something that would be not what you have thought through or seen through. So When you have limited players, the same market should be divided. And Zajit has been a strong retail player from the very beginning compared to its peers, which came retail later. So obviously, retail presence was much, much higher. In the same pool, other players also tried to move into this. So that should be the way to look at this. Does it answer your question? Yes, yes, yes. And on the health insurance, what I see that studies are growing at almost 40%, 50%. Some of the studies have become 10x of our size in terms of health insurance, while we have been there for 20 years, they have been there for 10 years. So why do you think multi line insurance companies have not been able to scale? I know there is a regulatory arbitrage in terms of agency channel, but I don't think that completely explains the trend share in scale that they have been able to achieve with us. No, I think your answer the question has the answer itself. So if you look at the scale of Sahi in premium and look at agency portfolio, you will see a substantial amount of life insurance in the Sahi agency, if you look at our bifurcation of that And the health insurance space. So I think the arbitrage that they have of being able to sell health through any agent It's a very powerful arbitrage. We should not underestimate it and not say that it is not substantial, very substantial because see, to build an agent, You acquire an agent, you train the agent, you teach products, you get the agent license. It's a task and a journey. And then as the agent matures and then they start selling. So it's a journey when you're bringing agency and that's why agency is a pretty Intense channel to build. Let's say if you're an arbitrage, you'll pick up any agent and start selling your product And especially, let's say, if I look at the SAI group of companies and their major agency post comes from the live agency and that they can do without the requisite Infrastructure putting it up. That gives a huge boost. So if you look at number of agents of some of the big size groups, if that runs into like 2 lakhs, 3 lakh agents and look at any dimensions company, the largest one like MongJazz, they will have like 50000, 60000 We'll keep on our time to build this force. So that arbitrage is a big arbitrage and that does give a huge push to build message. One more angle to this Is that we are a composite insurance company. I mean, ultimately, in the long run, dental insurance is a business of risk. And therefore, having property and casualty in the right mix is what composite companies do. So like if you have a catastrophe in fire, You could make money in motor. Or when you add both motor and fire, there are issues you could have hence growing. We saw that last year. And Monor line will add to actually a much higher scale to achieve the same level of profitability. Most of the health insurance business is low float Like motor third party, that kind of benefit you don't get. So therefore, the growth benefit is also much lower. But they are specialized. It is like comparing Composite player with a niche player because they will be sending only 1 type of 1 group of products. In that, they will get more specialization about it. But in our case, we will have to continuously manage our risk, and that is what gives us more profitability. If you have seen our combined ratios or profitability or ROEs at the results. We take the last question from the line of Sathai from Cated Securities. Two questions from my side. Maybe you touched a little bit on it. But on the same point about Yes, now you're audible. Yes. So on the same point on the health side, did you consider setting up a health Subsequent separately to kind of capitalize on the arbitrage on this kind of probably side, look, there's too much of a risk because it is standalone, so my judgment is different. Yes, I think that the DSS level because as of now, IRB is not very clear whether an existing insurance company should set up a subsidiary or not. So if you know some of the Mergers have happened also. I think even the standalone company has been merged into the other company. At a BFS level, we have considered that, But this arbitrage and all is not a long term thing. At some point, it will go away. And if you see last few years, The composite companies have also been growing their health portfolio quite well. So it is something we consider. And obviously, we do have a joint venture arrangement with Alliance On those partners, we do discuss it, but we have not taken a decision to set up another company yet. And just pertaining to PrinServe Direct where Bajaj Finance is kind of I mean the company is working closely with Bajaj Finance and I think now Bajaj Finance is also invested in that company. Yifuly, this is a kind of a open access platform where you expect other vendors to come in. No. On the face of it, it will be like that Balachs Finance will always have an upper hand over here. Why would they have an upper hand? See, a 19.9% stake does not give them any upper hand. It is only because of the strategic nature of the platform they are building for Bajaj Finance that they will share. The customer acquisition, Concerto has its own division. They will build their own this thing over time. Obviously, as the company started, they did have the advantage of something like e They did borrow on the Dutch Finance's network. But as time goes by, they will start adding more partners to every line of their business. You can see already in insurance, they have other partners. Some of them are not partners with the Raja Finance as well. There are limitations on the insurance side the regulation that they can't become a broker, that they will go with a corporate agent model only. Similarly, our investment they will build. So yes, It's a completely different thing. I don't think that stake means that they are not independent. I mean, if you see mutual funds, every distributor is up on market, right? And nobody is pushing any particular mutual fund. So the stake is not to control Sudhai's Finselk Direct. It is only to ensure that Continuity of support is there. And the future is they are in terms of the technology, the platform, they will be collaborating. And even in case of future partnerships, you might want to kind of the banking partner might kind of consider or you might kind of consider You want investor as a banking partner or an industry partner? As I said earlier, it is not as of now, we cannot take a call Because until this company reaches a scale, we may not consider that, but it is not ruled out. That's all I can say, Yes, that's fine. Yes. Thank you very much and all the best. Thank you. Thank you. That was the last question. I would now like to hand the conference over to Ms. Bani Dhati for closing comments. On behalf of JF Financial, I would like to thank Srini sir, the top management of the insurance businesses and all the participants who are joining us on the call today. Thank you and have a good day. Thank you all. It's been my pleasure. Thank you. Thank you for continuing financials that concludes this conference. Thank you everyone for joining us and you may now disconnect your lines. Thank you.