Ladies and gentlemen, good day and welcome to IIFL Finance Limited Q2 FY 2026 Earnings C onference Call. As a reminder, all participant lines will be in the listen-only mode, and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal an operator by pressing star then zero on your touch-tone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Nirmal Jain, MD, IIFL Finance Limited. Thank you, and over to you, Mr. Jain.
Hi. This is Kapish Jain. I'm the Group Chief for IIFL Finance. Ladies and gentlemen, thank you very much for joining this call. This is about the quarter two results for fiscal FY 2026. On the call, I am joined by Mr. Nirmal Jain, our Founder and Promoter and MD for the Group and the Company. I'm very happy to also introduce Mr. Girish Kousgi, who joins us as the MD and CEO for IIFL Home Finance. We also have Venkatesh on the call. Venkatesh, as you know, is our CEO for the Samasta Microfinance Company. So on this call, we will talk to you about our results for quarter two. Before I talk in detail on the number, I hand over to Nirmal to just give you a quick update on our business progress and the strategies for the fiscal.
Thanks, Kapish.
Good afternoon, everyone, and thank you for joining us. Maybe I'll just share my thoughts about the global macro and our company strategy. Globally, growth is uneven amid inflation and geopolitical tension, but India continues to stand out with strong domestic demand and disciplined policy. The RBI has maintained stability with manageable inflation and improved liquidity, while the government's focus on MSME, housing, and digital infrastructure continues to create opportunities for formal lenders like us. Against this backdrop, Q2 was a quarter of renewed momentum for IIFL Finance. Our gold loan business has fully normalized post-embargo and reached a record AUM in the last quarter. The MSME focus continues to be on secured portfolio amount, which is scaling up well with rigorous underwriting and a strong co-lending partnership. In Housing Finance, our growth was cautious given leadership changes and a stronger focus on collection, particularly in micro- LAP portfolio.
We are delighted to welcome Mr. Girish Kousgi as the new CEO of IIFL Home Finance. His vast experience in Housing Finance and retail lending brings renewed leadership energy and strategic direction at an important stage of our growth journey in the Housing Finance Company. About guidance for loan losses and provision, we expect lower loan losses and provision in the second half. We have tried to analyze the data more, and in our presentation, you'll find that the discontinued businesses of micro- LAP and unsecured digital loans, which are about 2% of portfolio each, and have been skewing the loan loss provisions, particularly in the first half, have been identified. They are now front-ended. Both these products have been discontinued.
We expect in housing, in our home loan and gold loan to continue at 1.3% and 0.4%, and about 2%-2.5% in our continuing secured LAP and unsecured business loan, which is in line with the trend in the last few quarters. Whereas in the discontinued businesses and also in MFI, in the second half, it will be about 8%. On a weighted average basis, we may have second-half loan loss provisions around 2.2%-2.4%, and that coupled with 3.5% in the first half will give us full-year loan loss provisions than what we expect to be between 2.8%-3%. In the second half, we expect disbursement momentum to gather pace, particularly in home loan and LAP. I think home loan will continue to grow strongly. Our balance sheet remain strong. On a consolidated basis, our computed capital adequacy is 28. 2%.
Liquidity for the group was above INR 8,000 crores. Our net gearing is 3.6 x, and provision coverage ratio was 93%, which is positioning us well for sustainable and high-quality growth. With this, now I hand it over to Kapish, our CFO, for the retail financial commentary on our quarterly performance. Thank you.
Yeah, thank you, Nirmal. So some of the numbers that I was highlighted by Nirmal, but however, just to go into further details, for Q2, our IIFL Finance profit after tax before non-recurring interest was INR 418 crores. It moved up by 52% on a quarter-on-quarter basis, led by the growth that we see in the gold finance business. We recorded pre-provision operating profit of INR 1,033 crores, which is up 38% by YoY and up 23% on a quarter-on-quarter basis. For the quarter, ladies and gentlemen, our consolidated AUM grew by 35%, and it is at INR 90,122.
It records a 7% quarter-on-quarter growth. This is driven by gold loan, which crossed, as Nirmal mentioned, a stunning new high of INR 34,577, and together, as being our stated intent, our home loan and gold now together consumed around 74% of the total AUM. If I further dissect this AUM, the other businesses on the core product side, comprising home, gold, and MSME and micro, is up 37% YoY, and they aggregate 88,477, which form 98% of our total AUM, being largely retail. Gross NPA has shown marginal improvement. It's at around 2.1%, and the net NPA is 1.0%. Both are down by 21 basis points, 11 basis points on a quarter-quarter basis. The company maintains a very cautious status on the MSME and MFI business, and the focus has largely been on recovery and collection.
This is also resulting into the fact on our guidance for the credit cost, which is expected to go down in second quarter and quarter three and four of this particular fiscal. The assigned loan books, since we have been assigning our portfolio and we've got very heavy traction with banks, our assigned loan books now comprises around 34% of the overall AUM, or booked primarily. Assigned book is standing at INR 18,607, which recorded a growth of 33% on a YoY basis and 24% on a quarter-on-quarter basis. The co-lending book also has improved sharply at INR 11,848, up 40% YoY. The quarterly average cost of borrowing, it has gone down by 7% on a QoQ basis. It's up 23% on a YoY basis.
Heavy liquidity has been maintained at around INR 8,174 crores, and the ALM has always been matched across pockets and buckets with net gearing at around 3.6x. Our annualized ROE for the quarter stands at 11.9%, and ROA is around 2.2%. So our basic earnings per share for the quarter is around 8.9%. Our capital adequacy is far higher than the regulatory requirement. We stand at around 18.6% for the NBFC. For HFC, it's 46.2%, and for Samasta, it's 33.4%, much higher than the regulatory requirement of 15%, led by the off-book strategy that we have with our bank partners. Key highlight for this quarter is, as I already mentioned, that Mr. Girish Kousgi has joined us as MD and CEO in the Housing Finance Company, and we also have good news that we got a rating outlook change from Fitch for our instrument rating from stable to positive.
With this, I come to the end of my submission and would open the floor for question and answer.
Thank you. We will now begin the question and answer session. Anyone who wishes to ask a question may press star and one on your touch-tone telephone. If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use handset while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question comes from the line of Shubhranshu Mishra with PhillipCapital. Please go ahead.
Hi, thank you for the opportunity. So three questions. The first part is on gold loans. Congratulations on that strong growth. How do we look at the gold loan momentum going forward? If one can give a YoY or a QoQ guidance for the next three to four quarters. First. Second is in terms of home loans, especially the affordable home loans, what kind of growth are we baking in for the next two or three years? And which all geographies will drive this particular growth? The third is on IIFL Samasta. Bihar is 22% of the portfolio. What would be the IIFL Samasta plus four lenders as a proportion there? And what kind of Par 0 numbers are we seeing in the Bihar portfolio? Thanks.
Sorry, can you repeat the last part of it, 22%?
Bihar is 22%.
Oh, yeah, I see it. Okay.
Because so what is the IIFL plus four lenders in Bihar? And what are the Par 0 numbers in Bihar in IIFL Samasta's book? Thanks.
Understood. Thank you, Shubhranshu . Gold loan momentum is very strong. It's very difficult to give any guidance in terms of percentage growth because what we have seen in the first half, that growth has been significantly higher than probably what we expected. And it's also a function of gold prices. At this point in time, I think I probably will reference from FY 2025 guidance. Only thing is that the momentum is strong, as we have seen in the first half. It might taper off a little bit or might continue, but it's going to be strong. As far as our home loan is concerned, I think our trajectory for growth has been around 15%-18% on a YoY basis. As I said, the first two quarters, we've been a little cautious for multiple reasons, and now Girish has taken charge as a new leader.
And I mean, he has tremendous experience, and I think we should be able to deliver anywhere from 15%-18% loan AUM growth in the home loan portfolio in the second half. Microfinance, Venkatesh, you are there on live?
Yes, I am. I am.
Can you take a step like this?
Yeah. I mean, in Bihar, we had the first one to implement the guardrail. So if you look at the plus four, it's less than around 5% now. And this penetrates to all the older book, which we have. It is prior to the guardrails, actually. So you had a second part to this question.
What is the Par 0 number in Bihar?
We are at a collection percentage of close to around 99% in Bihar.
But as far as the current market, right, what are the arrears there?
Arrears would be close to around 4.5%-6%, actually, in Bihar.
Wonderful. Wonderful. So thank you so much. I'll come back in the Q. Best of luck.
Yes. Thank you.
Thank you. Next question comes from the line of Abhijit Tibrewal with Motilal Oswal. Please go ahead.
Yeah, good afternoon, Sir. Thank you for taking my question. Firstly, what I wanted to understand is, other than gold loans, when I look at our MSME business, if I look at the other LAP that we call out, which is excluding the micro- LAP, or whether I look at the unsecured business loans that we call out, excluding the digital and MFI-sourced unsecured business loans, which we have discontinued, even there, we are seeing that credit quality kind of continues to deteriorate. So I'm just trying to understand, was it a bad origination, or are you seeing that overall at the industry level, unsecured business loans are still going through a little bit of a weather? And just wanted to add, what is exactly happening in the LAP segment today?
We've seen very strong growth across the industry in LAP, but at the same time, in this quarter as well, we have reported a deterioration in asset quality in the other LAP segment. So if you can please help us understand that?
Okay. So we are reorienting these businesses, and there is a legacy of this business where the micro- LAP business basically was cross-sell products to the microfinance customer. And that's where when you see the deterioration, one caveat there is that the denominator is sinking because we're discontinued for the disbursement. So now, on a small base, the percentages might look a little worse back because obviously, the base is sinking, and we are trying to sort out. When the business is discontinued, obviously, these kind of things will happen. But even in the continuing businesses, as we said, that we should be prepared for 2.5%-3%, particularly in the unsecured business, maybe around 3%-4%. And this book is maturing, and probably at a mature level, we are seeing the full impact of what it is going to be likely to be.
Also, we are trying to strengthen our collection, which I mean, there have been a few challenges in the last quarter. And so we hired, we made some changes in the leadership, and also we implemented certain more agencies and a stronger and a better clear structure. And that will improve our collection efficiency in these segments going ahead. Now, when you talk about lab, it's a very hello? It's a very heterogeneous product. Okay. From INR 50,000 to INR 50,000 can be LAP. And the yield also varies, and also the demographics and the customer segment can vary. Historically, we were doing this business, as I said, as a cross-sell product. And in case of microfinance, what used to happen is that if a customer has done two cycles well as a group, then individually probably will tag either unsecured or LAP product.
Unfortunately, these guardrails hit actually the larger customers more. The new guardrails which came last year, in fact, July 23, right? O kay. Now, but I think that impact is taken, and going forward, things will get better.
Got it, sir. Sir, just a related question. Have we done any ARC transactions in this quarter? If not, any plans of doing ARC transactions, particularly in these two segments where NPAs are elevated in the second half?
In digital segment, we are not done, but in home loan, we had a small ARC transaction. And in digital segment, we'll see how much we can see. In these small loans, our collection has to be done by us only. So we are really valued as our ARC transaction makes sense. But in the next quarter, probably we'll look at some ARC transactions, which we'll let you know after the quarter.
Got it. And sir, was there any one-off in your operating expenses in the standalone entity this time around? Or is it more in the nature of a strong gold loan growth using higher incentives?
Yeah. So gold loan, actually, the competition has become intense, and I think quite a few players have got into it, and they obviously try to poach people from existing players like us. So there has been a bonus incentive. And actually, many of our gold loan employees were very loyal long-term employees. Last year, they suffered because last year, with the RBI embargo, the business did not do well, and the incentives and bonuses were lesser. So we have huge salary increments and bonuses in the last quarter, primarily to gold loan employees.
Got it, sir. And sir, Jain, the last question that I had is, I mean, this quarter, again, I'm not comparing YoY, but QoQ, we have seen some slowdown in co-lending. Was it to do with these co-lending guidelines that come out and things are being reworked? Is that the case?
So actually, there are new co-lending guidelines, CLM 1, and the industry is also seeking some more clarification in the banks about the weighted average rate, how it works. And there are many banks, actually, they're just putting their systems and technology in place. And in the interim, they put the co-lending thing on hold. But there's tremendous excitement, and also, I think banks as well as NBFCs, both are keen to continue this with the new guidelines which come into effect from 1st January. So I think we'll see momentum in this from the next quarter.
Got it, sir. And then, sir, sorry for squeezing, one last question. You see anything touched upon it?
Abhijit, the new co-lending guidelines will be set for 1st January, and many banks are waiting to put their technology system processes in place and have complete clarity on it. If there are more clarifications on this or FAQs expected from RBI, then they'll get a momentum from 1st January next calendar year.
Got it, sir. And sir, I just want to take one last question. Might we briefly touch upon this in the last participant's questions? I mean, we understand it's early for Mr. Kousgi. He just joined us yesterday, but we've known him in his previous role. So just trying to understand that from here, given that this book has been consolidating for some time, the home loan book has been consolidating for some time, now from Q3 and the second half onwards, can we see better momentum?
If you look at the market now, what are the segments?
This is Girish. In fact, sorry. Okay, go ahead.
Yeah. So if you look at the market in all the four segments, we are predominantly present in Affordable and Emerging. That is cutting across EWS, LIG, and MIG. The market is quite robust across geography. And if you look at the industry, industry is doing well. H1, of course, the growth has been slightly lower, but of course, there are reasons for that. Otherwise, even this year, we can see H2, the book growth is going to be, I think, industry level, it will be in the range of 13% - 14%. So as Nirmal mentioned earlier, obviously, we had some challenges in the last couple of quarters. Now we are almost nearing to come out of that. So you can see good traction in H2 and going forward, we will be at par and surpass the industry guideline.
We already guided that home loan is going to be over 15%, and we should improve as we go along. So because the market is quite good, team is good, there are certain challenges we have sorted out kind of, and next couple of quarters, we will see growth and further strengthening going forward.
Got it. Thank you so much, Girish. I wish you the very best in your role.
Thank you.
Thank you. A reminder to all the participants, I'll give my best to the first one to ask a question. Next question comes from the line of Anusha Raheja with Dalal & Broacha. Please go ahead.
Yeah, thanks for taking my question. So I just want to understand what is your reading on the asset quality in MFI, given the fact that we have seen last few quarters the pain is there on the MFI side. But as per your assessment, how do you see the current asset quality? And secondly, if you can have in gold loans, tonnage-wise increase in the gold so that we can understand how much is the impact on the AUM because of the gold crisis. And thirdly, what will be the key change? What are your initial readings in terms of what could be the key changes with the new management coming in in the home finance subsidiary? So what broader things that we might expect are the key changes that can be brought? Yeah, thanks.
Yeah. So thanks. MFI, I think the worst is over, but still the second half will not be as good as the normal time till FY 2024. And the loan loss provisions, the guidance is almost about 8% for the year. So second half will be a little better than first half, but still not like the normal times before these guidance were introduced in FY 2024. These three lender guidelines, maybe Venkatesh can add in case there's something more they have implemented over medium to long term, they will reduce the leverage of these customers who are at the bottom of the pyramid and improve the credit quality and the behavior. But in the interim, we will see that this pain continues, maybe not lesser than the first two quarters, but still it won't be fully normal this year.
Gold tonnage, I mean, in the last quarter or quarter, around 16% growth. YoY, but it's not very relevant because we started on low base in 115% growth because just actually about a year ago, maybe 13 months ago, we had the ban was lifted, RBI embargo was lifted, so we started at the bottom. But maybe quarter over quarter, we have grown by 16% in terms of the tonnage.
Okay. And in terms of what can be the key changes that you might bring in the home finance business?
Sorry, come again?
Key changes in home finance.
Key changes in home finance, yeah. Maybe Girish can elaborate.
I know it's too early, just one day, but I think given the experience in this space and having worked for many institutions in this space, not too many changes. I think a little bit of rigor on business, a little bit of rigor in collection, improving collection efficiency, and a bit of tightened policy. Because if you look at the overall challenge, what we had, it was largely to do with the team and the efficiency, both on business and collection side. I think that we will correct it in the next couple of months. Not too many changes in terms of product policy or program because by and large, it's a very simple product, simple program. So one product, what we had, that we already discontinued.
But for that, in none of the other products, there's going to be any major change. There'll be change in terms of process, there'll be a slight change in terms of credit policy process, in terms of aligning the team. Otherwise, no major changes.
Okay. And just one last thing, if I heard it correctly, in the second half, you're anticipating credit costs to be 2.2%-2.4%?
Yeah, that's right, and the full year will enter 2.8%-3%.
Okay, okay. Thanks, thanks, sir.
Thank you. A reminder to all the participants that you may press star and one to ask a question. Next question comes from the line of Deepak Poddar with Sapphire Capital. Please go ahead.
Yeah, I'm audible, sir?
Yeah, you're audible.
Yeah. Thank you very much, sir, for this opportunity. So just wanted to understand, I mean, in one of your income items, the derecognition of financial instrument. So in the last two quarters, we are seeing a good income in that. So we just wanted to understand the nature of this income and how should one look at going forward?
You're talking about interest-free income, right?
Yes, so I'm talking about the derecognition of financial instrument, the net gains from that. So this was around INR 350 crores this quarter, and last quarter, it was about INR 230 crores.
So this is, as I mentioned earlier in the call, given our strong partnership that we have with bankers, we have been essentially selling our assets to bankers on a seasonal portfolio basis on the direct assignment side. So this is the increasing share of that portfolio. There have been income that is coming into the portfolio, one on a pay-off-to- annuity basis where we earn and we get into the P&L. And secondly, since the accounting requires you to upfront some of the income, then the DA transactions have almost doubled from what it was in quarter one. And that is causing the upfronting of this income which is coming into the P&L. So that's one element which is coming out on this particular P&L from an overall aggregate perspective.
So see, these are technical terminologies for in there.
Yeah. So this is basically the upfronted income on the portfolio which is sold after providing for, I think this is a question that should come earlier also. So when a portfolio, when there's a true sale along with the risk, then the NPV, which is the probable gain, net of expenses to service the loan, is taken as upfronted income.
Correct. I got it. So now this portfolio is already, I mean, the securitization percentage of totally your loan book is already at 30%- 35%, right? So how should one look at this income? I mean, in terms of trend or trajectory, I mean, this INR 232 or INR 354 crores, is that a sustainable income or you expect it to?
Yeah, normally, see what happens in typically we'll have 40%-45% of book loan assets. So this should be sustainable, and this has been there for the last several quarters, actually.
Okay, okay. And what is your target to reach this securitization book, off- book?
You know what happens in this? That on one hand, you upfront the new securitization. But by the same logic, whatever you had done earlier, that income will not accrue because that you already taken. So when the actual interest income comes, you have to reduce the upfronted portion and take the balance as income. You get what I'm saying?
Yeah, yeah. I got it. And.
While you get the upfronted on the flow, you lose the normal NIM on the stock in your profit and loss account.
Understood. I got this. And what would be our target for off-loan, off-book ?
I think normally, I mean, our target would be around 40%, sir.
I think 33%, -34% right now.
Yeah, so gold loan has grown very at a good speed in the last two quarters. Normally, a portfolio has to season for less than two years for three months and more than two years for six months before you can sell it down, and practically, with the audit verification, it might take some more time, so the portfolio which has been disbursed in the last quarter would not have been eligible for DA in the last quarter, so obviously, over a period of time, this will go.
Okay, okay. I got it. That would be it from my side. All the very best. Thank you.
Thank you.
Thank you. A reminder to all the participants that you may press star one to ask a question. Next question comes from the line of Shweta with Elara. Please go ahead.
Thank you, sir, for the opportunity for a couple of questions. So now that the consolidation has happened and we have discontinued certain portfolios like micro- LAP and personal loans, how does the mix shape up now going forward? And what are our growth targets?
So going forward, our focus will be on gold loan and mortgages. And mortgages can have two components. One is home loan, the other is LAP. Primarily, these are the key growth areas. Other than that, unsecured business loan can be a product for cross-sell to our gold loan or home loan customers, but will be a very small component of the whole thing. MFI continues, and we really need to see how the industry evolves from here. In terms of growth target, again, as I said, that this year, for instance, home loan has been lower than our expectation, but gold loan has more than better. But over a period of time, I think 15% to 20% should be our loan growth target. And with operating leverage and increase of margin, then our profitability should improve slightly better.
So on a steady- state basis, if you take a medium-term perspective, I mean, this would be the target.
Sure. And so just a follow-up question there. So now that we are targeting this 15%-20% odd range and the growth is back in reckoning, so if I look at the standalone capital adequacy around 18.5- odd levels and the scope and leeway that we have, even considering the gearing is around 3.6x, then how do you marry this equation? Wherein are we seeing our capital raising and offing considering 20% growth targets? Thank you.
The growth, Shweta will also be in the co-lending. Our internal accruals will meet the growth of the book. At appropriate opportunity, we can raise capital also. But the way the book is going along with the co-lending and bank partnership, it may not be a requirement for capital just to meet capital adequacy, but to be safe and to keep margin of safety at appropriate time, we can raise capital.
Sure. That answers my question. Thank you, sir.
Thank you.
Thank you. Next question comes from the line of Naveen with [MLP]. Please go ahead.
Just wanted to get a sense on the ROA guidance for the full year. We stand at around 3%?
ROA, you are saying?
Yeah, yeah, yeah.
No, okay. I think, I mean, there are so many volatile factors that we don't want to revise the guidance, but maybe I think the first half was around 1.9%. Then probably for the year, we should look at 2.5% now. The losses in the first two quarters, particularly unsecured and microfinance, have been unexpectedly higher. But again, as I said, that it's better, I mean, you know what components of the business is. You've got to forecast growth in each and every component with precise accuracy. So ROA will be around 2.5%-2.8%, I guess.
Okay. Thank you. And the credit cost guidance, sorry if I've got it wrong earlier, but it remains the same, right? Earlier, it was around 2.8%-3%, and it's still remaining.
Yeah, it remains the same for the full year. I think the previous person had asked the question, yeah. It remains within 2.8%-3%. So there's no change over there.
Got it. No change. Thank you. Thank you, sir.
Thank you. A reminder to all the participants that you may press star one to ask a question. Next question comes from the line of Ashwin Kumar with Franklin Templeton Mutual Fund. Please go ahead.
Yeah, thanks for taking my question. I joined the call quickly so in case any question is a repetition, feel free to refer me to the earlier transcript. I went through it. But just wanted to ask two questions. One is, with regard to the capital and the standalone entity, so I think that's stable QoQ, but if I see the growth in the standalone book, that's about INR 7,000 crore, about 20% from on a QoQ basis. I understand some of it is coming from assignment, but even otherwise, there should have been some change in the capital adequacy. So just wanted to understand the math there a little bit. That is the first question. And the second question is on the asset quality on the micro- LAP side. So any particular reason why there's been such a sharp increase over the last two quarters?
Because none of the other players have reported in this segment such a big change, so just want to understand if there's any specific issues which are causing this, and also wanted to understand where this micro- LAP book sits within the three entities: IIFL, IIFL Home Finance, and IIFL Samasta, and also given that you have discount during this segment in the digital loan segment, could that lead to sort of further asset quality issues given that, I mean, you're moving away from segment to the book will keep coming down, so at least from an NPA standpoint, it may not come down quite a bit in the segment.
Yeah. So thanks, Ashwin. So on the capital adequacy, your first question is standalone, the growth has been robust, and we are watching capital adequacy numbers very closely. I mean, as of now, I mean, obviously, we would like it to be higher around 20%, but in a longer-term perspective, I mean, there are a few quarters where you can have slightly lower than what your target level is, but then above the regulatory requirement. So as I said, that we are watching it, let's see how the growth and co-lending, as well as the off-book components grow. And we'll obviously take it up in the roadshow at appropriate time, what is expected with that. But I can assure you that we are watching it very closely on the capital adequacy of each and every company separately as well as together.
Now coming to micro- LAP, okay, where the losses are higher. So one is, just as I think we explained this earlier, the micro- LAP was cross-sell primarily to microfinance customers. The microfinance customers were very badly hit by the new guardrail, which restricted the loan amount very effectively from 3 lakh - 2 lakh and also the number of lenders from low restriction to 4 lakh and then 3 lakh. This obviously caused larger customers in the microfinance to be suddenly forced to cut down on their availability of credit. And this is working capital for people who run small businesses, so they are income-generating activities. So that is where the micro- LAP has been impacted because of the cash flows of these borrowers. This micro- LAP basically sits in mostly in NBFC, although it's closed by our MFI company.
MFI earlier had a 75% threshold requirement, and then the personal product was doing well, and also the parent company had a larger balance sheet, so we were looking at this on the parent company. Why is this looking higher? Because once you discontinue, then obviously your denominator stock is growing, and whatever has not resolved becomes larger and larger piece, so that is why these numbers are looking unusually high, so Ashwin, does that answer my question?
Yes. That answers my question. But does that mean that going forward, also we will see this number remaining high for maybe a few quarters? Because if I look at your stage two in the MSME secured segment, that is another 11%, and one to 30 is also another 6.5%.
Ashwin, what has happened is that this is only 2% of our total book now. And our focus is just on collection here. So this component may remain a little high, but when we're given guidance, we have taken cognizance of that. But it is a very small component, just about 2% of our total book.
Thank you.
Thank you.
Thank you. Ladies and gentlemen, as there are no further questions, we have reached the end of question- and- answer session. I would now like to hand the conference over to the management for closing comments.
Thanks a lot, everybody, for their active participation. For any further questions, you may reach out to our investor relations team, and we'll be more than happy to address your queries. Looking forward to meeting you again for the next quarter. Thank you very much, and I'm very happy to assist you in the order of things.
Thank you so much. Have a good day ahead.
Thank you. On behalf of IIFL Finance Limited, that concludes this conference. Thank you for joining us. You may now disconnect your lines.