India Shelter Finance Corporation Limited (INDIASHLTR) Earnings Call Transcript & Summary

Ladies and gentlemen, good day, and welcome to the India Shelter Finance Corporation Limited Q3 FY '25 Earnings Conference Call hosted by ICICI Securities Limited. [Operator Instructions] Please note that this conference is being recorded. I now hand the conference over to Mr. Chintan Shah from ICICI Securities Limited. Thank you, and over to you, sir.

Yes. Thank you, Tejal. Good morning, everyone, and welcome to the Q3 FY '25 Earnings Conference Call for India Shelter Finance Corporation. I would like to thank -- congratulate the management for a good set of numbers and giving us the opportunity to host the quarterly earnings call. We have with us from the management, Mr. Rupinder Singh, MD and CEO; Mr. Ashish Gupta, CFO; and Mr. Rahul Rajagopalan, Head IR. So now without further delay, I would now like to hand over the floor to the management. Thank you, and over to you, Rupinder, sir.

Thank you, Chintan. Very good morning, everyone, and wishing you all a very happy New Year. On behalf of the company, I extend a warm welcome to all of you. Thank you for joining us on the call today. We hosted our first earnings call around same time last year post listing, and we stayed committed to the words what we mentioned at that time. We remain steadfast on our focused approach of providing home loans and mortgages in Tier 2 and Tier 3 geographies. Let me reiterate what we communicated during our IPO, first earning call and our current state. We shared how we have done our horizontal expansion and focus on deepening our presence in existing geographies. I'm happy to share that we are progressing as per the plan. We plan for 40, 45 branches each year for the next few years. On that note, we opened 42 new branches in first 9 months of this financial year. Guided for an AUM growth of 30%, 35% for next few years and continue to grow as per the plan. There is a reduction in OpEx to AUM and currently stands at 4.3% for quarter 3 financial year '25. On asset quality front, we guided for a credit cost in the range of 40 to 50 bps and is maintained at this level. Our spreads continue to remain in the range of 6% as per the guidance. I'm happy to share that in the last 1 year, we got a rating upgrade and in rising interest rate environment, our bank hiked MCLR. There was no rate cuts. We were able to contain our cost of funds at a similar level. Further, we were able to reduce the gap in our cost of fund versus peers from 0.7% in quarter 3 financial year '24 to 0.4% in quarter 3 financial year '25. On that note, let me move towards some broader updates. We continue to see growth potential in Tier 2, Tier 3 cities, particularly for home loans and mortgages. Government initiatives particularly are helping into it. Further, we continue to monitor the situation on ground and are keeping close tab on our customer behavior. We witnessed a marginal uptick in 30-plus to 3.7% in quarter 3 financial '25. Forward flow stabilized in December and traction looks positive going forward. Moving on to the quarterly updates. We are pleased to announce that the company delivered strong performance in third quarter of financial year '25, driven by demand environment in an affordable housing sector. Our AUM crossed INR 7,600 crores, net worth crossed INR 2,500 crores. We continue to source internally with in-house sourcing of 97%, 98%. 100% of book is secured. Basis our conservative approach, LTV on the book stands at 52%. 90% of our AUM comes from Tier 2, Tier 3 cities. Average ticket size continue to be in the range of INR 10 lakhs. Moving to the results for the quarter. We are pleased to report AUM growth of 36% year-on-year to INR 7,619 crores, supported by disbursement growth of 29%. This quarter, we clocked INR 879 crores of disbursement. In this quarter, our branch network expanded to 265 branches by adding 5 new branches in this quarter itself. On profitability metrics, PAT came in at INR 96 crores, registering a growth of 54% year-on-year. ROA stands at 5.5% and return on equity further improved to 15.1% in this quarter. We continue to maintain our guidance what we indicated during our previous calls, that is branch addition somewhere 40 to 45 years year-on-year, maintaining margins of around 6%, credit cost in the range of 40, 45 bps -- 40 to 50 bps, loan growth in the range of 30%, 35%. Now, I would like to hand over the call to Ashish Gupta, our CFO, to take you through the financial metrics. Over to you, Ashishji.

Thanks, Rupinderji. Good morning, friends. Let me take you through the key financial numbers. AUM as of December '24 is at INR 7,619 crores. Year-on-year growth in AUM is 36%, while quarter-on-quarter growth in AUM is 8%. Total income for the quarter is up by 39% year-on-year, largely driven by growth in AUM. Total income is up by 7% quarter-on-quarter. Portfolio yield is at 14.9%, year-on-year up by 10 basis points. Our disbursement yield is running at 15%. Our cost of fund is stable at 8.8% in spite of increase of about 30 basis points in the MCLR by banks in last 12 months. Our marginal cost of funds for the quarter is 8.8%. We have undrawn sanction of INR 450 crores from National Housing Bank as well. Our lending margins are consistently above 6%, in line with our guidance for medium term. OpEx to AUM is down by 10 basis points quarter-on-quarter, while for 9 months, it is down by 20 basis points. Credit cost for the quarter is stable at 50 basis points, which is broadly in line with our guidance. DPD 30 is at 3.7%. Stage 3 is stable at 1.2%. PCR for Stage 3 asset is stable at 25%. Our total ECL is INR 61 crores against the regulatory threshold of INR 37 crores. We have adequate provisioning buffers in place. PAT for the quarter is INR 96 crores, year-on-year up by 54%, quarter-on-quarter up by 7%. ROA for the quarter is stable at 5.5%. ROE for the quarter is 15.1% at a leverage of 2.8x. It is up by 40 basis points quarter-on-quarter. With this, I conclude, and now we can open the floor for Q&A.

[Operator Instructions] The first question is from the line of Vivek Ramakrishnan from DSP Mutual Fund.

Congratulations on steady performance. My questions are on the asset quality. You said you were watchful of your customer segment and the 30 DPD has gone up. And, of course, in the market now overleveraging is the theme of the day. So I want to know how is your customer behavior? Where -- do you see any trouble spots? And is the LAP, as well as home loan portfolio behaving in line with the past or where the extra 30 DPD is coming from?

Vivek, yes, I think you mentioned very clearly, this is a flavor of the time when we talk about asset quality largely. So when we see in the market, the propensity of calls has increased towards the customer wave to follow up more than what used to be, say, a year back in terms of collection and all. So there is a 10 bps higher when compared to the last quarter. But what we see, things are not beyond control. That is the first thing. This is a tough time for entire industry largely. But seeing the earlier process that we put on, the collection mechanism that we put on, I think that's working decently well. So this blip time, which is for, I think, not for long days anymore, I think we'll be able to control in coming quarters. So normally, you have been seeing that quarter 4 is most of the time better than quarter 3, and we can see the traction coming around. So, yes, this is a time where everyone has to be on toes. We are also there and closely watching each and every activity. In a branch level, where we to take a certain action, we are taking it so that everything is steadfast.

Sure, sir. Are LAP and home loans exhibiting same behavior?

They are largely exhibiting same behavior, the same trend what it used to be a 1 year back, basically. No difference around that piece basically.

The next question is from the line of Sonal from Asian Market Securities.

Yes. Congrats on the steady performance, sir. I had a couple of questions. So first one was on fee income and other income. So your disbursements have grown broadly 6% Q-o-Q, but the increase in fee income and other income is higher. So just wanted to understand how do we see this line item going ahead? And how should we build it as a percentage of disbursements or as a percentage of AUM?

So if you look at the fees and our overall fee and commission income, so broadly, it remains at around 1.7% to 1.8% of the total average AUM. And it broadly consists of 3, 4 parameters, which include cross-sell, foreclosure income, loan servicing income and loan application fees. And it is well distributed across all these four heads. So as you are aware that we have got our corporate agency license in Q1. And as the process and products are getting stabilized, our income for Q2 -- for Q3 is slightly higher than Q2. Secondly, as our co-lending arrangements with banks are gradually picking up, so our co-lending disbursement is about 8% of the total disbursement. So as that particular business is picking up, that has higher proportion of fees to the India Shelter. So that is also contributing to the growth in fees income. I believe that in Q3 and Q4, this income percentage should get stabilized at around 1.7% of the AUM and should continue there for some time.

Sure. Sir, also, if you could just let me know what is the write-off for the quarter? And any change in the write-off policy? And again, a related question would be what would be the overlap? Like what proportion of our customers would also have MFI loans? If you could just give out those numbers?

We have a very consistent write-off policy that whenever our NPA account crosses the age of 2 years, we do a technical write-off, while our recovery actions remain continuing. So during the 9-month period, we have done a technical write-off of about INR 6-odd crores. And while parallelly, we have also recovered about INR 4 crores from the NPAs that we have written off in earlier years. So largely, the credit cost is driven by the incremental provisions that we have made.

Okay. And sir, the repayment rates, I mean, I've seen -- it's for you across the industry the repayment rates have come down. So if you could quantify what is the BT out rate for the quarter? And I mean, how should we look at this going ahead? And you could also allude that...

Yes. So BT rate remains in the range of 5.5%. That is consistent from quite a few quarters, and that looks trends as of now basically. So most of these BTs are going to the large FIs and sometimes to banks also, typically our Tier 2 customers. So that is a trend what we observed.

And any divergence on your on book yield and incremental yield because some peers alluded that their on book yield is higher than incremental yield. So anything that you are seeing? And how do you see your spreads would kind of remain over the next 2, 3 years?

We are in the range bound of 14.9% to 15%. At least for a year or so, we feel that we're going to maintain it. But as time keeps changing, there may be rate cuts or things around that piece. So we can tweak out. But what is our consistency is managing the spreads of 6% that we always like to keep the consistency on that side.

And some data keeping questions, fixed and floating rate books on asset and on borrowing side?

So on asset side, we have around 40% of the book at variable rate. And if you look at our borrowing profile, about 90% of our borrowings are variable rate. So there is some gap of overall variable rate book in terms of borrowing and asset, but largely that gap is filled by the equity at this point of time. But still there is a gap of around 15%, 20% that is unfulfilled at this point of time. So we are gradually doing incremental disbursement in variable rate product. If you look at our current disbursement run rate, around 85% to 90% of the monthly disbursement are happening in variable rate book. Given the high growth rate, that book is increasing at a steeper pace, and we should be able to fulfill this 15%, 20% gap that is there at this point of time.

Okay. And so, say, sir, 2 years down the line, should we expect that 40% would be a fixed rate or 30% would be fixed rate and 70% would be on floating rate? Is that a fair assumption?

60% fixed rate. Down the line, 12 months, you can expect that we should be able to bring down the fixed rate book to around 40%.

Okay. Okay. And sir, just in case if repo rate comes in, how do you expect the benefit on your cost of funds, say, over the next 3 months and 6 months?

I believe as the repo rate down comes in, so we'll have to wait for the reaction of the banks, how they react to it, how much benefit they like ultimately pass on to us. So if you look at our borrowing profile, around 1/3 of the total borrowings are linked to repo rate, which may come down in a quarter period of time. But the larger part of the borrowing is linked to MCLR, where we'll have to remain dependent on like when the bank will pass it on and what kind of frequency we have in terms of reset. So if you see larger part of the MCLR-linked borrowing is that at a 1-year reset. So that will have some lag in terms of the rate cut benefit that we will have. So down the line, 6- to 8-month kind of period of time, we can expect there will be some benefit that we can see in terms of whatever the repo benefit will come, will start getting reflected in the cost of funds.

Sir, will you be able to quantify like how much is linked to 6 months MCLR, how much is linked to 1-year MCLR?

It will depend on how the banks will pass on the repo cut in the form of MCLR cut. So if the bank will -- if the RBI cut repo rate, say, like by 25 basis points, banks will cut the MCLR by only 10, 15 basis points gradually over the period of time, then obviously, the benefit that will come will be delayed. It is tough to quantify at this point in time.

The next question is from the line of Raghav Garg from AMBIT Capital.

Congrats on the results. The 60% fixed rate book, this is entirely...

Sorry to interrupt Mr. Raghav. I would request you to please use your handset.

Is this better now?

Yes, sir.

Yes. Okay. Sir, I wanted to ask that this fixed rate book, which is 60% of the total, this would be entirely the home loan piece. Is that understanding correct?

So like so you're right that a larger portion of this is coming from the housing loan book. But if you look at about 2 years back, we were doing entirely home loan and LAP book at fixed rate. So we have started gradually doing variable rate starting from LAP book and then moved on to the housing loan book as well. So, obviously, proportion of fixed rate book is there larger in housing loan and slightly lesser in non-housing loan.

Okay. And see, assuming that there is a rate cut, do you think that your customers could come in or could be forged from a balance transfer point of view, at least on the larger ticket size loans, say, the threshold is INR 15 lakhs where you have -- INR 15 lakhs or above, where your exposure is about 25% of the total book. Do you think that in case of a rate cut scenario, your customers could come and ask for a BT unless you lower your rates?

Well, Raghav, our major chunk of customers that lies in the range of between INR 5 lakhs to INR 25 lakhs, which is more than 95% customer and INR 5 lakhs to INR 50 lakhs is the most focused customer segment that we work on. Secondly, when we talk about the book which we created in loan against property in the last 2 years, that is largely variable basically. That's almost all these cases are variable category. I'm talking about loan against property. There, if you also have a scope of cutting the rate back, that is one piece. Plus we have internal mechanism, which takes care of engagement with customers. You might have seen that on quarter-on-quarter basis, our BT rates are consistently in the same range bound basically. And this is not a story of quarter or 2 quarters. This is what we are executing from last almost 10 to 12 quarters basically. So anything which is happening in market, we always have a cautious -- caution around that piece, and we accordingly raise our bars to evade that thing. So if anything happens, we are very well prepared.

Understood. No, sir, my only reason to ask that question was that systemically, the loan growth has slowed down. You can see that in the numbers for the industry. And if the rates are cut, the competition for volumes is only going to go up. So just from that perspective, I was thinking that if you'll either have to let go of growth or you'll have to cut down on your pricing, either of the 2, but your point is well noted that you're well prepared. So that point is taken. The other question is, in a scenario where the growth has slowed down quite significantly for the economy, your LAP book has grown by 13% quarter-on-quarter. I know low base is one reason, but is there anything else to read into that? Any kind of seasonality at play here?

So I think there's nothing big picture to read out here basically. Yes, there can be effect of seasonality because before Diwali, generally, you always find there's a traction coming on the LAP side basically because most of the small segment of customers they look for raising some amount to reinforce their requirements basically. So that is some temporary blips basically you can find an imbalance.

Right. But that would have been there last year also, right, in Q3, but that is not the case. So that just makes me wonder if there's anything else here. But you're saying it's just seasonality, right?

Largely, yes, you can say so.

Understood. And sir, last question, quarter-on-quarter growth in home loan portfolio, that's only 5%. If I look at last several quarters, the sequential accretion has been about 8%, 9%. So is this -- why is the slowdown in sequential growth rate for the home loan book? Is this more consumption led where we are seeing trend slowing down? Or you've tightened your underwriting criteria? Or is it both factors at play here? That's my last question.

So there's a small tweaks we keep going here and there, basically. And if you see, overall, we have to maintain that is 60-40 ratio, right? That we're always consistent about it basically. That's a thought basically. So on quarter-on-quarter, there may be small changes here and there. So there is nothing -- we have changed the gears typically for one product or we have not done about certain product. That's a very small uptake here and there. You may find some changes happening in the next quarter also. That is possible because ultimately, we have to maintain those parameters, and we are quite committed towards that.

The next question is from the line of Kushagra Goel from CLSA. Sorry to interrupt, sir. I would request you to please use your handset.

Is this better?

Yes, sir.

So congrats on a good set of numbers. Just coming back to asset quality. Can you tell us what is the movement in your 1 plus DPD on a sequential basis? And if you could give some more color as to what improvement can we expect in 4Q? Yes.

1 plus is around 7%, 7.5%. And quarter 4 has been a trend across. That's a history what says, is better normally than the rest of the quarters, and we also expect so as we enter into the new quarter and spend almost 30, 35 days into that piece. So we are positive, optimistic about it, but let result comes. It's more on our ground that we have to work more than speaking.

Okay. And can you tell us the increase in 1 plus on a sequential basis? So right now, it's 7%, 7.5%, but what was it?

So it has been increased by almost 100 bps if we see that from last 1 year basically.

On a Y-o-Y basis, it's up 100 bps.

Yes, Y-o-Y basis.

The next question is from the line of Varun from Kotak Securities.

Congrats on a good set of numbers. I had a few questions. I would like to start with the yield. So if you look at our peers, many of them have reported yield pressure during the last 2, 3 quarters and their disbursal yields have been lower than the book yields. For us, you said that the disbursal yield is almost at par with the book yield at 14.9%, which appears a bit surprising, especially given that we are moving from a fixed rate to a floating rate. And floating rate typically tends to be a bit lower in order to incentivize the customers. Can you help me understand this a bit?

So our fixed rate book is majorly in the home loan, as I mentioned. The floating rate is being offered to the LAP customer earlier. And recently, we started for the floating rate customer -- floating rate for the home loan customer, which is very recent. Secondly, when we are adding new branches, we are going deep penetrating the geographies. Whatever the branches we added in the last 1 year or so, that is in Tier 3 markets. So there, you always have an advantage to get a better rates. Third important factor that is more on a sourcing pattern. We largely try to source through a direct channel, which is around 97%, 98% of in-house piece. There at least you have a control on the customer, as well as our drive basically. That also somewhere plays a role around that side.

Yes. My next question is on the portfolio in MP. So last quarter, you had highlighted that there was an exit in the team and that had led to heightened stress. Now, we are seeing that the AUM is down sequentially. So have things not stabilized in that state? Or do we expect some more deterioration on what you call, collections or on growth in that portfolio?

So we have had a new set of people in state. We are talking about Madhya Pradesh, particularly. So our new resource, the lead there is there, both in sales and collections. And yes, it takes some time to come to contraction, but things are largely in control. So it's no further deterioration, which is coming from there. Coming back to the previous position, a little time we have to give to them, and we are confident we'll bring that position back very soon.

Yes. And I had one other question on the self-employed ratio. Self-employed ratio is coming down on book. And again, we don't see a reflection of that in the yields. So why are you moving more to -- okay. Sorry. I think I got it wrong.

Self-employed is increasing from year-on-year basis. Last year, it was around 70%, 72%. Today, it stands around 74% something in that piece. So it is improving in that side.

And you're not finding any increased stress on the self-employed originations as opposed to salaried?

So when we see the ratio-wise, there's not much difference between the two for us.

Okay. And with regard to the other income, I'm sorry if you've clarified it earlier, but it appears to be low in the last 2 quarters, like 2Q and 3Q as opposed to the run rate you're doing in the last previous 6 quarters. Is there anything fundamental that has changed over there?

No, there is no fundamental change, but there is -- so we need to club the other income and the fee income and then see it together.

Okay. One final question I have on the...

Q1, we have got our corporate agency license. So the income is flowing into the fees and commission income now.

Okay. Got it. And one thing on the employee expenses. Can you split your employee expenses between how much is spent at the corporate headquarter level, how much on the supervisory and in the field level?

If we break down the total, the manpower itself first. So if you see around 78% of the total manpower are in the form of executives, which include our loan officer, our collection officers, our credit people, and then we have about 15% to 18% in the supervisory layer who are there as a branch manager, area manager, regional manager. And then we have around 4% to 5% people sitting at head office who are heading various functions and doing the supervisory from there. And if you see the cost-wise, the cost-wise, it is slightly different. Overall, about 60% of the cost is coming from the field and remaining 40% is coming from the supervisory and the head office.

[Operator Instructions] The next question is from the line of Shreepal Doshi from Equirus Securities.

Sir, I don't know if you've answered this question earlier because I joined a little late. So the question is on tightening of underwriting norms given the kind of noise that you are hearing in the segment that we operate or a notch below. So have we tightened the underwriting norms or looked at them again in terms of revisiting the foyer, or the kind of LTV level that we are comfortable with?

So every quarter, we review the credit norms. In fact, our credit pack runs on a month-on-month basis. And this is a continuous process. So we -- instead of tightening a norm at a general company level, we go a little deeper and we even try to understand what's happening in typical geographies even up to the branch level, and then we take a certain calls, which includes empowerment of the resources down the line, some changes in accrual, keeping in mind the particular challenges which this ground face, somewhere we have to add the people also. So this is all entire quarterly mechanism that we do keep doing it. So this is nothing just because of scenario alone, but that's a continuous process for us. That's the beauty of data that we capture day in, day out from the activities that we are doing from so many years. And these tightening and releasing, it's all matter of how the quality portfolio is behaving in those particular geographies. So this is not something new, but it's a continuous process for us, and we are doing it.

Got it. Sir, and which are these, I mean, locations and what really was the parameter that probably pushed us to tighten or I understand that it's a normal course of action, but still like what parameter do we closely monitor and which geography, for example, this quarter are these -- that we have tightened?

So in any zone, there can be even a single branch that we have to change a certain mechanism basis of we find some loosening knots around that side. We have to tighten up, whether it's a best performing zone or whether it's a average performing zone. So those -- typically, we take care of last 30, 40 branches where we try to implement that these are branches we have to come up across the curve. So there the all actionable items taken care, not only by underwriting team, but rest of the folks which are sitting in head office. So in most of the cases, if required, even the senior management also get involved into that side basically. So if you talk about particularly, as I mentioned in previous call, we put some titans, the major maximum titans came around was in MP. And I think those things start giving the results now, what we see in a very recent time, the things becoming a little more stable there.

The next question is from the line of [ Vishwa Teja ] from Falcon Capital Partners.

Great set of numbers. Sir, I just wanted to ask about the demand situation, like our guidance of AUM growth of more than 30%, 35% for the next 5 years. I just want to know when the industry is growing at around 70% to 80%. So I just want to know where the extra set of growth is coming from?

So, Vishwa, actually, we have not given any guidance for the next 5 years, particularly. So this guidance was given last year that for the next 3 years, we have this range bound. And there's an advantage to us, keeping in mind, we have currently a low AUM size compared to the peers which you're talking about, which are currently at very large level -- set of level. And secondly, our distribution network. So we are operating in 15 states. And not being a regional player, we have advantage to pull the levers from where the things are important, and we feel that the scope is there basically. So I feel that this distribution is playing very well across states, irrespective of certain geographies and all. So all levers is functioning in the right direction. I expect that things can very well be stabilized between 30%, 35% for the next couple of years also.

Okay, sir. Sir, the second question is regarding the BT rates. So a few of the RPs having less than 2% and a few players having less than 5% of the BT rates. So what are the measures that we are taking to reduce the BT rate, sir?

Our BT rates runs between 5% to 6%, and this is a trend for not a year or so, but from a pretty long time since we start getting recognition to that extent. And most of these customers, they move to the bigger institution. And these BTs generally happen in bigger markets like a Tier 2 market for us in that case because there's a more intensive competition in those places and customers generally look outside and being posed by third-party DSA for the other institutions and all. That is a trend. So that we have very well put in our business plan accordingly that this is something which we have to keep in mind. Secondly, we have an in-house mechanism where there's a separate team, which engage the customer from the head office itself, along with the support of branches, where we take a lot of data scrub and things around and try to engage this customer, and it is helpful in many ways basically. So you'll feel -- you can see the consistency in the BT rate also, which is in the range of 5% to 6%, which happened in our case basically.

The next question is from the line of Darshan Deora from Indvest Group.

So regarding the experience that you had in MP, where I believe some of your staff was poached by competition. What changes have you all made in terms of your HR policies or any steps you all are taking to ensure that similar incidents don't get repeated in other states? Are you guys extending some ESOPs or something to the supervisory layer or taking any other steps to prevent this sort of poaching from happening in the future?

Yes. Good question, Darshan. Actually, if you see, we have elaborated our ESOP policy to the large extent. So earlier, apart from front liners, which includes loan officers or collection officers, we were having some 10% of people covered under ESOP policy. That has been extended to now 25%, which is branch manager and above basically to that category of people. And again, there are certain policies which have been driven. One is the ESOP, obviously, then other engagement tools what we can go with the time basically. Plus strengthening the team with a backup, that is the second thought that we built up, and that's working better in terms. So it's always learning as you on ground. So a few learning what we find out, we have implemented strong in that sense.

The next question is from the line of Shreya Shivani from CLSA.

Congratulations on a good set of numbers. Just following up on this staff ESOP policy, et cetera. I wanted to understand that what has been the attrition rate for us for, say, employees who joined us in the first 1 year and post that, how much difference is there in the attrition rates that you have generally seen? And this is not particularly about MP, but for the company largely. And my second question is that, in the budget, there were certain -- the PMAY second version has been announced, et cetera. Can you help us understand how much did we participate in those? Or how much portion of our disbursal in the earlier version till 2021 was from the PMAY scheme? And how much can we scale it up this time as well?

Yes. Resources which are under ESOP policies, we have seen the attrition level less than 10% in those particular category. So that's always an advantage with these kind of policies, though it has been extended to a pretty large set of people. But yet, that is there. Now if we talk about attrition, we identify various aspects. One is the front liner, the new joinees who take some time to adjust. And these are the roles which is totally target based. Typically, the loan officers who have to go into field, get a new leads and get a new sourcing around. So that first couple of months, 3, 4 months are really important for that. And quite of them get come to that piece. So this does happen. But if you see the attrition level overall the company, if it is 37%, 38%, if you break between less than 6 months and greater than 6 months, there's a drastic change. If you talk about greater than 1 year, what you asked, I think that attrition level is in tune of 15% to 17%.

And on the PMAY scheme as well?

Secondly, on a PMAY scheme, last time when this scheme came, we were able -- our home loans particularly because the scheme is largely for home loan. So 18% to 20% of sourcing happened in this particular -- to the help of this scheme, particularly when it came in 2021. It has come recently. We have to come out the numbers in a couple of quarters where we can explain how the scheme is working for us.

Got it. Got it. So the PMAY disbursals as per you will start -- I believe the industry has signed an MOU with the government, right? So the disbursals should start in 2 quarters you're saying for the PMAY.

Our disbursement in the PMAY has started borrowers above 15%, 20% of the total borrowers, home loan borrowers are eligible for the PMAY scheme. But the data entry on the PMAY portal has just started. So we have to see how much of the borrowers input their data on the PMAY scheme, what is the success rate? This is their Aadhaar number is coming out from the PMAY portal. So once that data will be there in next 1 quarter, we'll be able to present a better picture of the success of PMAY scheme.

The next question is from the line of Chintan Shah from ICICI Securities.

Yes. Sir, just one question on the geographies, as you mentioned, on the stress pool, we have seen some rise in the DPD -- 1 plus DPD on a Y-o-Y basis. So any specific geographies or specific states where we are seeing a higher stress than the usual one?

Yes. I think this trend in market is currently not as easy as it was 1 year back. So yes, there is a certain amount of stress which you can find across. This is across geographies. You'll find some things going a little up because of the macro scenario, what is -- we all understand that piece. Objective is to curtail that. So action is thorough on that side. And what we look as we close this number, the things should improve, particularly in quarter 4, which is always better than quarter 3. That's what history talks about.

Sure. And sir, just as we say quarter 4 will be better. So what are the early signs in terms of January? How has been the collection in January as compared to December? Has it held up or has it been better than December? Any thoughts there?

So exactly on that basis, I'm giving this confidence because when January is better than December, then only we can give this kind of indication. But these are the early indications as we see that. Still there are 2 months, and I think we are positive about the progress around that side.

Sure, sure. And sir, lastly, on the BT out, so what percentage of customers we said 5.5% to 6% is the BT out run rate. So -- but typically, how many customers ask for the BT rate and then -- and how much percentage of them are we able to contain and how much percentage are we able to let go? Any percentage on that would be helpful.

When generally customer approach us, he doesn't reveal about the BT out particularly. He only look for a foreclosure in that case, right? So we don't distinguish between the customer who is going for BT or customer who is closing from own source. So as far as possible, we try to curtail that. But yes, when customer is persistent, we -- as a compliant company, we have to oblige that piece. During that engagement, if customer is mentioning that he's going for BT out, then we give them idea of the pros and cons and try to retain them on our books basically. So this is a philosophy that we run around. So we don't differentiate this is a BT out customer. This is closing from own funds. Engagement is required across basically.

Thank you. As there are no further questions from the participants, I would now like to hand the conference over to Mr. Rupinder Singh from India Shelter Finance Corporation Limited for closing comments.

Thank you, everyone, for taking your valuable time for attending our earnings call. An audio recording and the transcript of this call will be uploaded on our website in due course. Looking forward to hosting you all in the next quarter. Further, if you have any questions or require additional information, please feel free to reach us out. Thank you so much.

Thank you. On behalf of ICICI Securities Limited, that concludes this conference. Thank you for joining us, and you may now disconnect your lines.