Arman Financial Services Limited (531179) Earnings Call Transcript & Summary

Ladies and gentlemen, good day, and welcome to the Q1 FY '23 Results Conference Call of Arman Financial Services Limited, hosted by Emkay Global Financial Services. We have with us today, Mr. Jayendra Patel, Vice Chairman and Managing Director; Mr. Aalok Patel, Joint Managing Director; and Mr. Vivek Modi, Group CFO. [Operator Instructions] Please note that this conference is being recorded. I now hand the conference over to Mr. Manjith Nair from Emkay Global Financial Services. Thank you, and over to you, sir.

Good evening, everyone. I would like to welcome the management team of Arman Financial, and thank them for this opportunity. I shall now hand over the call to the management team for their opening remarks. Over to you, sir.

Well, thank you, Manjith. My name is Jayendra Patel, Vice Chairman, Managing Director, and good evening, everyone. It's a great pleasure to connect with all of you again, and thanks for taking time out of your busy schedule to join us over this call to discuss our financial performance for the first quarter of the financial year '22, '23. I must apologize for the delay in scheduling this call, but it was unavoidable. As usual, we have issued a detailed press release and investor presentation for the quarter, and I hope you had a chance to review it. Q1 of FY '23 was a fitting start to the fiscal year, which I'm glad to tell you, marks our 30th year in operations. I'm pleased to inform you that we have achieved some great results in the first quarter this year, despite aligning with new microfinance underwriting guidelines announced by the Reserve Bank of India on March '22, which involve significant background, operational changes and extensive training for our large field force. The last 2 years were challenging to say the least, but I'm glad to say that things are back to normal. Everything now is streamlined, and Q1 FY '23 is a great indicator for the situation rapidly returning back to normal. With the normalization of the macro environment, the credit demand has also returned to normal as -- so has our customers' ability to repay. Furthermore, with the new RBI regulatory framework for microfinance loans, the NBFCs will get a level playing field while allowing us to price the increased riskiness of microfinance loans. Although, the new regulation is targeted more towards bringing different categories of lenders, that is MFIs, NBFCs, banks and SFBs, among other -- under one regulatory umbrella, the NBFC-MFIs stand to gain the most. Let us now go over our financial performance for Q1 FY '23, and post that, touch upon operational numbers in more detail. Coming to the overview of our financial performance for the quarter, it gives me immense pleasure to inform you that as on 30th June '22, our company's consolidated AUM stood at INR 1,388 crores, higher by 77% year-on-year. Our expanding branch network helped cater to new customers and geographies aided by our organic demand growth for the existing geographies, which has not only led to great AUM growth but generated high-quality assets with repayment rates of 98% plus. As of June '22, our total operational branches stood at 308 and more than 50,000 new customers were added during the quarter. Consolidated disbursements during Q1 '23 stood at INR 380 crore, up by 212% year-on-year and by 12% quarter-over-quarter, despite adapting the new MFI regulatory framework, keeping the company ahead of the curve. And increased post-COVID loan demand further aided increased disbursement within the rural economy segment. Segmental AUM for microfinance stood at INR 1,159 crores, higher by 84%, and the AUM for MSMEs and Two-Wheeler segment stood at INR 229 crore, higher by 49%. Our gross total income increased by 59% year-on-year to INR 78.9 crore, and net total income increased by 71% year-on-year to reach INR 50.3 crore. The increase in gross and net income was due to strong secular growth in all the categories within the portfolio. Our profit after tax increased sharply to INR 15.7 crores in Q1 FY '23 compared to INR 3.6 crores in Q1 FY '22, registered a growth of 336%. This was also aided by strong growth in the portfolio and significant improvements in asset quality of our post-COVID disbursements. Our consolidated GNPA stood at 3.6%, and our net NPA stood at 0.3% as on 30th June 2022. The company has steadily created adequate provisioning to take care of the unprecedented impact of COVID pandemic, and the worst is over in terms of NPA provisioning. The debt equity ratio stood at 4.75x as of 30th June '22, and shareholders' equity stood at INR 228 crore. We have sufficient capital for growth in the short-term. For the long-term, we have announced the fund raised very recently, which is proposing to raise both Tier 1 and Tier 2 capital amounting to approximately INR 115 crores, pending regulatory and shareholder approvals. This is -- of course, regulatory and shareholders' approval. This equity fund raise is extremely important to the company to fund its growth and meet capital adequacy guidelines. This fund raise will allow us to reach at least INR 2,500 crores in AUM in the coming years. Coming to the collections. Our consolidated collection efficiency improved further during the quarter and grew from 85% in Q1 '22 to 98% in Q1 '23. Collections in the microfinance business have remained at healthy levels and improved further to 99% in Q1 '23. The MSME and Two-Wheeler segment performed excellently in Q1 FY '23 with 98% and 96% collections, respectively. This discipline the collection efficiencies resulted from a passionate on-ground workforce, continuous customer interactions and a customer-focused approach. As mentioned earlier, our comprehensive branch network as on 30th June stands at 308. The expansion has given us deeper penetration by tapping into newer districts in existing states and allowing us to explore new states as well. Due to our asset-light business model, the CapEx spend on our branch expansion has been minimal, which will allow us to reach branch level breakeven rather quickly. As I speak, we are transitioning to a new LOS and the LMS system, which will drive us into a new technology-based growth sales in the company. New transitions are always -- always precautious, and we are committed to implement it by the end of the second quarter. This technology will fundamentally shift how we do business and how we service our customers. Not only will we significantly improve our clients' experience, turnaround time -- clients experience and turnaround time, but we expect this technology to bring in significant efficiencies and reduce operational risk. The number for Q1 FY '23 clearly seem to indicate that COVID is behind us, but we remain ever vigilant. The future appears to be bright. And with the added capital and new technology, we have all the ingredients in place to take the company into a next phase. With a little bit of luck, the first half of FY '23 will be one of the bookmarks in the new chapter in the company's history. While we focus on growth, our foremost priority remains to maintain the quality of our loan book. A key outcome of our outstanding operational excellence is our collection efficiency, which remains robust at about 98% for Q1 FY '23. We remain bullish about the resilience of our overall economy, and our endeavor is to serve the most unserved and unserved population of India so that there could be also a part of India's growth story. I express my sincere gratitude to all our employees, Board of Directors, customers, investors and other stakeholders for their continued support during these challenging times. I would request the operator now to open the floor for any questions-and-answers session. Thank you so much.

[Operator Instructions] First question comes from the line of Shubham Ajmera from SOIC Ventures, LLP.

Am I audible?

Yes, please go ahead.

Yes. Congratulations on great set of numbers. I have 2 questions. First is on the new RBI regulations for MFI, where careful interest has been renown. So I would like to know, like, have we increased our interest margin for the risky customers during Q1? And what is our plan on the future? And are you planning to increase it further as well in the upcoming quarter?

Yes and no. So yes, during Q1, we have increased the rates by about 2.5% to 3%, what it was in Q4. We are watching it closely of what the competition is charging, so this is in with what the industry has increased it to. There has been an increase in our overall cost of borrowing and the overall cost of borrowing for the entire market due to RBI raising rates. So maybe in the -- in Q2, we have not raised, but in Q3, there is a possibility for us to raise by some small margin, by maybe 25 to 50 bps. But let's see, we have not made our decision on that yet.

Okay. Got it. And my second question is on the impairment losses. So like we have done aggressive provisioning and write-off post-COVID. So is there any recovery among that? And can we say now the impairment cost will not be much as compared to our previous few quarters, or post 2021?

So I mean, a lot of -- see, a lot of the provisioning cost and stuff which you are seeing is not only -- like, for example, Q1 provisioning will have standard asset provisioning. It will have ECL provisioning. It will be -- it will not only be COVID provisioning. So we are -- as the portfolio keeps increasing, the provision should increase. But yes, you can say that the quantum of impairment losses or provisioning will definitely not be as high as it has been in the previous quarters. But as the asset side grows in this business, 1% to 2% loan loss is to be expected.

Next question comes from the line of Savi Jain from 2Point2 Capital. Mr. Savi Jain, please go ahead with the question. Mr. Savi Jain, if you have muted from your phone, please unmute yourself and go ahead with your question. Since there is no replay from the line of Mr. Savi Jain, we'll go for the next. Next, that is Debashish from Digitian.

Am I audible?

Yes, please go ahead.

First of all, congratulations for a very good set of numbers, and also congratulations on the fund raise.

Thank you.

I have 2 questions. One is, the net NPA in first quarter is very good actually. It's 0.3% compared to all other listed players. There are 6, 7 listed players. If you take the average, it works out for them around close to 2%. So -- and the return ratios for us also are significantly better, so we are there pre-COVID times, almost there. In terms of return ratios and net NPA, we are better. So my question to you, Aalok, is -- I have 2 questions. One is this -- what we should assume realistically, the net NPA numbers? Is this an aberration, or you should have a higher number? That is one. Second, given the fund raise, then we always said that we are going to leverage 5 to max 6x. With this fund raise, still what level of -- when you feel we are done with the capital raise?

Yes, sure. Thanks. Great questions. See, as far as the net NPA is concerned, I can't speak for the industry, but a lot of the NPA pains we have taken over the last 8 to 10 quarters, and there was very minimal kind of restructuring or other kind of delaying factors which were used. So I think if you compare our, let's say, repayment rates or NPA figures in previous quarters, let's say, 4, 5 quarters ago or 6 quarters ago, they will -- they might appear higher than what the industry was reporting. So I think there might be some level of timing difference. That being said, I can't really say that what we can expect in the future because depending on what other kind of [ blankstone ] events and stuff happen. But the goal here is that to always maintain sufficient provisioning, and now that pricing caps have been removed by the RBI, I think it's prudent to be much more conservative in terms of your provisioning requirement. So my hope is to keep net NPA levels to at least less than 0.5% or even -- maybe even 0%. So -- or in the long run. But -- sorry, Vivek.

We -- ECL, if we can redeem when we entered into Ind AS. Prior to that, generally, Arman has been maintaining a net NPAs of much lower levels. But our converting into Ind AS accounting and COVID are kind of -- they're sinking together. And fortunately, there is -- AS Aalok has already explained, we've done a very aggressive provisioning initially in 2021 and '21/'22. So largely as a result of this, I think the NPA -- the net NPA has been consistently coming down. And now, I think if we can actually maintain it to something like sub 0.5%, that should be a good target to achieve consistently quarter-on-quarter and year-on-year.

Correct. As far as your question on the recent fund raise, assuming all the regulatory and shareholder approvals goes through, we are confident of at least reaching INR 2,400 crores to INR 2,500 crores based on this most recent fund raise. It depends on your pace of growth as well, because there will be internal accruals based on the kind of profits that we generate. So it might be higher than that, but most likely not less than that.

All the best for the future.

Thanks.

Next question comes from the line of Srinath V. from Bellwether Capital.

Just want to understand how has the business changed with the new rules? Do we still have group meetings, or how is the collection done? Because one of the key pillars of the group meeting was that we could collect the payments at one go for like 20 people, kind of getting some sort of cost advantages from that? That is 1 question. And the other question was that have we started looking at the deeper rural geographies where we did have some cost issues because of the population being less than? And given the new interest rate structure, have we started going into, say, in parts of interior Rajasthan, which weren't viable at that 10% margin gap? So these are the -- my 2 questions.

Sure. So as far as your first question, the -- as far as the groups go, yes, we are still collecting on a group level. We are trying to -- I mean, of course, it's at a very nascent stage. We are trying to go for cashless collections in some of our portfolios as well. However, we are still insisting on group meetings because that is following the spirit of the JLG. And also, as you said, it becomes operationally efficient for us to go and collect from a group rather than collecting from individual person, door to door. So that is still happening. I don't foresee that going away for at least the short and medium-term. Until there is a significant focus that shifts to cashless collections, which I don't foresee happening for a while. Your second question was about moving into deeper rural. Yes, that is definitely one of our strategies, and we will consider it. Our hands have been full in the past 1 or 2 quarters, so we have not executed on that yet. But that is in the works, and so we'll keep you updated on that.

Cool. And just a follow-up on MSME, how is the scale-up going? Have you been able to look at a slightly larger ticket size trajectory, around 1 lakh? Or in the current market, have you been able to penetrate to newer geographies? What is your broad growth outlook and AUM outlook over the next 1-year in that segment? Because that segment seems to be the one that has not picked up to the same level as what MFI has done?

So I mean, I wouldn't say it's not picked up. I think after doing MSME for like 4, 5 years, I think it's unfair to compare the growth level in MSME to the same benchmark as you can grow in microfinance because it takes a particular kind of customer engaged in a particular kind of business, so the sourcing is a little bit harder. The rejection rates become a lot; lot harder. That being said, I think we have grown from at a low point of INR 113 crores, I believe, in Q1 FY '22 to INR 181 crores in Q1 FY '23. So quarter-over-quarter, we have grown from INR 113 crores to INR 181 crores. So I don't know what that is in percentages, but.

No, not that way generally. No, okay, let me kind of rephrase it. How do you see the growth outlook? And it's been one of those things where you need a slightly more evolved labor force to scale up, rejection rates are high. So working around all these constraints, where are we today? And how do you see the next 1, 2 years in this product line? And the offshoot of that is, we had done some pilots to look at differentiated products in this space, maybe some sort of durable financing. Or even slightly small, larger ticket loans in MSME. I mean, even say rural Two-Wheeler, which is coming out of this branch network. So if you could cover all of those initiatives along with what's happening in MSME, that would be great.

Yes. So the rural Two-Wheeler, of course, we are still maintaining our focus on, and that is still generating volumes. Although...

It is about 30% of our entire Two-Wheeler book itself, it's about 30%.

Correct.

1/3 almost.

So that is definitely there. As far as the other initiatives, they were kind of -- due to COVID, they were put a little bit in the back burner. But we are revising them as we speak. We have a new Chief Risk Officer, who's taking the initiative of increasing the underwriting for issuing higher ticket loans. But as I said here earlier, we had a lot on our plate in the last couple of years. So new projects always kind of get delayed during -- when you are trying to -- trying to fight for our lives here and there.

Additionally, Aalok, we are talking about the IBL. Our learnings from MSME in Arman gave us the opportunity to kind of pilot the individual business loans in our microfinance, which itself is about -- those are still in a pilot place, but still about INR 30-odd crores. So that kind of gives us, at a group level, the reach to almost 150 branches which are more than 3 years old. And that ideal product is 100% cashless. So we are attempting to collect -- disburse and collect money in 100% cashless market. So a few things going on and a lot of lessons learned from a lot of different products.

Perfect. Perfect. Fantastic. Hopefully, over the next 2, 3 calls, we were -- as these products make it light of day, it will be nice if you could -- in the introduction itself, kind of give an overview. Because these are very interesting as you diversify your book. Fantastic results.

The next question comes from the line of Amit Mantri from 2point2 Capital.

Congratulations on the good results, as well as also on the fund raise. I mean, that's also the growth problem or goal capital problem. So that's a main outcome for the company. So my question is on the provisioning front. So now in the provisioning for the, like, see COVID-impacted growth or first wave, second wave impacted book. Is that complete? And now incrementally, the provisioning will be the business-as-usual provisioning, or would there still be a higher run rate of provisioning? Because even now, I think we had -- this quarter also, we had around 3.5% provisioning on the overall book. So going forward, will -- it is now come back to sub-2% levels? Or will it continue to be inflated on the higher side for some time even now?

No. I mean, I guess it just depends on how quickly on the write-offs. But to answer your first question, all loans which were troubled loans which we had created before March 2020, I mean, it depends on what you mean by COVID assets, right? Because COVID has been ongoing for 2 years when there was first wave, second wave, third wave. The largest issue was pre-COVID assets, which is what we call disbursements that occurred before March 2020. So those are all taken care of, right? There might be a few small things related to the third wave probably, but that will be negligible overall. Largely speaking, most of the impairment of provisioning that you will see from this quarter onwards is on the post-COVID book.

Yes. The business-as-usual...

The business-as-usual kind of a thing. Now conservatively, I would say about 2% is what you should expect.

Sure. Sure. And now, many of the other MFIs because of now the new regulatory regime, are now getting into some of these other geographies where we have been present. So many of them are now talking about getting into Gujarat, Uttar Pradesh, Bihar, Haryana, which are also very big markets for us or new markets. So how does your competitive intensity looking like now versus earlier?

Well, to be honest with you, Amit, it has slightly declined. I don't know why, but competition intensity has somewhat declined. And I'm not -- I cannot speak of why that is the case. But in a lot of markets, it seems that maybe our competitors are facing larger issues that they need to tackle, maybe they are -- I don't know. I don't want to speculate. You can probably speculate better than I do. But at least in the short-term, we are seeing somewhat of a decline. That being said, yes. I think over the long run, you are correct. There are South-based MFIs that are planning to move into Gujarat and there are East-based that are planning to move to the West, and everybody is planning kind of expansion. One of the reasons why we moved into Bihar was for a very strategic reason as well. It's because if we didn't make a move today and wanted to move 2 years later, it would be very difficult at that point because the market would become very crowded. So competition is something which is always there, and we have been doing it for a while. I don't have a exact, exact answer for you. But obviously, there are multiple reasons why we do get good customers onboard, and we provide a good service to them as well.

[Operator Instructions] Next question comes from the line of Gaurav prakash [ Mashalkar ] from ICRA. Mr. [ Mashalkar ], please go ahead with your question. Mr. [ Mashalkar ], if you have muted the phone, please go ahead, unmute yourself, and go ahead with your question. Since there is no reply from the line of Mr. [ Mashalkar ], we will go ahead with the next question. The next question comes from the line of Vinay Ambekar, an individual investor.

Jayendrabhai, Aalok, Vivek. We're very happy with how Arman has come through these troubled times. And we're very happy how you have kind of put in place levers for future growth. While finances are an important element of this, can you kindly elaborate a little bit on how do you plan to take the organization through in terms of what growth you would need at the organizational level to be able to reach the desired AUM of INR 2,400 crores, INR 2,500 crores that you mentioned? And if possible, indicate some broad time line by which that can be done in a sustainable manner?

Yes. I mean that's -- thank you, Vinay. That's a good question. So yes, financials are important, of course, but a lot of ingredients have to come together, I think as Jayendrabhai mentioned in his opening remarks, for the growth to go, a lot of things have to fall into place, as you said. So number one is, of course, we needed capital, which is -- there is a capital adequacy requirement of 15% or a debt equity ratio of somewhere around 6x that is stipulated by the RBI. But typically speaking, it will be difficult to have a debit equity ratio of more than 5x, so that we are solving by raising equity [ stepney ]. And hopefully, that goes through, and we'll get the money in a month or maybe 3 or 5 weeks of time. The second thing which we needed, of course, is a software. So I think as we speak, we are upgrading our LOS and LMS system, LOS is loan origination system and LMS is the loan management system. So everything pre-disbursement is LOS and everything post-disbursement is your LMS system. And this is a very state-of-the-art kind of, if I can use the term fintech? Or fintech is kind of a program, completely mobile-based. A lot of APIs to verify their IDs, voter cards, Aadhar cards, KYC validation, direct interfaces with the credit bureau, mobile phone verifications. You can use UPI as well. There are any drops for bank account verifications. Going completely paperless, we have signed with legality to do digital signatures. I don't know. We are using geo tagging for every one of our customers, so finding that becomes a lot easier. You can generate heat maps based on those geotag information, get village level information, do all kinds of analytics. As far as collections and stuff also, that helps. Categorization of centers. There is a great shift for big data analytics that we have put in our server. I mean, there are tons of things which we have -- cool things that we are doing with technology, and we're going to start doing. And the third big main ingredient, so one was capital, second was technology. The third and the most important is HR. So we need the right people for the right job. And I think I've said it many times that we are in -- essentially, we are in a business of selling a commodity, which is money. And when you go down to the nuts and bolts of our business, it's more of an HR business than anything else. So hiring good talent, retaining good talent is obviously getting more and more difficult, but we are up for the task. And we have a fantastic team of about 2,800 people with the right kind of culture that we have created that are doing a fantastic job underground. So I have full confidence that they should be able to grow.

So do you think that at an employee level, we will need to also double our employee strength in order to approximately double the AUM? Or you think we can be able to manage it with slightly less?

So it will be slightly lesser, there are economies of scale that you can do. But it's always a risk versus reward kind of a situation with the staff because you can push your field officer to have anywhere between 400 to 800 customers that he is managing. So 800 would be extremely efficient, and during the good days, that would reflect very well on the balance sheet. But when you run into situations like COVID or demon, that single [ apple ] is not able to handle 800 customers, right? I mean, all of a sudden, he has to go door to door to collect from all of them. So it's all about like finding the right balance between risk and efficiency. But yes, there will be some economies of scale. And especially with this technology and stuff, at least the back office and stuff, we won't to see a very, very large or exponential increase in back-office kind of office level people. So -- but unfortunately, our business is very much dependent on [ people ]. So for every few hundred customers, you need 1 FO, and then you have layers upon layers over that. You have the VM and Area Manager and the Regional Manager and a State Head, Area Zonal Head then you have a. So I mean, there are multiple layers that you have to create to keep control of everything.

Okay. My next point was around the provisions. While you indicated that approximate the provision requirement could be 2% going forward, is it possible to give a rough idea of how much do you think could be related to standard asset provisioning, and how much could be related to stress asset provisioning? And within standard assets, are you taking anything extra over and above the regulatory requirement? And similarly for this trust asset provisioning policy, whether you're taking any extra provision?

No, I think Vinay, I was generally speaking in very simplistic terms, more in terms of loan losses. So there will be, of course, standard asset provisioning and other asset provisioning that you'll have to do. What I basically meant was that if I'm lending INR 100, how much of it will not come back to me in terms of bad debt or, you can call it NPA provisioning or whatever you want to call it, or you can call it impairment? Maybe 4, 5 years ago in microfinance, we were getting away with a 1% kind of a loan loss situation. Given how the market has evolved, I think in the long run, you have to expect a 2% kind of a loan loss. So that is what I was referring to. As far as standard asset provisioning, the ECL provisioning and stuff like that, I mean, I think -- so Vivek will...

Vinay, in terms of the ECL, I mean, obviously, this may not be a forum kind of discount as to how much is provided on each of the standard assets because that would have multiple factors involved in terms of staging of these assets between Stage 1, 2, and how these assets perform. But largely speaking, if we talk of our ECL provisioning as compared to the statutory or compliance requirement by RBI, I think that's multiple folds higher than what is required by the regulator. So from that aspect, I think our provisioning are much aggressive and much higher than the requirement.

So I think I mentioned standard asset provisioning because I'm just used to it. But there is no such single standard asset. I think you are providing ECL coverages on all buckets.

All buckets.

Whether that's a 0 bucket or a 30, 60, 90, 180-plus whatever buckets, there are different layers of provisioning that get provided. And so long as that less than 90-day provisioning is more than what RBI stipulates for standard assets, we are good to go.

Fair enough, yes. I got that. All the best for the future.

Thanks.

Next question comes from the line of Kuneh Ghelani from Vivity AMC.

I'm just very keen to understand what the impact of the guidances are being on an operational basis, right? So essentially, with the changes that have come in, right? I mean, this should execute as well. How are -- how would you probably say in what level of the journey that you've been able to progress so far in terms of pretty much what the guidelines asked us to do in terms of aspects, such as income estimation, the monthly EMI estimation, farming, household level assessment, right? So that's a thing. From the length of, let's say, your systems, processes, policies, the manpower, right? So where will you rate yourself to be in the journey of being able to truly gear to those guidelines? And broadly, your stand for -- your FOIR challenges you are facing in that journey?

Well, FOIR-based kind of evaluation is something that we had been doing in our MSME for a long time, right? So we had some level of experience of doing that. Largely speaking, a lot of the EMI-based data and things like that, we are dependent on the credit bureaus. So we pull credit bureaus for the entire family at this point. For the customer and the spouse, there is an automated system. For the -- any unmarried kind of children over the age of 18, there is a manual process involved because our system is not ready yet. But with this new system, it should be completely family-based. The credit bureaus are also coming out with a family level of credit bureau check, where they'll give a consolidated kind of a credit bureau report for the entire family. So things are evolving on that point. The only place where you have to use a large-scale judgment is the income side, and that is not always easy to do. And I don't think RBI's intent is to make it difficult for people to borrow money. I think what they are looking for is just a systematic approach to get a good guestimate around their cash flows, right? And this is -- and this is what most people are trying to do. That being said, if 2 people are assessing an income of one individual customer, is there a chance of getting completely different answers? The answer is absolutely yes. But if you do a good enough job, hopefully, it will not be too far off, right. And I think most people in the industry and including the RBI is hoping that. They don't want a solution on day 1, right? They want the processes and the systems to evolve continuously, NFIs system to evolve continuously to assess that income. And I think the spirit, and everything is absolutely in the right place. I am wholehearted -- I wholeheartedly agree with whatever RBI has come up with as far as income verification is concerned. Yes, it's difficult to do, but just because it's difficult, that doesn't mean there shouldn't be a long-term endeavor to get us to a place where it's possible to do. So I think that's all I have to say on that topic. Now as far as the other markets are concerned, I don't know what. Am I missing something as well as the RBI regulation, Vivek? Those are the main ones.

So those are the main ones. And the other is in terms of the qualifying asset criteria, which was earlier 85% then been brought down to 75% for the total assets. So largely, if you look at it, it probably turns out to be almost the same equation at 85%, only depending on what are the other assets that any organization might have.

But for us, it does not factor us not much because we have 2 NBFCs, right? So the NBFC-MFI is basically for micro loans only. I think they are doing IBL also now qualify.

IBL will also qualifies for -- I mean, largely, I mean, 99% of the IBL is has been relapse of household income. So they all qualify for microfinance loan funding.