5paisa Capital Limited (5PAISA) Earnings Call Transcript & Summary

Ladies and gentlemen, good day, and welcome to 5paisa Capital Q1 FY '23 Earnings Conference Call. [Operator Instructions] Please note that this conference is being recorded. I would now like to hand over the floor to the management. Thank you, and over to you.

Very good afternoon, everyone. Myself, Prakarsh Gagdani. I'm the CEO and the Whole-Time Director at 5paisa Capital Limited. I am joined by my colleague, our CFO, Mr. Gourav Munjal. On behalf of Gourav, myself and the management team, I welcome you all for the first investor conference for the first quarter of FY '23. Friends, we entered this quarter, and we saw that the retail participation in this quarter was subdued. You are aware that in this quarter, the indices, both Nifty, the Midcap and also the Smallcap corrected almost in the range of 15% to 20% from their peak. It had an impact on the retail participation, especially on the retail cash market. In this quarter, the retail cash market turnover on NSE almost fell down by 14% quarter-on-quarter, which had an overall impact on the activity of clients in the NSE -- on the cash segment and also on the turnover and revenue. Now, let me take a few things from our results. First, our customer acquisition. In this quarter, we have acquired around 2.28 lakh customers, which takes our total customer base to almost 29.6 lakhs. Although compared to our previous quarter, our numbers are low. But it was a conscious call that we took from last 2 quarters, and I've mentioned that in the previous calls also, to improve the quality of customer. So from -- in the Q3 of last year, we acquired around 4.05 lakh customers. From there, last quarter, we acquired in the first quarter of this calendar year and the Q4 of last financial year, we acquired around 3.59 lakh customers. And in this quarter, we acquired around 2.28 lakh customers. Now, this was a part of our conscious initiative to improve the quality of customers, especially when the overall market participation is subdued. Second is on the cost side. So with improving the customer quality, it also had an impact on the reduction of cost, though our customer acquisition cost increased from INR 768 in the last quarter to INR 895. Now, this was broadly because the OpEx and the HR cost was fixed. And because the acquisition was down, it had a marginal impact on the increase in the cost. The second part was on the marketing spend. Now, because we were looking at improving the quality, in some of the paid quality -- paid category of the customers, the account acquisition cost was higher, which had an overall impact on the overall acquisition cost. Now, I would like to also assure that we are working towards reducing the customer acquisition cost, which was in the last quarter, and there is also further scope of reducing that. We are taking effort, and we feel that the increase in the customer acquisition cost is a temporary blip. Coming to the business side. Our total income dropped by 5% quarter-on-quarter. This is broadly because of the fall in the exchange turnover and the muted retail participation with [indiscernible]. But having said that, we have been able to maintain our market share. Our cash market share stands at around 3%, which has been same for last 2 quarters. On the derivatives segment, we have seen a marginal improvement in our market share. From 3%, we are now at 3.14% market share. Despite a bad market, our margin funding book was almost the same as against INR 322 crores for the previous quarter. We closed last quarter at INR 316 crores. Our overall efforts on optimizing cost has seen a drop of the cost by 10% Q-on-Q basis and which had a positive impact on our PBT. So our PBT went up by 68%, and we have closed the last quarter with the highest PBT and also PAT. We also improved on our margins, so our PAT margins improved from 5% to 9% in this quarter. Talking about our product and technology. In the past, we have informed that we were investing. After our fundraising, we were investing in building infrastructure, investing in technology, hiring tech and digital department people. I would like to appraise that we have almost completed our investment. And now, incrementally, there will be less impact on the fixed cost in the product and infrastructure and on technology. But with this investment, we have got some [ risk ] dividend. Our straight-through processing acquisition, it means that a customer opening an account through and through has improved and touched 85%. So today, 85% of our customers are onboarded digitally without any intervention and are completing their account opening journey in one single go. Our further improvements in technology product will see substantial improvement both in terms of customer experience and also a reduction in cost in coming quarters. At last, we will continue our focus on our growth, which is quality of customer acquisition, increasing in revenues, optimization in cost, and ultimately, increase in profits. With this, I conclude my opening remarks, and I open the floor for further question and answer. Moderator?

Thank you, sir. Ladies and gentlemen, we will now begin the question-and-answer session. [Operator Instructions] First question comes from Karthikeyan VK from Suyash Advisors.

You talk about quality of customers. Can you give us some parameters on which you assess the quality of customers? And therefore, how much of that is currently reflected in the numbers?

Sure. So when we see quality of customer, typically, the parameter that we see is the margin that a customer is getting in and what is our payback period. So overall, we maintain our payback period in the range of 8 to 10 months, but we dissect that into various sources through which we are acquiring account. So wherever we see that the payback period is getting more than the acceptable limit, we take an action in terms of the acquisition from that source. So that's how we define the quality of customer, and wherever we see that the quality is not good, we change the source of that application -- of that acquisition.

And when you say that your costs are higher because you had to pay for these acquisitions, were these migrating some other clients? Can you give some additional color on that aspect as well?

So what I meant was that typically, when the marketing cost -- why this has gone up because there were some good quality sources through which we acquire customers, especially the paid media. We do digital marketing on Google and on social media. Now, these are the channels where the quality of the customers are good, but then they come at a higher cost than our normal acquisition or even organic. So that's why -- because of the [ some ] share increase of the [ paid ], the overall cost has gone up.

And therefore, the outlook for your CAC should be, say, at least INR 895. Would it come down a bit? How should one think about it? Would you continue to invest in acquiring quality customers, and therefore, the CAC should be high? Or is there a trajectory for that, that you can indicate?

So definitely, we will continue to [ try ] for acquiring good quality customers. But I see that the acquisition cost will come down over next 2 to 3 quarters because obviously, on the HR and OpEx costs, we are taking steps to improve and bring down from the INR 250, which is right now, to INR 196, which was there earlier, and even reduce it further. Even on the organic side, we are doing a lot of activities on the brand, on [ SEO ] and also our partnerships so that from there, we get good quality customers, and the acquisition cost is lower. So there are various steps that we are taking, which I'm confident that will bring down the acquisition cost, at the same time, maintaining a good quality of customer.

And do you want to indicate a run rate for customer acquisition in terms of numbers? Or is that not...

It will be difficult right now for me to put a number. But obviously, the focus is on quality. So if we get a good quality customer with even double the run rate, we'll definitely [ chase ] that.

Next question comes from [ Deepak Poddar from Sapphire ] Capital.

Sir. Am I audible?

Yes, absolutely. Please go ahead, Deepak.

Okay. So just wanted to understand now this quality of customer that you have mentioned. So we have been maintaining earlier that quarter-on-quarter, we are looking at 15%, 20% customer growth, right? So now with this new focus, how basically this number is likely to change as we go forward?

As I was mentioning this to Karthikeyan also, see, the focus is definitely on quality. We have acquired 2,28,000 customers. If your question is if that number will fall down from here, the answer is no. We have taken action. We understand that -- where the entire trajectory is moving, so I don't see a downward trend from here. But on the upside, it will be difficult for me to give a number. But obviously, the effort is to move quality and quantity both in the right direction. But to say that what kind of number that we can look in terms of growth would be difficult to put a percentage of a number there.

[indiscernible] there will be no degrowth. That's what you are -- on a quarter-on-quarter basis in terms of your reported client level, right? And that's what you're saying?

Yes. We're saying that there won't be degrowth. But whether we will be able to improve the number in terms of quarter-on-quarter acquisition growth is something that I can't comment on this right now.

Okay. But it would be fair to assume that this number should come down, right? I mean, I don't want any range or so, but directionally, this 15%, 20% quarter-on-quarter customer growth directionally should come down?

Yes. Maybe for temporary for a quarter or so, yes.

Okay. Okay. And we still maintain that our revenue should grow at a faster rate as compared to cost, thereby improving our profitability?

Yes. Yes.

Okay. Okay. And your cost income ratio, if I see that, excluding your variable costs in terms of client acquisition cost, it has increased quarter-on-quarter, right? -- due to the [ base effect ] right? From 55% to 57%, if I include only the employee cost and other fixed costs?

Yes, it has improved. So as I had mentioned earlier also, because we had invested in hiring talent in the product and technology. And also, we were upgrading our infrastructure, there were investment in software and allied costs. So that is the reason you see temporary increase in the fixed cost to income ratio. And obviously, that increase also an attribution of a 5% revenue dip that we have seen quarter-to-quarter. So the cost has increased a bit, but revenue has gone down. That's the reason you see a percentage increase in cost to income -- fixed cost to income.

Understood. And how do we see that ratio in next 3 to 4 quarters?

See, we are working on reducing the fixed cost to income ratio, and our efforts are towards reduction of this percentage, and we are working on it. So I look forward to reduction in the fixed cost to the income ratio over the next 2 to 3 quarters.

Reduction -- I mean, at some quantum, anything that you can quantify would be helpful [indiscernible] from 55%, are we targeting 40%, 45%? Or what range we are targeting?

So our ultimately target is to have a 50% fixed cost, 25% PBT ratio and 25% variable. And we are taking every steps towards maintaining this ratio.

No, no. So I [indiscernible] the number, 50%?

50% fixed cost and the 25% PBT ratio, and 25% variable cost. So that contributes 100% of revenue.

Okay. Okay. I got it, I got it. I think that's it from my side.

[Operator Instructions] We are having a question from [ Sahej Mittal ] from HDFC Securities.

Sir, so my first question is on our commentary around our conscious strategy to slow down our customer acquisition run rate. So I mean, is this a conscious strategy? Or is this because what we see is that the industry in itself is seeing a slowdown in the customer acquisition run rate, and active client market share has been pretty much stable over the past few months. So is this a company-driven strategy or this is being -- this is coming on the back of slowdown in the industry itself? So yes, that was my first question. And the second one was around the sharp decline in the other expenses in 1Q. So what has led to this kind of a steep improvement in the other expenses? So these are my first 2 questions.

Yes. So see, we -- I would not say that we have slowed down on our customer acquisition. One, we are conscious of the fact that we have to acquire, and this has been our stand always that we believe in quality acquisition. And even in the past, wherever you saw that our payback periods are not matching, the quality of the customer is not good, we have retracted and corrected and move ahead. Because at the end of the day, you acquire customers who are serious customers to trade. Now, obviously, the industry is acquiring almost like 1.5 million, 2 million customers get acquired in the industry every month. But how much of that number is getting translated into turnover? Because if you see the biggest participation of retail, typically happens in the cash segment. Now cash segment turnover consistently for last few months is coming down, whereas the customer -- whereas the turnover on the derivative side is going up. What it means is that if there are people who are traders and these traders are consistently trading and participating in the market, but not every customer who's coming to the cash segment is trading. So wherever we see that the quality of a customer is not genuinely [indiscernible], so it's not slowing down of acquisition. We want to be aggressive in acquisition, but not on a fictitious number. So that is what our stand is. So wherever we see that, we take a beat, then we correct that and we move ahead. And then we try and improve the acquisition, and that's what we will continue. You're right that in some sense, because the overall market participation and attraction towards capital market is a bit muted, may have some impact on the acquisition, but not 100% impact on that. Now, moving to your second question, Mr. Gourav will answer that.

So there are some cost which is associated and directly connected with the customer acquisition. Like CDSL cost, NSDL cost, which comes under the professional expense. As you can see that our customer acquisition fall from 3.59 lakh to 2.28 lakh, and hence, we can see the impact of approximately INR 1.5 crore in our professional expense, which is a part of other expense. Second, we have optimized some of the costs in the -- related to the IT cost. So -- and we can see approximately INR 1.2 crore fall in IT cost, which is a part of other expense. So -- and that's a total bifurcation of INR 3 crores.

So this one -- so this decline or improvement in the IT cost, this is on a sustainable basis. Is that fair to assume? Or could we expect a -- any rebound in this line?

No, I think it would be on a sustainable basis. There may be -- maybe a 5% increase, 5% to 10% increase over a period of year. But broadly, you can assume that this is on a sustainable basis. And the kind of optimization that we had to do, we are in the process of doing. So I don't see a cost jumping again up very soon.

Right. And sir, one thing on our channels to acquire customers. So you just -- you have already told us that paid media and social media are the channels where you are focusing. So I mean, what is the payback period for the customers acquired through these channels?

So see, we don't acquire just from the paid media. So we acquire from multiple sources, which includes organic referrals, then we have our -- the digital tie-ups that we have done, the fintech tie-ups and also the paid media. So it's a combination of that. All put together, the payback period is in the range of around 8 to 10 months.

So which channels gives us the best payback period?

Organic obviously, is the best channel.

Right. Obviously, I mean, other than organic, because in organic, the customer acquisition cost is the lowest. But I mean, apart from organic, which channel gives us the best payback period? And what is that?

Unfortunately, I won't be able to share the data of the channel-wise acquisition and the payback period.

Right. I mean, if you could just name which channel is helping or would we be focusing on to get a better quality customer, which is helping us improve our revenue per customers?

See -- so every channel has got its advantages and the strength. So be it our digital partnerships, our organic, our paid and referrals. All those channels have the good quality customers. But every channel has multiple layers, multiple people, referring multiple people -- multiple sources through which we get our organic traffic. So there are various channels here. So broadly, all of them are good. But wherever we see that in a particular channel, if one particular sub-source is not good, we take action. So it will be difficult for me to say that, okay, fine, organic is better or paid is better. And paid X is better than Y. That is something it will be difficult for me to share.

Right. And for staff cost, could we expect a 10% growth on a year-over-year? I mean, is this the right way to look at it for FY '23?

Broadly, it would be in the range of around 5% to 10%. So even if I take the cost increase through appraisals in the coming year, but yes, it will be broadly in the range of 5% to 10%.

Right. And sir, last question was around, I mean, which customers are we targeting at? The investors or the traders? Because for us, obviously, traders are much more revenue accretive, so yes.

So see, as far as our acquisition is concerned, we target both investors and traders. We have different products for investors. We have different products for traders. For investors, we are focusing on purchasing through baskets and pushing them towards going for mutual fund SIPs or going for ETFs, so there are different products for them. For traders, we have a host of products. We have developer API. We are in the process of building an entire derivative-based terminal, which will provide the information to customers -- for the traders, what they want. We -- even on -- we have done so many partnerships with the fintech players who provide either research or some advisory or algos for traders. So there are various products and services for both the category of customers, and we are targeting both of them. So it's not like [indiscernible].

So out of 100 customers, if we acquire 100 customers, what would be the mix of traders and investors?

Typically, traders contribute -- are almost in the range of around 20% to 25%, and broadly, the balance is towards investing.

Right, right. And there's this one line item in our investor presentation in the revenue breakup, other operating income, what do we include here?

So other operating income is majorly pertaining to interest of fixed deposits. That whatever the, I mean fixed deposit we have keep -- kept in exchange as a margin, that's [indiscernible], and we got interest on that.

Got it. And the major investments which we have done in tech and infra, so that has gone -- that has gone as a part of OpEx or CapEx? Just to understand...

Broadly that -- broadly, the spends have gone into OpEx and some percentage has also gone into CapEx. But broadly, mostly, it is into OpEx.

Could you quantify the OpEx number pertaining to the investments which we have done on a -- on a quarterly run rate basis?

So actually, basically, CapEx and OpEx is defined by the [ Ind AS ]. We go as per the accounting standard issued by [ ICAI ]. And in this quarter, approximately INR 2 crores we have done in CapEx and INR 12.2 crores is in revenue expenditure, which is a part of other expenses.

Next question comes from [ Sumit Jankar ] from Motilal Oswal.

I want to know the market share for cash, commodity and derivatives.

As I said, our cash market share is stable in cash segment at 3% and derivatives segment is at 3.14%.

Okay. So my another question is regarding the turnover. You said that -- you mentioned that the cash turnover in the market is consistently reducing. And in turn, the derivatives turnover is increasing. So you can see that the clients are moving from -- moving towards the [ riskier instrument ]. So are they able to sustain? What is your take on this?

So see, one, there is an impact on the upfront margin and the peak margin that was implemented in phased manner. So after 100% implementation, typically, the trading volumes have moved from cash segment to derivative segment, especially in the options part of it. So people who are trading in cash segment, now, they have moved here. And that's why you see that the cash market turnover has gone down and the predominant turnover of that is delivery volume. And the other -- the trading volume has now moved to the derivative side. Now on the derivative, definitely, people are trading and there is an increased participation of retail in the derivatives segment. I have not seen that how many people are into -- how many people make loss, or they are making profit. But I think there is a consistent phenomena of a percentage of people whom we acquired. They -- over a period of time, they shift to derivative segment, and they did trade. Now, that trend is continuing. We are not seeing a decline or a very huge surge in the part -- in the percentage of people who are trading in derivative. So that's just a natural phenomenon, and I think that is here to stay.

Next question comes from Mr. Amit from RoboCapital.

My question was regarding the earlier discussion on PBT ratio of 25%. So when do we expect to hit that number? Is it fair to say that we get there in, say, 2, 3 quarters from here?

So yes, thank you, Amit, for that question. So as we said that our effort is towards moving from a 12% PBT margin to 25% PBT margin. It will be difficult that whether we are going to achieve that in the next quarter or maybe 2 quarters from now, but we are on that path. And I'm sure, in the foreseeable future, we will be achieving our set target for ourselves. But it can take 2 quarters. It can also take 3 to 4 quarters. But we are very clear that the path is towards improving profitability, improving our margins.

[indiscernible] add -- yes.

Please go ahead. Mr. Amit, please go ahead.

No, please go ahead. I have another question, I will wait and ask...

No, you can please go ahead with your question.

Okay. So the other point was -- which is related to, again, the PBT ratio. What is the total cost of acquiring a customer for this quarter, for example? Including all costs, which is the advertisement cost, the cost of people who are talking to customers [indiscernible] their accounts. All costs put together, what would be the total number?

So for this quarter, we have mentioned in the presentation the cost, including everything, is INR 895 for one customer. It was around INR 768 for last quarter. So there is an increase of around [indiscernible].

[indiscernible] the total number, so should I multiply that with the customer to get the total number of that...

Absolutely, absolutely.

Okay, great.

[Operator Instructions] We are having a question from Sarvesh Gupta from [ Maximal ] Capital.

First question is, how have your [ insure ] for the digital customers in this pricing is on a per trade basis? And I'm hoping that your mix is somewhat similar to the industry, given how high percentage of derivatives are. So what will be your number of trade per trading day? How has that sort of been in this quarter versus the previous quarter?

So if I understand your question correctly, you're asking in terms of what are the total number of trades.

Yes. I mean, your pricing is as per the trade, right? Number of [indiscernible].

Yes, yes. Pricing is on a per order basis, yes.

Yes.

So right now, we don't share that information. So I won't be able to give out that number.

What is the percentage decline Q-o-Q?

So as I said, see, our brokerage income is -- were down by around 4%. So broadly because it is -- the brokerage income is directly related to the number of orders, there's a 4% decline, and you can safely assume it's a 4% decline in the number of orders that we process.

Understood. Understood. And like because we, of course, had a market decline, so that is understandable that you would have seen some normalization. But at the same time, are seeing a very small percentage market share. Do you think that inside of the markets, we could have sort of increased the revenues because of higher number of customers? Or is that not playing out as we want?

See, if you look at our acquisition for the last 2 quarters, our acquisition was lesser as compared to the Q3 of last year. So it's -- I mean, it -- hypothetically, we can say that we could have increased just by acquisition. But what we have done is that we have seen that despite the number of acquisition being down from INR 4 lakh to INR 2.2 lakh, but it is not impacting much on the revenue side of it. So it very clearly means that we are focusing on acquiring good quality customer, which translates into revenue. So -- and that is something that we are continuously working towards, that how do we increase the revenue with a good quality acquisition and also increase the market share. So right now, because of the -- because of the market sentiment, you see cash market turnover being down, but the market share has been maintained. But on the derivative side, we have actually improved. So if you see in quarter-on-quarter, the derivative turnover for exchange has gone up by broadly some 9.8% or 10%, whereas our turnover has gone up by more than 11%, 11.5%, thereby increasing our market share from just 3% to 3.14%. So if you actually see it from a trading perspective, we have done better than the market.

Okay. Sir, I'm guessing that the number of orders per active client would have decreased by far more than 4%, right?

I won't be able to comment because it's a hypothetical -- as I said that I won't be able to give the number of order processed.

Okay. Can you give the Q-o-Q decrease in that, like percentage-wise?

It's a 4% decrease.

No, number of orders per active client?

I don't have it handy, but we can do it later.

Understood. Coming on to your expenses side. So I could not fully understand the initial commentary on your technology spend, et cetera. So you were alluding that now, going forward, there may not be really high increase in that. But we have already seen a significant [indiscernible] in the ad and marketing expense. So how are you seeing costs going forward? I mean, is this the current base like INR [indiscernible] crores? Is this going to be the base going forward? Or it will further reduce because there were some one-offs from earlier spending cycle on technology, infrastructure, et cetera?

Sure. So see, broadly, if I divide the cost, I will -- broadly, I will divide it into 2, which is your fixed cost and your variable cost. Now variable costs will directly be correlated to the acquisitions that we do. So obviously, that will keep fluctuating, and we do improvise on reducing the customer acquisition cost, so that will have a separate impact. On the fixed cost, I think it's safe to assume that the expenditures that we do on the fixed cost will, from now onwards, incrementally will not go up. Because, as I said earlier also, that we were investing in hiring talent in the product department and technology department. We were also upgrading our infrastructure, so we invested in creating a data center and upgrading that. So that required an investment into technology, both on the OpEx and the CapEx part. So that is more or less done. So on the fixed cost side, we will not see much increase from here on. It will stabilize and -- but the variable cost is something that will obviously keep moving according to the acquisition that we do.

How much would be fixed cost approximately in the INR [indiscernible] -odd crores?

So if you take INR 895 into 2,28,000 customers, that's something variable cost. Rest everything is fixed costs, so...

Okay. Okay. And this quarter, when we saw a lower -- higher CAC despite much lower ad and marketing expense, what exactly explains that? Was it just because the number of customers which were acquired were too low, or something else happened?

So I explained that in the earlier part of my call. So basically, if you, again, divide this customer acquisition cost into -- so HR and OpEx increased from INR 196 to INR 250. So broadly because my number of people who are there in that department and also the other OpEx cost is a fixed cost. So because the acquisition has gone down, this is showing to be going up. And on the marketing side, obviously, there are some good sources of paid channel, which comes at a higher cost. And that has -- and that has had an impact on the marketing cost going up. But having said that, we are working on optimizing on both, and we are confident that this acquisition cost was one-time blip of going up and it will again come down in the subsequent quarters.

Understood. And my final question is on your strategy, wherein you said that we want to go into higher quality customer. So -- but from a higher-quality customer, from their perspective, what will attract them to you versus there are so many other established players in both digital and nondigital space? So what exactly are we doing to differentiate ourselves to be able to attract those...?

See, one is that obviously, when we say high-quality customer, it doesn't mean that we are looking at people who are very, very high-end traders, and we are getting into that niche segment. I didn't mean that. I meant that, a quality means that if I'm spending X amount of money to acquire a customer, how fast I am recovering the entire cost. So if the recovery period is more, then we call it as a bad quality. And if recovery period is less, in our standards, then we say that the quality is good. Having said that, what do we do to differentiate? See, we are a product company and 100% of our turnover comes digitally. Of that, almost 80% comes through mobile. So the experience that we provide to our customers, both who are investors and also who are traders, actually is the differentiating factor. For example, just a few days back, we launched a new version of our app. There are various features that we've added for traders for their simplicity. So a better experience of the product will be actually the differentiating factor for our customers.

[Operator Instructions] We are having a question from Madhukar Ladha from Elara Capital.

I just -- most of my questions have been answered. I just wanted to know one thing, and maybe I've missed it out. What is your actual ADTV cash and derivatives ADTV for Q1 of -- Q1 and Q4? Can you give me those 2 numbers?

Can you repeat? ADTV? You're saying average daily turnover?

ADTO?

Yes, average daily turnover for cash and derivatives separately.

Yes. So for cash, it was around INR 950 crores, which is -- for this Q1, it is around INR 800 crores. For derivatives, we were at around INR 1.2 lakh crore ADTO. For this quarter, we are at INR 1.3 lakh crores ADTO.

Got it. That's it from my side, all the best.

Moderator, we can take the last question and then we can close the call.

The last question for today comes from Prayesh Jain from Motilal Oswal.

Just had a few questions. Firstly, when you talk about quality of customers, you mentioned one of the parameters is the margin that [indiscernible]. So what is the kind of number that we look for that?

Your question was not -- your voice was not clear, but I understand that you're talking about margin, what margin customers brings in, right?

Yes. So when you said that you're looking for quality of customer acquisition, you mentioned margin is the [indiscernible] one of the parameters. So what is the [indiscernible] that you're looking at?

So as I was saying, see, obviously, customers come with anywhere in the range of broadly around 15,000 to 20,000 kind of a margin. But my -- so we don't look the quality of customer in that way. As I said that the quality of customer, we'll look in terms of how far the payback period is. So I might come with INR 1 lakh margin, but I might just put one trade of INR 1 lakh and then stop trading. Though the customer quality -- the customer profile is good, but the payback period is not good. So when we look at quality, it is typically from the payback period and not from the margin perspective.

Okay. Secondly, could you give a breakup between -- the brokerage revenues between [indiscernible]?

So broadly, it is -- 60% of our revenues today come from around -- from derivatives and around 40% from cash, which includes both intraday and delivery.

Okay. And you see that being a similar [indiscernible] back, or it could have been lower?

[indiscernible].

I think your voice is not very clear.

Is it better? Is it...?

Can you please be a little louder, sir?

Is it better?

Yes, please go ahead.

Please go ahead.

Yes, sir. I think the 60-40 mix that you spoke about in Q1, how different would have been in, say, Q1 of last year?

It was broadly around 55-45, which has now moved to around 60-62. So that's a small percentage movement here.

Okay. And my final question is on your cross-sell and your cross-sell opportunities. That revenue also has come off in this quarter, but I understand insurance sales would have come down, but why should it drop by [indiscernible] number?

See, our cross-sell revenue is a combination of all the income, which it is to our subscription income, our mutual funds, the gold -- digital gold, insurance. So there has been a reduction in -- because of the market scenario, there has been a reduction in all. And obviously, cross-sell, one of our biggest product in cross-sell is our subscription income. So -- and again, that is tied directly to market. So that's the reason you see that from INR 5.93 crore, it is now around INR 5.1 crore, so there is a INR 70, INR 75 lakh drop there.

Okay. And so do you expect this to bounce back with markets [indiscernible] factor, right?

Absolutely, yes, yes.

I would now like to hand over the floor to the management for the closing comments.

Thank you very much, everyone, for joining the call. I hope I was able to answer your questions. If you have any other questions, you can reach out to us at [email protected], and our team would be more than happy to answer. Thank you very much, and have a great day ahead.

Thank you, sir. Ladies and gentlemen, this concludes your conference call today. Thank you for your participation and for using Door Sabha's Conference Call Service. You may disconnect your lines now. Thank you, and have a pleasant day.