Earnings Call: Q1 2022

Jul 30, 2021

Thank you, Bharti. Good morning, everyone, and welcome to this call. We have with us Mr. Yvesh Nath Gaur, MD and CEO and Mr. Puneetto Seel, CFO of LIC Housing Finance. I would request the management to share their initial remarks post which we will open the floor for Q and A. Over to you, Mr. Gaur. Okay, okay. It's a very good morning to all of you and thank you Pradeep. At the outset, I actually had a welcome to every one of you and invites for this post earnings investor call of LAC Housing Finance Limited. As you are aware, LAC FFL declared Q1 FY 2022 results Before beginning, I wish you and your near and dear ones very good health and safety. Though the previous financial year closed on a note of improved economic activity, since April, however, the situation changed rapidly, The emergence of the 2nd wave of the pandemic, lockdown and restrictions being imposed across various parts of the country, plunging the economic recovery again into uncertainty and also affecting our own operations. Since June, there has been improvement in economic activities. However, the graph of recovery will continue to hinge on the pace of vaccination and containment of prevention for the future Mr. Jin, start of pandemic. The key highlights of the results for the quarter are as follows. Total revenue from operations INR 4,857 crores against INR 5,004 crores for the corresponding quarter of the previous year showing a decline of 3%. Outstanding loan portfolio stood at INR 2,548 reflecting a growth of 11%, out of which individual loan portfolio, individual housing loan portfolio stood at INR 2 lakh 16,947 crores against INR 1,95,176 crores is up by 11%. Individual Home Loan Growth reported a growth of 13% and now it comprises a little more than 78% up from INR 7,600,000 a year ago. Total disbursement for the quarter was INR 8,652 crores. Out of that, disbursement in the individual home loan was INR 7,650 crores as against INR 3,560 crores in the last quarter, a growth of 52%. Disbursements in project loans, that is the developer loans, for INR 2.37 crores. Net interest income for the quarter The gross has against 12,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000 stood at 2.2% as against 2.32% from the Q1 FY 2021. Profit before tax for the quarter stood at INR 192.93 crores as against INR 1017.67 crores. Profit after tax for the quarter stood at INR 153 point INR 4 crores as against INR 817.48 crores, the same figure in the previous year. Loan disbursements During the quarter, it remained positive. Though they were impacted during April, May due to the resurgence of the 2nd wave of COVID, Geographically, the growth remained evenly distributed across the various regions, the Southeastern, Western, South and the South Leland. Our mobile platform, Gomi, has got a very good pickup accounting for more than INR 3,400 crores sanctioned during the quarter. On the portfolio front, the growth, the total portfolio recorded growth of 11 And sir, 2 lakhs,548 crores with increased focus on the home loan segment, The growth record in the home loan portfolio was 13%. In terms of asset quality, sales the exposure at default as on 30 June 2021, stood at 5.93 as against 4.12 as on 31 March 2021. Total provisions as on 30 June 2021 stood at 4,727.024, reflecting a prevailing 4%. ECL provisions to the tune of INR 834 were done during the quarter towards the increase in the NPAs. Asset quality continues to be an area of high priority for us. There has been a sharp increase in the delinquencies, mostly due to the economic activities being impacted in Q1 with the lockdown and disruption in many states because of secondary COVID-nineteen. However, With improvement in economic activities and our increased efforts on recovery, we are confident of controlling the same We believe that this should mark the peak during the quarter under review, we have witnessed collection from accounts, These were classified as NPA as of 31st March 2021 also. Though the amount may not be significant, it reflects some improvement in sentiments. Last week, a resolution has opened an account that was in MCLP. It resulted in the growth of more than INR 100 crores. OTR during the quarter stood at INR 2,350 crores. We have been very closely focusing on the collection efficiency, And it continues to be around 98% for the regular accounts in the 3 months of the quarter. On the funding side, we have witnessed a reduction in overall cost of funds by 5 basis points during Q1 FY 2022 and year on year by 99 basis points. Incremental cost of funds has come down significantly and stood at 5.03% for the Q1 FY22. Net interest margin for the quarter stood at 2.2% as against 2.32% over the same period 3 year period. Incremental spreads topped 1 of its highest levels and stood at 250 basis points during Q1 FY 2021. The funding environment and liquidity conditions remain quite favorable for the company. The company is offering home loans now at 6 point 66% interest rate for a specific limited period. This is the lowest rate ever in the interest rate it is the lowest ever interest rate in our company. Project RED, that is Reimagined Excellence Through Digital Transformation in association with the BCG Group. They're also been progressing quite rapidly and some projects, CRM, video KYC, video PD have already been rolled It will take probably in this quarter and the next quarter to come. With this brief introduction, I would like to invite you for your queries. Thank you very much. Thank you, sir. Ladies and gentlemen, We will now begin the question and answer session. And wait for your turn to ask the question. First question comes from Marup Adjania from Lara Capital. Please go ahead. Hi, sir. So can you give the breakdown of NPLs into core retail, Labs and developer? And you can even break down developer into LRT and others? I'll tell you, Aditya, this IHL loans, Indian Housing loans under Stage 3 now actually only Stage 3 required for you, correct? Yes, sir. So it comes to around 2.6% of the Which was 1.9% in 4th quarter? Which was around 1.9 in the 4th. Yes, correct. You are correct. Okay. Again, sir? Then is the non housing commercial, if you see, that is hovering around 18%, 18.91%. Other thing is non housing individual studies, 10.99%. In the Retail segment, total Retail segment, overall comes to 4.57%. Yes, sir. So this non individual of 10.99 that is large, is it? Yes, correct. And now the 2018 is still here. Got it. Got it, sir. Sir, could you explain the rise in employee expenses? Rise in employee expenses actually everything normal only because once in 4 years, there will be wage revision. So with respect to the effect of 2017, it is given. So now we have paid arrears to a tune of nearly INR 120 crores. So that is the highest amount for paid. That's why they have been booked in this quarter. Okay. So, Maruk, to that extent that INR124 crores to INR130 crores that is a one off, Which has appeared only in Q1 of this year, which is towards the earlier payments of last 4 years From Mr. Kanshak from August 2017. Got it. But if you're going ahead, could we continue to So raising employee expenses of say INR 600 crores odd or No, no, no, no. See, actually, if we the INR 600 crores Actually, you have to look at it from the point of view that after you remove that 100 and 25 odd crores, the number comes down INR 19, 92 crores. So that generally will be a run rate. So year on year increase, you can take around 15%. But The quarterly amount is around RMB80 crores when you are looking in last year also RMB80 crores was there. I know it will improve. So what happens, it will go by another 15% There is a given. Moreover looking this much only the figure 80 plus another 15% that's all within INR 100 crores. What happened now, whereas for the quarter Is one of the amount is only arrears which are paid for the past reviews. It is a track of Rafi to give the VAT, 1,000,000 once in 4 years. That's our 2 tier set. That's it. Got it. Got it, sir. So in terms of capital, would you have any alternate plan of raising in case this does not go through? So, see, actually, on this matter, we would not like to make any comment because as you know that we are working on the whatever instructions the stock exchanges have given and we would not like to comment on this matter. Okay. Once anything comes, obviously, it will be we have complied everything in full. We are in touch with the stock exchanges as per their we are waiting for the What we call some other instructions. Correct. Fair enough. And just one last question, the COVID provision is So of the total provision that you made in the quarter, which is INR 8.30 crores, of that, How much has gone towards restructuring? How much has gone towards COVID provision? See, as far as the Everything is in the ECL, yes. Everything is in the ECL, yes. Everything is in the ECL. And for restructuring under the OTR, you have to create a reserve, not a provision. We use for any other purpose. That reserve is basically an appropriation and it is not a provision. Right. But all part of ECM? Everything whatever provision has happened in the quarter has been reflected in the ECA provisioning in the P and L. Okay. Thanks a lot. Thank you, ma'am. Next question comes from Abhijit Tibrawal from Motilal Oswal. Please go ahead. Yes. Thanks for taking my question. So first thing, I mean, at least The restructuring that we have reported of about, I think, RMB53,500,000 during the quarter, I think it's higher than what we had guided for during the last earnings call. And the other thing is, if you could just comment on what has Can you relate to the sharp asset quality deterioration during the quarter? No, Abhijit, First of all, let me tell you that this number that you're talking about is not only for the quarter. It is very In the earlier in the disclosure, it is very clearly mentioned that this is the cumulative. It's not during the quarter. Right, right. Okay. And out of this about 4 quarters in the year is your builder loans. Yes, that is correct. That is correct. So sir, I mean, if I look at our GNPA, which I think you suggested is 18% to 9% sometime back And we see overlay this INR 47100 crores of restructuring in the builder loans. I think compared to an overall risk size of about INR 11000 INR 12000 crores. I think doesn't that seem a little too high? In other words, I would say, she booked 45%, 50% of the machine investor, Krishna. Here, one thing I'd like to tell you, what happened, people have taken Ivory, So what you call this OTR and all, but some of the clients with whom we are in touch, even they may even what you call preempt auction also, even they are well now. When the situation improves, certainly there will be once again, they can anytime they can call the restructuring. So they are all looking into that. All of our Even the dollar per loan book is very, very small for us. So where ODR is taken, they are still in a cashable position. And that way, they are totally the flipping of the NPS like the tender. So that's why I think there will be forward looking. We are very sure that further downside in this The thing is almost all rolled out, the next thing is. Okay. And sir, for the demo first book, if you could read what was your Stage 2 number, let's say, in actual terms? Developer book, if you see, at Stage 2, as far as the project is concerned, 2,490. Because there is stage 2 in the developer group. That's all. That's all. Okay. And just one last question that I had. So you have had a little 5% Q2 increase in your interest expenses, while your incremental cost of borrowings have actually come down. So what has led to this increase? I mean, can I be explained by, I mean, CPs Coming off in your book and being replaced by some of the efforts, Warren? No, Avijit, actually the cost of funds on a year on year has also come down, Potentially also just come down, both on the incremental as well as on the cumulative. If you see, there has been reduction in the interest expense year on year also by almost, I think, 5%, At 27%. I'll give you a number of points on. Interest expense In the June quarter was previous year was 3,764, as against that it is 3,549, which is in the published numbers. Okay, Okay, all right, okay. So I'm talking about the QQ increase. So that number was So Q1, I mean, sometimes it's not Not credible because year end sometimes there could be a drop because of some change in the liabilities. But year on year there has been a reduction. On a full year basis also there will be reduction. That one. So what you're trying to suggest is there's no point looking at the QO program? Correct. Okay. Thanks. That's all from my side. Yes. Thank you. Thank you, sir. Next question comes from Aditya Jain from Citigroup. Please go ahead. Could you What is the amount of ECLG divestment that has happened? Mr. Nizhan, can you please get louder, please? ECLGS. Yes, outstanding. ECLGS portfolio actually is now under 1 and 2. The ECLGS total retail disbursement actually, transaction amount is INR 65 crores in this quarter, in Q1. And then disbursement took place around INR8 crores. So you want exactly the total figure of ECLGS divestment during the quarter? So outstanding we feel this all disbursements which are there to date? Tank and Dispute, right, disbursement is INR 1.40 crores total During the quarter? Retail project put together. Total discussion, INR 1.30? Yes, INR 1.40 crores and retail of yours In the quarter 1 2022, the overall amount has come to INR 140 crores this year. Yes. Yes. And in the impairment, which is slated for restructuring, you explained it process to the P and L. The amount of the reserve is what? So at the end of the last quarter, I think you had From about the INR 285 crores or so, 5 of the expenditure, so there is a plan. So at this time, I'll tell you that for the First of all, the impairment reserve is not a provision, it is an appropriation. So please do not mix it up with the provision. It's a different thing altogether. It's an appropriation out of the P and L. That is the amount of reserve on which you cannot serve with dividends, Right. And that impairment appropriation will be done in the second quarter, that is in the September quarter where balance sheets were actually required to be published. It does not have any impact on the P and L. Is an appropriation. Once again, I'm clarifying. It is an appropriation. It is not a provision. Understood. So as of now, the way I should look at it is INR 285 crores the amount outstanding in that impairment reserve. That will be changed in the September quarter in the balance Yes, yes. Got it. And then just lastly, in recent hope, the increase in NTA, if you could Qualitatively tell us which sort of customers as a geography or whichever way it is, let me type it back, Which where has the increase in NTA come from? Normally, actually this quarter what happened in April May, there are not much of movements outside You are online. So geographically, if you are speaking, especially entire 2 Type 3 cities and all that happened there, our The points were very high. Last year also we got more than 50% of the business from there. So there what happened are some delinquencies that were there. Not be at the high ticket size. The industrial housing loan, even the small ticket per year and there, there was some flip. But mostly they are in the default also now. So what happens now, In the month of June, there is a good recovery in the line of 2nd June. So we are very confident going forward. I think in the individual housing loan segment, There will be sustainable and very durable recovery and so on. Got it. Thank you. Thank you, sir. Next question comes from Miti Gupta from India Inflowign. Please go ahead. Sir, what has passed the impairment for the financial instruments to write so much if we compare on the quarter on quarter basis? Can you please repeat your question? You're not very much clearly audible. So what has caused the impairment on financial instruments to rise So from 56.45 was here in quarter 1 last year to 83.41 in this year. That is PCL provisioning, no. There has been an increase in the NPS. So what has been the moment from Stage So to Stage 3 in this quarter? So stage Stage 2 to Stage 3 now currently we stand at 5.93 overall. So how much the fresh food has been moved from Stage 2 to Stage 3? See, Stage 2 to Stage 3, if you now look at overall, CEO. Okay, sir. Thank you. There is a margin improvement in field 1. Okay. Thank you. Thank you, ma'am. Thank you, ma'am. Next question comes from Srinivas Rao from HDFC Mutual Fund. Please go ahead. Hello. Hello. This is Amit Kanasa. I just had Couple of questions. One was that so last quarter of the restructure book was INR 2,970 crores And now it is INR 5,350 crores. Is it correct? Total is INR 5,350. This quarter is INR 2,350. Correct, correct. So incrementally was INR 2,300 crores, correct? INR 2,353 crores. Now this INR 5,353 crores, if you were to see In what stage? Is it categorized right now, stage 2 or stage 3 as registered? No, they are not. No, Yes, they are in force and all. They have to be eligible for those till restructuring. Then only they will be So this booking is largely So this booking is largely Stage 1 and Stage 1, Stage 2 put together. It is not in Stage 3. Okay. But between Stage 1 and Stage 2 where it could be sitting majorly? Majority will be in stage 1 only. That's what the even last quarter also we had the same experience. What happened now OTR 2 also is now started. Under OTR-one, we can get in the month by end of June. So both booked together Phase 1 and Phase 3 became the 5th launch plan. And then, I mean, is there more restructuring expected? Because the restructuring is still going on, right? Yes, it is going under OTR to know how many people may opt for this and all, but still it is open up to the end of September. It is also been able and all, depends on the Right now, OTR II opt is very little. Generally, it kicks up towards the end of the near about the closing date, And amount size also will be less than INR 50 crores. Right now, OPR2 is about INR 50 crores only. Not above INR 50 crores. And is there any interest reversals that you had to take during the quarter because your interest income is also CEO, down 1% QoQ. So this is normal repricing of the book or this is has an impact of higher NPAs also? No, it will be obviously interest income to some extent will also be impacted by the NPA increase, but it is also due to the fact of Reduction in the yields on the portfolio. But is the interest reversal a very large number or something like that? No, no, no, no. No, it is not, it is not. Actually, under Indej, you are allowed to accrue Indej. Indej first interest reversals are not generally Yes, he's not there. Okay, understood. Thanks. Thank you, sir. Next question comes from Amit Premchandani from UTA Mutual Fund. Please go ahead. Yes. Pankaj sir, for the opportunity. I had a question with 5,000 of several restructuring. How much has been the provision created on that? Sorry, can you please repeat yourself? The 5,000,000,000 of restricted amount, what is the provision created on that? Then 1,000,000,000,000 Actually, under the once again, I'm telling you, under the OPR regime as per the RBI Circular, Now what we have to provide is a blanket 10% on the outstanding amount, right? Yes. So that is something which is compliant. Now what happens to the difference between the ECL provisioning and the provisioning under this IRAP norm? This is under the IRAP norm and Under the RBI prescription. So it is not under the ECL computation. The balance gets moved into an appropriation Out of the P and L, which is called the impairment reserve, the balance side. But to answer your question, Fully, it has been provided as per the RBI norm that is 10%. So, Hi, Talim, to all require R500,000,000 provisions. It's safe to assume you have used the PCN 12 provisions And I thought we can further restructured assets rather than creating a fresh 10% program through the CML above the lines. Yes. Shri, what happens here, the treatment is different. So you have got the provisioning under the index is a pool provision, right, on the entire assets of whether it's Stage 1, Stage 2 or Stage 3. Now under the RDA prescription, you have to also clear 10% provisioning On the amount of restructured assets, so that INR 5,350 crores will be INR 500 crores of provisioning requirement under the RBI IRAC norms. Okay. That is a separate treatment. This is a separate treatment. Ultimately, you have to report the numbers on the ECN. This provisioning is also created and the balance is reflected as a co creation of reserve. Now if you look at as of March, the reserve was around say 280 or something. So that reflects the difference in the provisioning, just taken out the reserve. The PICC rollout has been taken out of the reserve But this reserve is below the line after the That is correct, correct. This is a reserve, not a provision. It's a reserve, not a provision. Okay. So that is not shown to the PMLs, so these are the PMLs? Yes. To the extent of the difference, only to the extent of the difference between the MSB RBI prescribed loans and this one. Otherwise, 4,700 cores is the provisioning which covers all the NPL accounts, including the ones Which are under restructuring. Right. So and the disservice to ATTRR that you mentioned? Yes. Thank you, sir. That's it, Sanjay. Thank you, sir. Next question comes from Shashank Verma from Axis Mutual Fund. Please go ahead. This is Ashant. Please go ahead with your question. Hello. Thanks a lot for giving me an opportunity. Sir, I just wanted to check on one prior question. This ECLBS, as long as what is the outstanding number? INR 400 crores, INR 450 crores approximately. Okay. One more thing, the software and developer accounts will continue how much for a sales on day? Software? Developer accounts Would be how much on an absolute basis or as a percentage of our entire developer book today? You are talking about top 10 Developer accounts or top 10 NPA developers in the NPA segment? No, no, sir. I'm talking about the standard accounts, top 10 standard accounts. Yes. Top ten standard, I mean, top ten in the portfolio, let us look at it this way. Top ten will be around, say, INR 2,000 crores. CEO. Okay, that's it. Thank you. Thank you, sir. Next question comes from Piren Engineer from CLSA. Please go ahead. Yes. Hi. I just have a couple of questions. Firstly, in the individual segment, in the second phase of restructuring, we've done only INR 40 crores or so. We've done only INR 40 crores or so. Like why did we let them slip into NPL and not restructure them? No, it is not allowing them to slip. Their time is still there. They have to be eligible. There are certain eligibility criteria. Got to satisfy that and all. We have to come under that, the rating consultant will be required. Retail may retail, the rating is not required, but there are certain eligibility criteria. Correct, correct. Those were just the ticket size based eligibility criteria, right? They have to be a performing account, no? No. So as of March, they would have been performing, okay? And then we have the option to restructured, but we didn't and then they've slipped in this quarter. And you think they've slipped in the month of April before the particular 3 months? Exactly. That is what I'm saying, that basic eligibility criteria of the accounting standard should have to be clarified and should have been achieved by the Optees. That is number 1. Number 2 is that not everybody is preparing for applying for OT Because many people are paying intermittently. It is not there second before completely, they are paying intermittently also. Retail segment around the 1557 numbers on accountants, yes, in the OTR. Okay. And sir, now if you can just give us the broad picture, we've got almost INR 9,000 crores of loans under NPL in the individual segment. Now what percentage of this NPL would be customers who are paying, but just that they are more than 90 days overdue? So they're paying, but they're paying with a lag. And what percentage would be those who are not taking at all? If you can give some color on this, that would be really helpful because Our collection efficiency always grew strong, but then quarter after quarter, our NPLs are rising even in the retail segment and Investors are just not able to understand how those 2% and 4% exist. So if you can give a sense of what Percentage of your NPL book is paying that could give a lot of clarity to investors. Would you happen to have that number offhand? So I'll just share some exact numbers. I'll try to share whatever numbers. It's a number the regular Up to date, the regular collection efficiency on a month on 1, which is that is on the regular accounts, That is more than 95%. That is around 98% and that has consistently been there. In terms of total number of customers Sir, actually made some payments. No, I meant how many NPL customers are making payments? Yes. NPL products, people are aware what happened, Tier 2, Tier 3 releases by April and month, CEO. The NPA customers are nearly what you call 10% to 15%. 15% across the board have converted and mentioned they are regularized and it's happening. So in the month of June, especially in the 2nd full end of June, really this It has helped us a lot. So 15% we can take as it is a benchmark, it is happening now. Going forward, definitely it will be more than even 30%, 31% is going to come up now. That's all we are looking at. No, no. So you are not getting my question. These are accounts that are regularized, which means they are being upgraded back to standard. I'm asking there will be a lot of customers who are paying, but they are still 90 days overdue. And therefore, they still remain as NPL and don't get recognized. I got your query. See, out of the Customers who are NPS on 31st March, you want what has been the collections on those accounts, right? Yes. That's all I have. Approximately about 30% of the customers have been making some kind of payment number wise. Some kind of payment they have been making. But obviously, this is not adequate enough to pull them out of Upgrade to the standard. Got it, got it. This gives good clarity. So my next question is out of the restructured book in corporate, which is almost 4,500 odd crores. How much of that is LRD? Or is it all builder loans? Mr. Out of which one? Yes. The restructured book in corporate, how much of that is lease rental discounting? Because there also we have 3, 4 percent in this high risk reconcurrently. But there also there is on the LRD also there is restructuring which is there. LRD maybe something around what do you call? LRD Restructures, that is there, it is there. Out of for example, on the Non Retail segment, Non Retail's total restructuring amount is In Q2 Q4, it is it has been around, say, 1700 odd crores And in Q1 around INR 2,000 crores, some INR 700 crores restructuring request have been received. Over 2 quarters. Yes. Okay, okay. And just as a risk of repetition, sir, if you could Explain exactly now, last quarter, our impairment reserve was INR284 crores as of March 31. This INR 284 crores had been passed through the P and L of FY 2021. See, again, I'm telling you, again, it is not It's a provision. It is an appropriation. It is an appropriation of the P and L account. Vision, this is an appropriation. Okay. My question is what is that number as of June And this is yes. As of June, what would it be? I told you it would have been around 350 odd crores. Okay. And so then what Understood. So this the difference between the INR 500 crores that we are required to make and the INR 350 crores that we have made, So the INR 150 crores difference is part of our EPL of INR 4,700 crores. Is that understanding correct? Yes, that is right. Understood. Fine. Thank you so much. That's all from mine. Thank you, sir. Next question comes from Subhik and Stanley. Please go ahead. Yes. Thanks for the opportunity. So, Ritu, I just had a follow-up question on When you say appropriation, so you mean that it's from an accounting perspective, it's part of the shareholders' equity. So I mean it's not like a separate. Separate. Yes, Yes. So it's still a part of Tier 1. It's not like a separate loan loss reserve on the balance sheet. But it cannot be used for servicing dividends? Yes, it cannot be used for servicing dividends, yes. And just a question, so this quarter you have INR 800 crores of provisions And your net change in the English terms, So this balance INR 250 crores, should I assume it as a write off? So I'm not getting your number. Somewhere there are some Missing it. When you are talking, yes. Tell once again, sir. Yes. So this quarter, the provision through your P and L are about INR 800 crores. And the net increase in your total ECL, which we have reported in your P and L, in your PPT is about INR550 crores. So the difference between the 2 that is of INR 250 crores, because ideally you're provisioning through the P and L sheet or asset added to your resale, right? So the difference between these 2 INR 250 crores is that should I constitute as a write off? So it's not a write off. It's only not a write off So I mean, or is it sitting in some under some other head? Yes. There's no write off. There is no write off in this quarter. Okay. So under what head is that sitting then, that 250 groups, I mean Yes, I've already taken the 250 crores. We can then touch when we'll able to Which figure you are talking about? One is about the provision we made 8.30 percent, okay. Yes. And then second figure of 250 percent, what you are telling, no 550 percent from where it has come? No, 5.50. So I'm looking at the difference between the ECL, the total ECL that you have. So last quarter, it was There will be some errors. We'll recollect later on. I think you're not able to connect the correct results. Okay, fine. I will get back to you separately. Thank you. Thank you, sir. Next question comes from Vikinsha from Credit Suisse. Please go ahead. Yes, my question is already answered. Thank you. Mr. King, sir? Your question is already answered. Thank you. We can go to the next one. Thank you. Next question comes from Kunal Shah from ICICI Securities. Please go ahead. All the questions have been answered, just a couple of them. So when you see in terms of the behavior of this restructuring pool, Okay. Vijay, maybe in terms of the provisioning that is added to the impairment allowance. Suppose it's from the restructuring phase and it defaults, So when does it actually come in with P and L? So maybe what is the nature of this restructuring? And Maybe is it like a 1 year, 2 year moratorium? So just to understand the stress in this coming into PNM, what could be the Again, Kunal, let me clarify. The provisioning is already done. It is only the difference between the IGAP provisioning under the IRAC And the ECL provisioning, which is to be reflected to a reserve, just to be created as an impairment reserve. So as I mentioned in the first part, I'll tell you, I'll explain to you what happens is that right now the Provision is made at the rate of 10% under the RBI circular. The moment it becomes an NTA, it will become 15%. So that will happen after the end of the restructuring period. Somewhere it is a 1 month moratorium, somewhere it is a 1 year moratorium, somewhere it is a 2 year moratorium. To answer your query, right now the provisioning is made at the rate of 10% as per the Reserve Bank guidelines. But you know that Generally, in the required provisioning for NPI account is 15%. The balance 5% The balance is 5% here in terms of 20% made and 5%. Just in terms of the nature of restructuring, is it 1 year, Different, mostly mostly what we have given is that we have not given principal and interest moratorium So customer very rarely it has been given. In most of the 90% cases, we have given only principal moratorium. So the customer continues to service the interest. So that is one thing that we have tried to ensure so that there is some regularity in terms of the financial discipline. Now, I mean, coming to your points, what happens if at the end of the moratorium, the customer is not able to service the principal or in the interim also he fails. So even in the interim if he fails then the moratorium covers it. Thereafter after the closure of the completion of the moratorium period if the customer is not able to pay, He will be deemed to be an NPA from that day. At that point in time, whatever is the provisioning requirement under the IRAC norms And also the ECL will be compared and whichever is required, whatever provisioning is required will be made. That is right. The OTR now, whatever government says that we are doing a 10% of the full year. Yes. Yes, yes, got it, yes. And overall GMP and the developer book, stakeholder bookings, how much? Is it 19 or it's a higher number? Development GMP as per the Stage 3 account, we talk of the Stage 3, that is 24.4%. That is 24.4. So 18.9 is the individual non housing commercial. Yes, correct. That is non housing commercial. That's the individual non housing. So That is for a 24.4, which is roundabout 3,700 plus 3,300 crores of restructuring. And then you mentioned the Stage 2 as well. So Page 2 is almost 2,400. Our loan book size under the developer loan is very, very small, only 15,000 per ounce only, not very high. Yes, that's true, yes. Okay. And finally, in terms of the restructuring on the retail side, so obviously, that's quite low and there will be no pipeline. But any expectations in terms of what can we Yes, true. Larger part of it is still developers and we have window tail of 10 years. So what is the kind of request we could get and how much we to get restructured because in some of the things that we had seen, retail restructuring also could be quite high because E and I components of housing room is generally Higher end people tend to restructure that. So any expectations in terms of how much will be retail restructuring? I'll share with you whatever has been the restructuring quarter wise Under both OTR1 and OTR2 on the retail. So that will give some indication of what is coming up or what can be expected. Say for example, in The Q4 that is March ending quarter, that time there was no OTR2, that time it was OTR1. So Under that OTR-one in Q4, we have restructured INR1200 crores approximately, INR 1190 something. So 1200 crores you can roughly take. Whereas in the Q1 of this financial year, The number came down significantly. It came down to only 234 crores under OTR1 and there were some around 45 crores or 40 crores under OTR2. So that number had come down to 300 cores in Q1 of this year. Generally, what we have observed is that Towards the end of the OTR window, the number of customers will come that increases. Same thing happened in Q4 also. All through the initial months of OTR, there were hardly any applicants. Towards the close, the number of applicants increased significantly. So I think 1% is something we can take on outside. Yes, that's the most because what happened so far already where risk is restricted. Already it's actually happened. It's very I mean at this point in time to take a number also it is It will not be a correct guest in it also. And one more thing is that people are already aware that they are also Come out of that. They want to preempt that option so that there are also some we are seeing some green shoots there also. That is also an advantage for us. Sure. And considering the fact that for the Non Retail segment, there are also eligibility criteria Regarding getting the RP4 rating from the rating agencies. That also in many cases, it is not, I mean, the most obvious, I will obtain that. Sure. And lastly, in terms of growth, so the sequential decline has been relatively higher. More of the Yes, Q4 is higher. There is the impact of 696 plus rate disruption. But otherwise, housing has done relatively well in general because there was a momentum. So how should we look at the overall growth in the coming quarter? What we saw in XQ of FY 'twenty one, Should we expect that in terms of our competitiveness, we will be somewhat similar and we will get back onto the growth and this is just a temporary kind of Moderation, which is there? Yes, sure, sir. I'll tell you actually as far as the growth is concerned, this Q1 Clearly was a good one compared to earlier already we have got more than 1% to 3% growth and even immediate activities are in full swing from June onwards. Then going forward now this Q2, we are expecting almost all the same turnaround of Q4 of last year, we're looking at that. So with that, what happens now, there should be a good actually even the current June, which has recently gone, one of the best in our of any for the past due month in terms of disbursement. So the next quarter and also even the Q3 also we expect excellent business. Especially for Q2, we are aiming at repeating whatever we did in last year Q4, so that what happens now, we can take a quantum jump with a great bounce back. Sure. Okay. Thank you and all the best. Thank you. Thank you, sir. Next question comes from Nishant Shah from Macquarie. Please go ahead. Yes, hi. This is Nishant. Question is in mind, which is So just one question. Of all the home loans and the lab loan NPLs that we have, I understand that the LTVs that you're standing at are very comfortable, right? Only question is, Of say, either the individual loans or the last loans, what percentage of those NPLs would pertain to projects which are like still under construction? Like we would have valued the, say, flat at Seibankarore, but that is assuming that the property has completed. If the project is stuck, Then there is nothing no collateral really to sell. So what percentage of our like NPL cases would be such where the collateral Probably is not currently in existence. It is stuck because the project is stuck or something like that. Because otherwise, would there really be a big worry in terms of Right offs or crystallized credit losses in the at least in the individual kind of portfolio. That's my question. Yes, Nishant, the loan to value on the project entire project portfolio is around 38 Sorry to interrupt, not on project, on individual. So what Individual LTV, 2, 3 different categories are there. I'm talking of, first of all, individual home loans, The NTVs are 44%. That is on the book, right? Correct. For the non housing individual, which is basically the lap, There the LTV is now 33%. And in the non housing commercial, the LTV is 34%. Correct. I think as far as the LTVs are concerned. Now for non housing individual and non housing commercial, There is no execution risk because these are normally ready meant and I mean readily available all income earning properties. The question what you have raised is relevant only to the individual home loan segment. And where in the individual home loan segment, Please understand that our disbursements will also be vis a vis stage of construction. So when we are talking of an LTV, it is an LTV on the book. It means that if the construction is 60%, then my Disbursement to that customer will also not exceed 60%, correct. That is the rule. So the LTV will hold. It is not That I mean, our exposure is more than the stage of construction. So if the stage of construction has not proceeded, then My discussion would have also not proceeded. And whatever construction has happened, The example that you have taken that the value is considered at the time of selling, it is not so. The value is considered at the time And to the stage which construction is specific? We have to value at every stage. Now as it is now, the total valuation on the book So, he is always to be more than 1.5 times also will be there, I think project here also. So that is taken care of, it is not a problem. Understood. So just to get this right, so in a case where you say given a home loan where the LTV is, say, 50%, right. And the stage of construction is done about 60 odd percent. The V, the value over there in this LTV ratio is not the final selling price, it It is only the valuation that is done is only up to the stage of construction. Okay. That is a stage of construction because my disbursement will depend on the stage of construction and the valuation done at the particular stage. Correct. Okay. No, so I'm just trying to okay, fair enough. So just again to just like understand this a little bit better. I want to say a flat on the 10th floor and the building is now completed to the 5th floor. In this case, How do you assign a value to the flat which is not yet in existence yet, in the case of a home loan? See, there is any such apartment which are high rise apartment even if your property has not come, you have a claim on the undivided share of land. Understood. Okay. Proposed share of land will be That is all undivided share of land. You have even you as a customer, You can also state that KMT, although my flat is on the 15th floor and the construction is completed after 5th floor, you still have a retained value in your investment. And in any case, but it's not that particular property will not have proceeded to that extent. Correct. Understood. So in this case, when you disclose an LTV of 44%, In case of a home loan where the disbursement or sorry, where the project has not been completed, the value considered is the proportionate stake of land or whatever. It's not So as not to the selling ultimate surrendering. Because the disruption will also be done on that, whatever what happens if you have purchased a 40 day It's a 20 storey apartment and your flat is on the 19th floor. It doesn't mean that you As a customer start making payment only when you have reached 19 crore. You start making even as a PMR. Got it. Perfect. So then in that case, the eventual crystallized losses from the home loan portfolio should be near 0, right, because an LTV of 44 is super comfortable. Then should he share the provision timing difference? I will share some numbers which will give you some comfort and write off That is ultimate loss. In the 52 years cumulative, in the home loan segment, we have done less than INR 300 crores. And the amount of disbursement that we have done is more than 4 lakh crores. So that way if you look at it, Ultimate loan losses will be in single between basis points. Got it. There is a time which is required for recovery. Okay. And when we do the recovery, the interest accumulated is also recovered, right? It's not just the principal amount. Mostly it is recovered. Somewhere it is Required to be waived also, but overall principal is not built. Yes. And the same interest and all will be taken care. They haven't been paid any. From senior interest, etcetera, in certain cases, we have to take a practical call to pay the IRR of the payout, not the exact amount, but our own non Understood. Perfect. Yes, that's all I was trying to get to. Yes, thank you so much. Thank you. Thank you, sir. Next question comes from Agnesh Chauhan from Reliance Nippon Life. Please go ahead. So good afternoon. Thank you so much for taking my question. I wanted to understand that you have filed the appeal with the SAP on the capital Resilience. What is the status of that? Please notice very clearly, we have not filed any appeals with the SAT. I repeat, we have not filed any appeals with the SAT. We are only in touch with the exchanges, whatever. We have also not received any instructions on SEBI. Only stock exchanges have been formed and you can refer to the disclosures that we make on the stock exchange. I would feel that you should Closures that we make on the stock exchange, I would feel that you should look at the disclosures that we have made with stock exchange. Stock Exchange have asked us to withhold the result of the evoking and exactly that is what we have done. We are waiting for an instruction further. So the instruction is awaited. We have not filed any appeals with the SAP, yes. Okay, sir. But there are some media articles which we have No, we see. We cannot respond to the media, but very clearly I am telling. We are fully compliant with all the regulations and all. We are in touch with So what is the exact concern from exchanges side on that? So, see, exchanges are actually after for certain verification. In the disclosure, it is 0. Disclosure, I would request you kindly go through the disclosure. We have given very It's clear explanation etcetera has been put placed with the stock exchange. Thailand is available, you can look into that. That tells you more details. Yes. Okay, sir. Thank you so much. Thank you. Thank you, sir. Next question comes from Vivek Ramakrishnan from DSP Mutual Fund. Please go ahead. Good afternoon. Thank you. My question is follows. It comes from the Rajiv point of the need that we had only 300 crores of write offs in the home loan portfolio. Would you also have an equal amount of how much is recovered, how many what is the amount of property that they've sold and the preferred money in the sense that At what point you've taken mission to sell the property and recover the money and because that always has this negative customer impact and so on. That's now only question, sir. Thank you. Normally, what you do when the people fail and all, there will be lot of what you call follow-up will be made So people once again regularize account and all. In case this all matter has become default NPA then again I mean for a long time And people also drive for all OTS and all is not over. Then what happens on the surface, they proceed. And as for that, all will take physical possession, conduct CEO. That I'll follow. That's all. That's the only normal procedure. So, sir, do you have any idea of quantum of sales of CEO. You could give like a Not in the actually on the expert level. Or else earlier and all, we used to have that run. And then every year Out of our NPAs which have gone into NPAs, we could have seen at least some suddenly will be the achievement level as far as the record is concerned by selling the properties. Apart from selling properties also, just issuance of also in many cases evokes an action from the borrowers. Yes. I understand that. Thank you very much. Thank you, sir. Thank you. Next question comes from Ankit Adewal from Yellowstone Equity. Please go ahead. Yes. Hello, sir. So just wanted clarity on the employee expenses, the earlier part. I understand it's about INR 125 crores and it's one time. But could you give some more qualitative color like what is it about? At the salary amount, you're asking wage arrears and all. Yes. But see what happened in our company, we have got one policy, wage policy. We don't revise salary every year. Once in 4 years, we will give escalation salary. So that was due from the year 2017 to 2021. It has been done now in the month of June. So the arrears are being paid from 2017 onwards to 2021. That has come to RUB125 crores somehow, value a thing. So henceforth what happened only the regular salary will be paid compared to earlier quarter there may be an increase of 15% overall as well as the discount for salaries Every quarter, every month like this. And so why don't we book provision for this because on our This is given that we will do every 4 years, it's kind of given that There will be some expense on an accrual basis. Why do we take like a one time deadline if accounting qualifies? Currently, whatever. But at least there is no, what do you call, know that What rate it will be approved or something and I'll go to board for approval and all, no? So what rate and all was there? It has not been it is Quantifiable at that stage, but going forward what we have decided is that next cycle whenever it is due that is Maybe in a couple of years from now, from that time onwards, every quarter, all amount might be because if it comes every quarter, then the amount will In just maybe a few it will not even cut double digit flows. Yes, yes. It is small amount. Very small amount, every quarter it will be Some 10% are that who can take and provide for this, what will you? I see. Okay, makes sense. And then just sorry to come again on the OTR You mentioned that it's mainly in Stage 1 and Stage 2. But on the other hand, whatever deficiency is there between the reserve and the Provision amount. You started sitting in Stage 3 provisioning. So why is there a disconnect there? No, again, I'll tell you again Kindly note, it is 2 different accounting practices. 1 is under Indes And the other one is as per iZAP, right. The RBI provisioning, etcetera, has to be created as per the iZAP, which is being done. Only the balance between Indes and ISA has to be reflected through a creation I understand. So please do not confuse the creation of a result with an OTR. They are completely different things. OTR also what happen people, they should be eligible now, CEO. Please don't confuse the provisioning that whatever is required is being done Appropriately and correctly, under the 2 different guidelines, that is the RBI guidelines of 10% that also has been done. Okay. And on the collection as you mean or addition fee, it's 98% for the month of June or for the whole quarter? Yes, we have been tracking for each month. Now you have to hear also you have to note that whatever collection happens for that particular month, considered for the regular accounts only that much of collection because if you add the collections of previous months, then sometimes the number might be even exceed 100. So only for the accounts which are due for that particular month, the ratio is taken. Whatever is the NPI account for them, there is a different calculation, In which case, get reflected through the NPA numbers. And this number has been consistent even in the March quarter also you have seen in total 97%, ninety Yes. Now because of that integration, the content collection, the EMAX payment, all these things helped us a lot. Okay. And just one last question. So you mentioned there was a recovery in one account. Is that related to builder loan? No, that is not a bigger loan. The loans were given to 1, I think, the corporate, corporate. Okay, so But there were some accounts that are pending with LCMP like 4 accounts is something with regarding developer loans. What's the progress on that? There also there is some progress, but Only when resolution happens, we will share that. Like we have shared this news also, this has happened in July. So it is obviously not factored in the June numbers. It will come into July into September numbers. But it is a progress, so that's why we thought that It will be shared with shareholders. Understood, understood. Okay. Thank you so much. Thank you. Thank you, sir. Next question comes from Abhishek Muradkar from HSBC. Please go ahead. Hello? Yes, please, please. Yes, yes. Thank you. So I just wanted to reconcile the NPA numbers because there's some confusion. And I really appreciate if you can help me with the number here. So as you said, The detailed mortgage book, which is the 1.8 lakh crore is just 7.2 lakh sessions, that has a Abhishek, in the interest of time, I read out the numbers, you can note it down. Okay, okay. You can just note it down. This is as per the Inderes, so we'll not talk of this is a Stage 3 that we are telling you. Yes. Yes. And the assets total assets are also On in-depth basis, right? Sure. So I'll just tell you the numbers. We request you to kindly note down Right? Yes. Individual home loans, the Stage 3 is 2.6%. You want numbers, the number is 4,727. Then in non housing commercial, The Stage 3 is 18.9 percent and the amount in terms of amounts is INR 2,707 crores. INR 2,700 707 crores. 200707. 2,707. Got it. Okay. In non housing individual, which is mostly the LAP, etcetera, there the Stage 3 is 10.99%, you can take 11% And the amount is 2,253 gross. 2,253, okay. And the project, the NDA number is 24.4% And the amount is 3,889. 3,889. Okay. So if I add up all this? 13,571. 13,500,000, got it. And the lab portfolio is in the sorry, the LRD portfolio is in the lab book, No, no, no, no, no, no, No, no, why I've given you so many bifurcations. Part of the LRD is sitting in the project and part of the LRD is sitting in a non housing commercial. Okay. Okay. What is that bifurcation? Can you please? See, total put together, the NRD book will be around 9,000 crores. And how much is in non housing commercial? That those details I will share separately, yes. Okay. Okay. This is fine. Yes. Thank you. Thank you, sir. Next question comes from Raghav Soni from Brand Capital. Please go ahead. Next question comes from Mr. Raghav Soni from Brand Capital. Sir, please go ahead with your question, sir. Hello? Yes. Yes, sir, I was just can you please highlight the provision coverage ratio? I think in the news article at both, I think it's 32%. Can you just give an overview of that? How is it 32%? Reason is that If we are now currently stands at 34% as of end of Thank you, sir. As of end of Q1, it is 34%. Okay. Thank you, sir. Thank you, sir. Next question comes from Saurabh Kumar from JPMorgan. Please go ahead. Mr. Saurabh, please go ahead with your question. Mr. Saurabh Kumar from JPMorgan, you can go ahead with your question. There is no response, sir. Next question comes from Mr. Parameshwaran Yes from Jefferies. Please go ahead. Hi, sir. Just reconciling some numbers. So if you look at Slide 20, you said that Ethian provision in Cades 12, total is about 13 crores, 100 and crores. Now on the restructuring side, I guess on a 10% basis, you need INR 550 crores. So is the balance INR 420 or INR 430 crores, is that the internal result? As of 20 crores, again let me tell you again I think you are getting confused. Please understand Which is done for the OTR that is under the RBI IRAC norms. What you are talking about is the provisioning under ECL. They are completely different thing. ECM is underwritten. Yes, sir. You said the difference is routed to impairment. Yes, correct. INR 110 crores in Stage 1 and Stage 2, the total U4. It is different. The requirement is INR 5 No, it is not. The requirement is not under Indes. The requirement is under RBI IRAC norms. What the numbers published are under Indes. It may or may not contain. They are completely different things. The pool of pooled business. So I wanted to understand if Swettigcrore has moved up in this quarter, So, Shweti Cro impairment reserve that you were holding as of last quarter, so it has moved up. Has it moved up this quarter? Yes, it has. It has. So what is that number outstanding now? Around 350 or 350 Thank you, sir. Ladies and gentlemen, that would be the last question for the day. Now I hand the floor to the management for closing comments. I thank you everyone for a very good interaction with every one of us. Looking forward now, the next quarter, there will be great bounce back And we are also very much confident that the disbursements, especially will be in higher scale across 10. Once again, I will again reassure all our stakeholders that we are fully I'm again to address all your concerns and I also thank you for your continued support. Looking forward for a very good And also more than expected growth in this quarter across all the regions with a very good data centers what we're having and With the involvement of all our team members, we are looking for the tradition of what we did in the last year Q4 in this Q2 now. Thank you once again.